13 September 2017
Delegates representing government, industry and academia met in London on Thursday 7 September for a lively series of talks and panel discussions on innovation in UK industry.
Chairing the event, Lord Mendelsohn, Shadow spokesperson for Business, Energy and Industrial Strategy (BEIS) highlighted the need for consensus between industry, academia, and government across party political lines on the Industrial Strategy, noting that Brexit adds an unprecedented degree of complication to its development.
Lord Vallance of Tummel, a member of the Science and Technology Select Committee, provided an overview of the trends, challenges, and opportunities for innovation in the UK. In a cautionary introduction, he described how previous industrial strategies had ‘derailed or run out of steam’ after an original flurry of excitement and good intentions. To avoid this, he said, the UK must learn from countries such as France and Germany to adopt a stronger culture of collaboration between business, academia, and the state.
Lord Vallance argued that a lack of understanding between scientific innovation and business had led to the failure of start-ups and university spinout companies to reach their potential. ‘The same goes for government – the three cohorts speak different languages,’ he said. An effective structure to link the three vital elements of innovation, he added, is essential to the success of the Industrial Strategy, along with politically-independent monitoring and reporting on development of the Strategy, proposing a model akin to that of the Office for Budget Responsibility.
Emphasising the need to bring these elements together at an early stage, Lord Vallance advocated that business schools ‘teach the language of science’ to their students to improve communication between disciplines. He extended this idea of a collaboration culture to schools, describing how encouraging children to engage in both STEM-related subjects and the arts would provide them with the foundation of scientific, technical, creative, and collaborative skills required for innovation. A ‘radical review of the ecosystem’ of education is needed, he said.
Innovation in waves
Following a biochemistry research career with 25 years in the pharmaceutical industry, and as Chief Executive of Innovate UK since 2015, Dr Ruth McKernan CBE certainly fits the ‘trilingual’ ideal recommended in the previous talk.
She presented an overview of Innovate UK’s ‘Wave One’ of Industrial Strategy Challenge Fund competitions, totalling £699 million of funding over four years in medicine manufacture, robots in extreme environments, clean battery technologies, self-driving vehicles, lightweight composite materials, and satellite and space technology. Planning for Wave Two of funding is underway.
Dr McKernan also highlighted how Innovate UK’s Infocus: Women in Innovation initiative had increased the percentage of female Innovate UK grant recipients from 14% in 2015 to 22% today. She went on to update on the progress of Catapult centres, set up by Innovate UK to promote research and development through business-led collaboration between scientists and engineers, and to exploit market opportunities. The High-Value Manufacturing Catapult, for example, has trained 900 apprentices in the past year alone. ‘Catapults are critical to the future of the Industrial Strategy,’ she said.
Addressing the concerns of one delegate who questioned the relevance of research funding for high-tech areas such as quantum computing to the broader manufacturing industry, Dr McKernan noted that manufacturers’ increasing use of computing, for example in process monitoring, leaves them vulnerable to cyber attacks – the development of quantum computing is the best route we have towards protecting these systems, she said.
Sue Daley, head of Cloud, Data, Analytics and Artificial Intelligence (AI) at techUK said that while 10–15 years ago data security was seen as an add-on to digital systems, today security is built into systems from the start. Responding to apprehension about the potential safety issues of AI, Daley posited that rather than increasing risk, AI should provide an opportunity to perceive cyber threats at an earlier stage than current reactive measures, improving defences. In his SCI Public Evening Lecture on 25 October, Hermann Hauser will discuss machine intelligence, posing the the question – are machines better than humans?
Spin-outs and SMEs
Several speakers throughout the day returned to two areas of industry where companies had struggled to bring their innovations to market – small and medium-sized enterprises (SMEs), and university spin-out companies. Lord Vallance said that too often spin-outs were bought early by overseas ‘predator’ investors, uprooting promising young companies before they were able to develop their innovations.
Dr Paul Findlay, Director of Business Development at the University of Hertfordshire said that, compared with graduate start-ups, spin-outs with university affiliation dominate in attracting investment and turnover, but that the top six research universities receive a disproportionate 92% of investment in spin-outs.
Improving regional connections for SMEs was key to Dr Sarah Perkins, Director for GW4’s summary of the South West England and South East Wales Science and Innovation Audit (SWW SIA), carried out by GW4 for the BEIS. Dr Perkins called for government to recognise the importance of place, after the SWW SIA identified the need for sustained government support for advanced engineering and digital innovation to better integrate business and innovation in the area, which boasts a world-leading aerospace group and the largest silicon design cluster outside of the USA.
Chris McDonald, CEO for the Materials Processing Institute also discussed the importance of regional support, citing the difficulty SMEs face in accessing innovation support in the north east in particular, arguing that businesses must have support at the very least within a 50-mile radius.
In further recommendations to support the development of SMEs, McDonald called for a simplification of research and development tax credit processes, the introduction of capital allowances instead of grants, and for government to recognise the importance of process engineering, as opposed to focusing chiefly on supporting product development.
By Simon Frost