November 2015


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Back to the Diamond: The system of innovation through an engineer’s eyes

By St Clair A. King

The UWI has long been committed to contributing to the diversification of regional economies. The focus has been honed with a strategic goal of being innovative since the economies of the region – including Trinidad and Tobago’s – are unsustainable and need the commercialization of products and services that are globally competitive and profitable.

UWI’s Research and Innovation Committee examined why regional economies failed to adapt after the removal of the EU preferential tariffs and, recently, the decline in the tourist industry. This took us to Lloyd Best’s work on the plantation economy and in particular to Sir Arthur Lewis’ thesis on how to diversify the economies by moving some labour away from agriculture into manufacturing; the latter to be funded by foreign investment given the lack of local capital.

The conclusion was that the regional private sector – due to its plantation history where exported commodities provided the foreign exchange resources – occupied itself in general with import-markup-sell and was risk averse; a situation also identified by Sir Arthur. Lloyd Best saw this risk averseness as a learned culture and mused whether a culture could change itself, a view supported by Prof John Foster of Queen’s University, New Zealand. According to Foster the complexity of a nation’s economy engenders over time certain structural rigidities that can prevent the economies from adapting to change. This inability to adapt suggests that the private sector required by the Triple Helix model will require the creation of a new embryonic entrepreneurial class for success.

Therefore, if UWI’s thrust into innovation and commercialization is to succeed, it cannot go it alone and, if it did, at best, the intellectual property developed would most likely stay on the shelves or be sold/licensed to the world. This would provide little help to the development of regional sustainable economies.

The literature, and in particular the work of Etzkowitz in his Triple Helix, showed that for this innovation idea to work, there has to be a close collaboration among R&D institutions, government and the private sector – driven in our case by the governments of the region. The R&I committee’s consultant introduced the idea of the Innovation Diamond that defined the interrelationship among the R&D institutions (centres of excellence), the financing system, the market development and marketing, the creation and support of SMEs and the protection and management of the ensuing Intellectual Property.

The crucial recognition was that UWI, operating on its own, creating IP, in regional economies in which fundamental market failures exist (absence of funding and venture capital with a risk-averse private sector), cannot make any significant impact on the diversification of the regional economies. The recommendation then was that The UWI should strive to encourage regional governments and institutions (CDB, CARICOM) to create these innovation systems in which the availability of adequate long term financing was crucial.

There was another, equally crucial process required: foresighting – the selection of the areas in which the region should focus attention. Even though there could be comparative advantages in certain areas, these alone would be insufficient to make the region globally competitive, profitable in the associated markets. Hence UWI’s R&D could form an integral part of the business innovation systems required to take these chosen options to market profitably.

The committee then reviewed UWI’s capacity and capability to engage in innovation. It immediately became apparent that UWI, in its present form, could not be part of an innovation system; it was not designed to innovate. Take, for example, IBM when it decided to build the personal computer, it had to create a separate entity since its organisation was focused on the improvement and sale of its traditional products. The company could not jump off into the deep and innovate.

UWI’s staff are not employed or rewarded to do research or invent or innovate. Though they are expected to publish their work – with academic freedom they cannot be instructed to work in any particular area with the sole aim of being promoted. R&D geared to innovation has different objectives from academic research. In the former, staff is rewarded for research and development and these activities are directed by foresighting decisions on what areas the region has decided to address.

However, UWI does have certain facilities that can support research and innovation which have to be complemented by other external institutionalized facilities: its libraries and access to information, its overall management systems, its students and even existing staff for both consultation and even project work.

The recommendation is that The UWI should create specialist centres of excellence, depending on the choice of areas for commercialization, staffed by well qualified researchers and business innovation professionals. These centres must work in tandem with external financing, marketing, market development, and so on. It is unrealistic to hope that, serendipitously, UWI’s mainly teaching staff, unsupported by an innovation system, could generate profitable products and services as by-products of their contracted duties that could diversify the regional economies.

The innovation system of which UWI can be part, has to be structured and its institutions integrated into the whole: the Diamond.

St. Clair A. King is Professor Emeritus in The UWI’s Faculty of Engineering and Chair of UWI’s Research and Innovation Committee