The conditions needed to translate research and drive innovation

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To ensure the continued excellence of the UK’s research and innovation (R&I) base, the existence and continuity of funding is key for translating research and driving innovation.

Additionally, numerous interacting conditions are required, such as the existence of knowledge, talent and capital; infrastructure and the formation of networks; and institutional culture and internal structures that shape the environment in which translation and innovation take place. However, there is no ‘magic formula’ for these conditions to be implemented.

Background

As the UK government works towards its commitment to increase investment in research and development to 2.4 per cent of gross domestic product (GDP) by 2027, there is a need for better evidence to inform decisions about how and where that investment is made.

In light of this, the National Academies have recognised the need to better understand the range of benefits that research and innovation (R&I) bring to the UK, and the conditions needed to ensure the continued excellence of the UK’s R&I base.

Goals

RAND Europe was commissioned by the National Academies to examine the evidence on the conditions needed to translate research and drive innovation. The researchers’ goal was to provide an overview of the existing evidence in the following areas:

  • The conditions that enable research and innovation to result in a range of benefits.
  • How these conditions interact in different environments and throughout the lifecycle of research and innovation.
  • How the effectiveness of different levers used to facilitate research and innovation has been measured, and how these measures might be made more robust.
  • The barriers to translating research and driving innovation.

Methodology

This study was based on a rapid evidence assessment of the existing literature on the conditions that support translation and innovation in the UK economy. The literature review drew on evidence from four distinct sectors: pharmaceutical and life sciences, defence, financial technology and creative economy. The sectors were chosen because they each make important economic and social contributions to the UK in different ways. To complement the literature review, the researchers conducted an expert workshop and interviewed ten key sector experts.

Findings

There are many interacting conditions needed to translate research and stimulate innovation.

For research to be developed into innovations that can deliver benefits to society there needs to be an effective research translation and innovation system in place. Essential conditions for this process include:

  • Drivers that spur innovation to occur.
  • Input resources, such as knowledge, talent and capital, which organisations use to undertake innovation.
  • Enabling factors, such as infrastructure and the formation of networks, which facilitate the collaboration of multidisciplinary teams.
  • Institutional factors, including culture and internal structures, which shape the environment in which translation and innovation take place.
  • Absorptive capacity, which allows organisations to recognise the value of new information, assimilate it and apply it.

There is no ‘magic formula’ for these conditions to be implemented.

Each of these conditions is required in different forms across the innovation pathway. For example knowledge, talent and capital are necessary at all stages, however their interaction through enablers such as networks and infrastructure is particularly important. Likewise, cultures and associated institutional structures can have an impact on innovation at all stages, and affect how widespread its adoption is.

Overall, the effectiveness of policy interventions to facilitate research and innovation is not measured particularly well.

Not all interventions are evaluated, while those that are often use metrics that focus on the economic impacts of the intervention, rather than measuring broader social outcomes. This makes it hard to determine whether interventions have been effective, since evaluations are not capturing the full diversity of benefits from innovation.

A common challenge to the research and innovation process was a lack of clarity about user needs, and stable access to capital.

Funding and continuity of funding is important for the translation of research and innovation, the absence of which can prove to be a barrier. Access to capital is often most challenging during the middle stages of the translation pathway, which tend to present more risk for private investors, such as venture capitalists. There are also relatively few demand-driven measures to stimulate innovation, such as public procurement policies or innovation inducement prizes.