Catalyzing Innovation in Georgia and Innovation Infrastructure

1. Catalyzing Innovation in Georgia and Innovation Infrastructure Gabriel Goddard Georgia Innovations Week April 24, 2014

2. Catalyzing Innovation to Generate Jobs

3. Problematic status of private innovation • Innovation intensity is low: R&D-to-GDP in Europe and Central Asia is 0.9%, half the OECD and EU27 averages, and it is not increasing. In Georgia it is closer to 0.2%. • … and tends to be “inefficient”: Innovation outputs like patents/product development is low in light of inputs. E.g., in Georgia, 29 patents granted in USPTO in last 10 years. • Inciting private investment in innovation is difficult: 63% of R&D in OECD is funded by industry and 30% by government, in Europe and Central Asia, the proportions are reversed.

4. Innovation infrastructure: What are the Building Blocks? • Strengthening the innovation ecosystem: Instilling an entrepreneurial culture, increasing business sophistication among companies, public and private funding sources. • Increasing the impact of Science: Closer research-industry collaboration, IPR constraints resolved, technology transfer increases; higher public and private investments in science. • High-quality education: Students get the skills to be actively engaged in a knowledge-led economy. • Public policies that give the right incentives: Clear vision for the governance of research and innovation policies and an effective support system through GITA and other entities.

5. Georgia Innovation Indicators WEF Global Competitiveness Index (GCI) 2013-2014

6. Upgrading the Innovation Infrastructure Flagship Projects that could be developed: • Centers of Excellence-to develop collaborative R&D that attains high-quality and leads to commercialization • Technology Transfer Offices- to create links between science and private sector and promote awareness about IPR • Innovation Labs- to provide access to specialized technologies, facilities, education, mentorship • Business incubators and accelerators- to promote a culture of entrepreneurship and improve access to funding • Technology parks- to promote the creation and growth of innovation-intensive companies

7. Vision

8. Reality

9. Important aspects to consider I. Ownership • Clear commitment from each of the parties in the “triple helix” to foster alliances, knowledge exchange and technology transfer. • Often through a not-for-profit, sometimes by the creation of a private company with public and academic sector shareholding. The appropriate strategy for Georgia needs to be determined. II. Governance arrangements • All three parties involved in the design and strategic governance of the initiatives. • A tripartite strategic board is often adopted, sometimes specific roles are delegated to one of the three parties. • An operational board that meets more frequently with closer oversight duties is sometimes constituted.

10. Important aspects to consider III. Financial model • Specific financial arrangements for both the development stage of capital investment and the operational stage of service delivery. • On the capital stage, design and procurement issues are critical as well as issues relating to the financial return on investment and ownership and use rights of the assets created. • At the operating stage the provision of ongoing subsidy, or revenue generation expectations need to be clarified and performance criteria agreed so that a good operational discipline can be ensured. IV. Service range and delivery strategy • Need to define the overall strategy – e.g., the range of services provided by the internal team and those developed by alliances with other providers. At a detailed level, the eligibility criteria for beneficiaries, key performance indicators and skills development.

11. Important aspects to consider V. Skills development • Active management of the initiatives is the key ingredient that determines the success or failure and there is a need to develop specific competences and cultures in the management team. • A skills acquisition needs to run in parallel with the physical construction so that the management is ready concurrent with the infrastructure and no time is lost in creating the desired impact. II. Monitoring and evaluation • Should be designed from the start so that evidence based decisions on the operations can be made and informed decisions on the expansion and adjustment of the model as experience is built. • There is also a need to align this effort with the reporting requirements, especially if there are significant public funds involved.

12. Thank you!