II
PROCEEDINGS



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Innovation Policies for the 21st Century: Report of a Symposium II PROCEEDINGS

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Innovation Policies for the 21st Century: Report of a Symposium Welcome Remarks Charles W. Wessner National Research Council Dr. Wessner welcomed symposium participants to what he said promised to be an intense discussion of the innovation policies of a diverse group of countries with a focus on the mechanisms used to help facilitate the innovation process. He observed that those in attendance, many of whom were intimately involved in the innovation process, knew the day’s topic to be complex and, at times, to be the subject of proposals that were ideological or simplistic. Because many countries around the world have adopted effective policies, it had also become increasingly urgent: Realization was growing in Washington, as it had in many other world capitals, that innovation and the mechanisms facilitating it are a key element in national growth and national competitiveness. In fact, the entire world is focused on how to deliver the fruits of research through products and processes that both enhance welfare and generate wealth. In the STEP Board’s work with other countries it had become clear, Dr. Wessner said, that the problems and challenges facing India, the People’s Republic of China, Canada, Finland, Germany, and the United States were essentially identical, something without precedent in his own public life. How do we capitalize our investments in research? How do we generate the type of students and the type of output from our universities that will help our economies to grow and to meet the challenges of the environment, of health care, and of providing a better life for our children? To discuss such issues, presenters had traveled to Washington from the four corners of the Earth. Dr. Wessner extended special thanks to Stefan Kuhlmann of the Fraunhofer Gesellschaft in Germany, to Peter Nicholson from the Office of the Prime Minister of Canada, and to Hsin-Sen Chu of ITRI, Taiwan. He also expressed particular appreciation

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Innovation Policies for the 21st Century: Report of a Symposium to the IBM representative who was in attendance; to Intel; to Sandia National Laboratories; and to the National Institute of Standards and Technology (NIST), whose support made the symposium possible. FOCUS ON THE “NATIONAL INNOVATION ECOSYSTEM” The day’s main focus, would be on how to link together universities, laboratories, and the private sector—both large companies and small—in an effective system of national innovation. A term for this, “national innovation ecosystem,” had emerged from previous work by the STEP Board, which was pleased to see that the concept had been picked up by the President’s Council of Advisors on Science and Technology (PCAST) and the Council on Competitiveness. Key to the formation and effectiveness of a national innovation ecosystem are what Dr. Wessner called intermediating institutions: the institutions, and with them the mechanisms, that can help bridge the diverse institutions that contribute to an innovation ecosystem. Even as he acknowledged the challenge of creating the necessary linkages, he counseled that attention be directed toward incentives. “I am always disheartened when I hear someone in France say, ‘We must reform the university system,’” he recounted. “It always reminds me of the Battle of Verdun: a very long, bloody struggle that in the end accomplished little other than the bloodshed.” While it is difficult to transform organizations by fiat, “we like to think,” he said, “that it is possible with appropriate incentives.” The pleasure of the day’s endeavor, said Dr. Wessner, would be in the opportunity to listen to a number of experts in this field engaging in what were referred to as “interesting experiments” by the vice-chair of the STEP Board’s Steering Committee for Government-Industry for the Development of New Technologies, William Spencer. Introducing Dr. Spencer, Dr. Wessner recalled the vital role that he had played in leading Sematech at a time when, in the opinion of many economists, the U.S. semiconductor industry was on the ropes and destined to become a marginal player in the world market. But being too busy, as it appeared, to read such prognostications, Dr. Spencer and the industry had “just kept going,” with a program to cooperatively improve product quality and output. As a result of the Sematech consortium, the trade agreement, and much hard work and inventiveness, the U.S. semiconductor industry is now ranked first in the world.1 Reiterating the importance of Dr. Spencer’s contribution to the industry’s recovery and the industry’s impact on U.S. productivity and competitiveness, he asked Dr. Spencer to come to the podium. 1 For a description of the factors contributing to the resurgence of the U.S. semiconductor industry, see National Research Council, Securing the Future: Regional and National Programs to Support the Semiconductor Industry, Charles W. Wessner, ed., Washington, D.C.: The National Academies Press, 2003.