By Kathy Gibson, Satnac 2013, Stellenbosch – An innovation ecosystem can be a tool to drive economic development and digital inclusion. This is according to Prof Willem Clarke, CEO of Resolution Circle, which is built around the concept of innovation.
McKinsey has named 12 disruptive technologies, most of which include the Internet in some shape or form. In South Africa, 68% of our R&D spend was on buying things – not making things. In addition, only less than 1% of our GDP is spent on R&D.
Entrepreneurs only contribute 35% to GDP, compared to 60% in other economies that are comparable to South Africa.
South Africa’s entrepreneurial engineers tend to be between 30 and 40 and are mostly mechanical or electrical engineers. This compares to places like Silicon Valley here they tend to be much younger.
In an innovation ecosystem, the cross-pollination of ideas is important.
But why is it important, Prof Clarke asks. “Innovation is the fundamental sourse of significant wealth generation in an economy.” And this drives job growth as well.
Importantly, this kind of employment requires STEM skills, which is a limitation in South Africa.
Success factors include cluster development, with physical closeness; a culture to innovate with open mindedness and tolerance for failure; and a university-industry collaboration where academic research can move over to industry.
This kind of ecosystem involves two kinds of economies: the knowledge economy and the commercial economy. “There is really a clash of cultures, with different rewards and different time frames.”
In an innovation ecosystem, there would be government funded academic research, which can be picked up by industry where it will be commercialised. Between research and industry, however, is a chasm and this needs to be bridged.
Prof Clarke says this could be done by raising the floor by prototyping and small scale manufacturing where the risk can be spread. Resolution Circle positions itself in this arena, and a case study in building an innovation ecosystem.
The company is owned by the University of Johannesburg although it is a private company. Its role is to commercialise academic projects and also provide work experience for graduates.
It has raised about R350-million in capital and spent at R200-million on equipment It doesn’t publish, it patents, and has products in the market already.
“It started when we realised that, in our diploma programme, we realised students needed work experience. We created a training workshop to teach students about trades; we also built an R&D centre to take in students.
“Through that we provide a service to industry and also give students experience.”
The core of the venture is prototyping and small scale manufacturing. It also partners with existing companies, providing outsourced R&D, while the partner company is responsible for sales and marketing.
Prof Clarke makes some observations regarding the innovation ecosystem. These include a need for role models, for new business models, and better geographic proximity for the ecosystem.
Some work needs to be done as well on the understanding of intellectual property. Importantly, he says, engineers need to realise that a product is more than its features and they need to work with social scientists, artists and other role players to make products successful.
He challenges students, inventors and industry to find ways to commercialise research. “How do we take that research and bring it into products that make money?”