In quest of an innovation commission
Innovation is important to help address global challenges, such as climate change and sustainable development
DR. MD. SHAMSUL AREFIN
Innovation drives productivity; it drives growth; and it drives living standards. It is through innovation that businesses find ways to generate more value from existing resources. As a result, innovation is, directly or indirectly, the main driver of productivity growth, and is the principal source of national prosperity (Nicholson, 2012).
Innovation can be manifested in four distinct areas. First, product innovation is the capacity of a firm to introduce new products and services ahead of competitors, to anticipate consumer needs or even to create them. Second, market innovation is the capacity of a firm to decide to change its market geographically, virtually, or creatively. Third, process innovation is the capacity to change how goods and services are produced and delivered to reduce cost, improve efficiency, and increase convenience for customers. Finally, organizational innovation is the capacity to convert creativity, market and customer knowledge, and technology into marketable innovations.
Innovation in its modern meaning is a new idea, creative thoughts, and new imaginations in form of device or method. Innovation is often also viewed as the application of better solutions that meets new requirements or existing market needs. Such innovation takes place through the provision of effective products, processes, services, technologies, or business models that are made available in the markets, governments and society. Innovation is related to, but not the same as, invention as innovation is more apt to involve the practical implementation of an invention (ie new / improved ability) to make a meaningful impact in the market or society. According to Kanter, innovation includes original invention and creative use and defines innovation as a generation, admission and realization of new ideas, products, services and processes. Peter Drucker said Innovation is the specific instrument of entrepreneurship the act that endows resources with a new capacity to create wealth. According to Clayton Christensen, innovation is the key to future success in business. Executives and managers need to break away from traditional ways of thinking and use change to their advantage. It is a time of risk but even greater opportunity. Tim Kastelle writes innovation is not just having an ideabut executing it so that it creates value. I like that he incorporates three key concepts: an idea, execution, and value creation.
The Global Business Coalition for Education launched the Youth Skills and Innovation Initiative to tackle these challenges by harnessing the innovation and creativity of youth and industry leaders to create, propagate, accelerate, and disseminate successful models at scale to prepare the next generation of creators, makers, innovators, and designers to thrive.
Global Summits on Youth Skills holds regional summits for business, government, academia, and practitioners focused on engaging the business community in support of public education and skills development for the Fourth Industrial Revolution regularly.
USA National Commission on Innovation Competitiveness Frontiers has taken a plan to redefine 21st centurys productivity, prosperity and security for exploring the future sustainableproduction and consumption for their survival and further development of national competiveness.
Canada has the foundation to be one of the top five most innovative nations in the world. Canada has excellent economic fundamentals and is one of the strongest economies in the G7. The Innovation and Skills Plan of Canada reflects a new microeconomic framework for supporting innovation one that aims to succeed by establishing a culture of innovation and a globally recognized brand for Canada as one of the most innovative countries in the world.
In 2017 the Government of Canada launched a bold, multi-year Innovation and Skills Plan a major redesign of the innovation policy landscape in Canada. The Plan features a brand new microeconomic framework for supporting innovation, novel ways of thinking about how to grow Canadas economy, and experimental first-of-their-kind initiatives to Canada. It aims to establish a culture of innovation and a globally recognized brand for Canada as one of the most innovative countries in the world.
Today, innovation performance is a crucial determinant of competitiveness and national progress. Moreover, innovation is important to help address global challenges, such as climate change and sustainable development. But despite the importance of innovation, many OECD countries face difficulties in strengthening performance in this area. Indeed, many OECD countries have seen little improvement in productivity performance in recent years despite the new opportunities offered by globalisation and new technologies, especially the information and communication technologies (ICT). Thus they agreed that a common Innovation Commission for the member countries are fundamental to overcome the challenges of 21 century.
In order to overcome these market failures and reduce the companies risk, a government intervention to compensate these companies and encourage their investments an Innovation Commission is legitimately required.
In light of the above, public authority for innovation in various forms in many developed nations are existed. The purpose of public authority for innovation in this area is to ensure optimal flow of knowledge in the market and to increase companies RD expenditure to a higher level than would be made possible solely based on profit-loss considerations, by removing investment blocks or by providing direct support to innovation, so that at the end of the day, companies will see higher yield and choose their investment accordingly.
Services of the Innovation Commission usually include a combination of direct and indirect support measures. Direct measures include direct government investments in the form of grants or RD loans dedicated for the business sector. Indirect support tools mostly include various tax incentives for companies dealing with RD and innovation.
Ensuring Social welfare through profit driven initiativesInnovation Commission may create a new business model. These citizens welfare driven innovation can be articulated by Innovation Commission. In one word social welfare and profit maximization aim can be blended by the Innovation Commission.
Many Startup companies of the world who positioned themselves in the international market in communication, internet, medical technology, agriculture, biotechnology, security, water desalination, digital platform and more have done it by the support from Innovation Plan of the Government.
In such reality, lack of Innovation Commission will result in a situation where private investment in RD is significantly lower than socially desirable, as demonstrated by the Economys Nobel Prize laureate, Kenneth Arrow whos claim was empirically proved by dozens of researches. A research conducted by Prof. Shaul Lach of the Hebrew University in Jerusalems (2018) examined the impact of government support on innovative RD in the business enterprise sector. This research indicates that the direct result of governmental support in RD is the creation of new research of up to two or three times higher value than the amount of the initial governmental grant, even in the industrial and software markets.
It is sought to promote the transformation from a startup nation to a high income nation, a move that will benefit the economy and enhance the welfare of its citizens. Global technological, economic, and social trends are today converging to create a window of opportunity, the Innovation Commission may be a suitable institution in our country that may strive determinedly to seize for the benefit of our economy.
The writer is a contributor to
The Independent
