By Brian McCaul
Okay, so everything gets slapped with the ‘2.0’ suffix these days, but when it comes to the opportunities that ‘social media’ and the new web have for the practice of ‘knowledge transfer’, I believe there really is potential for a serious shift in what we should be able to do. This is not just a vague faddish concept but an increasingly practical approach – especially for commercial knowledge transfer (or ‘tech transfer’ if you’re old-school) and it’s already bearing fruit. In drawing out some implications I’ve focused on commercial activity, as that’s what I do, but they apply equally other forms for Knowledge Transfer.
KT and web 2.0 were made for each other, because of the ability to speed knowledge exchange and expand collaboration. And although it’s not entirely clear how this will work through to reshape KT, I’d like to start the discussion with 6 propositions about how KT will, and needs, to change:
KT used to be about assembling and employing the most able team to cover the extremely broad range of skills required for taking an idea from the research base to market. This skill set has expanded as we get more sophisticated at what we do.
KT 2.0 is about assembling the right network…
No matter how big or smart your R&D organisation, you’ll never be able to assemble a team that covers all the legal, commercial, technical, marketing, financial… (and other) skill-sets needed…
To maximise IP extraction, and our ability to deal with it, we will always fall short with our own teams efforts. The bigger our organisation, the more difficult it will be to employ and organise this function within a classic hierarchy. This applies all the more to large research-intensive universities.
This is basic ‘Open Innovation’: ‘you can never employ all the smart people’ – neither as researchers and creators of IP, nor as business development managers and deal-makers. Exploiting the ‘innovation division of labour’ is just as relevant to public sector research organisations as it is to industrial innovation processes. Now Web 2.0 provides the opportunity, first, to find the right people with precisely the right mix of technical/commercial skills to exploit a specific innovation – when you need them. Secondly, it allows you to engage and co-ordinate them without having to employ them. Innovation communities such as GInnN, Knowledge Vine, Innocentive, Ninesigma… and many more are addressing the first part of this need – to find the expert.
So (step 1) now these communities allow you to find skills you need and the IP that you might require to plug an IP hole in a project, but this is only half the challenge. We also need (step 2) to manage and link these resources to our own teams and infrastructure. To be efficient we need to be able swap ‘due diligence’ and intelligence on external collaborators and their capability. Many of the Innocentive-style communities do not provide this capability.
The problem, therefore, has moved from finding people (virtually) to managing people (virtually). I’m starting to manage a virtual team (at step 2) via Leeds Innovation Network, and sharing information with similar communities at other institutions. Hence each KTO needs to be able to simultaneously organise and control its own virtual community and to interact with others – to be able to participate in a community of innovation communities. This is the principle behind the JISC Trial project between Leeds, Sheffield and Manchester Universities, which is looking to demonstrate the use of social media to exploit this ‘crowd-sourced’ approach to KT, both to location and management of external experts.
Step 3 is to deploy collaborative tools that enhance this virtual communities productivity and substitute for the lack of organisational infrastructure (online project management tools, multi-channel video conference etc). There’s quite a bit of work to do here, but theres are also many existing tool that can be used. And there’s evidence that these developments are also providing real academic research benefits.
KT used to be primarily about ‘Tech-Push’.
Even when it succeeds in gaining VC cash it was still about Tech-Push – albeit it with a business plan, some due diligence and cash. There’s still a place for this – particularly where the market is not yet ready for a particular innovation – and I stand by the spinout route as a crucial component of the innovation evolution system. But this route is certainly getting harder – particularly in a constricted market.
KT2.0 is about maximising Market Pull…
Whilst Web2.0 facilitates ‘Tech-Push’ (via sites like IP Net …etc etc) this on its own clearly has its limitations. KT2.0 supplements Tech-Push with user-led and market-led innovation. Social media is perfect for seeking and aggregating market-trends and particularly user feed-back, and there are plenty of examples of companies turning round setback from adopting this approach. Dell’s IdeaStorm looks and feels a lot like Digg.com, the popular tech news aggregator: Users post suggestions and the community votes, so that the most popular ideas determine product development. Cisco (iPrize) works similarly.
The challenge for knowledge transfer practitioners is to better apply this ‘pull’ approach for the development and screening (see 3) of earlier-stage technological innovations. Of course, people-based networks are a crucial element of generating connectivity to the market – and its pull. Networks such as IXC are helpful in this process, but, again, as with IdeaStorm, the ‘wisdom of the crowd’ is massively amplified through the aggregation of greater and more diverse market data points. Web2.0 developments allow us to aggregate this range of inputs.
In inevitably this will throw-up new challenges in the management of IP. But this is simply and extension of the challenge that Open Innovation presents – yet OI has always emphasized the importance of IP protection as a means of facilitating openness, without losing value.
KT was about driving as much resource into a project as possible, to maximise its likelihood of success.
KT 2.0 is about learning to ‘fail early’ and cheaply…
This is a concept that’s been employed in commercial R&D for a long time, yet it remains an anathema to academic R&D. With necessary caveats, the simple innovation of introducing stage-gating selection into academic KT programmes, could deliver significant increases in effectiveness.
Of course, universities are not commercial bodies in the straight-forward manner that corporate R&D organisation are; there remains a need to stimulate radical and ‘ultra orphan‘ technologies that will not be supported elsewhere. Nevertheless, the simple principle of ‘canning’ projects that, with some simple analysis, are clearly unlikely to develop any sustainable business model or market, would save enormous resource: Resource that can be redirected toward innovations that will succeed. The University of Leeds led ‘Regenerative Therapeutics/Devices Innovation & Knowledge Centre’ (IKC) is an interesting example of a concerted effort to adopt this approach.
But the introduction of ‘fail-early’ in any system requires a high degree of certainty around what is ‘killed’ and what gets the go-ahead’. Any decision to ‘kill early’ needs to be well informed. The best way to anticipate market reaction at these early stage is to have close user-involvement. To maximise the openness of the innovation process, and to maximise user-input, one simple step is to start to ‘Crowd-source’ this data. Again social media provides an ideal framework through which to garner crowd-sourced data.
This is perhaps the most important and difficult challenge. Given the propensity for ‘Black Swans’ (un-expected outcomes) to pop up regularly in KT, the ability to combine openness in the innovation process with increased selection ability to kill weak projects will be a new challenge. If you’re going to kill it early, you better be sure…! And this is particularly necessary to protect radical innovation from the University R&D base. (But another protection mechanism for the ‘black swan’ is proposition 6!)
KT was primarily about legal, technical/regulatory and commercial matters – in that order!
KT 2.0 understands that there are continually new innovation drivers emerging: be that the need for ‘business model innovation’ or ‘design innovation’ or the need to engage ‘user innovation’, or some other emerging factor…need to added to this mix.
These factors are just as, if not more, critical to commercial success than technical innovation. This doesn’t replace any of the previous requirements – it simply adds to the complexity of the KT process, and the breadth of the skill-sets required. It therefore also re-enforces the need to exploit the external ‘innovation division of labour’ – that is that KT professionals and KTOs cannot do this on their own. Again, we need to expand our networks and our external collaborations.
The Design Council’s Design for Technology Transfer programme is good example of how to in inject a new skill into the KT community/process: helping universities in “visioning or imagining new products and services, user testing, rapid prototyping, and communicating ideas – are complimentary to many of the challenges intermediaries face when taking new technologies to market”.
I’m currently involved in the pilot and am hoping that we can learn new tricks for our innovation pathway, but I certainly won’t try to do it on my own. I’ll be looking to use this pilot to find and to integrate a new set of designers into our Leeds Innovation Network community.
KT was about individual research excellence – groups or individuals
KT 2.0 is premised on the notion that innovation is a social process, and that the most interesting opportunities are likely to arise from cross disciplinary collaborations.
This has been implicitly understood for some time, but now there’s a growing body of network and social capital analysis to evidence this [See Prof Ron Burt’s research on Social Capital]. Networked individual and organisations empirically outperform those that are internally focused. And yet most universities still struggle to ‘mix it up’.
The other aspect of such a ‘community of communities’ approach (as mentioned in Proposition 1) is that it is now easier than ever to create an internal social community within large R&D organisations, like universities. It’s both cheap and easy to develop a innovation network, and its easier to find ways to ensure that such communities do not become a ‘island’ unconnected, or worse, competing for attention with other innovation communities.
New KT is about developing network capacity (or ‘absorptive capacity’ in the OI jargon). This is a second key theme in ourJISC Trial project: the creation of internal communities of practice for those interested in KT and innovation (whether academic or not), whilst specifically encouraging the sharing of ideas internally across discipline boundaries, and with external communities.
Manchester Leeds and Sheffield (and I hope Liverpool) will be looking to share best practice in growth these internal linkages but also – where appropriate – integrating their online community activity. This is about creating a communities of practice of active academics and allies within and without organisations.
KT (and I’m particularly talking about commercial KT) was, primarily, focused on the large VC deal, and avoidance of the ‘living dead’ spin-out, or ‘small’ licence deals…
KT2.0 understands that the funding environment is very different and even if the ‘IPO model’ and VC investment comes back to full vigour, alternative funding/exit strategies will become an increasingly important part of the mix…
The debates over the ‘death’ of venture capital are hard to ignore – whether exaggerated or not – a structural shift is taking place: the supply of capital isn’t balanced with the exit potential (IPO in particular). Venture capital is shrinking. And in many ways its likely that: “the future isn’t big anymore, the future is small”. At very least, other forms of financing – angel investing, bootstrapping, or using public grants – will become all the more crucial to the financing of early ventures. Or some more complex mix of all. Studies show that Angel funds in the US are not far below traditional venture capital.
This is not all bad news. But it has implications for the way we operate. One is that we might revisit the dismissive notions of what constitutes the ‘walking dead’ spinout. Secondly we may need to recognise that single investor funding transactions (without leveraging other finance forms) are going lot be less effective – and less do-able by early-stage VCs either! And, thirdly, and this is the point here, that diverse funding is – necessarily – going to dictate diverse networks! It also dictates a new culture:
“The new culture is open, fast-paced, and encouraging of first-time entrepreneurs. It’s about blogging and tweeting and digitized networks of people sharing information about what they’re interested in, and where they’re investing. It’s about informal “unconferences” popping up to discuss the latest tech trend”. The Cultural Revolution: Which Side Are You On? Skirsne
None of this diminishes the need for the venture capitalists – far from it! But they can’t meet the challenge alone, and the need to expand funding sources has a clear analogy in the Obama campaign model. Via the online MyObama.com strategy Obama’s team expanded fundraising beyond the usual ‘high-net worths’ and tapped into a broader networks for cash and support:
“There was a moment when the McCain team should have recognised the extent of the online challenge. It came during the primaries when Obama hired Joe Rospars, a veteran of Dean’s campaign, as its online director and lured Facebook co-founder Chris Hughes to build the campaign’s social-network-style site, myBarackObama.com. From then on, the Republicans were outgunned. It was like watching Web 1.0 slug it out with Web 2.0.” Poorly connected Republicans went down the YouTube, John Naughton
The lessons for KT are clear: that to access a broader spread of capital – social and financial, we need to have a organisational/fundraising capability more akin to the Obama campaign strategy – that is more networked and more web2.0.
Conclusion – An Age of Networks
If these propositions are true, then the key challenge is to increase our network our network capacity – as suggested in Proposition 1 – and to move beyond the closed networks that traditionally our professional associations have provided. Talking to other KT practitioners alone is not going to cut it or provide the new data points required for new thinking – no matter how smart they are.
This also provides a challenge for the existing ‘competency frameworks’ for KT professionals. The need for greater network capacity also requires a change of culture and new skill-sets. This in (perhaps overly) simplistic terms involves a shift from the ability to do specific tasks to the ability to co-ordinating others in doing things. This broadens an already board skill-set, increasing the importance of project management and the ability to manage social media networks. This is the ‘Network Challenge’ as argued by INSEAD Prof Paul Kleindorfer:
“This is, if anything, the age of networks,” …“This age of networks does not obviate the fact that there are nodes and firms and firm-centric decision rights, as well as capital rights and ownership rights. But network thinking certainly puts a whole new cast on the core themes of business and business education, from strategy to marketing to supply management.” -“The Network Challenge: Strategy Profit and RIsk in the Interlinked World”
To draw one final draw analogy: as with mobile phones, its not the functionality of the phone or its operating system alone (or even primarily) that provides market advantage; it’s increasingly the ability of the business model and the operating system to encourage the growth of an ‘application market’ or ecosystem around the phone. This ability to outsource the creation of new applications for its phones is what gives the iphone the edge against prior market leaders. So with the KTO, it will be less the functionality/capability of the team alone, that will make the difference. It will be more the teams ability to create an ecosystem of other market players around the team, who wish to work through the KTO to benefit from the transfer of knowledge. It will be the ability to incentivize those external players on risk shared basis and to leverage their networks that will provides competitive advantage. The more diverse this ecosystem the better. To put it in geek-speak: We need to be a little less windows mobile 6, and a bit more iphone (or better still Android!)
This challenges much of what we do: our incentivisation methodology, our approach to IP protection (though not as radically as might appear), the due diligence process (using more wisdom of the crowd), the phasing of KTO intervention in R&D projects (‘getting in earlier’ to influence business model development etc), being less obsessed with IP leakage and more bothered about deals…..and many other problems yet to be considered. But I believe there’s no alternative in the networked age than to change the way we innovate (and maybe be a bit more like Twitter!).
What do you think? If you want to find out more about the collaborations that lie behind this blog join the discussion here…