2 March 2010

UK innovation policy should refocus on customers

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Myth report
UK Government innovation policy should be refocused to reflect the crucial role played by customers in stimulating and funding the development of new hi-tech companies, claims a major new report on the Cambridge hi-tech cluster.

For many years, the “Cambridge Phenomenon” has been associated in most peoples’ minds with academic spin-off firms, established to develop new products based on intellectual property created within their university laboratories, and with Silicon Valley style venture capital providing the finance. But a two year research study at Cambridge University has found that the key to the success of hi-tech firms generating the most employment lies in developing solutions to customer problems. […]

The report found little enthusiasm amongst successful, fast growing high-tech firms for the kinds of multi-partner research grants involving university-industry collaboration that are favoured by UK policy makers and, in contrast to the US, a dearth of R&D contracts with public sector customers. […]

Instead the report proposes a series of new policies to encourage more R&D contracts between small companies and lead customers, including a new grants scheme and increased use of procurement to meet Government innovation needs.

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