Enterprise finances innovation
Research money is finally finding its way into business faculties, writes Luke Slattery
IN a significant shift of innovation priorities, higher education research expenditure on commerce, management and tourism services increased by 51 per cent between 2001 and 2005, according to the latest Australian Bureau of Statistics figures.
But the proportion of research and development spending on earth sciences during the same period was flatter, rising only 21 per cent for biological sciences, 27 per cent for chemistry, 17 per cent for physics and 31 per cent for mathematical science.
Business and management R & D — once regarded as fields with minimal research prestige and even less intellectual pedigree — grew from $ 11 million in 2001 to almost $ 20 million in 2005 as business schools and management faculties increased their focus on the field of innovation policy to become the third highest R & D growth disciplines.
Business Council of Australia policy director Patrick Coleman says that to support a broad innovation policy it is important to boost research in management and the services sector.
‘‘ One area the council has been particularly concerned about is the services sector’s performance internationally,’’ Coleman says. ‘‘ One important contribution that can be made is more research into innovation and services, and better application of that research.
‘‘ We’ve needed a more scientific approach to improving our effort in services.’’
He stresses, however, that ‘‘ the traditional focus on science and technology continues to be very important to innovation; we need to see growth in both areas’’.
‘‘ Without the right management capabilities you won’t do justice to new products and services; you need to be able to bring them to market.’’
Research and innovation policy adviser John Howard, author of several reports on the knowledge economy, welcomes the shift.
‘‘ We need to be doing more research in business and management to ensure we get innovation outcomes,’’ Howard says.
‘‘ Investment in management capacity and management capability is vitally important from the perspective of innovation policy. We’re also seeing a lot of crossdisciplinary activity between management and the science and engineering areas.’’
A measure of the growing prestige of business school research is the public recognition given to University of Queensland business school professor Mark Dodgson, winner of the 2007 Eureka prize for leadership in business innovation.
Dodgson, director of the school’s Technology and Innovation Management Centre, says that while much of the innovation underlining productivity growth derives from scientific and technological inventions, these have to be accompanied by ‘‘ an understanding of user and market needs, and the business models by which they deliver value. Business research is an essential complement to scientific research in the quest for a more innovative economy.’’
The school’s head, Timothy Brailsford, says university and industry have started to collaborate more closely and ‘‘ applied research is now making valuable contributions to business’’.
Brailsford, head of the Australian Business Deans Council, cites the Australian Research council linkage grants scheme, dominated this year by UQ, which generates 30 per cent of its successes in the scheme from its business school, as a key mechanism for productive industry- university cooperation in R & D.
Research in business schools is also gaining prominence as Australian business leaders increasingly see competitive advantage in terms of highly skilled labour, Brailsford says. ‘‘ Demand for individuals who can think creatively, critically and analytically is high. These skills are associated with research activity.’’
Norma Harrison, professor of management and chairwoman of operations management at Macquarie Graduate School of Management and professor of operations management at the China Europe International Business School is Shanghai, says until recently the ARC had favoured the sciences and engineering. This was because ‘‘ the expected outputs were more easily seen, measured or reported on’’, she says.
‘‘ The management field, with its strong behavioural aspects, has been relatively more esoteric, evolving and unstructured in approach, with many gurus espousing different theories. It was therefore more difficult to assess the expected outcomes of research from these fields, let alone clearly illustrate the significance of this research.’’
The big change, Harrison says, is that researchers in the soft fields of business and management have to be more disciplined in structuring their research proposals.
‘‘ They are seeing the results in more research funding,’’ she says.
The shift in higher education R & D funding is in line with a paper published earlier this year by the Australian Business Foundation, an independent Sydney- based economic and industry think tank, which called for a rethink of innovation policy from its focus on science to encompass ‘‘ the smart application of knowledge to transform businesses’’.
‘‘ The current dominance among policymakers of the science, technology and research push approach to innovation should be replaced by one that supports business engagement with markets and customers,’’ the foundation says.