Innovative engineering projects were celebrated at the recent 2012 New Zealand Engineering Excellence Awards. Sir Peter Gluckman, the Prime Minister’s Chief Science Advisor, gave the keynote address at the Awards. Sir Peter’s speech focused on three main points that have global relevance.
- The role of engineering and science in creating innovation and prosperity
- The role of engineers and scientists in risk identification, assessment and management
- How engineers and scientists need to take the lead in encouraging young people to seriously consider engineering and science as worthwhile careers.
This article focuses on the first point. Sir Peter in “Engineering a Smart Nation” wrote:
“ . . . science and innovation are key to our economic, social and environmental futures. The role of engineering in this transformation is critical.”
Within the engineering community, this is a common topic of conversation – that there is a strong link between engineering and innovation. On the face of it this appears logical, but won’t other professions claim exactly the same thing? This prompted me to go looking for some hard data to prove or disprove the engineering and innovation link.
Michael E Porter and Scott Stern authored National Innovative Capacity which looked at factors influencing global innovation in 75 countries. They found that the private and public sectors must work together to promote a favourable environment for innovation. The private sector is the engine of innovation, but the public sector needs to create the policy and institutional framework to support it. They developed a National Innovative Capacity Index based on four sub-indices:
- Proportion of Engineers and Scientists in the population.
- Innovation Policy based on a) the protection of intellectual property, b) the ability of a country to retain its engineers and scientists and c) tax-based incentives for innovation in the private sector.
- Cluster Innovation Environment – the existence of geographic concentrations of groups of firms in the same field (eg:IT)
- Linkages between the Cluster Innovation Environment (private sector firms) and the common infrastructure environment. This sub-index is based on a) the overall quality of scientific research institutions and b) the availability of venture capital for innovative but risky projects.
Using data from National Innovative Capacity the following graph plots the Proportion of Engineers and Scientists subindex against the National Innovative Capacity Index for the top 25 countries.
The strong correlation between the proportion of scientists and engineers available in a country and the National Innovative Capacity Index (NICI) is evident in the graph. As Porter and Stern put it: “The foundation of a nation’s common innovation infrastructure is its pool of scientists and engineers available to contribute to innovation throughout the economy.” There are some slight outliers. For instance, USA ranks first for NICI, but 6th for the proportion of engineers and scientists, indicating that the States may have a future problem due to a lack of engineering skills hindering ongoing innovation. Japan and Sweden rank 1st and 2nd respectively for proportion of engineers and scientists, but 12th and 8th for NICI, because the other three indices are weaker and reduce their ranking overall.
And how does New Zealand rank on the engineering and innovation scale?
Overall, New Zealand sits in 24th position for the NICI, but it is ranked 28th for proportion of engineers and scientists, 35th for Innovation Policy, 27th for Cluster Innovation Environment and 19th for Linkages. It was elevated in the rankings due to its higher result for linkages. Given the often lamented lack of venture capital in New Zealand, I can only conclude it is the high calibre of our universities that results in such a high score for this index. This is borne out by Auckland University ranking in the top 100, and Otago and Canterbury Universities ranking in the top 250 universities in the QS World University Rankings 2012.
But what does this mean for New Zealand’s innovation future? New Zealand will need to progress in a number of areas if it is to become a more broadly based innovation-driven economy.
New Zealand needs to pay more attention to both training and retaining engineers. Engineers will be retained in New Zealand when vibrant, innovative companies working at the leading edge of technology are allowed to develop and prosper. This can be achieved by:
- Creating a more favourable public policy framework including tax incentives to invest in R&D
- Developing private sector companies that aim to create unique products and processes rather than relying on natural resources
- Moving beyond technology licensing and beyond setting up new ventures with the sole intention of selling them off-shore- so that home-grown scientific and engineering advances can be developed in New Zealand more quickly than they disperse to other countries.
- Increased private sector focus on building own brands, controlling international distribution and selling globally.
- Engaging in extensive training of employees and making greater use of incentive compensation.
- Making seed capital (from both the private and public sectors) more readily available for innovative higher risk ventures, but linking its supply to the existence of the above factors.
- Strengthening the bonds between our tertiary institutes and industry to ensure that 1) academia produces graduates with the appropriate skills and 2) engineering advances which are developed within universities can be nurtured, developed and commercialised within, and in conjunction with, the New Zealand private sector.
Do you agree? And how can we do better? Share your thoughts with us in the input box below.
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