Do We Really Need "Outcomes"?

I was very pleased to attend a consultation exercise hosted by the CBI and the University of Teesside earlier this week. The purpose of this auspicious event was to acquaint a delegation of the Technology Strategy Board visiting our region this week with the issues and successes experienced during the early days of the Digital City project and other matters arising out of the interface between technology and business in the Tees Valley.

The Technology Strategy Board (handily, if occasionally confusingly, shortened by all to “TSBâ€?) is an organisation that has been established by central government with the purpose of the promotion and enablement of, and investment in (and I quote from the Executive Summary of the TSB’s policy document “Connect and Catalyseâ€?) “innovation enabled by technology for the benefit of business, to increase sustainable economic growth and to improve quality of lifeâ€?. A laudable aim for which it has been armed with a billion pound budget over a three year period.

To do this, the TSB is equipped with a number of existing tools (as well as some new ones) including Knowledge Transfer Networks and Knowledge Transfer Partnerships. The former I must say I don’t know a great deal about but I imagine that you might see informal versions of these in the cafes at Charlotte Square, the Quadrus Centre and such like, particularly on a Friday afternoon. The latter though I must confess to being a fan of.

Knowledge Transfer Partnerships (“KTPsâ€?), in case you were unaware, are a mechanism for giving businesses access to academics as a pseudo-employee over a defined period of time, 6 months maybe or more if the need requires it. The business gets the benefit of full time exposure to a knowledgeable worker that it wouldn’t ordinarily be able to locate even if it could afford it and could identify precisely what its need was. Either the institution or a third party funding body picks up much of the tab, often with the business funding the balance.

The difficulty is finding the precise circumstances in which all of the parties will benefit. The academic must be able to provide solutions in situations where the business might not even know what the problem is. The business must be able to make use of the academic’s recommendations. The institution ‘lending’ the academic must be enticed by the advantages that will be brought by the academic’s long term exposure to the big bad world of commerce or industry.

The general consensus around the table was that KTPs are a thoroughly good thing all round, and I must say that I agree with this - in theory. Unfortunately, having acted for three clients looking to take academics on board via KTPs, every one has failed and in each case, it has been due to demands being made by the institutions (or the funding party) as to, for want of a better word. ‘ownership’ of the outputs of the project. These outputs may be in fact quite different to what was envisaged by the parties when they entered the agreement in the first place, often, conversely, in the most successful examples.

It’s such a shame when, where all the other circumstances are fitting for a KTP, that the agreement should collapse through some naïve and inflexible approach adopted by the institution or funding party over the treatment of the project outputs. A number of people have said to me (usually during the course of those negotiations but also during our discussions earlier in the week) that where the work of the academic results in massive returns for the business, the public sector has a right to a share of the spoils. Eh? No. This is not about establishing some kind of financial return on an investment by the institution. The institution benefits by reaping the rewards of the academic’s experience when the dust settles following his or her return. But it’s the job of the business to make a financial success of the arrangement and where that happens, let’s not ignore the fact that most of the profits generated find their way back into the local community.

The problem here is the need to account for expenditure of public funds through the gathering of objective statistics, whether through somewhat dubious assessments of value added or jobs created, or a need to demonstrate assets acquired. The use of KTPs was just the example that brought this up, but it happens wherever public funds are used to stimulate enterprise. In every case, there is a need to account for “outcomesâ€?, and unless an outcome can be predicted, the chances of securing those funds in the first place are remote, to say the least.

If we want to stimulate innovation through the use public funds, it seems to me that we need to be prepared to invest where there is a risk that you’re not going to get the result you want. If we only invest in the projects where we can see an obvious outcome, then inevitably going to risk missing that eureka moment where a random combination of individuals are combined in unusual circumstances in such a way that they produce between them something truly extraordinary. I don’t deny that we still need to assess how those funds are used, but in my humble opinion (for what it’s worth), the best way to stimulate innovation through the use of public sector funds is to free it from the requirement to produce “outcomesâ€?. Maybe it’s me that’s the naïve one.

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