Three Things Government Can Do to Boost Innovation

Three Things Government Can Do to Boost InnovationI was asked not too long ago in an interview what advice I would give to an incoming UK government on how to increase innovation in our economy. Here is what I would recommend:

1. Make it as easy as possible to start a new business. Most radical innovations come from start-ups and we need a lot more of them. It is already reasonably easy to start a new business in the UK. However, we could further reduce administration and tax on new businesses e.g. no corporation tax for the first two years trading.

2. Increase the availability of loans for small and medium sized businesses (SMEs). At the moment many smaller enterprises cannot raise the finance they need to expand. We need to encourage venture capital funds, business angels and banks to invest in or lend to start-ups and smaller enterprises. This is risky so the government can help lay-off some of the risk.

3. Tilt higher education towards Science. Somehow our country has lost faith in Science. The media is cynical about Science in general. It is no longer seen as something that can solve problems and make life better. We need to rediscover the belief in Science and Engineering displayed by the Victorians. Many valuable high-tech start-ups come out of PhD studies or University research departments. We should encourage more bright students to take degrees and further degrees in Science based subjects. We should say that a degree in Physics is more valuable than a degree in History. One way to tilt the playing field would be to make tuition fees lower in science and engineering courses and higher in arts subjects.

We need more innovation in all parts of the economy including large corporations and the public sector. However, I would start with the SME sector. These three proposals would cost little but over a period they would encourage more start-up businesses and more high-tech businesses. This will help fuel innovation.

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Paul SloanePaul Sloane writes, speaks and leads workshops on creativity, innovation and leadership. He is the author of The Innovative Leader published by Kogan-Page.

Paul Sloane




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No Comments

  1. Cynthia DuVal on July 31, 2010 at 2:30 pm

    Hello Paul,

    Thank you for your article and food for thought. I had no idea that the UK has lost faith in science and engineering as drivers of innovation. I like what I think you are saying that we need to find balance in our innovation programs and raise the potential of larger numbers of students, professionals and companies to enter into innovation work.

    However, I vehemently disagree that tuition should be higher in arts subjects than science. OUCH! I say this because self direction, passionate motivation and artistic thinking are so key to innovative thinking, discovery and communications. These things can be cultivated through arts based learning that occurs alongside science and technology training.

    We are making a similar assumption here in the US, valuing science and technology over the arts and failing to see the synergy between the two types of thinking and endeavor and the value of interdisciplinary perspectives to innovative thought and action. I will be honest with you when I say the most innovative and compassionate and future oriented people I known are artist engineers who have synthesized these two disciplines to develop their careers.

    Here in our area we are advocating 1 and 2 and 3 as well but many of us feel strongly that these government interventions without number #4 will not meet our future needs. Here is #4: Develop theoretically informed programs to train and mentor young students and SMB professionals in the practice of innovative thinking, aesthetics and concept design, testing and analysis. If we do this innovation becomes pervasive in life and discoveries will be made in little and big ways across professions, lifestyles, disciplines and business functions. With the addition of aesthetics into the mix innovations will also have humanitarian and human futures and well-being principles counterbalancing profit first (and only) goals.

    There is a lot to be said for low tech innovation too. An example might be innovations in work force development; these need not be technical innovations but could still have a huge impact on millions of unemployed. Another example; replacing the principles (capitalism) by which we’ve lived and worked that have caused massive migration of jobs without regard for the well-being of local families and communities with new principles. The Business Alliance for Local Living Economies – BALLE – and social entrepreneurship are examples of cultural historical innovations that are having a profound transformative and positive influence on people’s lives, communities and economic outcomes around the world.

    In almost every instance, if we transform “or” thinking into “and” thinking, we enter open up new innovation territory to explore and develop.

    All the best to you,

    Cynthia DuVal
    Founding Director, DuVal Ethnographic Research Center & Change Agency
    Project: Innovation and Cultural Change

  2. Anna on August 1, 2010 at 6:29 pm

    Great posts, Paul and Cynthia.

    While I agree with Paul that there is a need to promote the sciences and engineering to students in the UK, I was interested (and reassured) to note Cynthia’s emphasis of the value of the arts and social sciences in inspiring innovative thinking.

    To build on Cynthia’s point #4, I would also add that the collaboration of enthusiastic youngsters, who have not yet formulated rigid thought patterns, with experienced professionals (in multiple spheres) might also serve to heighten our capacity to innovate and to challenge conventional norms.

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