Innovation in the 21st Century: Keeping the US Competitive

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Innovation in the 21st Century: Keeping the US Competitive

Justin R. Rattner

Justin R. Rattner

Vice president and chief technology officer, Intel Corporation

Posted: November 16, 2009 01:40 PM

Today, Newsweek and Intel released the findings from a survey on innovation and the economy. The good news: despite one of the deepest recessions in history, Americans have an undiminished faith in technology and innovation as the primary engines of economic growth. The bad news: most Americans say that the downturn has hurt the U.S.’s ability to innovate and they have significant doubts about our ability to maintain leadership.

While pursuing game-changing technology innovation is my charge at Intel, I am acutely interested in supporting this undiminished faith of the American people and am working tirelessly to relieve their doubts about our ability to compete on the global stage.

 Too often I find that organizations of all types are told by their management or their customers to be more innovative. They quickly embrace the idea, but then struggle to understand its true meaning and are clueless about how to achieve it.

Having spent my entire career in R&D, I’ve learned that innovation is a type of human endeavor, a process. If we as a nation fail to understand that innovation is this long, often torturous process, we will find ourselves taking a back seat to those countries that learned how to innovate by studying us in great detail, but then took the bold steps to make innovation their hallmark instead of ours. If we are not vigilant, the students will have become the masters.

Being an optimist, something essential to being a successful innovator, I believe we can return to our cultural roots and make innovation a process to be once again embraced and nurtured. Doing so will require the kind of investment environments, R&D strategies, and management know-how to keep us at the forefront of innovation and reassert our competitiveness in the rapidly changing, global economy.

A 21st Century Model of Cooperation between Government, Industry, and Academia

The old 20th century research model is all but dead. The big “think tank” labs that did research for the sake of doing research, such as Bell Labs (invented information theory and the transistor) and the Xerox Palo Alto Research Center (invented the Ethernet, laser printing, and the window-mouse user interface) are now just shadows of their former selves.

After World War II, much of what energized our economy was driven by industrial research and development organizations continuing the innovation process by taking the fundamental ideas from academia or the big think tanks and turning them into truly useful products and services. Indeed, the Internet may have been invented at UCLA and Stanford, with funding by the Defense Research Projects Agency, and the World Wide Web at CERN and the University of Illinois with funding from NSF, but it took industrial R&D at companies such as Cisco and Google to make the net and the web the global reality they are today.

In the 21st century, we advocate the adoption of a more contemporary research model, bringing together the best of world-class university research and industrial R&D with critical government support in a phased approach that yields the best outcome for all three sectors and drives a healthy pipeline of innovative American products and services to the global market well into the new century.

 

Can Government Alone Drive Innovation?

According to the survey, nearly half of Americans also want the government to offer incentives to spur innovation and a third think a national innovation initiative would be very effective. Where is the next invention on the level of the integrated circuit or the Internet going to come from, and how can we be sure it creates high paying jobs here at home?

For the 21st century R&D model to work we also must commit to increased funding for R&D in both the public and private sectors. While the call we often hear is for unilateral increases in government R&D funding and tax policy, I guarantee you that alone will not keep us competitive. The decreasing amount of industrial investment in R&D must be of equal concern.

A two-year old study by the Chinese government of its own electronics industry revealed that very few companies in China spend more than one percent on R&D. Are you surprised that most of those companies are not profitable? The few that spend ten percent or more on R&D, more typical of U.S. electronics companies such as Intel, do make money. There is a powerful lesson to be learned from this study. Government funding and tax policy must be matched by industrial R&D investments. One without the other is a recipe for failure.

Science & Engineering Education in the U.S. is Critical

The doubts that Americans expressed in the survey about the ability to maintain leadership in innovation is shared by Chinese respondents. To no one’s surprise, the Chinese believe that the U.S. has a significant advantage today, but they expect to take the mantle of leadership over the next 30 years. In contrast, Americans say their doubts are largely based on a perceived gap with other nations in the quality of math and science education, with 82% thinking that the U.S. lags behind other countries. While it’s true that we do lag, the good news is that the trend for American student is positive. The 2007 Trends in International Mathematics and Science Study (TIMSS) ranked U.S. fourth and eighth grade student 12th and 10th world-wide in mathematics, up dramatically from previous surveys. We need to do whatever it takes for as long as it takes until we’re on par with the Chinese.

Immigration Policy Helps Power U.S. Innovation

Since innovation begins with an idea in response to a need, the next big product or service idea will hopefully come from the mind of a current American or an American-trained student. Given that I’m responsible for six of Intel’s international research labs, I can say first hand that the U.S. doesn’t have an exclusive deal on smart people. They are everywhere on the planet and most of them don’t live in the U.S. It doesn’t help to chase them out of the U.S. once they finish their academic training. We should give them a job offer and a hiring bonus the day they get their PhDs.

Tuning Up for the Global Battle

With 75% of Americans believing that technological innovation is more important than ever in driving U.S. economic success, the significance of developing our innovators of tomorrow is more pronounced than ever. The space race was basically a dual between two countries. Now we are engaged in a truly global competition over who will have the best ideas and who will turn those ideas into products, services, and high-paying jobs.

It’s amazing to think that with an enlightened combination of cutting edge academic research and industrial R&D, well-informed government policy and support, and continuous improvement of math and science outcomes, the next big thing is on the horizon — something that will change our lives and better our world. In that: not just reason to have faith, but a reason to act and act quickly.

Motivating the Newsweek-Intel Survey

Intel sponsored this survey with Newsweek to highlight key areas of interest around innovation. In the current economy, there is nothing more important than driving change that will create jobs and build confidence among the American people. Intel is also sponsoring a conference in Washington, DC to explore what American business, governmental and academic institutions, NGOs, and private citizens can do to invigorate our culture of innovation that will drive economic recovery and ensure long-term, sustainable growth.

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