Submission to the Innovation Taskforce 
(Department of the Taoiseach)

From the
Western Development Commission
18TH September 2009

Ian Brannigan 
Western Development Commission   					
Dillon House
Ballaghaderreen
Co. Roscommon
Tel:	094 986 1441
Fax: 	094 986 1443
Web: 	www.wdc.ie

Contents

1.     Introduction and context                                                                                                     3
2.      Innovation context in the Western Region                                                                         4
3.	Recommendations
4.      Conclusion                                                                                                                                                     8

Submission from the Western Development Commission (WDC) to the Innovation taskforce (Department of the Taoiseach)
1.	Introduction and context
The Western Development Commission (WDC) welcomes this opportunity to make a submission to the Innovation Taskforce (ITF); (Department of the Taoiseach).The submission will seek to cover the following areas:

•	Current innovation context in the region.
•	Suggestions for sustainable innovation development in the region going forward 

In  composing this submission the WDC has sought to reach its conclusions with due regard to its regional growth remit as outlined below and also the national innovation contextual drivers as encapsulated in the Governments framework for sustainable economic renewal, the Smart economy document and the Strategy for Science, Technology and Innovation (SSTI) as well as the global context.  

The WDC is a statutory body established in 1999 by government to promote, foster and encourage economic and social development in the Western Region.  It operates under the aegis of DCRAGA .
The work of the WDC is determined by its legislative remit and by the national objective of achieving more balanced regional development through building on regions’ existing strengths and addressing their deficits, as set out in the NDP 2007-2013 (p.58).  The Western Region continues to experience deficits in a number of areas and there is a continuing economic and social development challenge facing the region, as the following headline statistics demonstrate. 

•	The gap in the index of Gross Value Added (GVA) between the West and Dublin increased from 53.9 points in 2000 to 65.9 points in 2006 (latest data available).

•	During 2000-2006, total net industrial output grew nationally by 22%, but declined by 7% in the Western Region.   

•	Total employment in the region in foreign-owned companies which receive assistance from the state development agencies declined in the 2000-2008 period by 12%, the decline in the rest of the State was 7%.  The region’s share of total national employment in assisted foreign-owned companies declined from 21% in 1996 to 18% in 2008. 

However there remains a high level of potential and unique advantages within the region which lends itself to significant development and opportunity in terms of an innovation ecosystem which would support the production of higher value goods and services, consistent with a knowledge economy. 
2.	Innovation context in the Western region 
Whilst a comprehensive overview and audit of total innovation assets is still needed within the Western region there are several widely regarded innovation assets in the public and private sectors. Certainly in the regions higher level institutes (NUIG, GMIT, Sligo IT, Letterkenny IT, St Angela’s etc) and public sector there are areas of general innovation excellence which offer specialisms supportive of high end innovative exploitation, examples include:
•	The Marine institute (Oranmore)
•	Belmullet wave energy test site ( proposed for 2011/12)
•	National centre for laser applications (NUIG)
•	National  centre for biomedical engineering science (NUIG)
•	Galway wave energy test site
•	Centre for Design innovation  and the BIC (business Innovation centre) at Sligo IT
•	Centre of Applied Marine biology and Wisar Lab at  Letterkenny IT
•	Centre for innovation and structural change (CISC) in NUIG
•	Innovation centre (GMIT)
There are also several support initiatives in the region for innovation development. The BMW piloted the concept of innovation vouchers via its recent EU funded programme on innovative actions. Also the HEI’s offer an emerging capability in technology transfer in varying degrees.
Similarly both in comparative and quantative analysis, more work is needed to fully baseline how the region stands compared to the national and international level in terms of how the innovation process works and what impact it has on economic activity in the region. However several pieces of work have been completed which offer us some outline of the innovation trends from a business perspective. In general, recent studies indicate that the number of firms in the region that are “innovation active” (i.e. actively participating in innovating their products or processes) is not far from the national average. In addition if we take the border , midland, and western(BMW) region data as roughly analogous to the western region, the BMW region, whilst still spending less in total  R&D spend than a comparable region such as the south and east, in the period 2003-2005 showed a significant increase in business R&D spending . In this period the increase on R&D spent by firms in the region more than doubled. 
However what is truly exciting for the western region about the purpose and aims of the innovation taskforce and its desire to make Ireland an “Innovation Island” is the latent potential the region possesses in terms of using innovation to exploit existing advantages located here in the region that will address predicted future global market demand hotspots. 
In terms of innovation development, in order for it to be sustainable it must primarily be market driven. In this way the goods and services that are enhanced through the innovation process are essentially pulled by the emerging demand. At this point it is important to outline what are the potential emerging market drivers globally so that the innovation focus needed may be assessed.
Research has provided four main factors which are seen to be possible market drivers for the coming decades. These are:
•	Ageing and obese populations – with attendant healthcare and technology needs
•	Emotional populations – the accelerating progress towards a more personal , customised product environment – the experiential world
•	Connected, mobile populations- the move towards a smarter built and constructed environment (a $1.5 T spend p.a.)
•	The challenge of societally acceptable, environmentally friendly energy harvesting, storage and management – The Terawatt challenge!
As such a review of the western region in light of the potential market demand that may emerge from the above drivers shows that the region may be particularly well placed to participate in areas such as renewable energy, where the region has unique access to the latent terawatts of renewable wave and wind energy offered by the North Atlantic. As we see above the terawatt challenge is predicted to create significant market demand in the coming decades. Similarly in the ageing and obese population driver the regions preponderance of world class medical device and life science companies allows another scenario where innovation investment could be matched with existing and emerging regional strength to address significant anticipated global market demand. Finally in regard to the emotional population market driver the fact that the region has a large and largely indigenous creative economy sector  allows it to address through the innovative upgrading of creative goods and services, the increasing quality of life demands inherent in the emotional population driver.  
Critically in these cases the region may offer the best solution for sustainable results nationally from any exchequer investment in innovation because the competitive advantage is located in the region and cannot easily be relocated. Also in several cases as the industry is already located in the region e.g. medical devices, creative industry, the most efficient approach locates the innovation process close to the business cluster location.
3.	Recommendations
If we are to truly compete on the global stage and achieve the aim as set out in the terms of reference of the ITF, especially in respect to the achievement of an “innovation island” then we need to address innovation development not just spatially (although certainly recent proposals in this regard remain weak), but more importantly on an industry led and potential returns basis. This is critical and  as such an appropriate view of the process is that whilst research may be considered to be the transformation of money into knowledge then innovation should be viewed as the transformation of knowledge into (more) money.
With this in mind and with regard to the preceding inputs on context, market and unique competitive advantages for the innovation island scenario the following list of recommendations may be respectfully considered by the Innovation taskforce:
I.	Market led - Any action plan to achieve the innovation island concept must be market led in order to lead to sustainable long term returns. Ideas into money is the basis for innovation
II.	Industry led – In order to maximise success international comparators have shown us that innovation processes led by industry and linked to their needs work and act as a locus for the private, public and third level sectoral expertise e.g. Centres of excellence models established in the North East of England ( Centre for process industries (CPI www.uk-cpi.com/ ), Centre of excellence fro life science (CELS www.celsgroup.com/ ))
III.	Identify and establish innovation facilities with unique Translational assets - Any innovation process must identify within its area of specialism the key enabling or translational assets which if available convert ideas into money. These may be as simple as prototype machines or as complex as bio catalytic converters for industrial scale up of enzymes. But in all cases they embody the innovation process in that they enable or enhance intellectual property (IP) and transform it into knowledge goods and services (see Fig. 1   a platform for innovation (below)). Ultimately investment in such assets realise a high return and frequently eliminate barriers to entry issues in knowledge industries. They are also key to moving high risk manufacturing based FDI industries in the knowledge economy into viable long term businesses and clusters.

IV.	Regionally balanced approach to Innovation Island – The taskforce may consider raising the national innovation capability by adopting a regionally balanced approach to innovation  investment by 
a.	Creating international innovation centres located in the western region linked to unique regional strengths (nationally and globally). These should be few, national in nature in that we need one centre of excellence per theme, and significant enough to compete via their capabilities internationally. Potential areas of investment include:
i.	Renewable energy – Ocean energy  (wind and wave)
ii.	Life science 
iii.	Creative – both directly and as a support for innovation  
V.	Leverage and enhance existing innovation assets -  As outlined on page 4, the region currently has a network of third level innovation assets , it is critical to the long-term viability of any regional innovation strategy that these strengths be incorporated and strengthened . An efficient capability in the area of technology transfer and IP management such as patenting advice and management are crucial to the development of an efficient and sustainable innovation ecosystem. This would create a finishing school for ideas and intellectual property developed in the regional HEI system (and as outlined in the private sector as well) and help address the long term haemorrhaging of human capital from the region to the wider world.
 
.

2.	Conclusion

The WDC is pleased to have been offered the opportunity to submit to the Innovation task force in regard to their ongoing review of a national innovation approach.  We are also happy to provide any further information or examples in relation to this submission, should they be required.  

Western Development Commission 
September 2009

If there are any queries in relation to this submission, please contact 

Ian Brannigan
Western Development Commission
Dillon House
Ballaghaderreen
Co. Roscommon
Phone: 094 986 1441
(www.ianbrannigan@wdc.ie)