This section tackles the third key question put forward in the call for evidence, responding to the question: how is research and innovation diffused or supported to drive productivity and growth in the regions, wherever it may come from?
Governmental policy can set incentives & ease regulations, but new wealth is usually generated by the unique & innovative initiatives found across the country before they ever find their way into the national statistics. The RDS have identified that one of the toughest challenges faced by SMEs lies at Chasm II. However, most existing metrics fail to evaluate effectively the success or failure at responding to this challenge. The 12 vectors and an understanding of the expected customer numbers for a venture at its current commercialisation readiness level (CRL) can serve to provide a far more granular and reliable understanding of where it lies in its commercialisation journey and its relevant strengths and weaknesses. This understanding can help businesses allocate resources more effectively by comparing their data with the expected values of other firms in their sector.
The network of UK Catapults was founded with a clear mission on a well-founded base of evidence, to support the translation between concept and commercialisation of new innovations and is considered by the government to be key support infrastructure for innovation in the UK. However, since the programme’s inception their performance has varied across market sectors and regions. Notable successes include the Catapults for Cell & Gene Therapy, High Value Manufacturing, Connected Places and Medicines Discovery. This success can be explained by their commitment to supporting firms beyond Chasm I. However, all continue to face challenges in developing sustainable business models and effectively tackling Chasm II. To solve this, catapults must stop mimicking and extending the support provided by earlier maturity interventions and focus themselves directly on providing support around CRLs 6 – 9. A catapult ecosystem that effectively meets this challenge will look somewhat different. The ecosystem will need to become more streamlined, perhaps reducing the total number of Catapults from nine down to around 6, allowing them to draw in larger volumes of patient capital to support more mature firms. Their interventions must have a stronger market space focus with the capability to effectively map out value chains and provide input on how firms can pivot their business models when they fail to find traction. Finally, these interventions must fully integrate all 12 Vectors, avoiding a tech-centric outlook.
While broader interventions can benefit UK commercial ventures their understanding of technology could also be improved from a more nuanced approach. Recent years have seen the rise of several new emergent markets resulting from products, combining technologies from vastly different disciplines. The use of machine learning and RNA-sequencing to identify biomarkers in the lifesciences industry, as well as the combination of automation with new battery technologies in the EV industry, have both resulted in major changes to value chains. The Triple Chasm Company’s new technology taxonomy may serve as a guide for understanding these interactions. Most tech-enabled SMEs develop their products around hybrid-technologies, however universities and other major institutions like the UKRI are built on traditional market segmentations incorporating pervasive & focused technologies. The result of this is siloing between the departments, creating challenges when engaging with new ventures intending to develop hybrid technologies. These institutions should reduce the barriers between departments to increase cross department collaboration and better support engagement with new businesses.