Alison Wolf column

April 9, 2004

As the regions hone their business strategies for global domination, the needs of small, local firms are being overlooked.

I wish someone could find me some quangos that have disappeared. Not ones that have been renamed, merged into super-quangos or swallowed back into government departments, but quangos that were closed down because their job was finished or they weren't worth the money.

This would cheer me up enormously, because I can see us creating, for excellent reasons, a whole new set of the things. In his review of business-university collaboration for the chancellor, Richard Lambert recommends a new stream of "business-relevant research funding" to support university departments that can demonstrate strong support from business. He also suggests allocating this money to the regional development agencies and their equivalents in Scotland, Wales and Northern Ireland. They could prioritise applications by considering the "likely economic impact of the research and the fit with their regional economic strategies".

Ever since the report was published, a "Not Through The RDAs" movement has been gathering steam. I have a lot of sympathy. My own experience with RDAs has been dismal (with one shining exception). My research is on training and skills, and I work directly with companies. When I have asked RDAs for contacts, let alone details on which companies are involved in particular activities, I've received (with that one exception) either nothing at all or just a pile of glossy brochures. Moreover, looking at the RDAs' economic strategies is an exercise in monotony. Everyone wants to be a "world-class region", to be "leading edge" and to foster creativity, innovation, enterprise and risk-taking. They also all want to be part of the global knowledge economy, which means, in practice, that they have all set their hearts on nurturing financial services, biotechnology and telecommunications.

I would probably be the same. It is far more glamorous and interesting to wine and dine people who can tell you about third-generation mobile phones or possible cures for cancer than to talk about ready-made desserts for supermarkets or ways to improve bus punctuality. But it is also unrealistic to have everyone chasing the same few industries. It is worth remembering that even in "knowledge economy" regions, the fastest-growing job categories are in care and personal services, and that huge numbers of employers are small and medium-sized firms well inside any sort of technological envelope. What they need is not new leading-edge research contracts with universities. Transfer of well-established, bedded-in knowledge would be more useful.

Here, unfortunately, we run straight into conflicting interests. Lambert is absolutely right to feel that universities have too little incentive to engage with business. But where incentives are really lacking is for small-scale activities involving local firms, where there is no immediate research or publication pay-off. With the next research assessment exercise looming, and individual careers built on research, knowledge transfer of this sort comes very low on the list.

Giving funds to RDAs seems all too likely to compound the problem. RDAs are typical of governmental organisations in that they love the glamorous and new and so will probably channel funds into exactly the sort of technological whizz-bangery that also appeals to university departments.

Moreover, artificial regional boundaries make no sense in this context.

RDAs will presumably give money only to universities in their region. This will mean Christmas every day at Wolverhampton University and screams from London. Attractive as these scenarios may be to many people, they are hardly what British business needs. Moreover, suppose your local university is over the imaginary regional border, in the East rather than the West Midlands. Should your deep regional loyalties make you happy to accept that it can't help you?

Unease over RDAs' capacities means that working through science and industry councils is now being proposed instead, involving businessmen who are used to investing in research. This will probably work very well in the couple of regions that have a regional identity and committed able people available. Unfortunately, it is also a recipe for rolling out yet another set of organisations, most of which probably will not work well at all. I also can't see how this will help smaller companies, since the experience required is quintessentially large-company based.

Something that works in some places is better than something that works in none. But this also seems a good moment to borrow Japanese manufacturing practice. Could we brainstorm any potential problems before starting production, please?

Alison Wolf is professor of management at King's College London.

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