Northwest rises to the challenge

July 9, 1999

A group of universities is leading the drive to be at the centre of wealth creation. Kam Patel reports.

The government's push to make universities more entrepreneurial should be allied to a drastically improved system for recognising and rewarding work that leads to the application of knowledge in the market, says Michael Harloe, vice-chancellor of Salford University.

He says current mechanisms, such as the research assessment exercise, drive departments towards fundamental research and away from applied work. He also claimed at a conference on business incubation last week that the anomaly was a key reason for the "lacklustre" performance of most university technology transfer organisations and of government schemes aimed at boosting university-industry links.

"Even collaborative research close to industry needs is not valued as highly as pure research defined as being done for its own sake," he said. Professor Harloe does not question the value of fundamental work: "It contains the seeds of tomorrow's new technologies. To interrupt the flow of new science and new scientists for the sake of short-term market-driven gain would be counterproductive."

But he warns that pressures on universities to enter the wealth-creating arena are mounting as the importance of knowledge as the raw material for advanced industry becomes more widely appreciated, not least by the government. Institutions are beginning to respond, he said, particularly those with strong records of working with firms and a deep understanding of the difference between fundamental and applied research.

There are various strategies to encourage university-industry collaborations, but Professor Harloe said those that throw academic researchers and their students into the arms of corporate bodies are "naive". "Such an approach not only fails to appreciate the importance of fundamental research, but also that the instincts of world-class fundamental researchers make them poor performers in the disciplined field of market-focused application and development - even at the forefront of technology. These responses also fail to recognise that the wealth-creating potential of the universities lies not with academic staff, but students."

Professor Harloe believes "fundamentally new" strategies are needed to meet the challenge of integrating universities into the wealth-creating process. These must not undermine the excellence of research in institutions or lose sight of the value of students.

The eight universities in the Northwest - Manchester, Central Lancashire, UMIST, Salford, Liverpool John Moores, Manchester Metropolitan, Liverpool and Lancaster - are already designing a customised, region-wide wealth- creation strategy that places universities at the heart of the process.

Professor Harloe said a key objective of the collaboration is to enable the institutions to be "places where people can learn and practise the skills of entrepreneurship at the forefront of knowledge, leading, if they wish, to the establishment of their own companies".

The aim is for every university in the region to have access to a business incubator and for every student to have been introduced to enterprise at undergraduate level. Postgraduates will be able to obtain the skills and knowledge to set up and run companies.

The scheme is under way, with a Pounds 15 million investment planned by the four Greater Manchester universities. They aim to expand their incubation capability and set up a centre where students can learn to be entrepreneurs.

Professor Harloe estimates that when the expanded incubator network is fully up and running (six years at most) it will have the capacity to produce 80 companies a year, generating additional economic activity of Pounds 200 million a year for the region. But he also conceded that the bold initiative was "fraught with difficulties".

Individual enterprise is not part of the scientific and engineering culture, so the incubators may not attract enough quality proposals to fill the places available. "The system in which professional scientists and engineers exist militates against it, so that as a community they are somewhat risk-averse and ignorant of the entrepreneurial process. Their professional institutions are dominated by members from large corporations and organisations, while their education is predominantly factual with little creativityI their employment prospects and aspirations reside mainly with large companies doing intensely technical work in a mechanistic order."

Scientists and engineers brave enough to break out of the system often have to contend with a hostile business environment: "Science-based enterprises in their early years are often shunned by the investment community, for being too risky in investment terms and too poor in terms of fee-earning potential," said Professor Harloe.

But he believes the experience among the universities in the Northwest will help overcome many of these problems. He is confident that the initiative will "become a major regional economic driver and an agency through which local and regional government will be able to operate to create indigenous industries owned and run locally."

The Times HigherJjuly 9J1999research 37 The longest-lasting metal hip joints are the most perfectly spherical.

THE STATE OF UK INCUBATION

Incubators unite business ideas, management skills and finance to select and nurture new firms. A recent survey by UKBI, a government-backed company that promotes incubation, found:

* There are 100 incubation projects in the UK, with an 80 per cent success rate in growing new companies

* 64 per cent of incubation projects use universities as one of their main sources of tenant companies. Large firms/research establishments are the next main source (56 per cent)

* It takes an average of just over Pounds 1 million to start an incubation project - 32 per cent were started with less than Pounds 500,000

* Nearly 7,000 jobs have been created by companies in UKincubation projects

* 60 per cent of incubation projects focus on supporting technology-based companies.

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