Saturday, April 24, 2010

Structural Shifts in Innovation ecosystems.

The Economist recently ran a series of articles on Innovation in Emerging Markets - a topic I am obviously passionate about. Its special report on innovation in emerging markets was titled the world turned upside down . "The emerging world, long a source of cheap labour, now rivals the rich countries for business innovation" said the Economist.

In India's Innovation Blueprint, I introduce a new term Innovation geo-dynamics to denote how globalisation, demographics and geo-political factors create structural shifts in the global innovation ecosystem.

US domination in global innovation is waning due to 1) the financial crisis where the private sector, that contributes to more than 75 % of R&D spending, cut back spending, 2) systemic drop in R&D spending over the years.  and 3) low enrollment in science and maths education.The Result: For the first time in 2009, the net number of utility patents granted by US PTO to countries, firms, and institutions operating from outside the US has outweighed patents granted to US companies and R&D institutions. Innovation by and large is gaining an Asian face with China, India, Singapore, Malaysia and Korea . China, India and Malaysia are annually being granted utility patents much faster than any other country in the world.

This shift in Innovation activity in Asia coupled with the economic activity of the two of the world’s largest economies – India and China - is creating permanent ecosystem changes for Innovation globally. For example, India could have a larger say in International intellectual property rights, standards and commercialization of IP. These trends constitute a critical external imperative largely ignored today. It is a case of the innovation ecosystem moving geographies - institutions of funding (venture capital funds, angel investors etc), institutions of research & development, institutions of higher learning, and private industry - cross borders to locations where talent is available and innovations are predominantly happening. That's geo dynamics of innovation. In other words, the ecosystems of innovation cross borders towards the geographical locus of innovation innovation activity and vice versa.
If you enjoyed reading this, consider buying India's Innovation Blueprint

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