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Executive Voices for April 2005

The Innovation That Every Business Seeks

By Barry Eveland

This spring IBM celebrates its 40th anniversary in Research Triangle Park.  My company’s long-time success here, and that of many other companies in the park, underscores the foresight of RTP’s founders.

They knew innovation would be a key to the state’s economic future, and clearly understood that it would require a concerted effort, focus and regional cooperation among the public and private sectors and academia.

This is as true today as it was 40 years ago, perhaps more important than ever.

Unfortunately, the confluence of the information economy and globalization has created an environment of uncertainty for businesses around the world.

Companies everywhere are searching for a path through this maze of uncertainty — about what will spur job growth, how to maximize return on investment, and which business processes to implement.

And yet, often the answer can be found in one word: “innovation.”

Innovation is the intersection of invention and business insight. It creates new industries and national and global markets, spurs productivity and economic growth, generates high-value, higher-paying jobs.  It raises the standard of living for everyone.

On the other hand, America’s generations-old worldwide leadership in innovation and technology is now under attack.

We at IBM are extremely proud that IBM leads the world for the 12th straight year in the number of patents awarded.  Of the company’s total of 3,248 patents, about ten percent (355) came from IBMers who work in North Carolina, mainly in the Triangle area.

Yet, a sobering statistic is that a mere four U.S. companies are among the top ten in patent awards.

With America’s loss of worldwide technology leadership at stake,  leaders from many disciplines have joined a National Innovation Initiative (NII), co-chaired by IBM CEO Sam Palmisano and Georgia Institute of Technology President Wayne Clough.  The group’s mission is to identify and implement new policies and programs that will ensure a rich, fertile environment for future innovation.

The effort won’t come easy, but it certainly is critical — and timely. One recent study projects that 91 million new jobs will be created worldwide over the next decade.  The most pressing question is: Where?  Europe?  The U.S.?  China and India?  Elsewhere?  What does this mean for North Carolina. . . . And RTP?

Jobs will emerge in those regions that create a fertile environment for innovation. But what will be the determining factors?

Skills:  Businesses must invest in training the workforce in new, cross-disciplinary skills, and  universities will need to modify curricula to ensure a steady pipeline of talent versed in emerging disciplines.

IBM is heartened by a new, closer partnership we’ve forged with Duke University, UNC-Chapel Hill, N.C. State University and N.C. A&T. Through this pragmatic relationship called the IBM Academic Initiative, IBM and these schools are working together to create new programs to better prepare students for technical jobs in the real world.  It is vital for our state and nation that every member of the business community becomes involved in a closer linkage with our schools.  At all levels.

Investment:  Innovation — and the entrepreneurial spirit behind it — needs financing, proper incentives, and a willingness to support calculated risks. While businesses need to invest, government must play a key role by publicly funding research, setting appropriate intellectual-property rules, and establishing financial regulations and tax policies that encourage innovation and infrastructure investment. This last element is especially important for attracting and retaining the best and brightest to a new nanotech lab or biogenetics facility, and encouraging them to live and work here in North Carolina.

Openness:  Although global economy firms must compete on the basis of innovation, this competition may often turn, paradoxically, on how well an organization embraces openness and collaborates across industries.  Business leaders must master the art of “coopetition” with their corporate rivals — simultaneously cooperating and competing to innovate and thrive.

That’s why IBM recently announced that it is opening up to the technical community some 500 patents.  The Information Era in which we find ourselves requires more of a balance between proprietary innovation (for income and competitive advantage) and collaborative innovation (for interoperability, open standards and public benefit).

This new focus on collaborative innovation holds the greatest potential to spark economic growth for our country and this region.

Economic development issues are being addressed locally through initiatives such as the Research Triangle Regional Partnership’s “Clusters of Innovation” work.  It is a fine example of concerted economic development effort at the regional level, supported strongly by government, education, community, and business leaders.

Much more needs to be done to ensure that innovation can flourish statewide. North Carolina would benefit from a state equivalent of the National Innovation Initiative to help ensure that our fair share of jobs and economic growth comes to this region, and the state.

Together, all of us can make an impact that will last for many generations to come. The future begins tomorrow.




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Last Modified: April 19, 2005
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