Enterprise Ireland’s new corporate strategy, launched earlier this week, has set a highly ambitious target of increasing the annual spend on research and development by Irish enterprise to €1.25 billion by 2020. It places innovation firmly at the top of the agenda and will see the agency introduce innovation supports to facilitate the development of new products and service platforms, provide assistance to clients to help them win more international research funding through the European Union’s €80 billion Horizon 2020 fund, and support increased knowledge, skills and intellectual property-sharing between Irish firms.
While innovation is of central important to the strategy, Enterprise Ireland research and innovation divisional manager Gearóid Mooney believes the term can almost be a distraction. “People can see innovation as a bit of a vague concept and ask what precisely is meant by it,” he says. “What we mean is the development of new products, processes or services. The evidence of the past 10 years is that companies who invest in those things do significantly better than those that don’t.”
Investing in innovation
The firms did better in terms of sales, exports and employment performance. “During the financial crisis those companies that continued investing in innovation weathered the storm and many of them actually grew despite the economic background,” says Mooney.
“Innovation is absolutely critical to success. Firms already exporting, for example, need to continue innovating or they are dead in the water. We did some work with the ESRI and it showed that a new product only maintains an advantage in the market for between one and three years before others catch up. If you want to sustain success you’ve got to continue to innovate existing products and services. And if you want to enter new markets you have to adapt products to meet their specific conditions and that requires innovation and change.”
While Enterprise Ireland has been supporting innovation for many years, Mooney points out that there is always room to improve. “We have a fairly good offer to clients but we wanted to see how it could be made even better in the new strategy. We spoke to some of our top-performing R&D clients and asked them how it could be improved and that has prompted a major redesign in the offer. We wanted to find out what good looks like in this regard. Finance is just part of it. We will be expanding our Innovation for Growth and Excel at Innovation training courses to help companies get the most out of their R&D efforts.”
Another area which the agency will focus on is the use of public procurement to stimulate innovation. “The US and the UK are ahead of this in this regard,” Mooney says. “In the US they have the Small Business Research Initiative, which has delivered some quite staggering results.”
The idea is for public bodies not just to put out tender notices for products or services but to ask companies to develop new solutions to problems not yet solved.
“An organisation like the Department of Health could put out a challenge which can’t be met by an off-the-shelf product,” Mooney says. “If an Irish firm comes up with a solution and it works they can then sell this to other health services around the world. That’s the beauty of a programme like this. Not only does it help companies develop a new product or service but it gives them a customer to prove that it works – that’s vitally important when trying to break into new markets.”
The Horizon 2020 programme has the potential to be a major source of funding for Irish R&D over the next few years. “We are now able to look back over a couple of cycles of funding under the programme and see what sort of projects receive support – that will help us in assisting Irish companies succeed in their funding applications,” says Mooney.
A particularly interesting element of this programme is the SME funding initiative, which, unlike other funding streams, provides support for individual SMEs without the requirement for collaboration with international partners.
“International partnerships can be complicated and difficult to arrange,” Mooney says. “This initiative is for SMEs with smart stuff to develop, disruptive products and services in particular. To date, 19 Irish companies have secured more than €1 million each under the initiative and we will be working to help more Irish companies to win funding.”
The strategy will also see Enterprise Ireland encourage collaborative projects. “Academics are really excellent at winning funding for collaborative projects and we want to utilise this as best we can,” Mooney says. “Knowledge Transfer Ireland is a joint venture between Enterprise Ireland and the Irish Universities Association to let companies know what’s going on in the universities so they can find research projects that might be of interest to them. It has been quite successful so far but it needs to be even more successful and that also will be a major focus under the new strategy.
“The number of companies collaborating with third-level institutions has skyrocketed in recent years and we will showcase these firms and their innovation capabilities in order to inspire even more innovation investment.”