Limited support for late-stage development is the weak link in the UK innovation system

Written by: Eureka! | Published:
Professor Dame Ann Dowling, president of the Royal Academy of Engineering

Senior business decision makers have told the Royal Academy of Engineering that they need more support to take the final step in translating ideas into business success and economic growth. Research published by the Academy found that a lack of support in the final development and demonstration stage of innovation is holding back the potential of an otherwise strong innovation system in the UK, compared to other countries such as the US and Germany.

Late-stage development and demonstration is technically challenging and risky but crucial for bringing new products and services to market. At this stage companies demonstrate their technology to potential customers, and test them in purpose-built facilities or real-world situations increasing the probability of successful transition to the marketplace. The Royal Academy of Engineering’s research found that more support for this stage of development in the UK would encourage further investment in R&D in this country, develop local markets for new technologies and help the UK to become a leader in emerging technologies and sectors.

The government’s Industrial Strategy sets the UK a target of investing 2.4% of GDP in R&D by 2027, with a longer-term goal of 3%, to increase innovation and productivity in the UK. This target cannot be reached without stimulating more business investment in R&D, through this research the Academy has identified the factors that are influencing decision making on R&D investment into the UK in today’s boardrooms.

Professor Dame Ann Dowling, president of the Royal Academy of Engineering, said: “The UK undoubtedly has many attributes that already attract engineering businesses to locate their high quality early-stage R&D activities here, not least our world class academic research base and its excellent collaboration with industry. Unfortunately, this is undermined by gaps in the R&D and innovation system at a highly risky and expensive time in the development cycle. Plugging these gaps would help innovative engineering businesses, boost productivity, and create better jobs and social outcomes in the UK.”

Chief technology officers, chief executives and chief engineers from some of the UK’s leading large and small companies took part in the research, which highlights many advantages of locating R&D in the UK, including the UK’s highly-skilled engineering workforce, support mechanisms for early-stage R&D, and a healthy culture of collaboration with universities and between businesses. It also identified other areas for improvement including:

  • Driving R&D and innovation in engineering services
  • Transforming the unrealised potential of the UK’s public procurement spend to drive innovation
  • Breaking sectoral boundaries to accelerate game changing innovation across sectors
  • A more joined-up, coherent approach to R&D and innovation support across all government bodies

This report is available on the Academy website as a series of short explainers on the strengths and weaknesses identified through the research. It builds on ‘Engineering an economy that works for all’, a 2017 report from the engineering community in response to the government’s Industrial Strategy green paper.

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