By Gillian Marcelle and Keston Perry
Part 1 - Reconceptualising innovation and the challenges of Caribbean development
Innovation as a vital source of private and social gains has been recognised the world over. Global policy debates, most recently at the OECD Global Forum on Development (GfD), have taken keen interest in the policy implications of innovation for inclusive development, addressing some fundamental questions. The myriad challenges facing small island states of the Caribbean make the strategic management of innovation an imperative and the consequences of under investment far-reaching.
Indeed, Trinidad and Tobago, like the rest of the region, needs to take science technology and innovation (STI) and its potential contribution to development seriously.
There is a firm foundation provided by the past efforts such as the Caribbean Technology Policy Studies (CTPS) programme, spearheaded by the late Norman Girvan in the 1970s and 80s at the University of the West Indies, with important industry-level analyses by the late Trevor Farrell. This important research programme had these issues as its central focus, long before many other parts of the developing world caught on. The insights derived have since been left in abeyance (or forgotten).
The CTPS programme was in fact a watershed in Caribbean research as it provided a thorough going deep analysis of the links between STI and the region’s developmental challenges. These studies also demonstrated how home-grown institutions and researchers could add value to forward-thinking policy initiatives. Since the 80s, however, the pace of technological change has been at break-neck speed, and the region appears not to have coped well, despite some efforts in ICTs and green technologies.
What is even more disconcerting is that the perception of Caribbean private sector firms as not being dynamic and able to seize opportunities, as well as upgrade capabilities has become even more entrenched. In this respect there are some bright spots in terms of public sector led initiatives and efforts to create specialist institutions concerned with innovation.
From this perspective, the Trinidad and Tobago government, at least in principle has outlined policy efforts aimed at enhancing the country’s institutional capacity and infrastructure for innovation. There has however been a great deal of emphasis on the inadequacy of national levels of expenditure on formal research and development (R&D).
These concerns are by no means unique to the Caribbean. Most developing nations struggle to achieve levels of expenditure equivalent to 1% of GDP, and with the current debt situation in many Caribbean countries this is not likely to improve. However, what the policy makers in the global South should take comfort from is that it's the non-technological aspects of the STI ecosystem that may prove far more important for innovation outcomes.
R&D expenditures matter, but there are a number of other worthwhile investments, such as search and scan capabilities that may prove more important. The conventional treatment of laboratory based R&D as the holy grail is no longer de rigueur. It is now common cause, even in wealthy countries, that science based activity that produces breakthrough or radical technologies are only a small proportion of innovation activity.
This is even starker in the developing world where our lived realities are of informality, frugality and survival. Investigations of these conditions are prompting some of the most interesting work in innovation, not based on models of laboratory centric science and technology.
In the Caribbean, we need a holistic understanding of innovation and the conditions which give rise to its success. Viewing innovation as an investment activity that requires the judicious selection of modes by various actors gets away from the fear explicitly addressed by stakeholders that we are not in good stead to achieve much. In fact, there is little real basis for fear of private sector crowding out the public sector, particularly if state enterprises are taken into account, where they function as alternatives to private sector provision, or in separate domains altogether.
Innovation as a long-term investment activity
We suggest that the Caribbean region needs to begin by reframing innovation along the following lines. Innovation is an investment activity that produces returns over the medium to long term. The inputs and activities that are likely to enhance innovation outcomes include equipment, as well as skilled, confident, human beings who are not risk averse and work in settings (both public and private) that encourage and support experimentation and learning, even from mistakes.
There is an open exchange and sharing of knowledge including across geographic and national boundaries and organisations and individuals are able to define and discern their interests. Innovation can also be made more effective when there is a cadre of competent scientists, engineers and technologists who engage in activities that generate new knowledge or solve existing problems, including those related to functionality and affordability.
There are business cycles and technology patterns at play and these influence how well enterprises and societies respond to and create opportunities. High levels of innovation can be transcendent leading over time to societies redefining their sense of themselves and increasing communal and individual self-esteem.
Innovation also requires the mobilisation and allocation of financial capital. Mechanisms that finance innovation should be targeted yet flexible.
Public sector funding of innovation ought to emphasise well-designed funding initiatives that place emphasis not only on increasing access to financial capital, but also on cultivating risk-taking entrepreneurs and are best directed at strategic initiatives. Authorities can identify sources of investment within existing fiscal priorities or create new ones, which do not necessarily place greater burden on the taxation system.
For private sector investors, the balancing of risks and rewards will moderate behaviour, and this will change over technology and industry cycles. Innovation hotbeds thus require aligned financial systems, mindsets and organisational cultures.
Scholarly work in the field of innovation studies, as well as by international development agencies, including UNCTAD, suggest that in developing countries, investment in human capacity, firm-level competence building and efforts to make innovation attuned to the practical realities, can auger quite well for improving the chances at innovation success. All of the other inputs and activities such as attitudinal change are equally important.
From the foregoing, we strongly urge the region to scale up its investment in innovation- enhancing input; these include but are not limited to science and technology related capabilities. Moreover, the region needs to rethink the nature of innovation capabilities and enhance both the policy and strategic understanding of how innovation outcomes are realised over time.
There is broad agreement that the Caribbean requires high-quality capabilities in sufficient quantity and does not currently possess them. However, there is an absence of a compelling narrative providing guidance for corporate strategy and public policies. We need a story that describes how innovation can align with the regions structural realities and pressing needs.
The illustrations taken from the experiences of other countries small (such as Slovenia) and large (Brazil and Indonesia) can go a long way but will not substitute for a well-grounded research and policy experimentation programme on the scale of CTPS, thirty years later. In the next part of this article, we outline such a programme.
A version of this article appeared in Trinidad Business Guardian and Sunday Business digital editions on July 24, 2014
Gillian Marcelle, Trinidad-born Associate Professor of Strategy and Innovation at Wits University and Visiting Research Scholar at MIT Energy Initiative, Tata Center for Technology and Design has over 20 years experience and training in innovation management, policy and advocacy gained in the US, Europe, the Caribbean and Africa. She is currently based in Cambridge, MA - Gillianm@mit.edu
Keston Perry, Trinidad-born doctoral researcher at SOAS, University of London, is investigating the institutional dynamics of science technology and innovation policy for economic development in small economies, such as in the Caribbean. – firstname.lastname@example.org