Our mission is to make the UK a nation of innovation

Look back through history and you will see that we are a nation of inventors - the pocket calculator, the internet and the TV are all products invented by Britons.

It is this ability to invent that has secured our place at the forefront of the global economy for the past few hundred years. But this ability won't be enough to ensure we remain competitive through the next few hundred. To achieve that we are going to have to learn a whole new skill: innovation. Invention, innovation, what's the difference? The dictionary defines invention as the 'design or creation of something which has never been made before', and innovation as 'introducing new methods and ideas'.

In the context of our economic landscape - the knowledge economy - innovation has progressed to mean not just the introduction of new methods and ideas but, critically, the exploitation of them.

To compete against aggressive new economic entrants such as India and China, the UK must develop ways to exploit products and services, and, specifically, to become adept at innovatively exploiting technology for socio-economic gain.

Government has shown a commitment and willingness to forward the innovation agenda; indeed, it has placed innovation at the heart of the UK's future economic growth.

In December 2003, the government published Competing in the global economy: the innovation challenge, a document which set out government strategy to improve the UK's innovation performance. Its principal aim was to make the UK the leading major country in Europe in research and development (R&D) within a decade.

The report identified six areas of priority, each with a series of commitments:

* Encourage knowledge transfer between business and science, from business to business, and in collaboration with international partners

* Use government's enormous purchasing power to stimulate innovation from businesses

* Support high-level skills and high-performance workplaces

* Innovation as a key driver of economic development in the Regions

* Impact of the regulatory framework on the ability of business to innovate: use of intellectual property rights, standards and the design of regulations

* Support small businesses and entrepreneurship as key sources of innovation.

In July 2004, the government published its Science and Innovation Investment Framework 2004-2014, followed in November 2004 by the publication of the Department of Trade and Industry Five Year Programme.

The framework sets out the government's ambition for UK science and innovation over the next decade, particularly the contribution to economic growth and public services, and the attributes and funding arrangements of a research system capable of delivering this.

These are positive first steps, but there is still a long way to go. Government and industry must work together to overcome the barriers to establishing the UK as an environment conducive to innovation.

The Science and Innovation Investment Framework's aim to improve the amount of R&D invested in the UK only adds up if private sector, as well as public sector, investment increases. University research centres have not been given enough incentive by their funding frameworks to collaborate with industry.

The R&D tax credit system is not yet robust enough to maximise its impact. If the UK is truly committed to creating the best incentive system for R&D in the world, then the effective tax credit rate must be raised above the 'noise level'.

The effective rate for large companies is 3.75 per cent to five per cent. Anything short of 10 per cent fails to provide sufficient incentives to invest in R&D in the UK.

There are many short-term actions which can be taken to create a sustainable economy based on innovation and continuous growth. But the full benefits of such actions will only be realised when the underlying culture supports and promotes innovation.

We must recognise and harness our strengths and build on our own capabilities.

Intellect, representing the hi-tech industry, is determined to ensure that innovation is at the heart of the UK's future. It is committed to working with government, academia and other stakeholders to raise the UK's innovation success.

The Innovation Nation? project aims to take the debate to the next stage, to put innovation in the context of business, government and in the UK as the place we all live and work. Its recommendations will provide us with a roadmap for our innovation evolution.

John Higgins is director general of Intellect, the hi-tech trade association, Computing's partner in the Innovation Nation? Project

Are we an innovation nation? What the experts say

Julie Meyer, Chief executive, Ariadne Capital

I think the UK is strong in innovation. But I think it is hampered by what I perceive to be negativity. I do not think it is a lack of innovation; I think it is a lack of optimism.

Terry Hook, Skills development executive responsible for the IT industry at e-Skills UK

The area that is not being given sufficient attention, which will lead to us being more innovative, is leadership and management. Leaders and managers probably have not had the opportunity of understanding and being educated in the application of technology, and how that technology can drive their business more effectively.

Martin Ripley, Head of e-strategy, Qualifications and Curriculum Authority

Around education, and the politics around education, there is a view that innovation is in somebody else's back yard, not in ours. That needs to change, and change a lot further.

Carsten Sorensen, Senior lecturer in information systems, London School of Economics

Innovation is increasingly becoming experimentation. If there is a management culture where failure is punished, there is no incentive to experiment and no incentive to go out on a limb and fail. Innovation will only happen if there is a willingness to fail.

Antony Walker, Chief executive, Broadband Stakeholder Group

When we talk about innovation, we still look at it in terms of the old industrial model and the old industrial society. I think we are innovative, but we need to think differently about what innovation means in a knowledge economy.

See also:

Innovation Nation?

Computing and Intellect present a major campaign to examine the role of innovation in the UK economy.  13 Jun 2005

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