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Saturday October 29, 2011

Innovation nation: What exactly works?

At Your Service by DATUK MADINAH MOHAMMAD
There are some roadblocks that need to be overcome to create a successful Malaysia.
MALAYSIA is now confronted with many challenges which can derail its development aspirations as articulated in
the New Economic Model.
There are risks and there are opportunities. We need to mitigate the risks and capture the opportunities. Climate
change, for example, can be a threat but the concern over climate change also offers opportunities in the green
business.
However, we need the right strategies. Innovation is the potent instrument that the country needs. How does the
country embrace and make innovation work?
Innovation is about generating new ideas which deliver values. These can be economic, societal or environmental.
Contrary to popular belief, innovation is not just about science and technology (S&T). Innovation transcends all
aspects of life but many agree S&T is a key tool of innovation.
Countries which invest heavily in S&T have achieved the most successes in innovation. This explains why the
Science, Technology and Innovation Ministry (Mosti) has always been committed to championing the innovation
agenda.
Since its early days, Mosti has introduced many initiatives to drive innovation. Many funding mechanisms have been
created.
Many institutions under Mosti including the Malaysian Technology Development Corporation, Technology Park
Malaysia, Academy of Sciences Malaysia, Sirim and MDEC have made an indelible mark on the countrys innovation
agenda.
However, implementing the initiatives continues to be challenging. There are still major roadblocks that need to be
overcome.
Removing such obstacles has become the strategic focus for Mosti. This urgency is felt even more with recent
initiatives such as the Economic Transformation Plan (ETP) involving 12 National Key Economic Areas (NKEAs).
The NKEAs will propel the nation into the high-income category.
At Mosti, the planning and execution goes beyond NKEAs.
Mosti has crafted strategic plans based on the innovation experience of past years. What works in the past has been
retained and new initiatives formulated to forge ahead.
Funding the right R&D is undoubtedly one major obstacle. Over the years, billions of ringgit have been invested by
the Government. Though small compared to developed nations, it is still quite substantial. Developed economies
spend about 3% of GDP on R&D, while ours linger below 1%.

R&D does not come cheap. The risks are high. The outcome can be uncertain. Often, only a small percentage makes
it to the market.
On the other hand, any R&D breakthrough that reaches the marketplace would more than make up for the losses.
R&D commercialisation remains a major challenge. It has been littered with stories of failed projects ending up in the
proverbial Valley of Death. Others remain locked up in publications. How can these be released?
R&D is an expensive investment. But returns can be high. Over the years, Mosti has introduced various mechanisms
to realise the returns.
However, there has been mixed success. Weaknesses still exist on both the supply and demand sides of the R&D
value chain. It is clear scientists have to propose the right R&D ideas. Entrepreneurs will have to embrace the
innovation where R&D is viewed as strategic investments.
Undoubtedly, many factors contribute to the challenges in R&D commercialisation. These are being actively
addressed at Mosti.
Mosti plans to strengthen the ideation process through judicious investment in technology and patent tracking
databases. The evaluation and monitoring mechanisms also are being strengthened. This will ensure funding of the
right R&D.
On the demand side, venture capital funding is lacking for early stage commercialisation. Venture capitalists blame it
on the lack of good deal flows. There is also still a dearth of entrepreneurs who are R&D literate. Many see R&D as
costs rather than investments.
Mosti is introducing instruments to motivate R&D. Mechanisms to efficiently link researchers and entrepreneurs are
being fine-tuned for implementation.
Talent is another major determinant of success. The declining interest in science is a major concern. Unless
addressed soon, the target to reach the critical mass of scientists will not be met.
The nation needs at least 50 research scientists and engineers (RSEs) per 10,000 working population. The country
has been stagnating at about 29 RSEs per 10,000 workforces.
Developed economies which boast high innovation have more than 100. We need to attract and retain more talents in
S&T.
We need to introduce new incentives to attract the countrys best minds. We need to reintroduce the inquiry based
science education (IBSE) in schools.
In countries such as France and China, the IBSE has been a major success. Recent announcements to review
Malaysias education framework should address such needs.
Mostis recent initiative to institutionalise the National Science and Research Council across the board should provide
solutions to clear the supply side roadblocks.
For Malaysia to become a truly innovative nation, the demand side roadblocks will also have to be dismantled.
We have to promote a culture of innovation throughout society. This is where Mostis recent initiatives to stimulate
grassroot innovation are extremely relevant.

In fact, innovators at the grassroots demonstrate a natural passion to move their invention to the marketplace. This is
because grassroots innovators are basically innovative entrepreneurs. With the new initiatives, we can look forward
to more innovation really working for the nation.
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