Research and Enterprise

“Enterprise.” Merriam-Webster, n.d. Web. 22 Sept. 2015. <;
en·ter·prise ˈen(t)ərˌprīz/
a project or undertaking that is especially difficult, complicated, or risky
readiness to engage in daring or difficult action :  initiative <showed great enterprise in dealing with the crisis>
a :  a unit of economic organization or activity; especially :  a business organization
b :  a systematic purposeful activity <agriculture is the main economic enterprise among these people>

I often begin a blog post with a “true confession” type of statement.  Usually, I’ve read an article that made me think, sometimes the article is another blog (I only read a couple of blogs regularly, and I do so because they are the ones that make me think most!).  I’m normally content to allow others to express insights and thoughtful commentary on a particular topic, and save myself the time and trouble of posting anything at all. However, I’ve found that reading another person’s blog is more often the “inspiration” for a posting of my own, and then I hesitate to post my own blog. I don’t really want to be derivative, thus, I post less often. So, I’ve managed to begin a blog, and then pretty much drop it for months.

Yet I find myself coming back, mostly because I feel there are still a lot of topics where there is an ongoing struggle to come to terms with some decision-making, especially related to academic research, intellectual property protection, etc.  In the past weeks, I’ve done a bit of cursory reading on several topics that are part of some student team projects I help manage, under the umbrella programmatic theme of “Innovation to Enterprise.” The teams are each assigned a project from a faculty research group, and they are asked to explore the commercial potential of these projects. Most of the students are entirely new to the concept of “technology transfer” and have no clear understanding of new ventures or entrepreneurial activity. The students find it challenging to begin their projects, and they are frustrated when they realize that, more often than not, the results of the research are so tentative or nebulous that they can’t draw proper conclusions.

I once dealt with a company who expressed a similar frustration. They were working with researchers under an agreement that provided them with rights to review certain “Invention Disclosures” and gave them a set time for making a “decision” on whether (or not) they wish to license the “intellectual property” associated with the disclosure. At one point, I dutifully called for their response on a particular disclosure, as I was expected to make a recommendation for next steps based on their decision.

The CEO was a bit shrill when he replied, more or less, that there “isn’t enough information” to decide.

His response wasn’t unreasonable on the face of the matter–the disclosure probably DID NOT include enough information to make a “decision.” On the other hand, I was accustomed to making similar decisions with much less information. Perhaps  I was less than sympathetic in this instance, since some company contracts lawyer had inserted these decision deadlines as a way to keep both the tech transfer office and the academic researcher on some kind of “leash” as it were. There were too many points at which the research path and the commercialization strategy diverged. The company wanted a nice comfortable “oversight” role in the research without being directly involved, at least until they could make THEIR decision.

The scientists were too busy making their own decisions–about publications, conference presentations, grant proposals–to bother with the “tech transfer stuff” as part of the mix. To complete the muddle, the structure of the tech transfer office, and the IP policy, greatly restricted the ability of the researchers to make their own decisions on that aspect of their projects. They didn’t spend much time thinking about intellectual property since it was explicitly not considered part of their “job” in any practical sense. So for the scientists, lobbing off a few half-baked invention disclosures might be their entire contribution to fulfilling the contractual obligations involved. Some researchers might unilaterally decide that commercialization isn’t a serious option, or at least not one they wish to pursue. Thus, they will go about their work without making an effort to consider intellectual property except within the context of research and publishing–plagiarism, that sort of thing.

It is, ultimately, the decision of the researchers to start the commercialization process. Even without the terribly drafted contract and commercial “partner” I wouldn’t have expected the research group to be super diligent about getting a properly drafted invention disclosure into my hands. When a researcher does make a decision to pursue commercialization, the existing academic infrastructure does not support that direction. How could you possibly justify putting time and effort into that doesn’t earn you the “rewards” of academia? Not always the case granted, as some researchers do manage to come to terms with the awkward system, and are interested and/or motivated to move forward with commercial development. Fortunately for my student teams, the projects they are working on fall into that latter category. Unfortunately, it doesn’t make the process any less opaque.

It’s like sporting event where all the researchers are players  who start by playing one game, and at some mysterious signal, shift to playing another game with different rules. More confusing, a whole new set of players arrives, in the form of the technology transfer office, the patent attorneys, sometimes even corporate partners and investors. So the challenge is finding a way to make decisions that are consistent within the context of the situation, recognizing that many of the parties are still learning how to play a game with some obscure rules.

The researchers may be quite willing to work with a tech transfer office, or anyone frankly, who is willing to step in to make decisions necessary for the business development effort. That doesn’t mean they have made enough effort to understand the process so that  their own work is directed toward that end. In general, academic research isn’t directed toward the same ends as business development, and even if it were, business development isn’t that easy either. If it were, everyone would step up and start their own company, develop wonderful products and reap the rewards. It’s obvious that even the most motivated entrepreneurs can enter the market with a new product to be met with indifference on the part of their desired customers.

My goal, as it has been since I took my first job in “technology transfer” 20 years ago, is to make sure that the decisions made by the people involved are the best ones they can make, with the information available at any point. This may result in decisions that aren’t consistent with certain institutional metrics for commercial enterprise–numbers of disclosures, stories of successful startup ventures–but hopefully those decisions are ones that best serve the goals of the research enterprise, which is, in the end, the goose that is supposedly laying golden eggs. (But I begin to mix my metaphors, or something like that, so will close for now).


Is Stanford still a university? | LinkedIn

Is Stanford still a university? | LinkedIn.

The End of Stanford?

Both of these short “editorial” pieces ask an interesting and somewhat philosophical question about the role of the university in student “entrepreneurship.” The linked articles (by Nicholas Thompson, editor at Newyorker. com and Stanford alum) question some of the more “intense” levels of involvement that many universities are embracing, with schools like Stanford as our role models. Now, I’ve always tried to resist using “what Stanford does” as a yardstick–I even included a nice little slide in one of my presentations, showing little lemmings jumping off a cliff with a cartoon balloon from one shouting as it fell “…well, Stanford does it!” But the urge to follow their lead is almost irresistible.

At its heart, this is nothing more than a bit of “peer pressure” since every university is looking to establish a reputation–presumably a “good one” too–showing how their own activity reflects the “best” new practices. In some cases, it may be near impossible to replicate these practices (we’re no Silicon Valley) so at least that provides some protection from following all the yellow brick roads “we” see. It’s easy though, to wish your own institutions of higher education could collect all the accolades that a school like Stanford receives.

After some reflection, I realized that the piece reminds me a bit of the book I’m reading” (audiobook format as usual these days, so “listening to” is more precise) “Antifragile” by Nassim Nicholas Taleb (click here for his website and here for the Amazon link to the book–note I am not an Amazon affiliate, just being helpful). Now, that is a bit of a leap, but I tend to think that way, so it’s not surprising if you know me very well at all!

In the book, which I confess to not having finished as yet, Nassim Taleb refers to a phenomenon he calls “lecturing birds on how to fly” and makes some very disparaging references to Havard Business school faculty (not Stanford faculty, but I’m betting he would do so if he wasn’t more centered on the east coast). In many ways, his argument is also along the lines of a  sort of “chicken and egg” situation (even though chickens don’t fly).  As I see it, a school like Stanford provides a lot of opportunities that “attract” very entrepreneurial students, very smart ones at that, and then the “university” manages to get those little entrepreneurial birds to fly. Many other universities then follow Stanford’s lead on how to teach their own students the Stanford way of entrepreneurship, since it has such great success.

If you look at it that way, it seems that some of the things critiqued may be simply circumstantial, and Stanford isn’t really “doing” anything except meeting some expectations of the students already there.  Is this “harmful” to Stanford in some way, as Mr. Thompson is pointing out?  Perhaps, but it may be more true to say that Stanford is being given credit for ‘causal’ influence that isn’t there. In some cases, maybe there is also a negative impact on students (or more precisely, on their education). Certainly, I think it’s a good idea to ask the questions…but is someone going to try to find an answer?  Regardless, it serves as one more example for me to use when people try to propose the next “me too” model for my own programs or projects.

This is hard to resist–who among us doesn’t feel the need for validation that takes the form “well, I found out that X is doing things this way”? As happened regularly, I was once contacted by a colleague at another university (no names), who was engaged in a contract negotiation with a company.  The company had cited my own university as an example of a peer who had “agreed to these terms” so she called me to confirm.  One of the reasons she did so was that the terms seemed to be “less desirable” and she seemed to suspect the company was not telling the entire truth. Now, at this point, I didn’t want to get into exactly what my organization had (or had not) agreed to, since there were too many complicating issues to explain.  But I did give her one piece of advice that seemed to help.  I told her, “Just go back with–even if “University X” agreed to those terms, that’s not a good reason for us to agree.”   As I explained, there might BE good reasons for her to accept those terms, but the company needed to work through those specific reasons with her–not just “by reference” insist that since another university agreed, it was OK.

Otherwise, I am continuing to “read” the Taleb book, and I hope that there are some more interesting issues raised.  As I understand, Nassim Taleb is nothing if not interesting, and I’m looking forward to learning more about some of his insights on innovation.

Free Agency Angst

First thing, I’ve meant to be more consistent with posting, but got caught up in launching a small “idea pitch” competition for students.  It was a good experience, and fun was had by all of course, but I didn’t see daylight for the past couple of months.  However, as my schedule has returned to normal in the past week, I noted increased discussion in technology transfer circles on the subject of “free agency” and the rise of a more concerted “just say no” campaign. Ordinarily, I would steer clear of the subject—for me, it falls into the cateogry of a subject better left alone if there isn’t a good chance to have a calm and reasoned discussion. On the other hand, I’m not ever clear that the subject truly is “free agency” (whatever most people mean by that) or if it gets back to the “Stanford v Roche” questions on ownership of inventions made by university researchers. The two are, of course, linked.  But ownership of intellectual property should be a question that can be answered factually.

I won’t make any attempt to revisit Bayh-Dole legislation, or the Stanford v Roche decision, and interpret those in any way–Gerald Barnett  is doing this with much more rigor than I would be willing to devote to the effort.  I would just say the answer is along the lines of “in a particular case, figure out who owns the intellectual property.”  The owner of the intellectual property—whether by right of inventorship, by contract or voluntary assignment, or by any other means of acquiring ownership which you might imagine—is entitled to make decisions on how to manage the rights. Free agency is actually the default option when the inventor(s) own(s) intellectual property.  But so what?

In the end, you simply have to ask, what are the real goals of university technology transfer?  Intellectual property protection is really meant to help market investment, to develop innovations more quickly and efficiently.  The party who makes the product/market development investment does so with some assurance that an enforceable patent will allow for at least a moderate period of uncontested market share—at least in theory. Since universities generally cannot take products directly into the market, and since an inventor rarely has the experience or resources to do so, licensing of patents is the default mechanism for inventions originating from university research. In my experience, the primary reason that faculty researchers are interested in technology transfer is to see that their knowledge is transformed into a real world solution to a problem.  They choose to work with any licensing agent (whether internal or external) only if it seems there will be more benefit than bother associated with the activity–that is, when they feel strongly about getting a product developed and on the market.   This may. or may not, include an expectation of significant financial rewards as well.

I’m very supportive of the licensing staff at most universities; after all, that is the role I’ve served for over sixteen years.  I know all about the constraints and obstacles facing technology transfer efforts. I understand that a lot of the so-called “failure” there is rooted in circumstances that can’t easily be addressed (such as lack of funds to staff the office, or for prosecution of patents). Thus, it isn’t obvious that free agency will solve specific issues and problems with commercialization of university inventions, anymore than salads at fast food places solve the so-called epidemic of obesity.  However, as much as we might hate to admit it, there are too many problems with management of intellectual property in a university setting to ignore. There may be lots of arguments against current proposals for so-called “free agency” but I find it difficult to oppose considering the model, at least in some form.

Even  if free agency is an option, faculty would need to be motivated by other considerations to take advantage of their “freedom.” Since many of the free agency models are only dimly conceived—Who, exactly, are these “agents”? And how would they engage with faculty?–it would be necessary to think through the consequences of how a particular model was implemented. Many of the free agency proposals seem to assume that the “successful” university systems would be open to managing the patents for others. On that front, I cannot imagine that a university would allow their technology transfer office to work with another university’s intellectual property on a regular basis.  Of course, joint ownership is an exception, but even then I’ve known it to work both ways. There are multiple cases where I was perfectly content to allow another university to “take the lead” but was met with resistance from the other side, where my counterpart was hoping my office would manage the intellectual property.  It can be a great temptation to have someone else bear the expense, and be the bearer of bad tidings when a decision is made not to file a patent, etc..  Thus, it wouldn’t seem that free agency is always a bad deal for the technology transfer office.

So why not take a serious look at the model and see how it might be implemented to advantage in a particular situation? I doubt that this means a complete shutdown of the technology transfer offices. There are many facets of intellectual property management that the university will still want to deal with directly, and until there are more examples of specific routes for faculty to pursue, the existing licensing office will be the first stop–how else will faculty know where to go? It might not be a very attractive option for faculty when such a system is implemented at first, due to simple inconvenience and lack of other options. Of course, there are a few independent licensing groups, and sometimes attorneys can freelance this sort of work, but these aren’t simple options for the average faculty member to find and evaluate. Even if you work in this arena for many years, it can be difficult to engage with a suitable partner. Further, the terms of such a relationship might be a significant barrier—exactly how much does this option cost faculty?

Honestly though, I think it is worth the experiment. If the benefits of this kind of arrangement do outweigh the “free” option of the local university licensing office, how can you argue with this? I won’t, however, hazard a guess at this stage on how effective the free-agency model will be in practice.  After all, if the primary and most obvious “agent” available is still the university’s own technology transfer office, or at least the closest “bigger” university office,  it’s not clear this will result in great change.  Still, I think there is room for innovation in technology transfer itself, not just in the research results from the university laboratories.

Giant Slaying and Patent Reform

Last week, I attended a local seminar on the America Invents Act. Much of the discussion at the seminar was centered on arguments supporting the nature of the changes made. There were recitals of “what was wrong” with the old U.S. patent code, and so forth; then arguments were advanced justifying the principal changes (although the presenters almost implied these might be “principle” changes!).Without getting into a detailed discussion on the virtues or failings of the AIA (such as “first to file” and whether this will hurt, or help, any particular party) the gist of the seminar was that the U.S. patent system was unbalanced and no longer served the original purpose of protecting “inventions” in a coherent fashion.

Following the AIA seminar, I was doing some online research, to support drafting of some funding proposals. Since I like to slip in the occasional “true confession” here, I confess that in the course of such research I often follow a wild goose “link” and wind up reading interesting bits of history or trivia. Thus, I came across a discussion of AIA on another blog, from the Hoover Institution at Stanford University–Patently Bad Policy by F. Scott Kieff. Toward the end of the post, Kieff writes: “To paraphrase Judge Jerome Frank writing in the 1942 case of Picard v. United Aircraft: predictable enforcement of patents helps give the Davids the vital slingshots they need to take on the Goliaths.”

I felt compelled to search out this reference and read exactly what Judge Frank had written. So, I wound up reading some case law –OK, I don’t get out much. I was amused to find a somewhat familiar discussion of the problems inherent in the patent system (and enforcement of patents). The opinion in this case (Picard v. United Aircraft Corporation, 128 F. 2d 632 – Circuit Court of Appeals, 2nd Circuit 1942) was written by Judge Learned Hand, with Judge Frank writing to concur. As I understood the ruling, two key claims of the patent were held to be invalid, but otherwise a prior opinion was upheld.

Judge Frank does agree with the opinion of Judge Hand in this case, but is not entirely comfortable. He took the time to discuss how some of the patent claims might “seem” valid until you looked closely. But in the end, the subject matter was a mere “improvement” not rising to the level of “patent worthiness.” He summarizes, quoting an earlier ruling from Judge Hand:

Nothing is an invention which is the product of “the slow but inevitable progress…through trial and error” and of “the exercise of persistent and intelligent search for improvement.”

Nevertheless, he seems to feel that the patent disclosed something of value and that the patent system wasn’t able to capture or protect this properly. He is concerned that all “modern” research (back in 1942) is conducted such that “trial and error” is the name of the game, and that the “exercise of persistent and intelligent search for improvement” will result in many ideas being “unpatentable.”

If that means that every kind of patent system is outworn, the idea is disturbing. For, as I see it, there seems still to be room for some kind of patent monopoly which, through hope of rewards to be gained through such a monopoly, will induce venturesome investors to risk large sums needed to bring to the commercially useful stage those new ideas which require immense expenditures for that purpose.

Obviously, since patent law is expressly intended to offer incentive and rewards to inventors, not investors, Judge Frank goes on to suggest that we “may not need patents as rewards to inventors” since:

Modern industrialism owes much to the ideas of Faraday, who cared nothing for money. Kaempffert writes: “To be sure, inventors long for wealth. So do poets. But the patent laws are no more responsible for great inventions than are copyright laws for great poems. Watt was no more impelled by the desire to make money when he invented the separate condenser than Milton was impelled to earn the equivalent of twenty-five dollars by writing Paradise Lost.”

He also suggests that what might be needed is something “patent like” to protect investment in research and development:

And so patent monopolies may still be socially useful; they may, indeed, as I have said, foster competition. The David Co. v. Goliath, Inc. kind of competition is dependent on investment in David Co. — the small new competitor. And few men will invest in such a competitor unless they think it has a potential patent monopoly as a slingshot.

It seems to me that this is at the heart of all the hand wringing about patents today—and even about similar difficulties facing copyright law. Thus, there are those who honestly believe that certain advancements in technology are not proper candidates for patent protection(such as software) or that there are too many examples of “incremental improvements” being passed off as inventions (as for many biotech patents). Likewise, there are those who see no reason to limit patentable subject unduly, since their primary goal is to offer incentive for investment in the development of products.

Many times in a meeting with faculty I’ve observed that while we certainly can file a patent application to protect software they have developed, it might not be the best way to protect it. Then again, I can’t say that copyright law is a very satisfying alternative, and I’ve always wondered why someone can’t come up with an innovative mechanism that allows for proper protection of this sort of work. Obviously there are many people who agree that these were NOT intended to be included in the realm of patentable inventions. Further, modern business practices essentially defeat the intended purpose of a patent. If software is going to obsolete in 3-5 years, of what possible use is a 20 year “limited monopoly”?

In the end I agree with Judge Frank when he states that “[the] problem is not whether there should be monopolies, but, rather, what monopolies there should be, and whether and how much they should be regulated.” How many “slingshots” should be put into the hands of how many “Davids”? Which “Davids” should get a particular slingshot?  And don’t giants get to have slingshots too? Remember, Goliath can’t have been too happy about the outcome of that mythical encounter with his David. But then, if the slingshot was used effectively, maybe it would deter a modern Goliath from interfering in the business of the David holding it, and there would be no cause to actually slay any giants, just back them off a bit!

For now it seems, the only answer to the problem is offered by the current AIA legislation, about sixty years after Judge Frank’s comments. Only experience will prove whether AIA achieves some of the desired goals, but hopefully, it is a move in the right direction.

Patenting the Doodle…

 To invent, you need a good imagination and a pile of junk.

Thomas Edison

In the course of a normal work day, most of us find ourselves online and we often use the website. The entry page of the website is famous for being almost entirely clear of the usual webpage clutter.  The page is a simple white background dominated by a banner header Google, with just a handful of links to specific sections of the information services also offered by the company (such as, Maps, to search Google maps).  The banner heading, also famously, is sometimes used for a bit of fun–to commemorate holidays or historical events, the word/logo Google is enhanced–with artwork and sometimes interactive effects. This is called a “doodle” by the company–my all-time favorite being the Pac Man Doodle game that was actually a mini-version of the arcade game.

For those who might have missed it, filed a patent application for the “method” of their “doodle” and that application has been reviewed by the U.S. Patent & Trademark Office, resulting in the issuance of U.S. Patent No.7,912,915 entitled “Systems and methods for enticing users to use a website.” The abstract for the patent is included below:

A system provides a periodically changing story line and/or a special event company logo to entice users to access a web page. For the story line, the system may receive objects that tell a story according to the story line and successively provide the objects on the web page for predetermined or random amounts of time. For the special event company logo, the system may modify a standard company logo for a special event to create a special event logo, associate one or more search terms with the special event logo, and upload the special event logo to the web page. The system may then receive a user selection of the special event logo and provide search results relating to the special event.

I call attention to this particular patent as an interesting example of a patent filed to protect an “invention” that is embodied as a software/information product.

First, I predict there will be many commentaries on the folly of the USPTO in allowing the patent to issue (similar to the older “1-click” patent issued to back in 1999, U.S. Patent No. 5,960,411). I will leave that sort of commentary to others, since I as a rule do not comment on the patent strategy elected by others unless that is of immediate concern to my patent strategy.  However, I do want to use it as an example of the kind of intellectual property strategy decision that can be extremely confusing.

What, exactly, does the patent allow Google to do now?  The answer, directly from the USPTO website, is that the patent owner is enabled legally “to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States.”  That is, so long as the USPTO recognizes the issued patent as still valid.

Without going into a lot of detail on the patent approval process, this key element of the patent system is at the heart of every decision to file a patent application.  You must ask yourself “what” is it about the invention that you would be able to control?  How important is it that this be something you can control? In order to evaluate this, the invention elements that are described in the Claims section of the patent document must be consulted—the claims describe the essential elements that must be present in any “product” that would infringe the patent.

This patent includes only four claims (less than 250 words) describing the “essence” of the Google doodle. By virtue of the patent, Google wishes to “preclude” others from constructing their version of the doodle, and the associated fun or “enticement” value that the doodle provides to the webpage.  The pundits will have a great deal to say about whether this is “patentable” subject matter.  In my case, I think the overarching concern would be is it “patent worthy” subject matter?

For most companies, I predict the answer would be “no” in the sense that they would only be “copycats” of Google if they attempted the same dedicated program of a modified banner logo as part of their own website development.  In that, the doodle patent is likely an attempt by Google to warn off such “counterfeiting” more akin to the use of a trademark.  Trademark law, however, cannot be used effectively because the logo is “changing” and trademark protection assumes that the marks protected be very specific words or images.  Note that this highights perhaps the limitations of current intellectual property law in general–companies are looking for ways to protect their assets, and modern technology has outpaced the ability of the legal system to “protect” certain elements of competitive advantage .

While no other reputable company would be well served by “copying” Google in this fashion, these companies also would not care to be unreasonably “precluded” from going about their own business by Google. I saw a passing reference (can’t recall where!)  from someone who felt this patent could be used to prevent other companies from making simple changes to their own banner logos (e.g., near the 4th of July holiday, adding a picture of a fireworks display next to the company logo/name).  However, if you read the claims carefully, there is a further element required—that the modified logo be linked to information related to the special event or holiday, so that this information can be delivered to the user when they click on the modified image. Note, this is very specific functionality, directly tied to Google’s core business—allowing users to find information on topics of interest to them.

So I think that for their purposes, the “invention” described is perhaps patent worthy to the company, so long as that worth is taken in proper context.  But, like any patent, it might lend an element of “power” to the company, and issuance of this sort of patent triggers a good deal of fear-fear of misuse of patent infringement claims against others.  Most companies would find that limited budgets for intellectual property litigation render “use” of the patent impractical. Google, with fewer limitations on budget, will likely be limited only by requirements of the legal system itself, and by common sense as it were.  Thus, many will bemoan the poor judgment of the patent examiner in “allowing” the patent, since there is always a chance that a well-heeled company with a “patent stick” can use it to torment smaller competitors.

Google, however, might see the question in a different light—without this patent, someone else might have attempted to file a very similar patent, and “come after” the assets of the company for infringement. Like many large companies with a lot to lose, they will bear the financial burden of the patent prosecution to build an IP “fence” around their product. The patent itself can also be useful for promotional purposes, even if it is not directly useful for enforcement against competitors.  Unlike Google, smaller companies have little incentive to pursue such indulgent intellectual property strategies. Truly key innovative concepts and elements must be prioritized in the decision-making process. Thus, whether or not this “doodle patent” represents an example of how the patent system is broken, it is at the very least illustrative of how the patent filing strategy must be evaluated in making the decision to file. No two organizations will face the same set of considerations, and so will pursue different strategies. Only later will the results show whether the strategic direction was successful.

Technology Transfer and the Third Way

Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.

William Pollard

Today, I noted with interest several references to a recent work by Dr. Roya Ghafele (University of Oxford), entitled “Financing University Research: Waking a Sleeping Giant,” related to an analysis on the means to finance university research.

Granted, this sort of work does not seem to appeal to a broad audience, rather to those specialists in the fields of intellectual property and research commercialization. I dutifully followed each link, in order to read the original “paper” and found, to my surprise, that it was actually a rather sketchy PowerPoint presentation on the subject, 14 slides in all.  Still, given the immediate relevancy to my work, I read through it, hoping to find some useful insights to share.   I found that it raised some issues that are of interest to everyone working within the academic environment. 

First and foremost, the title itself refers to “financing” university research.  Every faculty member can empathize with the problem of securing funding.  The second slide, likely in the spirit of an executive summary, lists recommendations for institutional programs and policies.  Since this is in presentation format, I presume that these are a bit clearer with the attendant commentary.  On the third slide, the subject is introduced as follows:

The ‘Third Way’ of university research commercialization focuses on systemic change, rather than on single stakeholder intervention. It reflects a third generation of innovation policies that focuses on training, awareness raising and the leverage of cluster effects, rather than the development of physical infrastructure (i.e. science parks).

This is a unique approach that outperforms existing best practice in many ways; i.e. it focuses on the leverage of network effects among the various academic institutions, rather than repeating the traditional ‘one university – one commercialization’ approach.

In the rest of the slides, Dr. Ghafele presents a rough outline of current university practices in “research funding” (or research commercialization), adds an elaboration on the recommendations summarized in the second slide, and ends with a checklist for “impact assessment” to evaluate institutional progress toward implementing the recommendations.

I don’t want to reproduce the information in the presentation, but rather to highlight three points that it raises with respect to the “systemic changes” that she advocates as part of this “third way” of research commercialization.

Programmatic Recommendations

The work includes multiple programmatic recommendations for improving performance of the technology transfer function, grouped into five broad categories as follows 1) Incentive Structures, 2) Boundary Spanning, 3) IP Entrepreneurship Awareness, 4) Institutional Support, and 5) Adequate Funding.  Clearly, many of these presume that there is institutional and individual resistance to change, and that it will be necessary to overcome this in some way. It is truly difficult to argue with some of the recommendations (e.g., “promote incubators”) but it is equally difficult to imagine effective implementation of most. 

How effective is it, after all, to “Undertake Awareness Raising Seminars” when most of the audience does not yet recognize the relevance of the topic?  Naïve implementation of such recommendations would likely increase overhead costs associated with technology transfer (already recognized as an “unprofitable” activity at most institutions) and assessing the impact might be a formidable task. Can the potential benefits be demonstrated such that the intended audience will embrace training opportunities?  Or is it preferable for the administration to “mandate” the training for the university community?

Cost/Benefits analysis

Among several benefits predicted for these changes, are “number of spin offs created, revenues created through academic consulting, joint ventures, and licensing revenues.” In order to realized these benefits, the institution is asked first to assume some additional “costs” to carry out programmatic changes (including “Overhead costs, Administrative expenditures, Depreciation of capital assets, and Costs of complementary services related to policy”).  

A first observation is that while the list of benefits may not be intended as a comprehensive one, two of these—academic consulting and “joint venture” revenues—are not tracked by the conventional technology transfer process, or at least not well.  Likewise, the costs listed might be associated, at least in part, with the staffing and activity of the technology transfer office, but are presented as “in addition” to those costs.  There is an assumption that the current levels of spending on technology transfer are NOT directed toward the most effective practices. 

The short list of costs does not overtly include extra money for intellectual property protection—although it does seem to encompass increased levels of staffing for the institution.  So perhaps internal expertise on patent protection (patent agents?) might be part of these.  However, a good deal of the transactional friction in technology transfer is related to these direct costs for protection of intellectual property.  Notoriously, additional spending on patents does not directly correlate with increased technology transfer effectiveness; however, lack of an intellectual property asset to license effectively shuts down the technology transfer process.


 Finally, the third key point I would like to highlight is the emphasis on entrepreneurship as part of the “third way” answer set.  The limiting factors for establishing new ventures are related to the 1) resources (both human and capital) and 2) culture (or values).   Some of the recommendations are related to training to increase awareness (i.e., to change culture, influence values) and to increase skill sets (provide the human resource component, and develop entrepreneurial activity). In my experience, entrepreneurship is, indeed, a key part of any successful research commercialization effort.  Economic impact of new ventures is commonly recognized as a benefit to the wider community—local, state, or national—new job creation in particular. Yet this is still a very risky strategy for long-term success.

 Most universities are willing to fully embrace the tangible benefits, such as increased licensing revenue.  In the end, it seems that many of the “intangibles” are really at the heart of the issues raised.  There are “intangible” benefits that are not being adequately accounted for in the current practices (such as partnering opportunities that may result in commercialization). Likewise, there are “intangible” costs or obstacles to technology transfer (devoting time and effort to learning new skills necessary for entrepreneurship).   With most universities under pressure to justify their budgets and spending, administrators will be reluctant to divert money into channels without clear outcomes.

In conclusion, one key take away from the presentation is that we need to find ways to improve the cost/benefit analysis. In order to implement any of the recommendations, it is important to communicate the benefits ahead of time.  It is also critical to find cost-effective means of doing so, in order to justify the investment of even modest levels of funding for this purpose.  Then, if the recommendations are sound, it should be possible move forward, and reap the desired benefits.  In order to sustain progress, the efforts must be subject to continued review and improvement, both in terms of measured outcomes and allocation of resources.  There are very real benefits to be reaped from research commercialization by the university, but it will require commitment and discipline on the part of the individuals involved to realize the rewards.