This paper describes the process by which inventions derived from basic university research in science and engineering are commercialized. The process is described in terms of two systems: an invention system and a commercialization system. This is not a theoretical model, nor an idealistic goal. It is an empirical depiction of what actually happens in Canada, a picture of the innovation process learned over the years from the experience of those who have actually been involved in it. It is not a static picture; it changes as new local approaches prove successful and the process is eventually improved across the country.
For present purposes, we define innovation1 as
innovation = invention + commercialization
This definition suggests a framework for what follows, an examination of the two systems that correspond to its two aspects.2
But before we go there, we must first consider a third system, the basic research system, shown in figure 1.
There are five inputs to the basic research system:
- the intellectual contribution of the professors and students doing the research;
- the input of world research results and expertise both into the preparation of the research proposal and into the peer-reviewed funding competition that provides quality control;
- the infrastructure of facilities and services provided by the universities: the so-called indirect costs of research;
- the university salaries of most of the professors leading the research;3
- the discovery grant from the Natural Sciences and Engineering Research Council of Canada (NSERC) to cover the direct costs of the research that include the support of the students involved.
Figure 1. The basic research system in science and engineering
The main criterion for the discovery grant is excellence, both of the proposed research and of the applicant's demonstrated record. With that criterion, the funding process achieves a reasonable probability that the funded research might produce world-class scientific discovery. To keep the graphics simple, we show only the last input explicitly. The other four can be treated as implicit in the NSERC process for funding basic research in the universities.
The time scale of the basic research system can be taken as the five years that is the normal duration of discovery grants. It is also characteristic of the time taken by Ph.D. students in science and engineering to complete their degrees.
There are two outputs of the research system, and both are shown in figure1:
1. new codified knowledge, communicated to the world through peer-reviewed scientific publications in scholarly journals;4
1 Innovation is a generic term, whose meaning includes both having a new idea and putting it into action. The definition of innovation used here is appropriate when discussing research in science and engineering. It includes both process and product innovations, in both the goods and services sectors. Finer shadings of these innovations into incremental vs. revolutionary, disruptive vs. sustaining is not pursued in the present discussion. (In fact, innovations emerging from basic research are often disruptive of existing practices, and some are even revolutionary.) Discussion of social innovations, organizational innovations, marketing innovations and institutional innovations is also beyond the scope of this paper.
2 In spite of this definition of innovation, we will resist the temptation to call the combination of the invention system and the commercialization system the innovation system, since that term is already widely used for a broader concept that includes these two systems and much more.
3 Strictly speaking, only a portion – typically 1/3 – of the salary of a professor doing research should be considered as an input to the basic research system. The exceptions are professors who hold Canada Research Chairs, NSERC Industrial Research Chairs, and other endowed Chairs or Professorships whose salaries come from the research sponsors.
4 According to King (David A. King, "The scientific impact of nations", Nature, 430, 15 July 2004, pp 311-316), Canadian researchers contributed 4.58 percent of the world's scientific publications in 1997-2001, and 5.81 percent of the 1 percent most-cited papers in that period, ranking sixth behind the US, UK, Germany, Japan and France on both counts. To put these numbers in a larger perspective, Canada has about ½ percent of the world's population and 2 percent of the world's economy.