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In this issue...

Innovation – the centre of corporate strategiese
Lord Sainsbury, UK Minister for Science and Innovation
British Innovations
On the road again
Christopher Macgowan, Chief Executive, Society of Motor Manufacturers and Traders
Fossil Fuels – An Energy source for the Future
Greg Lewin, President, Shell Global Solutions
Chain of success
Kenny McKay, Director, and Will Wright, Manager, Restructuring practice at KPMG
Innovation and the Patent Office
Lawrence Smith-Higgins, Head of Awareness Information & Media The UK Patent Office
Benefits of association
Dr Michael Moore, CEO, PIramed Ltd
Innovation and strength in the UK biotech sector
Aisling Burnand, Chief Executive, BioIndustry Association
Simfonec: Helping make good research BIG business
Heron Evidence Development: Successful deal of missed opportunity
Springwell Ltd: Match-maker for Innovative Technologies
Korn/Ferry International: Pharmaceutical companies desire to break the mould
A quality core interface
Dominique Kleyn head of BioPharma Business Development, Imperial College London
Evolutec Group: Creating a range of commercial options
Moving forward
Dr Ceri Williams, Senior Manager, Science and Innovation at Yorkshire Forward and Dr Danielle Hankin, Bioscience Cluster Manager
Oxitech: Revolutionising SIT Programmes
Oxford Expression Technologies: Meeting the needs of the post-genomic era
Business Services
Innovating business related services
Norma Rose, Director-General, Business Services Association
BT: Innovation Strategy and Innovation Continuum
UK Film Council: How the UK wins in the international film industry?
On the defence
Major General Alan Sharman CBE, Director General, Defence Manufacturers Association
ProEtch: Precision parts of quality
Wallop Defence Systems: Aircraft Countermeasures and the Dual Spectral Threat
Education, Education, Education
Ruth Kelly, Secretary of State for Education and Skills
Applied Sciences at Wolverhampton - Innovation in Higher Education Professor Trevor Hocking, Associate Dean, International Development
Wind energy
Marus Rand, Chief Executive, British Wind Energy Association
Vital energy
Ian Leitch, Commercial Director, Energy Industries Council
Waterman Group: Solutions to solve climate control legislation
Winning the war against germs
Dr Ron Mitchell, Managing Director, GB Environmental
Show me the money! Funding for innovation – who can help?
UK: Innovation Nation?
Launching the “Innovation Nation?” initiative
Innovation in the 21st Century
Gemma Harman, Director of Strategy & Media, BT Chief Technology Office
UK Manufacturing - a driving force for innovation
Andrew Manly, Director General, Manufacturing Technologies Association
Waterman Group: Single project model 3D
Renishaw: Achieving global manufacturing competitiveness in the UK
Yorkshire Forward
The European Nanotechnology Trade Alliance
Del Stark, Chief Executive, European Nanotechnology Trade Alliance
University research drives a new wave of innovation
Omar Cheema, Nanotechnology Business Development, Imperial College London
Oxford Instruments: Enabling nanoscience and nanotechnology
Semefab (Scotland): A real driver of change
Metal Nanopowders: New products that meet your needs
Regional Development
London Development Agency: One jump ahead
91Advantage West Midlands: At the heart of it all 95


Innovation - the centre of
corporate strategies

Lord Sainsbury

From nanotechnology to stem-cell research, from genetic fingerprinting to the World Wide Web, the UK deservedly has an international reputation for outstanding science and technology, writes the UK Minister for Science and Innovation, Lord Sainsbury

In the UK we are working hard to raise our rate of innovation to a similar level, as this is the key to keeping businesses competitive in the global knowledge economy.

We face a major challenge from emerging economies like China which has 5% of our wage costs. At the same time scientific understanding and new technology are changing our world faster than ever before. Developments in ICT, new materials, biotechnology and new fuels are unleashing new waves of innovation and creating many opportunities for entrepreneurial businesses to gain a competitive advantage.

Many UK businesses are already very innovative. Nearly a quarter of the world?s top 100 medicines have been discovered and developed in Britain. This is more than any country except the US. And 40% of the biotech drugs in late-stage clinical trials in Europe were produced by British companies. But we need many more companies to put innovation at the centre of their corporate strategies.

The largest proportion of US and Japanese R&D facilities in Europe are based in Britain

The government is determined that we should be one of the best places in the world for science and innovation, and we have, therefore, in recent years introduced many new policies in order to produce the best-possible conditions in the UK for companies to innovate and grow.

The UK is the most-favoured inward-investment location in Europe, attracting around 40% of Japanese, US and Asian investment into the EU, and we want to build on this success. We are attracting an increasing number of international companies to do their R&D in the UK. The largest proportion of US and Japanese R&D facilities in Europe are based in Britain.

Hundreds of global companies have established R&D centres here and are benefiting from new product research, design and development. Many other multinational corporations have formed strategic partnerships with universities or contract research teams in the UK. They come here because of the UK?s long and highly successful R&D record and because we offer a pool of skilled researchers, institutional support, a world-class science and engineering base, high-tech clusters and financial incentives.

The government believes that if we are to improve our record of innovation we need to maintain a dynamic and creative basic research base. That is why we have already increased the Science Budget substantially. In 1997/98, the UK Science Budget was £1.3 billion and by 2007/8 this will rise to £3.3 billion.

We have also set ourselves ambitious goals for the future in the government?s 10-year Science and Innovation Investment Framework and in the DTI?s 5-year programme. We want to increase the level of knowledge intensity in the UK as measured by the ratio of R&D to gross domestic product (GDP), from its current level of around 1.9% to 2.5% of GDP by around 2014. This would substantially close the gap between the UK and the US, the best performing, innovation-driven major economy.

Our vision is that the UK becomes a key hub in the global knowledge economy

At the same time the government has introduced incentives in order to improve the rate of knowledge transfer. We have had three major schemes to increase our rate of knowledge transfer, University Challenge, Science Enterprise Centres and the Higher Education Innovation Fund. In the last six years we have spent £169.5 billion on these activities, which have now been merged into one third-leg funding stream and, over the next three years, we will be spending £187 million on them.

These schemes have been extremely successful and we have seen a major cultural change in our universities. For example, the market value of university spin-outs floated on the Stock Market in 2004 was £604 million, £100 million more than the government?s total investment in knowledge transfer to date.

A successful research and develpment (R&D) record means the UK can offer a pool of skilled researchers, institutional support and financial incentives

We have also introduced R&D tax credits for companies worth £600 million a year and which have already supported SMEs to the tune of £778m. The government has also pulled together all DTI funding that supported pre-competitive applied R&D into the Technology Strategy. And we are giving the Strategy strong financial support. The Science and Investment Framework launched last summer announced an increase in funding for the Strategy of £320 million between 2005-08, more than doubling the previous budget. This will help to exploit our strong UK science base and ease the transition of ideas from the laboratory to the marketplace.

A Technology Strategy Board, composed mainly of industrialists and venture capitalists, has also been set up to manage the Technology Strategy and make certain that the collaborative research projects it supports create competitive advantage for companies in the UK.

We are also directly helping smaller businesses through our Grants for Investigating an Innovative Idea, reimbursing consultancy fees to help businesses get advice on the steps needed to implement their ideas, and Grants for Research and Development, which helps businesses carry out R&D that could lead to technologically innovative products or processes. More details about these products are available through the Business Link network, or

Our vision is that the UK becomes a key hub in the global knowledge economy. This means that the UK should be a country famed not only for its outstanding record of discovery, but also for innovation, a country that invests heavily in R&D and education and skills, and exports high-quality high-tech goods and services to the world. We also want to build on our strong science and technology links with the best research around the world, so that we can always stay at the leading edge.