Making Tech Transfer Work

Nelsen argues that companies of all sizes are shooting themselves in the foot if they fire their own internal R&D executives and managers, assuming they can simply rely on ideas from a university. “If CEOs in some industries are firing the guys in R&D to make their earnings look better, that’s not going to help,” she says. “You need the receptors for early-stage technology in the company, the engineers and development scientists who can receive the technology.”

There’s a debate in the economic-development field about whether large companies or small to medium-sized ones do a better job of commercializing technology. Nelsen says smaller companies are the stars, but Brookings’ Moro thinks the deck is stacked in favor of the big guys. “The large corporations are characterized by greater capacity to drive and structure long-term research partnerships, which allows them to work more smoothly with large research universities,” says Moro.

“Smaller and medium-sized firms may not have a chief research or innovation officer. They may not have the stan- dard, professional player who can spend the time to develop a research contract or partnership.”

Size May Matter

Actually, it takes both large companies and small startups to create the robust, regional ecosystem necessary to commercialize ideas, according to other experts. Sometimes large companies license a technology but spin it off into a captive company to develop it. Many times, large companies will simply acquire small firms that have already “baked” a technology and proven its commercial value. “Small companies innovate, big companies acquire,” says Waymon Armstrong, co-founder and president of a $12 million a year company in crisis simulation software called Engineering and Computer Simulations, in Orlando. The technology originated at a research park that the U.S. Army uses to develop simulation training for soldiers.

Rick Weddle, president and chief executive of the Metro Orlando Economic Development Commission, says one key to creating a regional climate where commercialization can flourish is breaking down the silos between tech-transfer officials, entrepreneurs, large companies, economic development officials and other constituencies to allow them to better communicate and align their interests. “If you are in your silo, and another person is in another silo, there’s no way you can help each other,” says Weddle, who also managed North Carolina’s vaunted Research Park for seven years.

CEOs cannot create the ideal ecosystems for successful tech transfer by themselves, but they can work with different constituencies, including state and local political leaders, to eke out progress. Weddle says many states are now enacting new laws to remove legal barriers to tech transfer from public universities and are studying how to improve their climates for innovation. That’s good news for CEOs looking for new ideas.

The Bottom Line: Technology transfer from the nation’s idea laboratories could be greatly improved if CEOs invest in developing relationships with scientists and help create ecosystems that foster commercialization.

William J. Holstein is the author of, most recently, The Next American Economy: Blueprint for a Real Recovery.