Mapping the Big Green Challenge - The Skills & Learning ...

Mapping the Big Green Challenge 11 Introduction1.1 Challenge-led InnovationThere has been increased interest in recent years in the development of challenge-led innovationpolicy. This offers a more specific focus than over-general innovation-friendly market measures, yetavoids the pitfalls of trying to ‘pick winners’. Attention is directed to the reward of performance‘outcomes’ rather than subsidising knowledge ‘inputs’. The model that has attracted most interesthas been the offer of a ‘prize’ designed to induce innovation to meet a defined goal. It draws itsinspiration from the past successes of such prizes in solving the measurement of longitude or theaccomplishment of air travel.The new global challenge of climate change has given rise to a series of new challenge-led prizeinitiatives. Some of these are defined around specific technologies: the Automotive X-prize offers$10m for a marketable low emission car, the H-prize offers $1m for advances in hydrogen storage &distribution, the Virgin Earth Challenge offers $25m for achieving large scale carbon capture. Otherchallenge-led prize schemes avoid specific technologies and aim, more broadly, at any significantcontribution to carbon emission reductions. The FT Climate Change Challenge offers £75k for themost promising innovation to tackle climate change and the Shell Springboard offers up to £40k foran innovative low carbon business idea.The prize as an alternative policy instrument to grants and contracts is not as straightforward assometimes supposed. Ex post recognition is unlikely to significantly steer innovation into newdirections. Ex ante inducements need to be appropriately targeted and resourced if they are to beeffective (Newell & Wilson, 2005). A recent study concluded that the architecture of a prize as an‘innovation instrument’ was far more diverse than generally recognised and could facilitatecollaboration as well as competition between innovators (McKinsey, 2009).The reorientation of the challenge-led approach towards societal outcomes in itself represents a keyshift toward a demand side innovation policy and away from traditional supply side. The choice ofoutcome is critical to the type of innovation that may be induced by a challenge-led scheme. Thereis a tendency to translate general societal goals into specific technological objectives as the best wayof implementing a challenge-led innovation strategy (Technology Strategy Board, 2008) yet theavoidance of prejudging technological solutions is the strongest appeal of these new challenge-ledinnovation instruments.1.2 New Forms, Locations and Sources of InnovationCurrent UK government innovation policy highlights the ‘changing face of innovation’ in a number ofkey respects (DIUS 2008). The forms of innovation arising from the ‘exploitation of new ideas’ areoften new practices and new services as well as new products. These draw on novel capabilitieswhich may be social rather than technological in nature. The ‘newness’ appropriate to innovationpolicy is not restricted to world or national breakthroughs but embraces novelty ‘to the sector orthe organisation’ or ‘taking an idea from one context and adapting it to another’. The locations ofinnovation are far more diverse than traditionally acknowledged and may be found in the thirdsector and in public organisations as well as in profit driven business. The sources of innovation areAppleby Ltd July 2009