Techno City is a welcome development
The Government has laid the foundation for setting up a ‘Techno City’ in Pitipana, Homagama in Sri Lanka with a planned investment of Rs. 19.3 billion or about $ 130 million over the years (available at: http://www.ft.lk/article/569426/Govt–aims-for-hi-tech-with–Techno-City-).
This is a part of the Technopolis to be set up in the land area from Malabe to Pitipana under the Government’s Megapolis project that aims at elevating the Western Province of the country to the status of wealth creator for the nation.
Prime Minister Ranil Wickremesinghe, speaking at the foundation laying ceremony, has said that it is the wish of the Government to develop the Techno City as an innovation centre making available the inventions to be made at the Techno City to entrepreneurs for commercial production, a process known as ‘innovation’. He has also remarked that if Sri Lanka could get back Sri Lankan scientists working in the US, the country could make a true quantum leap in developing its scientific and technological invention base.
According to media reports, five institutions are to locate their research centres at the Techno City initially. They are the National Science Centre, the Arthur C. Clarke Institute for Modern Technologies and the Universities of Moratuwa, Sri Jayewardenepura and Colombo. Of them the University of Sri Jayewardenepura has got the lion’s share of Rs. 7.5 billion or $ 50 million as a start-up technology based university in the country.
Past attempts have just been wish lists without concrete plans
This writer has been drawing, in this series of articles, the attention of policymakers to the need for developing the country’s science and technology base, if the country desires to push itself up from its current lower middle income country position to higher middle income country position in the initial stage and then to rich country position as the final goal. Having examined the strategy adopted by the previous Government in this regard, this writer noted in 2013 that it was a mere wish list without any concrete plan to attain the objective (available at: http://www.ft.lk/article/228844/Becoming-a-technologically-advanced-nation).
There was a proposal by the previous Government to set up several university townships, but there was no allocation of funds or development of a concrete roadmap to make it a reality. The only worthwhile attainment in this regard by the previous Government was the establishment of the Nanotechnological Institute at Pitipana with private sector participation.
Sri Lanka can learn from South Korea
In a subsequent article in 2014 on the strategies followed by South Korea in converting that backward economy in the 1960s to a world-class scientific and technological powerhouse within a few decades, this writer emphasised that the Government should concentrate on a few selected areas for development drawing lessons from President Park, who had remarked that “if we try to attain everything, we wouldn’t attain anything”, (available at: http://www.ft.lk/article/285478/Korean-growth-experience-and-its-relevance-to-Sri-Lanka-today).
South Korea had connected its infrastructure projects to industry, taken action to develop world-class research institutions and set up a large number of vocational training schools to keep on supplying technicians needed by a new economy continuously. Without such a plan, the industry would be starved of the needed skilled workers to keep the industry going. Hence, Sri Lanka should pay attention to developing vocational and technical education in order to supply the needed skilled workers to a growing industrial economy; the alternative would be to import them from abroad with underlying social, political and economic issues at its front yard.
Sri Lanka should now get on to the ‘missed global technology-bus’
A general observation made in these articles is that Sri Lanka has already missed the ‘global technology-bus’ by being a passive spectator of the world’s developments in that area. The other countries in the region had teamed up with the world’s giants in technology and extracted a high external benefit by being a partner of technological developments. Singapore did so by linking its universities to the best universities in the US and attracting foreign direct investments or FDIs from large corporations which had already developed high technology. South Korea, Malaysia, Taiwan and Thailand had attracted FDIs with high technology.
Sri Lanka could have been a breakout nation in the early 1980s but the costly ethnic war and the insane reaction of the majority of Sri Lankans had prevented worthwhile FDIs from coming in. An example often cited, as reported by Saman Kelegama on page 57 of in his ‘Development Under Stress’, is the shifting of the proposed manufacturing plants of two major electronics multinationals, Motorola and Harris Corporation, from Sri Lanka to Malaysia and elsewhere, respectively, due to the ethnic riots of 1983. Therefore, it has been suggested that Sri Lanka should now restart its efforts at converting its economy into a complex economy which also includes the development of nanotechnology.
Innovation-based economy concept needs prior action
Prime Minister Ranil Wickremesinghe has emphasised the need for creating an innovation-based economy as the way out for Sri Lanka. Innovations are needed but there are several pre-steps which Sri Lanka should take in order to generate innovations.
One of the initial steps is to create new products or services known as inventions or using inventions done elsewhere for domestic commercial use. There are thousands of such inventions made by knowledgeable people every day. But not all these inventions lead to creating a commercially viable new product or service.
For instance, there are stories of some Sri Lankan youth inventing remarkable new products such as a ‘sea-water driven motor car’ or a ‘multi-tasked paddy-thresher’. While such inventions have their own merit, they may not be commercially viable at the current stage of technology due to higher cost of production compared to available alternatives. Hence, they just remain as prototype inventions incapable of going through an assembly line of a factory that depends on commercial viability for its survival.
The Austrian-American economist Joseph Schumpeter has made this distinction between invention and innovation. According to him, the inventions so made are used by entrepreneurs by converting them into commercial production lines. That process is called, as mentioned earlier, innovation.
Researchers lack capacity to use inventions commercially
According to Schumpeter, innovation leading to the continuous economic growth of a country is a process and it consists of four stages. The first stage is the invention where a researcher or a scientist, through elaborate experiments, comes up with a prototype of a new product.
At the time of creating these inventions, the scientist or the researcher concerned has no idea about whether they would be commercially viable. He only knows that it would change the prevailing world habits or systems. Commercial viability comes from two other factors. One is that there should be a demand for the new product in preference to what is presently available in the market. The other is that the producers should be able to produce it at a cost that would generate them a profit when they sell it at prevailing market prices. If these two conditions are not met, the prototype invention will just remain an invention only in paper.
It is entrepreneurs who generate innovations
In the second stage known as innovation, enterprising people will draw, according to Schumpeter, on the discoveries of scientists or inventors and convert them into commercially viable products or services. By doing so, they create new opportunities for investment, growth and employment.
But for them to do so there should be mechanisms for making such new discoveries available to them for using in commercial production and guaranteeing their right to use them, known in economics as ‘property rights’. This involves linking research institutions with business. In the case of private research institutions, the question does not arise since private researchers should necessarily have to sell their research outputs to those who could use them productively. The problem arises with respect to state-owned universities and research institutions which are normally reluctant to pass their research outputs to private sector-owned businesses. Though such disabilities are not there in the case of state-owned businesses, such businesses do not have proper business acumen to convert a research output into a viable market product.
Innovations should get diffused
The third stage is called ‘diffusion’ or making available such knowledge to interested parties through the market mechanism. According to Schumpeter, it is the entrepreneurs who perform this task as well.
Diffusion is a concept first put forward by Researcher Gabriel Tarde in 1903 when he said that knowledge disseminates over time taking the shape of a slanted English letter ‘S’. This is because every new product has its own ‘product life’ growing rapidly in the initial stage and then coming to a peak before it starts to decline again. At this stage, a new product will take the place of the old discarded product.
Tarde identified five stages of the innovation process: Initial knowledge from the invention done by a researcher, forming an attitude on the invention, deciding whether to adopt or ignore the invention, using the invention in a commercial production and confirming the decision to adopt the invention continuously. Once one innovator comes to the market, there will be others who would follow his lead. It then leads to more inventions and innovations.
Successful innovations are imitated like a pandemic
The final stage arises from diffusion where other entrepreneurs will imitate the initial innovation. At this stage, innovation spreads across the economy like a pandemic. There will be hundreds and thousands of new entrepreneurs who will imitate the initial trailblazers.
This was evident in the computer industry. Before the 1970s, it was the mainframe computers that ruled the world. But after Stephan Wozniak and Steve Jobs broke the rules by producing the first Apple Macintosh desktop, a new desktop computer industry was developed throughout the globe. Then, it was a series of new inventions and innovations that started to supply the world with laptops, tablets, phablets and now hybrid tablets.
Techno City should encapsulate researchers and entrepreneurs
The Techno City is expected to make inventions through scientific research and technological advancements. Such inventions should be combined with enterprise, an art mastered by entrepreneurs to convert them into commercial use. Hence, in the second stage, it is of utmost importance that the Techno City should house leading enterprises as well.
There are examples of such combinations successfully implemented elsewhere. Today, that isolated existence of research and industry cannot sustain itself for two reasons. One is that invention and research requirements are rising dramatically in a fiercely competitive world. Hence, industries and entrepreneurs are incapable of meeting those requirements through only research done in-house.
The second is that entrepreneurship has become a specialised talent and not all inventors are skilled in that talent equally. Hence, the two types of work, namely, invention and innovation, have to be separated with each group specialising only in its area of competence.
Accordingly, industry has to depend on research institutions and universities for inventions and research institutions and universities have to depend on industry for innovation. This linkage is now being established in a different kind of a production model.
The dead Sheffield has been converted into a vibrant research town
An example for this new model is the Advanced Manufacturing Facility set up around the University of Sheffield, UK with many giants of industry and commerce being located there (available at: http://www.brookings.edu/research/opinions/2015/03/25-manufacturing-innovation-district-sheffield-england-katz-kline).
The need for establishing such advanced manufacturing facilities has arisen due to sheer necessity: The need for competing successfully with low-wage and low-cost countries. Hence, it is necessary for advanced economies to bring out continuous innovation of production and processes involved in manufacturing. To do so, they have to engage in applied research, investment in sophisticated plant, technology and investment, automation of manufacturing processes through robotics, and developing a highly skilled workforce. All these four requirements are now met in one location where industry has been linked effectively to research and knowledge creation.
Co-existence of small start-ups with giants in industry in Sheffield
Sheffield had been famous for quality steel products for decades. It was such a popular world brand that, instead of calling ‘Made in England’, steel product manufacturers in Sheffield were successful in developing their own brand name, ‘Made in Sheffield’. Like Ceylon Tea, it instantly denoted quality and reliability.
This was not to be for long after Sheffield began to experience fierce competition from other countries that also went into the same production line such as Japan, South Korea and now China. Consequently, Sheffield lost its glamour as well as economic base. Now to regain that lost glamour and lost economic base, Sheffield has established an Advanced Manufacturing Park around its university which functions as the key knowledge creator. It provides advanced manufacturing companies with industrial expertise, cutting-edge machines and equipment and solutions to complex industrial issues.
More than 100 giant manufacturing companies including Boeing, Rolls-Royce, BAE Systems, Hitachi and Tata are located in Sheffield Park. Along with these giants, a large number of small and medium-sized start-up research developers have also been set up in the park in an incubator facility so that they can benefit from the practical exposure they will get.
In addition, apprenticeship is provided to young workers to train them on the job thereby demonstrating that, to be creative and skilled, one need not have to acquire a four-year university degree.
Similar to the Sheffield Advanced Manufacturing Park, advanced research towns have been established around almost all the leading universities in the US. MIT, Washington and Boston are some examples.
A proactive attempt by the University of Sri Jayewardenepura
An important requirement is that the local researchers should have willingness and capacity to work collaboratively with foreign researchers. If local researchers feel that they are superior to foreign researchers, then, there is no room for learning through cross-fertilisation which is a must for any nation to move forward.
Recently, this writer had the opportunity to observe an initial meeting which the Vice Chancellor of the University of Sri Jayewardenepura, Professor Sampath Amaratunge, and his leading research team had with the Pro-Vice-Chancellor of UK’s Northumbria University, Professor Jon Reast.
It was a brief meeting but what it demonstrated was the sparkling willingness of the Vice Chancellor and his research team to work collaboratively to upgrade the research capability of the university. To this writer, this was an encouraging sign since the University of Sri Jayewardenepura is a leading player in the proposed Techno City.
The University of Sri Jayewardenepura has been able to inculcate a research friendly culture in its core researchers. It has, in preparation for its new role, established a Research Council overlooking research work at the university and under the Council, nine new research centres. Some research centres have established research collaboration arrangements with world famous universities like Oxford, Duke, North Carolina, National University of Singapore and Taiwan’s National Cheng Kung University. The university says that it has got funding; its meeting with the Northumbria University’s Pro-Vice Chancellor was to equip those research centres with experienced researchers. This is the way a proactive university should support the Government’s initiative to convert Sri Lanka into an innovation-based economy.
This is a culture of modesty to learn from others. It should be promoted across the nation, if the Techno City project is to become a success.
(W.A Wijewardena, a former Deputy Governor of the Central Bank of Sri Lanka, can be reached at email@example.com).