Generating knowledge and transferring it to the world has been, and remains, the core mission of research universities across the globe. Daniel Nadis looks at how tech transfer offices can become more effective in this mission.
Since the Bayh-Dole Act, the ‘knowledge transfer’ mindset has been assailed with chronic doubts, and may be facing unanswerable questions. ‘Publish or perish’ does not sit easily with revenue maximisation, especially in the science and technology sphere. Inside the technology transfer unit, patent prosecution, licence/spin-off negotiations, and collaborative research deals compete for time and attention. Few technology transfer organisations (TTOs) are in a position to be self-funding from transaction revenues, but with dependence on the university for cash comes head count limitations and other operational constraints, especially in difficult economic times.
Does this litany sound familiar? Laments such as these have been told and retold, but no quick fix or sustainable solution seems possible. In the lab, when every direction seems to be a dead end, researchers seek an entirely new paradigm: to address the fundamental challenges of sharing knowledge, while making money from protecting value, all in the context of difficult economic circumstances. What might such a paradigm be?
What if one views the TTO not as a small piece of a university culture, but as a small piece of a commercial marketplace? Today, the TTO operates as a tiny element of a not-for-profit-organisation, whose motivations rarely intersect across the entire range of university endeavour. In most cases, university revenues from technology commercialisation are less than 1 percent of total annual budgetary requirements. Indeed, revenues from selling branded mugs and sweatshirts may actually exceed tech transfer income. From a commercial perspective, such a unit would look like a child’s lemonade stand across the street from an 80-storey office tower. To survive and flourish, the TTO’s primary interactions need to be horizontal—across TTOs, across geographic markets, across technologies—and not simply vertical within the university. Looked at from this perspective, TTOs can radically change workloads associated with generating revenue while collaborating to create more valuable transactions.
As standalone businesses, most TTOs today would have unacceptably high risks:
- Sole source supply chain (university IP) Every other business works hard to avoid this situation—they fear being bought by their supplier, being unable to work with competitive suppliers, or being limited from sales because of their unique identification. Ultimately, of course, the sole source supplier can also effectively shut them down for reasons unrelated to their own imperatives.
- Lack of human resources flexibility Suppose a gold-plated opportunity to triple revenue came along? With a strong story, getting more people would be a no-brainer in the business world. In TTO-land however, the university, as shareholder, rarely supports additional resources for such one-shot opportunities and the deal disappears.
- Poor visibility: suppliers Which TTO can see even half of the possible ‘wares’ of its supplier? What TTO knows far enough in advance of coming ‘products’ so as to create a profit-maximising ‘auction’ environment? How can a proactive TTO look for necessary complementary IP in its own portfolio among the myriad academic silos maintained by hyper-specialised researchers?
- Poorer visibility: customers The most difficult challenge of all is finding the profit-maximising customer for the technology that does surface. There are no universally agreed valuation methodologies, few exact ‘comparables’ at such an early stage, and little idea of what exactly a potential buyer wants to buy, and how much that buyer may be prepared to pay.
Let’s now look at this as a horizontally organised industry. The greatest challenge—figuring out how to be a ‘for profit’ business among academics—becomes the greatest advantage because a pure return on investment-driven metric is not required. Instead, TTOs can demonstrate all of the other traditional success metrics, including revenue generation, by sharing resources with their competitors and customers as is done everywhere else.
In a horizontal model, resources are shared on an ad hoc basis among an entire network of people in a common operational context, on a shared but secure platform. Better information is available to more people, and at a faster pace. Transaction values are improved as customer needs are better understood. Commercial evaluation is speeded by access to a range of ‘on-stream’ experts, and collaborative research contracts can be concluded more rapidly among pools of researchers.
So much for the fantasy. How about the reality? The remarkable fact is that all of the tools currently used in the industry to create this horizontal model have been in use for a number of years. For-profit businesses know that information movement, transparency, and expertise-sharing are the sine qua non of increased productivity and increased profit. Can these techniques be applied in the tech transfer world as well?
With the coming of age of cloud computing, a number of companies have created ‘virtual’ marketplaces. Supply chain managers have adopted these techniques to link raw materials to finished goods to retailers. Google and Amazon have clouds for information storage and sharing. This level of pure information-sharing is well advanced. Sharing data in this way, however, doesn’t add the truly critical resource —human decision-making—to the process. What the tech transfer world needs is ‘Collaboration 2.0’: the virtual business created in a market space by all participants. For tech transfer, what might this world look like?
- TTOs will operate as standalone businesses for their university shareholders, much as they do today. Accordingly, participants in the horizontal ‘virtual’ organisation must remain able to run their own businesses in their own way.
- In a dense mix of peers, productivity gains will be easy to spot and crucial to maintain. Legacy data management platforms, specifically designed for technology transfer, are not the same as business management software. In today’s world, data are entered once, are instantly available to any team member, and can be manipulated by anyone without needing an IT or finance expert’s assistance. If the TTO is not operating in this manner, it is missing the single largest tool in delivering its key performance indicators while gaining net resources (people time) for further success.
- Intelligent collaboration platforms deliver more than just a huge pile of unmanageable data. They will:
- Allow each participant to order information in a meaningful way;
- Exchange information with different people applying different levels of security/confidentiality simultaneously;
- Create ad hoc, ‘deal-specific’ groupings, assembled (and disassembled) in minutes; and
- Allow stakeholders direct access to data they require without distracting the business.
Using this Collaboration 2.0 paradigm, all of the key TTO metrics can be harmonised with shareholder (university) drivers.
- Knowledge transfer is maximised, whether for reputation, revenue, or the ‘greater good’.
- More packages of IP are assessed faster, more accurately, and more consistently, for protection or publication.
- Collaborating market participants—whether inside or outside the particular TTO—add their value without significant time cost.
- TTO activities are transparent to their shareholders, reducing paperwork and demonstrating value.
- No IT involvement is required, no new hardware or software is purchased, and every member of the university knowledge transfer community is connected with one click.
Using a horizontal market and Collaboration 2.0 paradigm, TTOs can shift from overworked and underappreciated academics to self-directed, successful participants in the burgeoning marketplace of knowledge transfer. The Association of University Technology Managers (AUTM) Global Technology Platform is a step in the right direction. More broadly, inexpensive software meeting these challenges is now available. Just look out, not up—your peers are there waiting for you.
Written by Daniel Nadis, CEO and Founder, Occams Resources, April 2012
The One Nucleus blog is written by individuals and is not necessarily a reflection of the views held by One Nucleus.