The promise of the innovation taskforce is compelling. It has captured the imagination of our entrepreneurs

ANOTHER REPORT destined to collect dust? Three decisions will tell us this year whether we are serious about the Smart Economy.

It has been three months since the report of the Taoiseach’s Innovation Taskforce was launched and in May we had the welcome news of the establishment of a high-level group chaired by Minister for Enterprise, Trade Innovation Batt O’Keeffe charged with implementation of the recommendations.

A lot has happened since the taskforce report was released. Despite the recent wobbles in European markets, the US recovery is well underway with almost 300,000 jobs added to the economy in April alone. In California, venture capital investments are back to boom levels, the innovation pipeline continues to deliver and Intel announced the strongest first quarter since the company was founded in 1968. Silicon Valley is back and Ireland is at the party. The Irish Technology Leadership Group (ITLG) held two events in Silicon Valley during March – the opening by the Taoiseach of the Irish Innovation Centre in San Jose and the annual ITLG awards at Stanford University for Irish high-tech start-ups.

I believe that investment in education, research and broadband infrastructure is the foundation for sustainable prosperity. This model has been proven across the world, from Silicon Valley to Shenzen. Former Intel chief executive and current ITLG chairman Craig Barrett put it like this: “Having smart people is important, smart ideas is important, and then letting smart people get together with smart ideas to do something is the third thing.” I’d like to suggest these three categories as a framework for measuring progress this year on the Taskforce recommendations.

SMART PEOPLE

In the past, bonus points were offered for honours maths at Leaving Certificate level. This practice was abolished a number of years ago and since then less and less students are opting for honours maths, with only 19 per cent taking the subject in the most recent examination. The taskforce has recommended that we “introduce additional measures to promote the take-up of higher-level maths, including possible incentives such as the awarding by HEIs of CAO bonus points on a pilot basis starting with Leaving Certificate 2012”.

This means that the decision needs to be taken this year. The Minister for Education Mary Coughlan sounds positive on the proposal – we need leadership to ensure action from her department and the universities to make this happen. We will know by August whether this recommendation has been fully implemented.

SMART IDEAS

Investment in research is critical to our future prosperity. Currently Ireland spends less than 2 per cent of GDP in RD, but a key recommendation is that by 2020 we “achieve the goal in the renewed Programme for Government of investing 3 per cent of GDP in RD”.

This is a modest long-term objective. South Korea is aiming for 5 per cent, while Singapore, Finland and Sweden have set 4 per cent of GDP as their target. It’s important to note that this investment will include not just government investment but will involve encouraging major increases in RD investment by both indigenous and global companies here.

The centre of Ireland’s RD effort is Science Foundation Ireland (SFI). SFI is investing in research institutes at universities all over the country. This research will deliver huge returns in the long-term, but SFI is also helping the IDA attract multinational RD investment such as Cisco’s RD centre in Galway. The SFI budget has been cut in the last number of years. This will certainly cause leading-edge research to move to other countries if we do not act now. We can send a signal to the world that we are serious by deciding to restore SFI’s 2011 budget to 20O9 levels and committing to a 10 per cent annual increase after that towards the 2020 horizon.

THE INNOVATION ENVIRONMENT

The original Smart Economy report promised more than a year ago to deliver a €500 million venture fund to invest in innovative small Irish companies. This proposal was strongly endorsed in the Innovation Taskforce report.

The National Treasury Management Agency has been discussing options with US-based venture funds but results are not yet visible.

We don’t want the government picking winners and losers, which is why the Innovation Taskforce recommended changing Enterprise Ireland’s role to focus on the front-end of the innovation pipeline and the volume of early-stage companies. You can motivate by reducing financial risk, but the trick here will be to connect with the people who are more naturally motivated to help – the Irish diaspora. If we are serious we will see the first investments from the Innovation Fund in 2010.

The promise of the innovation taskforce is compelling. It has captured the imagination of our high-technology entrepreneurs and has grabbed global attention. The potential for 117,000 new jobs by 2020 is what is on the line here. The three near-term decisions discussed here will show the world that we are serious and strongly signal our intention to be a global leader in innovation in the next decade.

Barry O’Sullivan is senior vice president at Cisco Systems, co-founder of the Irish Technology Leadership Group and was a member of the Innovation Taskforce