Research and Development →
- 31 Jul 2014
- Research & Ideas
A Scholarly Crowd Explores Crowdsourcing
At the Open and User Innovation Workshop, several hundred researchers discussed their work on innovation contests, user-led product improvements, and the biases of crowds. Closed for comment; 0 Comments.
- 23 Jul 2014
- Lessons from the Classroom
Innovation Is Magic. Really
When Stefan Thomke teaches students how to manage innovation and creativity, he turns to an unexpected source: Magician Jason Randal. Open for comment; 0 Comments.
- 14 Jul 2014
- Research & Ideas
Pay Attention To Your ‘Extreme Consumers’
Jill Avery and Michael Norton explain what marketers can learn from consumers whose preferences lie outside of the mainstream. Open for comment; 0 Comments.
- 19 Sep 2013
- Working Paper Summaries
U.S. High-Skilled Immigration, Innovation, and Entrepreneurship: Empirical Approaches and Evidence
In the 2008 Current Population Survey, immigrants represented 16 percent of the United States workforce with a bachelor's education. Moreover, immigrants accounted for 29 percent of the growth in this workforce during the 1995-2008 period. Exceeding these strong overall contributions, the role of immigrants within science, technology, engineering, and mathematics (STEM) fields is even more pronounced. Even so, the importance of the global migration of STEM talent has been under-studied. In this paper, which focuses exclusively on the United States' experience, the author reviews academic work regarding the effects of global migration on innovation and entrepreneurship. Findings show that while some aspects of the phenomenon are well understood, such as the quantity and quality of immigrants, scholars still have very little insight on others, such as return migration. Overall, immigration has clearly been essential for the United States' leadership in innovation and entrepreneurship. There is also evidence of positive impacts of high-skilled diasporas for home countries, although the ledger that can be measured in the United States remains incomplete. Key concepts include: Scholars are just beginning to trace out and quantify how the economy reacts to immigration. Academic research on low-skilled immigration has a longer history, and efforts to evaluate high-skilled immigration are just starting to define its unique attributes from general immigration (e.g., the impact of firm sponsorship of H-1B visas). In terms of quantity, immigrants generally account for about a quarter of the US workforce engaged in science, technology, engineering, and mathematics (STEM) fields. This share is growing rapidly. In terms of quality, most immigrants engaged in STEM work in the United States are better trained for this work than natives (e.g., chosen academic fields of study, levels of education obtained). Conditional on these education choices, immigrants and natives appear quite comparable in quality, with some greater potential for the "long tail" of superstars. Immigration is associated with higher levels of innovation for the United States. The short-run consequences for natives are minimal. However, this aggregate achievement involves some displacement of U.S. workers, and the long-run impact is less understood. Long-run estimates range from very positive to substantial crowding-out depending upon the study and technique. High-skilled immigrants promote knowledge flows and foreign direct investments to their home countries. It is still unclear whether this benefit fully compensates the country for the potential negative consequences from the talent migration. Closed for comment; 0 Comments.
- 09 May 2013
- Working Paper Summaries
Clusters of Entrepreneurship and Innovation
For many decades, the common wisdom among local officials pursuing employment growth for their areas was to attract a large firm to relocate. This "smokestack chasing" led to many regional governments bidding against each other and providing substantial incentives to large plants making their location choice decisions. The success of entrepreneurial clusters in recent decades, however, has challenged this wisdom, and now many policy makers state that they want their regions "to be the next Silicon Valley." This has led to extensive efforts to seed local entrepreneurship, with today's politicians routinely announcing the launch of an entrepreneurial cluster in a hot industry, such as biotechnology, nanotechnology, or advanced manufacturing. In this paper, the authors explore the rationale for and efficacy of policies to promote local entrepreneurship and innovation and reflect on recent initiatives in this domain. Key concepts include: Entrepreneurship is often linked to local economic growth, and economic theory provides rationales for why governments may want to support entrepreneurship and innovative activities in their local areas (e.g., spillover benefits to neighboring firms). Economic theory and practice also identifies potential pitfalls in these efforts. Policies supporting the emergence of clusters of small-scale entrepreneurs allow policy interventions to touch many entrepreneurship simultaneously, providing important scale to interventions, and appear to respect the empirical tendency of economic activity to cluster. Such approaches can also avoid the dangers of targeting specific firms for support. Despite this foundation and the tremendous current policy interest for entrepreneurship, the optimal formulation of entrepreneurship policy is not yet known. Indeed, relative to our understanding of how to craft policies for mature fields like international trade and monopoly, we have very little experience evaluating policies towards start-up clusters. The best path forward involves extensive experimentation and evaluation. Without advances in these dimensions, we cannot be confident that policies to promote entrepreneurship will have their intended impact. Closed for comment; 0 Comments.
- 14 Feb 2013
- Working Paper Summaries
Fostering Translational Research: Using Public-Private Partnerships to Improve Firm Survival, Employment Growth, and Innovative Performance
The authors demonstrate that a unique Danish mediated public-private partnership model for fostering the translation of basic science into commercial applications help firms significantly decrease the likelihood of bankruptcy while substantially increasing the average level of employment. Funded firms in the study were granted significantly more patents and published more peer-reviewed papers, and the impact of these publications was significantly higher. In addition, the mediated partnership model improved the knowledge produced as well as the collaborative behavior of scientists with a significantly higher level of citations and more cross-institutional coauthored publications. Key concepts include: Mediated public-private partnership funding affects firm performance especially in the mid-term, three to four years after funding. From a policy standpoint, by providing a public-private partnership funding scheme coupled with strong mediation, governments are able to incentivize firms to take on more basic science research and development and make the results more successful. Closed for comment; 0 Comments.
- 19 Nov 2012
- Research & Ideas
LEED-ing by Example
When a local government decides to pursue environmentally aware construction policies for its own buildings, the private sector follows suit, according to new research by Timothy Simcoe and Michael W. Toffel. Closed for comment; 0 Comments.
- 25 Sep 2012
- Working Paper Summaries
Colocation and Scientific Collaboration: Evidence from a Field Experiment
In recent years there has been considerable interest in the policy arena on fostering collaborative and especially interdisciplinary collaborations. Yet there is scant evidence on how to do this in practice. To learn how team members find each other in the scientific community and decide to collaborate, the authors designed and carried out an experiment involving Harvard University and its affiliated hospitals. Results suggest that matching between scientists may be subject to considerable frictions, even among scientists in relatively close geographic proximity and in the same organizational system. However, even a brief and focused event facilitating face-to-face interactions can be useful for the formation of new scientific collaborations. Key concepts include: Face-to-face interactions play a central role in the initiation of new collaborations. Creating settings where scientists meet face to face and discuss early-stage research ideas can be useful for fostering collaboration. Matching between scientists is not easy. For example, many factors that affect successful collaboration are not easily observed to both parties until collaboration is well underway, such as personal chemistry and scheduling constraints. Time spent in events that facilitate face-to-face interactions also has opportunity costs. The effect of such activities on scientific productivity and welfare more generally is still unclear. This is the first study to bring field experimental methods to a workplace setting in the scientific community. Closed for comment; 0 Comments.
- 19 Sep 2012
- Research & Ideas
Funding Innovation: Is Your Firm Doing it Wrong?
Many companies are at a loss about how to fund innovation successfully. In his new book, The Architecture of Innovation, Professor Josh Lerner starts with this advice: get the incentives right. Open for comment; 0 Comments.
- 11 May 2012
- Working Paper Summaries
Creating an R&D Strategy
This note by Gary P. Pisano provides a framework for designing an R&D strategy. It starts with the simple notion that a strategy is a system approach to solving a problem. An R&D strategy is defined a coherent set of interrelated choices across decision concerning: organizational architecture, processes, people, and project portfolios. To illustrate the framework, we use examples of three pharmaceutical companies and examine how their different R&D strategies were rooted in different assumptions about the core driver of R&D performance. This suggests that the very first question to be answered in strategy development is: What's our shared understanding of the root cause of the problem we are trying to solve? Key concepts include: A good strategy provides consistency, coherence, and alignment. The "game plan" for an R&D organization can be broken down into 4 strategic levers: architecture, processes, people, and portfolio. Together, decisions made in each of these categories constitute the R&D strategy. R&D performance results from the interaction of many different decisions and choices, including the size and location of R&D facilities, the division of labor between various groups, the choice of technologies used inside the R&D organization, the selection of personnel, the allocation of resources, the design of processes for managing projects, and other factors. Closed for comment; 0 Comments.
- 06 Feb 2012
- Research & Ideas
Kodak: A Parable of American Competitiveness
When American companies shift pieces of their operations overseas, they run the risk of moving the expertise, innovation, and new growth opportunities just out of their reach as well, explains HBS Professor Willy Shih, who served as president of Eastman Kodak's digital imaging business for several years. Key concepts include: Outsourcing ends up chipping away at America's "industrial commons"—the collective R&D, engineering, and manufacturing capabilities that are crucial to new product development. If the United States wants to keep from slipping any further in its ability to compete on the industrial stage, the government must increase its support of scientific research and collaborate with the business and academic world. Open for comment; 0 Comments.
- 31 Aug 2011
- Research & Ideas
Improving Fairness in Flight Delays
Airlines and the FAA don't like flight delays any more than passengers, but what's to be done? Assistant Professor Douglas Fearing and colleagues propose a "fairness" system that could save travelers time and service providers millions of dollars annually. Key concepts include: The model could reduce flight delays by 4 percent or more on some of the worst travel days, resulting in a systemwide savings of $25 to $50 million annually. Closed for comment; 0 Comments.
- 28 Mar 2011
- Research & Ideas
Why Manufacturing Matters
After decades of outsourcing, America's ability to innovate and create high-tech products essential for future prosperity is on the decline, argue professors Gary Pisano and Willy Shih. Is it too late to get it back? From HBS Alumni Bulletin. Closed for comment; 0 Comments.
- 28 Jan 2011
- Working Paper Summaries
Agglomerative Forces and Cluster Shapes
HBS professor William R. Kerr and doctoral candidate Scott Duke Kominers develop a theoretical model for analyzing the forces that drive agglomeration, or industrial clustering. It is rare that researchers systematically observe the forces like technology sharing, customer/supplier interactions, or labor pooling that lead to firm clustering. Instead, the data only portray the final location decisions that firms make (for example, firms that utilize one type of technology are clustered over 50 miles, while those using another technology are clustered over 100 miles). The researchers' model identifies how these observable traits can be used to infer properties of the underlying clustering forces. Key concepts include: Most industries exhibit spatial clustering. The paper's framework provides a theoretical foundation for inferring properties of agglomerative forces through observed spatial concentrations of industries. The model demonstrates that agglomeration clusters generally cover a substantially larger area than the micro-interactions among firms upon which they build. This structure is present, for example, in the technology and labor flows in Silicon Valley. Agglomerative forces with longer micro-interactions are associated with fewer, larger, and less-dense clusters. These patterns are evident in both technology clusters and industrial agglomerations. Closed for comment; 0 Comments.
- 05 Jan 2011
- Op-Ed
Funding Unpredictability Around Stem-Cell Research Inflicts Heavy Cost on Scientific Progress
Funding unpredictability in human embryonic stem-cell research inflicts a heavy cost on all scientific progress, says professor William Sahlman. Open for comment; 0 Comments.
- 23 Nov 2010
- Working Paper Summaries
Growth Through Heterogeneous Innovations
Economists have long recognized that innovation is central to economic growth and development. But as a profession, economics is just beginning to model the many types of innovations that exist and the amazing heterogeneity in the firms that conduct research and development--from General Electric to Silicon Valley start-ups. This paper provides theoretical and empirical evidence surrounding how firm size influences the types of R&D undertaken, with particular focus on choices to pursue exploration R&D (capturing new product lines) versus exploitation R&D (refining current product lines internally). From the choices made by individual firms and new entrepreneurs, the model then builds to consider aggregate economic growth. Research was conducted by Ufuk Akcigit of the University of Pennsylvania and William R. Kerr of Harvard Business School. Key concepts include: Exploration R&D seeks to create new technologies and products for the company to build market leadership. Exploitation R&D focuses on improving existing product lines that the firm already owns, in order to build stronger profits. Large firms have many product lines and thus naturally engage in extensive exploitation R&D to improve their current technologies. Small firms and new start-ups have a comparative advantage for undertaking exploration R&D. Quantitative tests find that exploration R&D has had a greater spillover effect into economic growth than exploitation R&D in the United States over the last couple of decades. This illustrates one channel through which small, innovative businesses and start-ups can play an especially important role in economic growth. Closed for comment; 0 Comments.
- 01 Jun 2009
- Lessons from the Classroom
The Challenges of Investing in Science-Based Innovation
Smart science-based businesses view today's economic turmoil as an opportunity to stoke up research and innovation for long-term competitive advantage, says professor Vicki L. Sato. How about your business? Key concepts include: Companies with highly differentiated products will be able to weather this storm, and come out the other side stronger. Innovation management challenges fall across several key areas, including strategy, organizational design, decision-making, and resource allocation. Different situations will require different business decisions—investing in R&D isn't always the right path to take. Closed for comment; 0 Comments.
- 25 Mar 2008
- Working Paper Summaries
Incompatible Assumptions: Barriers to Producing Multidisciplinary Knowledge in Communities of Scholarship
Just as flows of knowledge within and across communities of practice improve the quality of new products, knowledge sharing among knowledge workers within interdisciplinary communities may be critical for new discoveries and for a more comprehensive and accurate understanding of phenomena. In spite of this, biologists tend to talk to biologists, economists tend to talk to economists, and lawyers tend to talk to lawyers. This paper argues that producing and disseminating knowledge within a multidisciplinary community of practice is enhanced when knowledge workers hold compatible assumptions, even when the form and content of knowledge generation across those workers varies. Key concepts include: Generating multidisciplinary knowledge may require communities of scholarship to acknowledge the presence and limitations of their assumptions. Within a community of scholarship, interpretive barriers to sharing knowledge arise when subgroups hold contrary assumptions about the appropriate questions to be asked or the fundamental nature of the phenomenon under investigation. Cross-discipline understanding may stem from the potential for members to recognize the relevance of others' findings to their own scholarship. Closed for comment; 0 Comments.
- 07 Feb 2007
- Working Paper Summaries
The Value of Openness in Scientific Problem Solving
Scientists are generally rewarded for discoveries they make as individuals or in small teams. While the sharing of information in science is an ideal, it is seldom practiced. In this research, Lakhani et al. used an approach common to open source software communities—which rely intensely on collaboration—and opened up a set of 166 scientific problems from the research laboratories of twenty-six firms to over 80,000 independent scientists. The outside scientists were able to solve one-third of the problems that the research laboratories were unable to solve internally. Key concepts include: Opening up problem information to a large group of outsiders can yield innovative technical solutions, increase the probability of success in science programs, and ultimately boost research productivity. Open source software communities provide a model for improving the process of solving scientific problems. Outsiders can see problems with fresh eyes; in this study, problems were solved by independent scientists with expertise at the boundary of or even outside their field. Achieving true openness and collaboration will require change in the mindsets of both scientists and lab leadership. Closed for comment; 0 Comments.
Financing Innovation
There is growing consensus that well-functioning financial markets play a central role in driving economic growth through their ability to spur technological innovation. In this paper for the Annual Review of Financial Economics, the authors ask how financial markets might actively shape the nature of R&D that is undertaken. They also examine how this may impact technological innovation and growth through the shaping of the ideas that are developed across firms. Drawing on a new but growing literature on the role that capital markets and financial intermediaries play in impacting firm-level innovation, the authors first elaborate on theoretical contributions regarding why financing R&D projects might be distinct from financing other types of projects and the channels through which financial intermediaries and capital markets can impact innovation. They then discuss empirical studies on financing innovation in mature firms, in particular the literature on how ownership and capital structure impact the amount and nature of innovation undertaken by firms. The paper also looks at innovation in startups and the growing literature on the effect that multi-stage financing has on innovation in young firms. Three main themes emerge: 1) A growing body of work documents a role for debt financing related to innovation. 2) A very active area of research has looked at "learning" across multi-stage financing. 3) There is strong interaction between financing choices for innovation and changing external conditions. Key concepts include: Financing constraints can be extensive in the context of firms engaged in R&D and innovation-with the ability to shape both the rate and the trajectory of innovation. Capital structure plays a central role in the outcome of innovations. Bank finance is an important source of finance, particularly for larger firms with tangible and intangible assets to pledge as collateral. Public markets may provide deep pockets but pose a set of agency costs that might be particularly harmful for firms engaged in exploration and novel innovations. There is a growing interest among academics and practitioners in the multi-stage financing of innovation, both in established firms and startups, and understanding the optimal contracts and policies that might stimulate innovation. Closed for comment; 0 Comments.