Polish-Israeli Chamber of Commerce

Can A Government Foster Innovation? – Part II

Israel’s unique, world-renowned high-tech economy – with the highest number of startups per capita in the world and the highest rate of R&D spending – owes much of its success to the unique public-private partnership which helps keep our tiny country on the cutting-edge of innovation worldwide. At the center of this partnership stands the Office of the Chief Scientist (OCS) in the Israeli Ministry of Economy. As Chief Scientist Avi Hasson says, “We have no business plan other than innovation.” Indeed, it is his role to keep Israel at the forefront of innovation worldwide.

In our last column, we explored several ways in which our government works to spur innovation in our knowledge-based ecosystem, which could prove useful on Poland’s path to developing its “Creative Economy.” Here are a few additional ideas:

Foster International Collaboration. There’s no better breeding ground for innovation than multi-disciplinary and cross-cultural pollination. Bringing together people from different backgrounds and cultures, melding ideas, points of view, cultures, languages and sensibilities is exactly the type of mash from which innovation is born. That is why the OCS has established fifty international agreements around the world matching hundreds of joint R&D projects between Israeli and foreign companies. This includes the recently signed Polish-Israeli industrial R&D agreement, funded respectively by our two governments.

In addition, execution of frameworks such as business delegations and events with partner countries is crucial for building real relationships.

Establish Bridges between Industry and Academia

Collaboration between academia with its deep research and industry with its eye towards commercialization is a phenomenon whose enormous potential is just being tapped. Channeling basic research towards the marketplace has enormous ramifications for such fields such as biotech, medical devices cyber-security, and others. Governments can and should play a key role in this “cross-cultural” pollination.

Create Infrastructure. Generally, it doesn’t make financial sense for the private sector to invest in infrastructure, while for governments, investing in infrastructure that serves thousands of companies, has enormous value. So, for example, our OCS gave a significant grant to develop Israel’s first human tissue bank, which will likely play a key role bolstering our growing biotech sector. No individual company would likely underwrite such an endeavor.

Utilize Your Human Capital. Human capital is, at the end of the day, the primary resource in any knowledge-based economy. That is why we are investing significant resources in bringing sectors with enormous talent such as the Israeli-Arab and Ultra-orthodox communities – both underrepresented in hi-tech –into the sphere of action. Women have also been traditionally low in numbers in our hi-tech workforce. Government can play a key role in integrating those sectors, to the benefit of all.

Bring Innovation to Traditional Industry. Most traditional industries generally focus on two things: how to pay salaries and how to pay suppliers. In today’s rapidly changing marketplace, even these industries will not be viable for long without innovation. That is why we are investing hundreds of millions trying to inculcate the importance of R&D and invention into such industries not normally associated with innovation, such as food, plastics, metal and textiles.

Know When to Walk Away. As we said, governments can be good at taking risk, but they also must know when to put their money down and move out, allowing entrepreneurs and innovators to do their thing without the cumbersome interference a government ministry can bring to bear.

Pivot. We are constantly reinventing ourselves to keep up with the needs of the marketplace – that is a lesson we have learned from the startups themselves. Updating our groundbreaking models of public-private partnerships is crucial in a global marketplace which seems to be moving at the speed of light.

Companies who wish to benefit from the lessons of the “Startup Nation” and learn more about business opportunities with Israel can contact us at Israel Economic and Trade Office

The local focus

On the 14th -15th of June, a delegation of close to 150 participants from leading Polish companies, technology parks, economic zones, academic institutions will be accompanying government officials to Israel, marking 25 years of renewed diplomatic relations.

The delegation will be visiting Haifa, one of Israel’s leading high-tech hub and home to the Technion – the Israeli Politechnika. On the second day an economic forum will take place in Tel-Aviv where Polish and Israeli business leaders will have the chance to share new ideas.

Tal Harmelin