Instrumented Interconnecteds Intelligent

By Bernard Meyerson
IBM Fellow and Vice President, Innovation

A newly-released tally of US patent awards in 2011 could shock many people. Last year, only two US-based companies finished in the top 10—IBM at No. 1 and Microsoft at No. 6. Hewlett-Packard and Intel fell off the list. Eight of the companies in the top 10 now are headquartered in Asia. Some people will point to this result as yet another signal that America’s global competitiveness is waning.

What’s really going on is more nuanced but just as worthy of attention. Innovation, like so many other things, is becoming increasingly global. People and organizations all around the world now have the software tools, the financial capital and the network connectivity they need to participate more fully in the creative aspects of the global economy. This is a good thing. It helps to generate economic activity worldwide–increasing demand for products and services.

But the globalization of innovation also poses huge challenges. Companies and governments need to understand the transformation that’s underway, and, in order to boost their competitiveness, they need to come up with strategies to deal with the changes.

How important is dealing with the globalization of innovation? Intellectual capital—embodied in employees and citizens, and protected by patents and copyrights—will be the most important resource in the 21st century. It will be even more crucial than financial capital or natural resources in determining which companies and which countries are most successful. It’s that important.

IBM has long been a pioneer of global innovation. We established our first scientific research laboratory outside the United States in Zurich, Switzerland, in 1956. We now have research labs in 9 countries—the newest of them in Brazil. We have set up more than a dozen “collaboratories” worldwide involving government research institutions, universities and other companies—mostly focused on Smarter Planet-related issues. In addition, we’re increasing the cross-border interactions between our own researchers and also between our people and outsiders. Teams made up of people from around the world work collaboratively on projects that aim to transform the way people live and work everywhere. Of the US patents granted to IBM last year, 26% included non-Americans among the inventors. In essence, we have created a global innovation ecosystem.

Here’s our formula for creating such an ecosystem:

Tap into global talent pools: Companies need to hire the most creative people they can find, and, increasingly, that means hiring globally. This approach not only provides companies with employees who have diverse talents and points of view; it also helps organizations enter new markets they might not have explored otherwise. For instance, scientists in IBM Research in India came up with the idea for what we call the Spoken Web—technology that enables illiterate people worldwide to enjoy the benefits of Internet access. Many of our health care innovations come from our lab in Haifa, Israel.

 Collaborate across borders: IBM develops solutions to the world’s problems by teaming with other companies and with government agencies. One such collaboration is the SmartBay project in Ireland. IBM is working with The Sustainable Energy Authority Ireland and the Marine Institute Ireland to balance economic activities with the need to protect the environment. Another example is IBM’s semiconductor collaboration in New York’s Hudson Valley. Asian and European companies have moved scientists and engineers there to co-develop the latest advances in computer chip fabrication.

Share resources and ideas: Some challenges are just too big for any one company–or country–to solve on its own. Increasingly, organizations address these situations by sharing assets, as in cloud computing, or ideas, as in open source software and other crowdsourcing efforts. For instance, IBM has worked with a handful of global pharmaceutical and chemical companies to build a cloud-based software tool for analyzing information about chemicals and molecules. The goal: making it easier for the partners in the project to create everything from life-saving drugs to environmentally sustainable packaging materials.

Improve science and math skills: Education is the foundation for innovation, job creation and economic development—and, of course, it’s globalizing. IBM is working with more than 200 universities worldwide to help them develop new degree programs in analytics. The goal is to prepare the next generation of experts who will create analytics tools or use them to expand knowledge of how the world really works and to help leaders make better decisions. For IBM, the attraction is an expanded global talent pool of people who are potential employees for IBM and its clients.

To be sure, there are a lot of moving parts in a global innovation ecosystem. It’s not easy to manage. But IBM’s ecosystem is one of the primary reasons why we have for the 19th year in a row claimed the No. 1 rank for US patents. And it’s one of the reasons why we hope to remain a leader for years to come.


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