Research Focus

On Tuesday, I am speaking about Pingar's experience of working with a University research partner at a Technology NZ workshop in Tauranga. As those who have followed this blog would expect, I will be talking about our relationship with WaikatoLink and how it has evolved over the past year or so.

Pingar's current research strategy however extends far beyond WaikatoLink. Later this week, John and Emma will be recruiting three computer science graduates to join Kaimai Research at the Technium in Swansea. They are going to focus on Pingar's integration into Microsoft SharePoint.

Also this week, I hope to start an engagement with Auckland University of Technology (AUT) to help commercialise a truly exceptional algorithm being developed there.

Research & Development (R&D) is a critical function at Pingar. Whilst most focus is still on the imminent launch of Pingar, we are already looking at the next phases of research. The AUT and POWIS initiatives are just part of that process.

Tuesday's Technology NZ workshop is designed to encourage companies in the Bay of Plenty to take advantage of innovation as a means of tackling the recession and preparing for the inevitable economic upturn. For me, innovation and R&D is not such a transitory activity. For me, it is what Pingar is all about.

TechNZ in Tauranga - 9th June

TechNZ is hosting a series of ten “survive and thrive through innovation” Research and Development (R&D) workshops throughout New Zealand this autumn to help businesses get ahead despite the recession.

The events, held in conjunction with regional TechNZ partners, are aimed at giving companies new tools to identify emerging business opportunities, develop new products and prepare for the inevitable economic recovery.

On the 9th June, Tauranga is hosting one of the ten workshops. Running from 9.00am - 1.00pm, the event will be held at Baycourt Centre. I have not seen the program at this point, but do know one thing. I will be speaking at the event to talk about my experience of working with WaikatoLink.

For more details of this event, visit the Events Schedule.

Aussies Boost R & D Incentives

Foreign companies will be able to claim 40 cents for every dollar invested in research and development under new rules to be introduced by the Australian government.

Senator Kim Carr, the minister for innovation, industry, science and research, said companies would be eligible even if the intellectual property were owned outside Australia. “This is the biggest increase since records began and the biggest change to business innovation support in more than a decade,” he said.

The 40 per cent tax credit, to be introduced from July next year, would offer “more generous and more predictable incentives for doing R&D in Australia”, he told the Financial Times on Sunday.

The scheme, to be managed through the Australian tax-return system, would have no turnover limit.

I hope someone at the Beehive is watching.................

Research 2009

Looking ahead, 2009 looks like it is going to have a very heavy focus on three or four very specific research projects.

Clearly because of the nature of the work, I have to remain reasonably zipped on the specifics. It does look however as though there will be new direct engagements with WaikatoLink, AUT and the University of Swansea in Wales. These projects will drill down on detailed aspects of the Pingar platform and prepare it for the competitive landscape we have clearly identified.

This research will almost certainly involve our ongoing relationship with the Foundation for Research, Science & Technology. It is hard to overestimate the importance of their work. In times such as these, it is vitally important that NZ businesses continue to invest in innovation and new IP. For Pingar, research is a significant line on the P & L. We view creating new IP as a cornerstone of our corporate development strategy.

So despite the economic times we are in, 2009 will see us pressing ahead with our research activities. For us, research is investment, not cost. It lays the foundation for Pingar's long term strategic growth.

Research Focus

One of the greatest 'truisms' about software development, is that the research and development process never stops. The art is to make a call at each point of the cycle so that a milestone is acknowledged.

Think Version 1.0, Version 1.1, Version 1.2, etc, etc.

One of the challenges that Pingar has faced is that not only are we working to milestones: we are also spreading the R & D process between different geographically located teams. Time differences present a whole set of new challenges.

So as we close our current funding round, the focus is now firmly moving back to longer term research and development. It is a case of looking beyond the core platform and determining how that can be enhanced with the user in mind. There are no shortage of options.

In many of my previous posts, I have referred to the challenges New Zealand poses in terms of market size, access to markets, and so on. In the R&D space however, NZ competes with the best. Over the past couple of weeks, I have become aware of research in our space being undertaken in New Zealand which is genuinely ground-breaking. With the new focus in mind, I will be working with partners here to determine how Pingar might leverage some of the great IP that is being created.

R & D Focus

Over 250 people from over 170 businesses and R&D organisations are expected to attend the TechNZ - Innovation for Business Growth event tomorrow in Auckland. I will be one of them.

The programme includes:
• R&D snapshots session – representatives from Lanzatech, High Modulus and Endace about how they’ve used R&D to transform their businesses.
• Keynote speaker Neville Jordan, Chairman and Founder of Endeavour Capital, will talk about how he transitioned from entrepreneur to venture capitalist and now supports the next generation of science and technology companies.
• An interactive panel discussion about harnessing R&D talent and using innovation to grow your business featuring Phil O’Reilly from Business NZ, Claire McGowan from the Biopolymer Network, Andy Hamilton from The IceHouse and Craig Armstrong from New Zealand Trade & Enterprise.
• Hon. Pete Hodgson, Minister of Research, Science and Technology, will officially launch the revamped TechNZ programme.

For Pingar, research & development is a critical part of our business plan and model. Phase 1 leads to Phase 2 leads to Phase 3. It is a constant ongoing commitment. TechNZ and The Foundation for Research, Science & Technology are important partners in this. Tomorrow's conference is welcomed.

BOP Regional Economic Development

I have been invited to attend the Bay of Plenty Regional Economic Development Forum, to be held in Rotorua tomorrow morning. The purpose of the Forum is to identify strategic priorities to boost regional economic development.

I have received no shortage of pre-Forum briefing documents. The Bay of Plenty Regional Governance Group has clearly been busy.

The Forum provides me with a platform to press the case for greater engagement between the tertiary education sector (University) and the private business sector in the Research & Development space. It is becoming a bit of a hobby horse of mine. I guess that is down to my personal experience of this engagement back in the UK. In London, there was a choice of Universities to engage with. In Tauranga and surrounding districts, there is none. The impact on economic development is real.

The Forum's Agenda includes short presentations from Environmental Bay of Plenty, the Ministry of Economic Development and NZ Trade & Enterprise. There then follow sessions identifying the key strategic regional priorities.

This Forum and its stakeholders are the backbone for future development strategy. The challenge will be coordinating the disparate interests of the different stakeholders in the room. As one of the few private sector delegates invited, it will for me be an interesting take on public sector co-operation in action.

R & D v ROI

As per previous postings, Pingar is instinctively committed to Research & Development. It is a key aspect of our long-term Business Plan.

As well as deploying our own internal resource, we work closely with 'best-of-breed' technology and business partners. These include Microsoft, FAST Search, Global Graphics and HBI Software.

Closer to home, and hot on the heels of yesterday's blog, Pingar is also actively engaged with Waikatolink; (University of Waikato). Over the next few weeks, I want to talk more about the importance of private sector / tertiary education engagement. It seems to me that there is real failure of the private sector in NZ to understand the benefits that such engagement can bring.

Let me spell out my position on this.

The Pingar / University of Waikato relationship is not academic. It is commercial with a capital C. I do not regard Research as not a cost. I regard it firmly as an investment. To understand this, I will introduce you to my 'x5 valuation' theory. It is not scientific, but is based rather on offshore experience of this space. It is my take on the Return of Investment (ROI), Pingar and its shareholders can expect from hard-core Research.

In simple dollar terms, every dollar spent on Research, increases the value of IP within the company by a factor of 5. So you spend NZ$200,000 on a specific Research project and the impact of its successful development and deployment increases its value to NZ$1 million at the point of commercialisation.

This increase of valuation of course appears on the Balance Sheet, not the P&L. So cash flow does dictate the level of investment that can be committed to Research at any one time. This is particularly important for SME's where cash flow is critical. The important lesson for business however is that Research should become a core value within the Business Plan model. It will create the innovation necessary to both build value and ignite competitive edge.

Because of their skill-sets and researcher resource, Universities and others engaged in tertiary education make the perfect partners for the private sector. It is unlikely that most SMEs will have the internal resource necessary to manage the whole Research process.

In March 2003, I gave evidence to the House of Lords Select Committee on Science & Technology on the subject of 'Science in the Regions'. A key aspect of the Committee's study was to identify routes by which SMEs could engage with University and Polytechnic research functions. It was clear during that study that both real and imaginary obstacles and perceptions existed and neither the private sector nor the tertiary education sector were engaging effectively.

I guess those same forces exist here today. The private sector in NZ does not understand the value that tertiary education and Research can bring through joint engagement. And Universities and tertiary research providers have collectively failed to convey the value such engagement can bring to the private sector.

The impact in New Zealand is clear. Spend on R&D by the private sector falls well below the OECD average. So does productivity. So does pay. This issue has to be addressed.

FRST things first

The Foundation for Research, Science and Technology (FRST) invests in research, science and technology (RS&T) on behalf of the New Zealand Government.

I have been working on a Technology for Business Growth (TBG) Application Form over the past few weeks and finally managed to submit it yesterday. The provision of potential government financial support such as this provides a vital source of funding and support for businesses wishing to exploit the bleeding edge areas of innovation and research.

Together with the new R&D Tax Credit regime which kicks in on April 1st next year, New Zealand is finally getting to grips with the importance and significance of a strong R & D culture to long-term economic development. FRST is a good example of that commitment.

The Tauranga Round Table

Tomorrow's visit by Helen Clark and leading Ministers to attend the Western Bay of Plenty Economic Development Forum in Tauranga provides a good opportunity to address some key long-term concerns for the region.

I am attending the Tertiary Education and Research and Development Workshop. It is being chaired by Dr Michael Cullen. I cannot think of a single non-physical infrastructure issue more important for the Bay.

I believe there are solutions to this issue, but they require the input of both the public and the private sectors. Tomorrow's Economic Development Forum is I hope just the first step in that process.

Research and Development in the Bay

I received a letter yesterday from the Prime Minister, Helen Clark. It invited me to attend a Regional Business and Central Government Economic Forum on 30th October.

A number of Ministers will be joining the PM and I have elected to attend the Tertiary Education, Research & Development workshop being chaired by the Minister of Finance, Hon Dr Michael Cullen. The workshop will discuss the particular challenges and opportunities specific to economic growth in the Western Bay of Plenty.

I have blogged before about the importance of tertiary education and its potential impact on R & D in the Bay. Pingar's recent work with the University of Waikato is evidence of this.

Back in 2003, when I was still based in the UK, I was asked to provide oral evidence to the House of Lords Science & Technology Select Committee investigating 'Science and Regional Development Agencies'. You can read a summary of its report here.

Support for Research & Development activity is a key task for regional and central government. Without the correct frameworks in place, government organisations and the private sector will not deliver. At a time when a key focus in New Zealand, like so much of the world, is on developing a 'Knowledge-based Economy', meetings such as the upcoming Economic Forum in Tauranga are essential to build the strategic platform from which a meaningful Research & Development policy can be delivered.