Blog: Jason Molesworth

Michigan may be a peninsula, but it's no island. Entrepreneur Jason Molesworth writes this week on closing Michigan's "capital gap" and embracing international trade and competition.

The $1 Billion Question: How to Leverage Michigan's R&D Capability

Here's a straightforward question that a typical Jeopardy champion would likely struggle to answer:  "What university has the largest R&D budget in the United States?"  Any guesses?  M.I.T., Stanford, Harvard? – Answer: Johns Hopkins University in Baltimore, Maryland.  

This factoid is a little distorted though, as it's heavily influenced by the fact that Johns Hopkins hosts the Applied Physics Laboratory, which essentially serves as the federal government's anchor applied physics research center.  Here's a tougher question:  "If you strip out funding for the applied physics research center at Johns Hopkins, what university would lead the country in terms of its annual R&D budget?" – Answer: University of Michigan.

With an annual R&D budget that exceeds a billion dollars per year, and a world class research talent pool, U of M is producing innovative basic, translational, and applied research that few universities in the world can begin to compete with. U of M isn't alone either, with Michigan State, Eastern Michigan, Wayne State, and Oakland University all conducting material levels of R&D across a wide range of fields of study.

An interesting question then is, why when asked about academic R&D do most people immediately think of "the coasts"?  M.I.T. springs to most people's minds, as do Stanford, Cal Tech and Berkley.  This starts looking like a branding challenge, where a major gap exists in people's minds between the perceived and actual scale of innovative R&D that's taking place in the state of Michigan.

R&D is also clearly not an academic effort alone.  Michigan firms in the automotive, life sciences, alternative energy, advanced manufacturing, and healthcare I.T. sectors (to name a few) are producing an impressive pipeline of innovative R&D efforts.

The key question facing Michigan policy makers, businesses, and all around general advocates is: "How can we leverage the impressive R&D capabilities and resources in the state to build a firm foundation for future economic and employment growth"?  While this is a pretty straightforward question, the answers are a little more complex.  In my opinion, some of the most important solutions should include:

 -- Clearly defining R&D, and particularly the commercialization of market-viable R&D, as a state priority and a clear source of competitive advantage.
 -- Actively increasing the scale of funds available within the state for early and mid-stage firms to effectively commercialize innovative R&D, particularly from private investment sources (See my previous post regarding the importance of increasing access to capital in Michigan.)
 -- Developing a national branding strategy that specifically articulates the measurable advantages Michigan possesses from an R&D perspective
 -- Conducting a targeted recruitment campaign that seeks to attract entrepreneurs with applied innovation experience and success to the state
 -- Focusing on strengthening the R&D and innovation enablement "Ecosystem" across the state in a truly systematic manner, and
 -- Perhaps most importantly, evolving our mindset as a state to realize that innovation, entrepreneurship, and responsiveness to rapidly changing market opportunities is the key to the state's future prospects

None of these ideas are particularly new or innovative, but they're important to continually articulate and position, as our future success will largely depend on our ability to successfully innovate and leverage the state's impressive R&D capabilities.  The good news is that Michigan already has one of the most progressive and comprehensive approaches to public-private partnership-led innovation enablement and economic development in the country.  Significant progress remains to be made, however, in translating the state's R&D strengths into economically viable firms capable of driving broad-based prosperity and job creation.  We've got the right assets to compete; now we need to execute the vision and continue to evolve the necessary skill sets to realize sustainable success.