orporate site selectors have known for years that the presence of a major research university can be a determining factor in choosing a business location. The American Electronics Association calls university-related research and development the second most important site selection factor, behind access to capital, for a high-tech company.
However, only recently have academic researchers been able to quantify the contribution of universities to corporate growth and economic development.
This new research could prove valuable for corporate real estate executives, especially as they operate increasingly in a marketplace that depends on higher education to provide the critical work-force talent and knowledge capital needed by growing companies.
A landmark report — “Innovation U.: New University Roles in a Knowledge Economy” — takes an in-depth look at the contributions of 12 American research universities to U.S. productivity and concludes that business-university partnerships will be the principal variable that separates high-growth regions from other parts of the world.
Produced by the Southern Growth Policies Board and written by scholars Louis G. Tornatzky, Paul G. Waugaman and Denis O. Gray, the report should be required reading for every executive who works for a technology-driven company.
The authors note that “business-higher education partnerships have emerged from the ‘grass roots,’ as opposed to being discovered in Washington and imposed as a top-down, one-size-fits-all uniform formula. The most successful American higher education institutions in business-higher education partnerships have demonstrated a very pluralistic and individually tailored approach to the evolution of their practice of partnering. There are common practices but no one model or approach is being followed by all.”
The research study presents case studies from 12 American universities: Carnegie-Mellon, Georgia Tech, North Carolina State, Ohio State, Penn State, Purdue, Stanford, Texas A&M, University of California at San Diego, University of Utah, University of Wisconsin and Virginia Tech.
- The authors identify 10 critical components that characterize each university:
- industry-research partnerships
- technology transfer
- industrial extension and technical assistance
- entrepreneurial development
- industry education and training partnerships
- career services and placement
- formal partnerships with economic development organizations
- industry/university advisory boards and councils
- faculty culture and rewards
- leadership/structures, policies and institutionalization.
“Interestingly, most of the 12 American universities spotlighted in this publication come from regions and states either dominated by traditional heavy manufacturing … or from more resource intensive, agriculture dominated areas represented by Georgia Tech, Virginia Tech and Utah,” the report notes. “But institutions such as Carnegie Mellon, North Carolina State, Ohio State, Penn State, Purdue, Texas A&M and Wisconsin are Midwestern or Southern, predominantly land-grant institutions that have ‘gotten it’ regarding the transition of the American economy to one that is increasingly knowledge-driven.”
The authors state that it is imperative that American business leaders understand this transition. “The future American economy is going to need and rely on higher education even more than in the past, and not just for its role in educating the future work force,” they write. “All fields and careers will require at least some post-secondary education for entry. Higher education will need to play an ongoing lifelong education and learning role for much of the work force. A key discriminating factor for future regional economies is likely to be the talent pool. Those that offer quality workers with the right generic skills and career experiences can differentiate themselves. No longer a commodity item, talent is something all regions can address, but it will require collaboration of their higher education institutions including community colleges as well as four-year colleges and research universities.”
Quantifying the contribution of universities, the report notes that U.S. universities performed US$27.5 billion in research in 1999. The transfer of technology-related research led directly to $33 billion in U.S. economic activity and the creation of 280,000 jobs.
The authors also note the importance of developing entrepreneurs: “We expect that universities that are actively linked to and involved in state and local economic development will operate or partner with local efforts to foster start-up, technology-based companies. In many cases, involvement in such activities will be explicitly premised on regional economics and the perceived attractiveness of creating contiguous, high-technology industry.”
The report also notes the important role universities will play in the future as the predicted labor shortages in many science and technology fields materialize in the American workplace.
“Concerns about ‘brain drain’ have focused new attention on the university’s traditional educational mission and how it can help meet state industry’s labor needs,” the report states.
In the following special section, several prominent colleges and universities share their success stories and the unique resources they have to offer expanding companies.