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One
old joke still echoing in the tech economy is that
an extroverted geek is one who, in the course of
his conversation with you, stares at your shoes,
not his own. Therein may be a lesson for
Virginia’s political leaders and economic
development officials as one considers a slew of
investment announcements from state capitols other
than
Richmond.
The
legislature will consider a 20 percent tax credit
for companies who partner with state universities
on research projects. That’s in Hawaii.
The
governor has included $34 million in biomedical
research investments in his Jobs Proposal, which
also includes natural resource-based industries,
job preservation, growth and career training.
That’s Maine’s
governor.
Nine
million dollars from the Lottery Fund will
establish a pre-seed stage “proof of concept”
fund for commercializing research into business
ventures through a newly established Nanoscience
and Microtechnology Institute – in
Oregon.
Supporters
of other legislation, meanwhile, would like to
have $301 million in all to provide for research
infrastructure, regional technology innovation
centers and related needs. Those supporters are in
Utah.
And
state residents may vote soon on a $230 million
ballot initiative to fund stem cell research
grants that will complement $150 million in bond
funds already committed for a Stem Cell Institute.
Congratulations, New
Jersey.
These
are initiatives by states largely in the middle
tier among their science and technology peers, not
by
California,
New
York and
Texas.
Those big states always seem to find hundreds of
millions, even billions to lead on innovative
public investments and Virginia
regularly gives them a “we don’t have that kind of
money” shrug off. It’s easy not to take
instruction from those one has no expectation of
emulating.
But
the announcements from smaller, middle-tier states
show there are leaders who are not content to look
at their own reflections and be driven solely by
the limitations of politics in their own states.
Instead, they are renewing their awareness of the
competitiveness a global, innovative economy
requires. And they are showing their determination
to compete by making direct state investments and
adopting new incentives for partnerships with the
private sector.
Virginia
studies these kinds of incentives annually, but
has proven itself capable of only discrete
investments, not broad commitments. The
Institute for Advanced Learning and Research in
Southside, for example, just received recognition
from the Small Business Administration and Council
of State Governments for its model of distributed
research and rural economic development. Virginia
Tech,
Averett
University,
Southside
Virginia
Community
College
and local and state governments are partners in
that enterprise, which also received a $1.6
million topping up by the General Assembly for
FY2006.
But
Idaho’s
“TechConnect” program, the University of
Maryland’s “Maryland Industrial Partnership”
program and the Michigan Economic Development
Corporation’s “SmartZone” initiative were
the entrants cited as best practices from among 19
finalists. Meanwhile, a xenophobic General
Assembly in Virginia stripped technology and
research related initiatives from its FY2006
budget, including zeroing out the biotechnology
commercialization loan fund it approved last year
and tabling incentives for technology startups and
early stage investors, while readying itself to
adopt new restrictions on stem cell research next
year.
Several
hundred Virginians were reminded this week of just
how critical it is to compete in the world market,
even for the types of technology companies that
currently power the Commonwealth’s economic
engine. At a breakfast sponsored by the Northern
Virginia Technology Council, the president and
chief executive office of CSC, Mike Laphen, traced
the history of how this once stodgy, predictable
federal contractor now has grown to 76,000
employees worldwide with $13.9 billion in 2004
revenue.
CSC
is headquartered in
El Segundo,Calif.,
but has thousands of workers in
Virginia,
which is also the preferred residence for CEO
Laphen and others on his senior executive team.
CSC’s Federal Sector Division, headquartered in
Falls
Church, is
responsible for about $6 billion of CSC’s
revenue and 40,000 of its employees. But CSC’s
latest contract award announcement is a $236
million information technology infrastructure
service contract with French automaker Renault.
Laphen also suggested that his analysis showed the
commercial market is growing faster than the
federal government one. Hence, CSC has a new focus
on
Europe
,
the second largest information technology market
in the world, and new contracts not just in
France,
the
United
Kingdom and
Ireland,
but also India,
Bulgaria,
South
Africa
and
Mexico.
Laphen made it clearer why CSC has sponsored a
successful cycling team in
Europe
for several years now.
These
changes at CSC, Laphen explained, were responses
to business transformations underway since the
company was founded in 1959. CSC had to grow in
the commercial market, which now represents about
two-thirds of its business now. It had to move
into outsourcing, which now represents half of its
work. And CSC had to expand its international
business, which now represents 40 percent of its
revenues, up from 10 percent just a decade ago.
A
couple of days before, Gerry Rubin, Director of
the Howard Hughes Medical Institute’s Janelia
Farm Research Campus in Loudoun County, reminded a
smaller group at the Center for Innovative
Technology that HHMI’s objective as it plans to
begin operations in mid-2006 is very broad:
Identify important biomedical problems for which
future progress requires technology innovation,
then foster the establishment of integrated teams
of biologists and tool builders who seek to break
through the existing barriers.
“HHMI
poses the thousand-person-year question,” Rubin
said. “Suppose you were given generous funding
to assemble a group of 100 people for a period of
10 years and asked to tackle an important
biological problem that was not easily approached
in a university setting?” Add criteria, such as
high potential impact and better accomplished at
Janelia Farm, and HHMI has established some pretty
focused objectives.
Listening
to HHMI’s Rubin on research might suggest
renewed public investments in students, professors
and researchers who demonstrate great promise to
make original and innovative contributions.
Listening to CSC’s Laphen on global marketing
might suggest a Tour de Virginia cycling event,
not just a culture of “tight contracts and
flexible relationships.”
But
what might help Virginia’s
leaders learn more about the global competition in
research, development and innovation is to stare a
little more at the shoes of other states and
countries while putting their budgets and
strategies together. Other states and other
countries are coming up with their own answers to
the “thousand-person-year” question and those
answers will include jobs and businesses in the
most competitive, forward-looking and responsive
locations.
--
March 14, 2005
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