Published on November 27, 2008
The Getting of Knowledge - funding & managing applied R&D Andrew Campbell 6 December 2006 Outline • The Getting of Knowledge – Strategy – Governance – Management – Communication – Legacy – Evaluation • Take home messages 1
Introduction • Research investors are ‘keepers of the long view’ • It is a highly strategic business • It is big business, involving $$ billions and hundreds of organisations • But there is little written on how to do it • This guide is aimed initially within LWA • But may be of some interest more widely Acknowledgments • Investing in R&D is a strategic privilege • Bobbie Brazil & the LWA Board for the sabbaticals • Current and former colleagues – Especially Nick Schofield for much of the detail • Current & former directors • PMC members from LWA and our partners • R&D Corp partners - especially fellow EDs 2
Land & Water Australia ♦ One of 14 Rural R&D Corporations and related companies - Statutory Authority (PIERD Act 1989) ♦ research to support sustainable resource management ♦ we buy, broker and manage research, we don’t do it don’ ♦ managed corporately, independent Board (CAC Act) ♦ $12.8m appropriation; ~$33m R&D spend (2005-6) ♦ >30 co-investing partners ♦ We’re in the knowledge business We’ R&D Programs • Industries • Landscapes – Sustainable Irrigation – TRACK (Tropical Rivers) – Grain & Graze – Environmental Water Allocation – Managing Climate Variability – Riparian Lands – Land, Water & Wool – Native Vegetation & Biodiversity – Agroforestry (through RIRDC) – Healthy Soils – Weeds – SAGE Farmers • Innovation • People – Innovation Call – Social & Institutional – Scholars & Fellows – Land & Water Resources Audit – Indigenous 3
About Applied R&D • ABS categorises research into four types: pure basic; strategic basic; applied; and developmental • This work focuses on the last three, especially applied • Applied research “seeks to acquire new knowledge with a specific application in view” • We know the application context • We know the intended end-users & beneficiaries • We can tease out the nature of the knowledge need • We can identify prospective adoption pathways 4
The many hats of a research funder • The focus here is not on how to do R&D, but on how to invest in and manage applied R&D • This draws mainly on LWA experience over 15 years across a wide range of R&D programs – learning from failures as much as successes • A significant emphasis on collaboration • There is a rich menu of possible approaches to the business of funding and organising R&D • Focus on Return on Investment (ROI) • Balanced portfolio across asset classes • Balanced portfolio risk • Posit and target where future returns may be generated – long term perspective • Regularly review and adjust portfolio 5
• Funds collaboration and linkages – the arrows, not just the boxes • Understands who is doing what and has a good understanding of national capacity • Centre of the nervous system and has the best overview • Looks for and brokers links across boundaries • Builds and nurtures relationships and develops networks • Efficient, accredited systems, and professional contract staff • Strong service capability (legal, financial, business, communication) • Process accountability (governance, risk management, reporting, audit) • Emphasises capability as an investment vehicle for other investors 6
• Recognises & fosters creativity, develops ideas • Spontaneous rather than directed • Treats each innovation as a separate entity • Flexible financing model – able to move and commit funds quickly • Opportunistic and entrepreneurial • Not rigid about process • Independent, skills-based Board, with strong corporate governance & accountability • Leadership and influence, top-down agenda setting • Strategic alliances and partnerships • Commercial focus • Efficiency and performance orientation • Hierarchical, rationalist, managerial in structure and process 7
• Works very hard to understand client needs, culture and values • Works within clients’ operating systems to meet their needs – understands their systems and leverage points • Action learning and participative processes – involves clients in designing R&D • Shares knowledge and develops priorities jointly • Uses and builds on existing delivery pathways for adoption • Respects and incorporates non-scientific knowledge • Clear destination and purpose • Strong real-time intelligence gathering, constant external scanning • Accepts that there are many alterative futures • Highly responsive to new opportunities • Continually refines course - as opposed to rigid five year plans • Focus on monitoring and evaluation in an adaptive sense, rather than after the fact 8
• Knowledge is the base capital – drives economic growth, jobs and behaviour • Explicit about epistemologies – how we know what we know • Pays attention to knowledge assets - even ‘old’ projects & programs • Recognises all forms of knowledge and respects different knowledge domains • Articulates links between data, information and knowledge • Recognises complexity and uncertainty • Analyses knowledge systems and applies knowledge management concepts & tools • Negotiates research focus between researchers and end-users – translates knowledge needs into researchable questions • Synthesises research outputs across projects & programs to meet defined end-user needs • Able to understand and be understood by both scientists and end users • Combines technical literacy and know- how with client empathy and credibility • Analyses and understands delivery pathways and how to plug into them • Analyses knowledge gaps and needs, stays in close touch with end-users 9
Strategy - corporate • “doing the right things right…” • So how do you work out those right things? • Strategy starts with purpose – the business niche • Maintaining strategic capacity – scanning, analysis, evaluation, reporting • Strategic navigation vs 5 year plans • A portfolio approach – Avoids having all eggs in one basket – Spreads risk – Enables a mix of ‘hats’ or approaches according to specific contexts Evaluation • It must be: – hard-wired in from the start – adequately resourced – instilled into the culture of the organisation • Done well, it can improve program management within the life of a program • At a portfolio level it generates valuable intelligence, especially through time • LWA has evaluated 30% of total portfolio back to 1990 with consistent methodology and transparent, conservative assumptions (see Chudleigh, Simpson & Schofield 2005) • Benefit:cost ratio 4.8 (and rising); IRR 24% 10
Strategy – program and project level • Scoping the research questions is critical • Understand the nature of the knowledge need • Understand where knowledge sits c.f. other factors – market or policy failure, values, institutions etc – knowledge may not be the constraint… • Understand the type of knowledge required • Understand the adoption context of the intended end-users before considering research methodology • Be very clear (SMART) about program objectives • $$ invested at this end have a short payback period Strategy – program and project level • Science is just one knowledge domain • Others may be equally relevant to the particular mix of knowledge required – E.g. farmers’ local knowledge, Indigenous knowledge, strategic or organisational knowledge • Think about the mix and embed it in program design Some initiatives targeting other knowledge domains: – Community Fellowships – Recording Traditional Knowledge (Victor Steffensen, Balkanu) – Knowledge for Regional NRM – SAGE Farmers 11
Management • Procurement • Project Management –(not discussed today) • Knowledge and Adoption • Legacy • Evaluation Procurement • Core business for research investors • Fundamental to overall performance, efficiency and risk at the organisational level • Reputation and credibility are on the line in every procurement process • Research procurement is not the same as letting a tender for cleaners, IT, or printing • We are concerned with building the knowledge base, R&D capacity, and coordinating research effort (objects of the PIERD Act) 12
Procurement pathways Alternatives • Open Call • Select Tender • Commissioned • Joint Venture Discriminating criteria • Clarity of R&D question, scope, opportunity – Degree of integration, collaboration, capacity-building required • Knowledge about available providers • Desired level of contestability & transparency • Cost-effectiveness (including leverage potential) 13
Pros and Cons of different procurement options Process Open Call Select Tender Commission Joint Venture Transparency High Low Low Low Contestability High Medium Low Low Advantages Most open & Faster & more The most efficient. Potentially max transparent. Easiest efficient than open Good for protecting leverage in $$ and to ensure competitive call. Fewer IP. Easy to plan & influence. Can neutrality, can turn disappointed budget. Integration build R&D capacity. up new ideas/talent & parties. Can be & collaboration can Can evolve R&D communicate highly contestable. be built into tender priorities as you go. priorities Can build specs. Protect IP. Can be integration into efficient (but not tender. axiomatic). Disadvantages Most work, More risk of Least transparent. Hostage to one depending on process being Riskiest against provider. Not very systems. Many questioned. comp neutrality. transparent or disappointed parties, Assumes complete More difficult to contestable. my deter best knowledge of prove relative value Partnerships can be researchers. Not provider market. for money. lots of work. conducive for Quality of tender Hostage to one integration. specs crucial. provider. Collaboration • Efficiency in investment • Reduces duplication • Enables coordinated approach to cross cutting issues • 3 levels – communication, coordination, co- investment • Be very clear why you are collaborating • Must invest in relationships • Attribution can be hard 14
Governance • Crucial to get governance frameworks right at corporate, program and project levels • PIERD/CAC Acts excellent at the corporate level • At the program level, governance is trickier, especially for collaborative investments • We use 3 key instruments – Program Management Agreement (between co-investors) – Program Management Committee (comprising reps of funders plus end- users and/or technical expertise) pursuant to S89 of PIERD Act – Project-level research contract • Contracts are more about clarity and shared understanding, not as a basis for litigation 15
Factors influencing practice change in NRM Information and the Practice Change Cycle 16
Communication (knowledge & adoption) • Make it real • Resource it • Instil it in the culture of the organisation • Plan K&A from the start. It will: – influence the research methodology – encourage involvement of stakeholders in design and management of the research – target research questions to user needs – assist implementation, and – improve the adoptability of research results Managing the knowledge legacy • The legacy must be planned and budgeted for – How will research results be managed over the adoption timeframe? – How will people access info after the program has finished? – Project level results may be less useful than synthesis products or activities across projects or even across programs - targeted at user needs, in their context at the appropriate scale – Consider a harvest year – Engaging with intended users or stakeholders, even just market testing products, can help ensure that outcomes are used and embedded 17
Knowledge assets of interest Magazines Spatial datasets Publications Reference books •Reference books Funding Journal•Journal articles and (Guidelines opportunities manuals etc) articles•Research reports •Pamphlets Anecdotal •Magazines Conference evidence Research proceedings •Conference proceedings report Knowledge needs Current Specialist Decision Decision support tools research Research directory frameworks •Programsadvice projects •Models •Projects •Decision frameworks •Specialist contacts Current research Models •Spreadsheets Spreadsheets for advice programs NRM Toolbar interface NRM search [Click name to [Click name to My profile Google open My see librarian Customise my Australia R&D Directory library] services] toolbar Organisation This Worked Here! Update toolbar assets Click dropdown Includes form Uninstall Knowledge needs Advanced to view list of for requesting toolbar Events and funding folders information Help [Searches on Decision tools (Playlists) that from the Contact us selection] Knowledge market stays open to librarian allow drag and Square report drop from icon Add/Delete search results indicates databases which search engine is [Click to see current [Click to logout or selected alerts plus access login as someone alert settings] else] 18
In summary • Research investors are ‘keepers of the long view’ • Applied research is targeted investment • Understanding the knowledge need is crucial • The R&D (scientific inquiry) process itself must be nested within an appropriate framework of governance, management, adoption and legacy effort • Knowledge and Adoption; and Evaluation processes must be hard-wired into program design from the outset • Smart research investment demands skilled all-rounders • I’ve been lucky to have worked with some of the best! for more info: www.triplehelix.com.au www.lwa.gov.au www.lwa.gov.au www.aanro.net www.aanro.net 19
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