Mission: Policy, Purpose, Innovation

At the Open Mic Session, a learning session held at QUT ACE Australian Centre for Entrepreneurship & Innovation , we listened to Artemis Chang 's insightful presentation hosted by Michael Rosemann . Artemis's thought-provoking questions about an organisation's multipurpose tendencies during the current Polly crisis sparked my interest. The relationship between policy, purpose, and innovation in organisations is critical in shaping how value is created and distributed. My research focuses on Dynamic Monitoring and Evaluations of mission-oriented innovation policies and aims to shed light on this complex relationship. Given the pro-policy bias of such policies, it is often challenging to identify interaction mechanisms among the policy, purpose, and innovation in general. My research questions whether we need more mission-driven venture creation, or if we need mission-driven governments, or if we need The Entrepreneurial State, or just a well-functioning Enabling State.

In my analysis of the relationship between innovation policy and economic efficiency, I consider the juxtaposition of mission-driven government interventions against market-driven solutions. This contemplation is crucial given the inherent tensions and potential synergies between government mandates and market dynamics.

1.???? Mission-Driven Ventures: The government's commendable focus on steering entrepreneurial efforts towards societal challenges is not without its concerns. While this approach might risk sustainability despite noble intentions if not aligned with market demands, there is a glimmer of hope. A balanced methodology, where missions are validated through market mechanisms, could potentially enhance viability and impact. This approach, where ventures undergo rigorous market testing to meet consumer needs, could be the key to transforming well-intentioned missions into impactful solutions. It's a beacon of optimism in mission-driven ventures, offering a potential solution to the sustainability challenge.

2.???? Role of Government: The proponents of a mission-driven government advocate for robust state involvement in directing innovation towards specific societal goals. However, this approach can lead to significant inefficiencies, such as misallocating resources and stifling private sector initiatives due to regulatory and bureaucratic overhead. In contrast, an enabling state offers a more promising path. Reducing regulatory barriers, protecting intellectual property rights, and investing in foundational science and education set the stage for broad-based innovation. This approach supports the infrastructure upon which the private sector can innovate rather than dictating the direction of innovation. It's a more flexible and adaptive approach that instils confidence in the potential of innovation. It's a reassuring and confident path to follow.

3.???? Entrepreneurial State vs. Enabling State: As proposed by some scholars, the concept of the Entrepreneurial State suggests that the government should actively engage in commercial market activities as a leader in innovation. While this model has its merits, particularly in sectors where the market fails to invest sufficiently (like basic research and infrastructure), it also poses risks of government overreach and potential crowding out of private investment. The alternative, which I favour, is a well-functioning Enabling State. This model promotes a government that facilitates, rather than dictates, commercial innovation through policies that create a fertile ground for all businesses to innovate and compete.

Returning to Artemis’s questions, understanding how each policy, purpose, and innovation element interacts and impacts organisational outcomes is crucial. This knowledge can guide policymakers, professionals, and academics in making informed decisions and shaping effective organisational development and innovation strategies.

1.???? Policy: Both internal and external policies provide the empowering framework and rules within which organisations operate. Effective policymaking supports innovation by setting clear guidelines and standards that promote transparency, efficiency, and ethical practices. For instance, a policy that encourages open communication and collaboration can empower the organisation to foster a more innovative culture by facilitating the exchange of ideas, as we've seen in the case of the Net Zero Economy in Australia.

2.???? Purpose: An organisation's purpose is its fundamental reason for being, beyond just making profits. A clear and compelling purpose can inspire innovation by aligning the organisation’s activities with its broader goals. This alignment helps ensure that innovation efforts contribute to meaningful outcomes, not just incremental improvements. For instance, a company that aims to enhance sustainability might innovate by developing eco-friendly products or processes.

3.???? Innovation: Innovation, the primary driver of value creation within organisations, refers to creating new and improved products, services, processes, or business models. It offers new ways to meet customer needs and improve operational efficiency, significantly impacting the organisation's success. Innovation can be incremental (minor improvements) or radical (completely new approaches), and it often requires a conducive environment supported by appropriate policies and aligned with the organisation's purpose. I am in the middle of running a Sports Tech Innovation Workshop, and I will pen down a few elements of prototyping and value creation in the sporting industry.

How They (Policy, Purpose, and Innovation) Affect Value Creation and Distribution:

• Enhancing Competitive Advantage: Organizations that integrate policy, purpose, and innovation often establish more vital competitive positions. Their innovations are not just new but are deeply connected to what they stand for (purpose) and are supported by robust policies that ensure these innovations are sustainable and ethical.
• Attracting Talent and Investment: Companies known for meaningful innovation attract talent and investors. People want to work for and invest in profitable companies that contribute positively to society. Policies that support fair labour practices and environmental sustainability can enhance this effect.
• Improving Efficiency and Reducing Waste: Innovation can lead to more efficient processes and reduced waste in materials and resources. Policies that encourage or require such efficiencies (like waste reduction mandates) can amplify these benefits, leading to cost savings and improved profitability, which can then be passed on to consumers or reinvested in further innovation.
• Driving Social and Economic Change: When organisations innovate in line with a societal purpose, they can drive broader social and economic changes. For example, innovations in renewable energy technologies can contribute to combating climate change. Policies supportive of green energy can accelerate adoption and impact.

Policies should aim to empower all potential innovators in the economy rather than selectively promoting certain enterprises or industries. This broad-based approach fosters a vibrant, competitive landscape and ensures that innovations are economically viable and socially beneficial.

Thoughts?