Introduction to the volume:
The Future of the University and Public Research for the Entrepreneurial Age
by Carl J. Schramm
President and Chief Executive Officer
Ewing Marion Kauffman Foundation
It is commonplace to say that we live in the Information Age—and no less true because oft-repeated. But also no less true—yet hardly ever repeated—is the fact that we live in an Entrepreneurial Age. How these two basic trends—the dominant forces of our time—intersect is the topic of this volume, and of the conference on which it is based.
Apart from fringe anti-globalization activists, nearly every observer today holds that the Information Age is a good thing. It is raising living standards, alleviating poverty, expanding opportunity, increasing the wealth of nations, improving productivity, reducing the potential for conflict, and enhancing quality of life. All this is widely understood.
The basic realities of the Entrepreneurial Age are not as well appreciated, though they are arguably even more powerful—and inarguably wholly intertwined with the fate of the information revolution. Consider: World GDP has grown more than tenfold since 1970—and four-fifths of that growth has occurred since countries in the developing world and those once behind the Iron Curtain began to liberalize their economies. This is, to say the least, not a coincidence. Where there is economic freedom—where individuals with ideas and drive can pursue their dreams—money is made, capital is formed, and the pie expands.
The importance of the entrepreneur was long the not-so-secret—if often insufficiently appreciated—key to the success of the American economy. Now, entrepreneurship is driving growth everywhere—from Israel to Ireland, Taiwan to Turkey, and, of course, in India and China. Even the mature economies of the Old World—long enamored of central planning and tight coordination between big business and big government—are getting into the act, under the ambitious goals of the Lisbon Agenda. Yet there is reason for concern. In the Information Age—when wealth, progress, and success are more than ever derived from the mind rather than the soil— how well are the chief repositories of information, our universities, keeping up? How well do they understand, and incubate, and practice, entrepreneurship themselves? Are today’s universities equipped to support and augment the world’s burgeoning culture of entrepreneurship? And, if not, how can we help them become so?
More specifically, the twin engines of entrepreneurship and the knowledge economy have ushered in many radical innovations: new forms of technology—from IT to biotech—new patterns in society, new demands on the workplace, even new modes of living. Universities were instrumental in developing much of this radical innovation, but how well have they kept up with its transformative impact?
Rising living standards enable more and more people throughout the world to earn a university education. The demands of the knowledge economy make such an education more and more valuable—and outright necessary for certain careers. A result has been massive demographic change on campuses. Vastly more students are coming to study, and their backgrounds are more diverse than ever, by every measure, whether age, ethnic group, or socio- economic status. How are the universities adapting to this fundamental change among their “consumer base,” as it were?
Finally, universities are no longer self-contained. It is not so much that the Ivory Tower has been breached; more that every individual tower is now linked to every other in ways, and to a degree, that are unprecedented. Competition—for students, for faculty, for research funds, even for attention—is at a fever pitch. And it is no longer merely regional, or intra-state, or even national. That competition is now global, and becoming more so.
The Kauffman Foundation and the Max Planck Institute convened a conference in the summer of 2008 to explore just these issues. We brought together more than a dozen leading experts from Europe, Israel, and the United States—presidents of universities, renowned researchers, people steeped in the mission of what a university should be. They brought diverse perspectives and unique insights, but several common themes emerged.
Manuel Trajtenberg—professor of economics at Tel Aviv University—crystallized the framework for thinking about these issues by observing that “entrepreneurial university” really has three possible meanings.
First is the extent to which universities are innovative in terms of their own institutions, how they are structured and governed, and how they adapt to change. Second is the extent to which universities can drive entrepreneurship in the broader economy by generating ideas, training entrepreneurs, and working with the business community. The third sense of universities as entrepreneurial institutions is their ability to effect broader change throughout society at large.
Few would disagree that universities have lagged considerably at entrepreneurship in the first sense—at reforming themselves. As robust as they can be as agents of change for the world around them, they remain stubbornly resistant to change within their own walls. But for universities to fully and effectively become entrepreneurial in the second sense, they will have to embrace entrepreneurship in the first sense.
Our presenters understand that. Three of Europe’s most innovative university presidents led off the conference, described the obstacles to change, and voiced their determination to overcome them. Michael Crow recounted his efforts to transform Arizona State, up to and including abolishing academic departments, creating new ones, and even helping to found entirely new disciplines. And Alan Merten explained all the ways in which his own university—George Mason—has changed over the past decade, and is now “going global.”
The second sense—explicitly fostering entrepreneurship in business—is more problematic. Universities never have been at ease embracing this role, preferring to keep their distance from the private sector and instead partner with government or other nonprofits. Yet, whatever misgivings its inhabitants may have, the university plays a vital role in nurturing entrepreneurship. It trains the scientists who make the groundbreaking theoretical discoveries, the engineers who find practical applications for those discoveries, the businessmen who bring those applications to market, and the managers who keep those businesses running. All this is done without any conscious plan. In some cases, universities end up as primary conduits of talent and ideas for entire industries—Stanford and the Silicon Valley being the shining examples. All of the presenters touched on this topic to some extent, but three did so most directly. Jan Willem Oosterwijk—president of Erasmus University in Rotterdam— talked about the university’s history in fostering entrepreneurship, and described a new university and private sector partnership specifically geared to building a culture of entrepreneurship in Dutch society. Robert Litan and Lesa Mitchell—both of the Kauffman Foundation—raised the question of whether this direct approach is desirable, only to answer with a quick and emphatic, “yes.” The bulk of their discussion then focused on the “how:” getting the approach, and the mix, right.
Universities have clearly exhibited great facility at entrepreneurship in the third sense, changing the societies around them mostly—but not always—for the better. Indeed, the gains of the knowledge economy are inconceivable in the absence of high quality, and widely available, post-secondary schooling. Universities also have acted as agents of social change, bringing new opportunity to formerly marginalized groups. Several of the conference speakers explored this aspect of the university’s role. William Wulf, one of America’s leading computer scientists, showed how so many of the technological innovations that have revolutionized society, business, and everyday life originated on campuses and in labs. Manuel Heitor, education minister for the government of Portugal, made an aggressive case for greater direct involvement between universities and the societies they serve. And Frank Douglas, senior fellow at the Kauffman Foundation and one of the world’s most distinguished biotech researchers, laid out a hopeful vision of how universities could take a leading role in a revolutionary new approach to finding a cancer cure.
The papers and the discussion that follow explore these and many other facets of what it means to be an entrepreneurial university. They define the questions and propose answers, in the process shedding much light on one of the most important challenges facing the university in our time.
Thanks go to David Audretsch of the Max Planck Institute, and to Robert Litan and Lesa Mitchell of the Kauffman Foundation, for organizing this conference. The conference also greatly benefited from the participation of the many other experts who attended.
This volume doesn’t have all the answers. But knowing the right questions, and understanding them, is the necessary first step toward wisdom.