A New Reality for
Research Universities
Partnership with industry may be the only way to prevent poaching of their best and brightest.
By Vivek Wadhwa
Toyota recently announced that it is investing $50 million to establish research centers at Stanford and MIT to work on artificial intelligence (AI) and autonomous driving technology. In July, Google said it was funding a project at Carnegie Mellon to turn its campus into a living laboratory for Internet-connected sensors and gadgets. In January, Uber Technologies lured 40 researchers away from the Carnegie Mellon’s National Robotics Engineering Center.
This is just the beginning. Industry is going to be poaching more and more talent from leading academic and scientific institutions because it has become a matter of survival. Change is happening so fast that businesses are not prepared for the disruption that it causes. Companies such as Toyota have been blindsided by technologies emerging from other industries and visionary firms like Google have come to realize that they can’t do everything on their own.
For universities, this is good — and really bad. Like industry, they will have to adapt or perish.
The good news is that decades of investment in basic research — in fields such as computing, medicine, sensors, AI, digital manufacturing, robotics, nanomaterials, and synthetic biology — are finally paying off. Ordinarily, only a tiny proportion of basic research is turned into products. Using available data, Tom Katsouleas, provost at the University of Virginia, has estimated that there may be as little as one near-term commercialization for every $10 million invested in fundamental research. It can take many years before research discoveries are recognized for their market potential. But we are now witnessing the commercial applications of past research —and all are on exponential paths. With their convergence, amazing things are becoming possible.
When computing, telecom, and consumer electronics converge, for example, we get smartphones, smart TVs, and augmented reality systems. With computing, medicine, and sensors coming together, we have wearable medical devices such as the Apple Watch—which will transform health care. With its ResearchKit app, Apple will change the pharmaceutical industry. Uber is already disrupting the transportation industry with its GPS based cellphone apps; it now plans to replace human drivers with AI systems.
These converging technologies will cause entire industries to be wiped out and enable new trillion-dollar industries to emerge. The majority of today’s Fortune 500 companies will be decimated. All of this will happen within the next decade. Corporate executives have no idea what to do; the innovation models that they were trained on, such as Clayton Christensen’s The Innovator’s Dilemma, are defunct. The competition no longer comes from within an industry, but from elsewhere. Companies don’t have domain experts in synthetic biology, nanotechnology, and robotics and have no idea how to respond to the new threats. Start-ups such as Uber and Airbnb are attacking not only the technologies of these incumbents but also their core business models.
When businesses realize they are under siege, they enter a state of panic. They buy up all the start-ups they can and then scour the universities — without being nice or ethical. Just as Uber did, they will take what they can get. After all, what better place is there to acquire knowledge and talent than research universities?
Universities can recognize this new reality and collaborate with businesses or they can be a victim, as CMU was. This means having to rethink the ideals of academic freedom and the sanctity of industry-academia separation. And it needs to be about partnerships. There is a huge opportunity to teach businesses about emerging technologies and have them fund research commercialization efforts. With government funding of academic research on the decline, this may be a good alternative. It doesn’t have to be a Faustian bargain; it can be a win-win if the partnerships are structured in a meaningful way — just as the Google partnership with CMU was. Stanford University also figured this out long ago. Its close collaborations with industry have caused innovation to happen on a grand scale—and its endowment to balloon.
Vivek Wadhwa is a scholar of entrepreneurship and director of research at Duke University’s Pratt School of Engineering. He is also affiliated with Stanford, Emory, and Singularity Universities.