The Problems with Obama's Innovation Strategy

Recently, the Obama Administration issued A Strategy for American Innovation: Driving Towards Sustainable Growth and Quality Jobs. Reading it would inspire anyone to think that this Administration has a good handle on what needs to be done to shore up America's many weaknesses and keep the U.S. out in front in terms of economic as well as scientific leadership. It details where our country stands on important issues such as R&D investments, workforce skills, physical infrastructure, energy, and health care, among others. It puts forth a fairly clear and comprehensive vision for the results the Obama Administration wants to drive and provides a breakdown of where approximately $130 billion in government funding might be spent over the next several years to support this first-of-a-kind innovation agenda. Bravo!

Seeing a codified assessment and vision made my heart sing, but at the same time made me nervous. Not only is its lack of executional detail scary, but the rate of concurrent change called for shows a level of naivete that seriously undermines the plan's intention. If the health-care debate is any indication, I predict much of Obama's innovation funding will be wasted. Here are a few reasons why:

1. We know from studying innovation in large-scale entities such as Procter & Gamble (PG), UPS (UPS), and Kaiser Permanente and in other governments such as Finland, Japan, and South Korea that success requires that innovation have a permanent place within a large entity's structure. Working from a strategic plan and through an agreed governance structure, this type of place is where a high-level view of the problem space is developed, priorities agreed, funding dispersed, and meaningful metrics and measures show success or failure. Neither the U.S. government nor any agency within the U.S. government, with the possible exception of the Defense Advanced Research Projects Agency (DARPA), has such a place.

2. We know successful innovation requires discipline. Without it, precious money and time can be seriously squandered. This is why protocols for driving innovation at scale have been widely adopted by companies and countries alike. Without any structure to support this new U.S. innovation strategy, there is no hope this funding will be spent efficiently.

3. The current state of government contracting laws supports convention, not innovation. Currently, government awards tend to go to the typical "Beltway Bandit"-type firms that have little to no track record for innovation.

4. Moreover, scientific research funding and grants aside, there is precious little money available for discovery-related activities that would help decide what type of strategies are needed when it comes to spending the type of big bucks this plan endorses. But as the innovation strategy outlines, many of the problems America is facing are large, complex, and interrelated. Many, like education and health care with their multifaceted social aspects, are particularly hard to figure out. This leads me to contend that since the bulk of them have been sitting there unaddressed for some time that the agencies either don't know what to do or are up against political impediments that keep them from acting. 5. Couple this paralysis to act with the requirement that detailed requests for proposal (RFP) must be written for any outside third-party company working for a fee above the low six figures and you have a recipe for innovation constipation. Writing an RFP assumes an agency knows what needs to be done. Given the current chaos on Capitol Hill, do we reasonably believe what to do in most agencies is actually known and agreed?

6. Let's also acknowledge the policy and legislative components inherent in the Obama innovation strategy. Congressional approval and oversight will almost certainly be required for most of what is called for. Given the difficulties Republicans and Democrats are having presently in agreeing on any controversial issue, I have little hope that most of what is contained in the plan will be acted upon before quite some time, leaving a disappointed citizenry and a country that is still woefully unprepared for the challenges of the 21st century.

Innovation in government is going to require policy innovation just as well as any other component in the mix.

A Support Structure Must Come First While these structural issues are clear impediments to innovation, there are some activities that I am very excited about. I believe that newly appointed CTO Aneesh Chopra and his team at the Office of Science & Technology Policy are onto something big with the Government 2.0 initiative. With the goal of opening up government data to drive transparency, efficiency, and responsiveness, a torrent of new applications are being created that run using Web 2.0 technologies. In comparison to some of the big problems contained in the Obama innovation strategy, these applications are comparatively simple to create, yet they provide huge returns through the creation of new business models, enlighten decision-makers who had limited visibility into the problems they are tasked to solve, and allow people to participate in government as they never have before.

But my instincts tell me we have a different journey to go on before realizing anything close to the plan outlined in this strategy. My suggestion would be to rescind the ambitious spending and take a step back to answer the following questions: How do we build the right structure to support innovation in our federal government? How do we thoughtfully create the right set of strategic programs to produce the desired outcomes? And how can we inspire the legislature to work together without the turmoil we are seeing today? Realizing real innovation gains will require that government achieve a level of alignment that does not exist today. Until that is achieved, America is destined to underachieve with respect to its innovation potential.

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