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Research with impact

Erkki KM Leppävuori | 29.9.2015

By the time this magazine is published, Finland will have a new Parliament after very important elections. Once the new Government is in place, it is time to see how much weight the campaign promises hold, and whether the politicians will keep them. 

Hopefully they will, because Finland is in a dire need of clear and unambiguous decisions on how to build the country’s future.  There are no easy choices, and the decisions require not only vision but also thinking outside the box. Politicians must be prepared to leave their personal comfort zones.  

Many signs point to cutbacks and economic atrophy, far fewer to growth and regeneration. Following the latter requires the ability to take and tolerate risks. 

In my opinion, investing in research is the only effective way to improve the competitiveness of businesses in Finland. In particular, research that promotes productivity and product value adds to company profitability and thus to a healthy national economy.

I have been disheartened by the fact that experts in different fields have very conflicting views on how to secure our competitiveness. Cost-efficiency is a must, but in order to be able to survive on global markets, our economy must be built on strong expertise and competitive products.

For a small nation such as ours, two things are critical: allocating resources in the right places and directing funds where returns are the best. Finland can ill afford duplicate research projects; nor should any funding be directed to quasi-scientific activities under these challenging economic conditions. 

Universities and research institutions should deepen their cooperation, but not without a clear mission and mandate for each party. Funds should be granted based on results and effectiveness, and decision-making should use comparable financial and result criteria so as to identify the best investment areas.  

As for the new Government Programme, it pays to look at previous ones: they contained a clear intention to invest in RDI, which has enabled the continuous growth of our national economy. The past two Governments have reaped the last economic benefits produced by significant investments in RDI in previous years. Should the negative development continue, we can only expect grim results! 

According to Statistics Finland, research and development expenditure fell to EUR 6.7 billion, or 3.3 per cent of GDP in 2013. This downward trend is expected to accelerate, and the expenditure in 2014 is likely to come to some EUR 6.4 billion, or 3.1 per cent of GDP. We cannot let this go on! Competing countries continue to increase investments in their RDI resources, and significantly so. Can we really afford to lag behind?

Research and development, and the results of applied research in particular, are the catalysts of economic growth. The Government and businesses need to invest more in new technologies and innovations, and must be prepared to tolerate risks while doing so. We must also tap into the high-level expertise available in Finland to provide results. Organisations such as Tekes – the Finnish Funding Agency for Innovation and VTT Ltd ensure that this expertise will build new businesses and promote economic growth. By doing this, we have a direct impact on the growth and competitiveness of Finnish companies, the creation of new jobs and generation of tax revenue.

We should aim to bring RDI expenditure to EUR 8 billion, or 4 per cent of GDP. This will promote economic growth and improve the competitiveness of Finnish companies, while also securing interest and investments from foreign companies.​

Erkki KM Leppävuori
President & CEO, VTT Ltd

 

 

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