Ignore the ‘ivory tower’ clichés – universities are the innovation partners more Kiwi businesses need

When it comes to turning research into real-world success, New Zealand has a problem.

Despite the country’s NZ$3.7 billion research and development spending in 2023 – a 17% jump from the previous year — too many New Zealand businesses fail to commercialise innovation.

According to the World Intellectual Property Organization, New Zealand ranks 21st for innovation inputs. This means we’re good at investing in research and development. But we rank 45th in knowledge outputs and 78th in industry diversification. Essentially, we’re spending more but getting less.

So, what’s holding the country back? In a lot of cases, it can boil down to a lack of collaboration with universities.

Universities are typically focused on generating novel or new-to-the world knowledge, with researchers, cutting-edge technology and deep industry connections.

Working with universities can connect businesses to researchers, government agencies, private industry and global networks. Collaboration can also offer businesses credibility. It signals to investors, partners and customers that they are serious about innovation.

Yet many businesses underestimate their value. They assume collaboration is slow, academic or bureaucratic.

Our study – based on a digital survey of 541 firms across a wide range of industries and regions in New Zealand – looked at whether collaborating with universities could help businesses to bring ideas to market, sell intellectual property and develop technology.

We also considered whether there was a difference in working with international universities versus collaborating with local institutions. While identifying details of the individual businesses were kept confidential, here is what we learned.

The case for foreign university partnerships

Our research found partnering with foreign universities allowed New Zealand businesses to tap into global expertise and advanced research. It also provided access to diverse knowledge networks, where businesses could learn from various real-world applications of scientific knowledge.

For example, a New Zealand business specialising in artificial intelligence (AI) can gain game-changing insights by collaborating with top universities in the United States.

The partnerships can provide access to leading AI models, advanced algorithms, and global industry connections. These partnerships can enable the business to stay ahead in an increasingly competitive market.

Additionally, many universities had well-established technology transfer offices. These had experience in helping businesses commercialise research.

In short, foreign university collaborations opened doors to the world’s best knowledge and technology – critical for firms operating in fast-moving industries.

The strength of local university collaborations

We also found local university collaborations had their own advantages, including an understanding of New Zealand’s specific challenges, from climate change impact on agriculture to AI adoption in small businesses.

This contextual knowledge made their expertise highly relevant for firms aiming to commercialise innovation within New Zealand’s unique market conditions.

Working with local universities also allowed businesses to build strong, personal relationships with researchers, fostering faster and more effective knowledge exchange.

Unlike foreign partnerships, where interactions may be limited to emails and virtual meetings, local collaborations allowed for regular in-person brainstorming, experimentation and problem solving.

Finally, collaborating with New Zealand’s universities gave businesses access to top local talent, helping them recruit skilled graduates familiar with the domestic market and its needs.

A balanced approach

Investing in research and development alone won’t drive innovation for businesses. Without strategic collaboration, firms risk wasting resources on ideas that never reach the market.

Businesses should take a balanced approach. Foreign university collaborations can offer groundbreaking advances, cutting-edge knowledge and global networks. At the same time, local university collaborations offer accessible knowledge, local expertise and stronger working relationships.

By embracing these partnerships, New Zealand businesses can turn research into commercial success, drive national economic growth, and position themselves as global innovation leaders. The question is no longer if firms should collaborate with universities – it’s how quickly they can start.

This research was completed with Annique Un (Northeastern University), Kazuhiro Asakawa (Keio University), Jarrod Haar (Massey University) and Sihong Wu (University of Auckland).