Framing the Issues

TRE Networks: A
Uniquely American
Solution to Regional
Innovation
Opening Remarks at the 2010 TRE Annual Meeting: December 7, 2010

by Timothy Franklin
Office of Public Partnerships and Engagement
Pennsylvania State University

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Let me set the stage for our conference agenda by highlighting three themes.

During a planning session for this meeting last spring, Ed Paisley responded to a presentation
about TRE by remarking:

TRE represents a uniquely American answer to regional innovation activities going on around
the world. Instead of top down policy, it is bottom up and regional; it plays to the strengths of
regional economies; it lifts efforts beyond regional boundaries; it is built upon public-private
partnerships; and it spans the rural-urban continuum. (Ed Paisley, Center for American
Progress, 2010)

Regrettably, as my hair has gone gray, I do not experience wonder as often as I once did. That
comment, though, left me in wonder. It reminded me how important wonder is to our passions
and drive.

So, Ed’s comment became the overarching meeting theme for this Annual Meeting. It suggests
developing a uniquely American solution to global innovation challenges. It seems a near truism
to state that we have moved past the inflection point dividing economic eras – from industrial
to innovation. However, too many policies, structures, and programs remain in place that
evolved during the industrial era under a completely different set of assumptions about how
strong economies grew. The need is to become more systematic in addressing innovation
challenges from around the world. How does the U.S. approach this challenge since many other
countries benefit from centralized planning and decision-making? Centralized planning is not
our American way. However, the stakes are high because innovation means high living
standards for those who lead. Many of our US regions simply cannot match the strategy,
resources, and execution the centrally-driven policies and practices of our innovation
competition.

A second theme is focused on regionalism – “what it takes to make regionalism work.” For
anyone who has tried, growing regional innovation clusters involves a much broader set of
players and is far more complex than any single group can impact independently. We need a
team of partners. We need enlightened self-interest. TRE inquires about regional development
from the perspective of the region and asks, "What can be done to help this place succeed?"
How can strategy be customized to each region’s need? Transforming less competitive regions
is also implied here. Many regions need transformative strategies since incrementalism will not
keep them from falling farther and farther behind.

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Regionalism and innovation clusters offer critical, and related, perspectives for reframing our
approach. Cluster analysis explains much about what is working; however, it does not answer
the question of gestation and birth of clusters. Likewise, regionalism offers a competitive
economic scale but wants for collaborative mechanisms that transcend jurisdictional
boundaries. How do we grow high functioning clusters in places where they are not? Who
convenes the region? How do we overcome fragmentation? I commend Mary Ann Feldman’s
recent study on the fragmentation found in a single region, “Silos of Small Beer.” Conclusion:
the regional vectors of change are not aligned.

The third theme should be clear from the program title. What is the potential and real value of
research universities in playing a central role in innovation-based regional development?
Unleashing research universities matters because brainpower, new ideas and innovation
matter. Universities possess convening power without as many jurisdictional issues.
Universities bring expertise across the complex continuum needed for regional development.
By several accounts research universities are the most important asset in regional
development. However, the previous two TRE Roundtables raised the issue that much of this
impact is a byproduct of doing other missions. The question becomes "how do we become
more intentional?" If we were more intentional: What would we focus on? Do we know why
research universities have this impact? If so, how would we expand it?

In 2001, when we were struggling to transform Southside Virginia when it was losing its
economic base in textiles and tobacco, two capabilities of research universities seemed to rise
above the others in their transformative value. (1) Research universities pool adults with
college degrees and (2) they provide access to large sums of competitively-distributed federal
R&D funding. These represent dynamics highly correlated with regional prosperity. It should
be no surprise that the totality of our public and private investment in research and
development aligns closely with US regions that are pooling the brainpower, growing jobs, and
winning in this economy.

When we built research labs and hired more than a dozen research faculty at the Institute for
Advanced Learning and Research, the effect was to plant a cadre of nearly 50 faculty, graduate
students, and engineers into that place – instant brainpower. Their research interests -- in
motorsports, robotics, polymers, and plant biology -- offered a new narrative to a suffering
region, aligned educational pipelines, and targeted industry sectors. This place-based
brainpower brought industry and funding relationships and their presence activated networks
and brought partners into a region that had begun to hollow out. It offered a magnet to pull
the Research Triangle and other healthy North Carolina economies in that direction. The result:
nearly instant opportunities to seed regional innovation clusters and rationalize value for

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private interests across a rural-urban corridor. The story of nanotechnology in the Albany, New
York region has many similar themes.

Of course, Southside leaders continue efforts to convert the resources I cite into new jobs, new
companies, supply chains, innovation clusters and regional prosperity. Transformation takes
time to manifest. Patience is required. However, the investments in innovation capacity got
the attention of the marketplace and offered the opportunity for Southside to compete again.

In looking at the question of unleashing research universities, permit me a simplistic assertion:

“New ideas are the raw material of innovation.” As a result, knowledge creation is the premier
economic development incentive of the 21st century. Research universities supply a principal
vehicle for knowledge creation. If new ideas are the first resource of regional growth, how can
we help places that have innovation infrastructure be more productive? How can we level the
playing field for regions lacking the innovation capacity to compete for federal research funds
and the impact they have on pooling brainpower and new ideas in places?

So, our overarching theme inquires about a new system to support U.S. competitiveness that is
regionally-framed, innovation-based. Without question, the US is globally competitive in
regions that have innovating clusters in them. At the national level, though, how do we better
use federal investments to be more productive in driving innovation at a cluster scale? At the
regional level, how do we organize to manage the complexity of the task? In planting public
seeds to grow private economies, how do we maximize and broaden our national innovation
capacity to strengthen regions across the rural-urban continuum?

Spending is not enough. Resources need to be deployed within the region in ways that will
create actual transformation. Simply writing checks to regions in hopes that they will know
how to grow an innovation ecosystem doesn’t guarantee that it will happen. Simply writing
checks to universities to do research and hope there is both means and motive to bring those
results into the marketplace and needy geographies also does not guarantee it will happen.
And finally, turning a blind eye to geographic inequities that result from disparate levels of
innovation capacity and the distribution of competitive federal research funding will not
increase support for innovation-friendly policy and pave opportunity for compromise in the
upcoming Congress.

In closing, let me recognize the common level of passion all of us share. This is more than a job.
It is a legacy. I challenge us to work over the next day and a half to advance principles and
policies that begin the effort to establish a new framework. As we do so, let’s ask ourselves,
"What uniquely American solution responds to the innovation race and ensures that our

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grandchildren's economy is the strongest in the world, just like the one we inherited from our
grandparents?”

I look forward to the dialogue!