“Germany lies buried under a heavy blanket of rampant bureaucracy”

Professor Carolin Häussler holds the Chair of Organisation, Technology Management and Entrepreneurship at the University of Passau and is a member of the Commission of Experts for Research and Innovation (EFI) headquartered in Berlin, which advises the German Federal Government in policy matters and produces an annual report on Germany's performance in research, innovation and technology. In the video interview (German), Professor Häussler provides a general account of the topics covered in this year's report and highlights the recommendations made for one of this year's focal points relating to technology markets. Below you will find a condensed version of the interview.

What topics does the EFI Commission address in its Report 2023?

Tradition has it, that we comment on the current state of research and innovation policy first – and this is precisely where the government has come up with several new strategies: the strategy for the future, the digital strategy and the startup strategy. And then we decide on the topics that we believe are or will be important for Germany. In the Report 2023, we believe these topics to be: innovation in an aging society – both in terms of innovation by older people and the question of how innovation can make the lives of the elderly more comfortable. New Space – meaning the way we use outer space, better said space technologies, in our everyday lives. And, lastly, technology markets that help us make better use of ideas for innovations.

How is Germany doing as an innovation hub?

Not as well as we would like. Germany is falling behind as an innovation hub. You can tell by the fact that we are no longer in the premier league in terms of key technologies – especially when it comes to key digital technologies. Another sure sign: our showcase company BioNTech has decided to relocate its cancer research to Great Britain on the grounds that general conditions are more research-friendly there. Germany lies buried under a heavy blanket of rampant bureaucracy, which is leaving us ever less room for manoeuvre, hampering innovation in particular and definitely stopping us from jumping into the competitive technology fray. As a result, fewer innovations see the light of day, and where innovative solutions become available they are not brought to implementation quickly enough. What is more, data collection and data use, which are of vital importance in research, are significantly slowed down by the plodding pace of digitalisation and complex data protection requirements. While others have long joined in the race, we are still waiting for approvals that will determine what we are allowed to do and what we are not allowed to do. That diminishes the willingness to make use of technology leaps and to experiment, both of which are crucial for the emergence of new ideas and innovations.

What the innovation hub would benefit from most is a sense of a new beginning! We need a paradigm shift, meaning a paradigm shift in research and innovation policy, so that we can harness the absolutely decisive transformation in terms of decarbonisation, climate change and digitalisation for an innovation drive across the country, which will hopefully put us back on the cutting edge.

How can the innovation hub be reinvigorated?

By cutting red tape, simplifying and harmonising the system and creating clear-cut rules for data use. Unfortunately, the data protection rules currently in place have been undermining a comprehensive and innovation-friendly data economy for years. They leave too wide a margin of interpretation and understanding, resulting in a high degree of uncertainty. We urgently need further clarification in their regard. The EFI Commission has recommended that the federal government use the forthcoming national data strategy to provide a greater degree of certainty. The consistent interpretation of the data protection rules across all German states would be a key prerequisite. The patchwork it currently is imposes high costs and, in the worst case, prevents innovation. What the innovation hub would benefit from most is a sense of a new beginning! We need a paradigm shift, meaning a paradigm shift in research and innovation policy, so that we can harness the absolutely decisive transformation in terms of decarbonisation, climate change and digitalisation for an innovation drive across the country, which will hopefully put us back on the cutting edge.

You mentioned a paradigm shift – what would such a shift entail in terms of research and innovation policy?

We need a research and innovation policy that is mission-based and agile and sends a clear signal to business and society. The EFI Commission believes that the strategy for future research and innovation presented by the federal government is a step in the right direction in that it lines up a series of missions, such as the mission "Climate protection and the conservation of biodiversity", which seeks to encourage social and technological innovation. This strategy needs to be implemented with the help of an agile governance structure that reaches across the different portfolios and is capable of inspiring a sense of new beginnings.

What role do technology markets play in the innovation process?

The topic technology markets is about making better use of ideas and inventions for innovations and bringing them to implementation more quickly. Let us assume a company has developed a new technology but lacks the skills and resources needed to market this technology as best possible. If we succeed in bringing this company together with another company that has the best market expertise, we will actually be able to realise innovation potential. That is exactly the kind of match-making that happens in technology markets, meaning in markets where technological knowledge is traded in the form of intellectual property protection rights such as patents and licenses. Technology markets encourage an efficient division of labour in the innovation process. However, by international standards, Germany is far behind in terms of the rate of participation among German companies. In the US, but also in European countries like France and Sweden, there is much greater willingness to trade in technology. This may be due to a certain abiding reluctance to organise innovation processes in an open manner. However, it may also be down to the comparatively medium-scale structure of our economy where small- and medium-enterprises are particularly reluctant to put in the effort required for technology trading, from finding suitable partners to signing contracts, and inclined to avoid any uncertainties.

What would the EFI Commission advise the federal government in terms of technology markets?

We need to reduce the barriers for technology trading and create greater transparency. One of our proposals, for example, is to expand the databases operated by the German Patent and Trade Mark Office and the European Patent Office using AI so as to improve matching between the patented technology available and trading partners. We have also suggest linking up the patent databases with other databases and creating financial incentives in a bid to ensure that information on ownership transfers and licence availability becomes widely and readily available. Small- and medium-sized enterprises, in particular, need to be strengthened in technology markets. This can be done, for example, by developing standardised contracts that facilitate the transfer or purchase of technology use rights. Funding programmes like "WIPANO – Knowledge and technology transfer through patents and standards" should be continued and expanded. The same goes for universities and non-university research institutions. They too need to continue their drive to further professionalise technology transfers and patent commercialisation and to make them more entrepreneurial and competitive. All these actions can help us to make better use of ideas for innovations. And, in so doing, give a new boost to German ingenuity.