Helsinki, Finland
infoDev Global Forum
May 30, 2011

A very good morning to you.
It’s a pleasure to welcome you here today – on behalf of the World Bank Group – to infoDev’s fourth Global Forum on Innovation and Technology Entrepreneurship.
Our discussion of mobile applications, climate technology and agribusiness takes us into some of the most creative sectors of the economy.
The performance of these sectors will have a direct impact on the highest priority for the future: turning today’s imaginative assets into tomorrow’s productive capital – thus spurring job creation.
The success of new ideas in these areas will be a crucial factor in renewing job growth worldwide.
Allow me to begin by thanking our co-hosts for setting the stage for a successful conference.
The Ministry for Foreign Affairs for Finland has been generous with its support.
It has also been a pleasure to work with Nokia, a pioneer in innovation, which is represented here by Esko Aho – Finland’s former Prime Minister.
And I’d also like to thank the City of Helsinki for making us feel so welcome.
Let me also suggest that, while you’re in Helsinki, you take some time to see the 50 exhibits at the “SME Fair.”
There’s just an awesome range of innovations on display.
You can readily envision how some of them will change people’s lives – and perhaps change the world.
The speech-to-text software for the Arabic language;
the algae-to-biomass conversion process, producing clean energy;
and the mobile application for matching donors with the needy during a crisis –
many of the exhibits offer breathtaking possibilities.
So I hope you’ll enjoy the “SME Fair” – and salute the creativity of the entrepreneurs who have come here from all around the world.
Our discussions here this week will build on the work that the Ministry for Foreign Affairs, Nokia and infoDev have been pursuing together.
Reflecting on those discussions:
In my remarks today, I’d like to sharpen our thinking by raising three questions that will hopefully trigger debate among us for the rest of the week:
First: What role do innovators really play in shaping the economy – in taking creative leaps forward?
Second: We often hear about the importance of far-sighted public policy in fostering healthy innovation ecosystems. I’d like us to explore what value such active public policy contributes to nurturing those ecosystems.
And third: Amid the frequent lamentations about the lack of leadership in driving innovation: Are there additional practical steps we can take to support sustainable, innovative enterprises?
Such questions are essential in the debate over innovation and growth.
First: Let’s consider the question of the role of innovators in reshaping our economy.
As entrepreneurs: If you sometimes feel as if you’re laboring in loneliness – well, you’re not alone in that feeling.
Economic history is filled with examples of leading-edge inventors who struggled in solitude.
Gottlieb Daimler and Wilhelm Maybach started experimenting with gasoline engines in 1872 – but it took 20 years until they sold the first automobile.
The Wright Brothers tinkered in their bicycle shop for 11 years, before making the world’s first powered flight in 1903.
The inventor of the light bulb, Thomas Edison, looked back on his career and quipped that he had “failed his way to success.”
Having earned more than 1,000 patents, he said, “I make more mistakes than anyone else I know – but sooner or later, I patent most of them.”
Successful innovators have always been society’s visionaries – but, realistically, failure rates among them are extremely high.
Similarly: Small organizations are more likely to be agile enough to grasp a new idea.
But small firms are not always well-positioned to bring those new ideas to scale.
Larger firms also play an important role, with their access to capital and production know-how.
Innovation is, ultimately, about setting ideas into motion –
moving ideas from experimentation, via incubation and adaptation, toward commercial application.
And that process depends on having a vibrant spirit of innovation in both small and large-scale firms.
Individuals will always inspire innovation. Their role is certainly indispensable.
But it also takes far-sighted institutions and a diverse ecosystem to allow ideas to flourish.
That brings me to my second point: What else is required for the creation of a healthy innovation ecosystem?
First of all, let me emphasize that policymakers cannot reach for any single, off-the-shelf solution to the problem of creating a creative ecosystem.
Instead, they must consider a variety of policy levers – adapted to their individual situation.
Realistically: Getting the policy formula right is more difficult in practice than it looks in theory.
There is an element of spontaneity – even luck – in the evolution of a successful ecosystem.
The world’s hubs of innovation, after all, are the places where ideas collide.
They’re the places where innovators share ideas, tinker with each other’s designs, and learn from each other’s mistakes.
Much as policymakers would like to think that wise policies can shape such a process, the driving force is really innovators themselves.
In tight-knit clusters of competing industries, innovators can follow the experimental ethos of Tom Peters, who tells them: “Test fast, fail fast, adapt fast.”
Trial-and-error is inevitably part of the pattern – and that requires tolerating plenty of failures.
That process requires not just the availability of capital, but a certain audacity of capital . . .
so it will be ready to fund – not just the ideas that are the most immediately profitable – but also the ideas with long-range potential.
And, for the long-term sustainability of innovation ecosystems:
Government, I would argue, has a responsibility to offer support via effective policy and funding.
That’s what we’re aiming to encourage here through the infoDev “Top 50” competition, which rewards some of the most promising SMEs from the developing world.
To promote the success of ecosystems, pragmatic policy must create the framework for entrepreneurialism.
Getting tax policy right is essential. So is setting a realistic regulatory framework.
Intellectual property rights, patent law, and appropriate incentives must all be in place.
Sound public policies alone are no guarantee of an ecosystem’s success.
But getting the institutional framework right is one of the crucial components in building confidence that new ideas are welcome.
The true drivers of the process, as always, are innovators themselves.
The so-called “Triple Helix” of university-industry-government cooperation is increasingly important in fostering creativity.
University funding, R&D programs and technology-transfer centers can promote basic research and its practical application.
Incubators can spur the commercialization of ideas, supported by venture capital.
Enterprising processes and structures like these are essential, too.
That brings me to my third point: whether sufficient practical steps are already being taken to catalyze innovation and sustainable growth.
On this point, I’m pleased to report some significant recent developments that aim to promote healthy ecosystems.
In the area of the World Bank that I lead – Financial Sector and Private Sector development – we champion the work of infoDev.
infoDev directly supports entrepreneurs and small businesses, helping unleash the creativity of innovators.
infoDev brings a “practitioner’s knowledge” to the table.
It offers a global incubator network; South-South learning; specialized incubation efforts like the Climate Innovation Centers and mLabs; and mechanisms for innovative financing for entrepreneurs.
infoDev has been a creative catalyst in inspiring innovation. For instance, we expect that as many as 50 new mobile applications will emerge from its five new regional mobile applications labs – in Armenia, Kenya, Pakistan, South Africa and Vietnam.
Amplifying infoDev’s success, the Bank is now creating additional initiatives to promote stronger innovation ecosystems.
Let me illustrate how we’re doing so.
The World Bank has long worked with public-sector clients, counseling them on pragmatic policy approaches. And the International Finance Corporation of the World Bank Group has worked with individual firms, to help focus private-sector investment.
In-between the policy level and the individual firm level, however, there has been a gap:
We have not been helping clients at the industry level.
I’m happy to say: That pattern is now changing.
We’ll address the potential of that middle level, through the work of a new practice – on “Competitive Industries.”
This Practice will offer crucial support to help sustainable innovation take place.
In this Practice, we’ll help clients identify their areas of comparative advantage in specific industries.
That will help them focus on the areas that have the greatest likelihood for success.
Together with the capabilities that infoDev has nurtured, the World Bank Group and its partners will be able to deliver a “1 plus 1 equals 5” solution.
Moreover, the partnerships we have being pursuing – like “Creating Sustainable Businesses,” with Nokia and the Ministry – have already advanced the dialogue on innovation.
Thank you all for joining us here to discuss the innovation agenda.
I’m looking forward to hearing your ideas, about spurring creativity and promoting innovation ecosystems that can create prosperity for all.
Thank you very much.