 Good afternoon. My name is Edison Cruz. I'm a faculty member of the University of the Philippines. I'm also the director of the Technology Management Center. My job as a director is to supervise the various programs of the center. I'm referring to the teaching, research, extension, and mentoring programs of our institution. This afternoon, I want to talk to you about innovation and the university. Why innovation? Because innovation is very, very important. So the first half of my talk will be about innovation in the context of business, because private sector or business drives the innovation process. The second half of my talk will focus on innovation and the universities in general in the country. Why is that important? Because universities are also important players in our innovation ecosystem. So now we start with innovation. What is innovation? From an economic point of view, innovation is something new that brings benefits for an organization and for society. What are the major words or terms in that statement? Number one, something new. Never seen before. It's a new experience. It's a new solution. It brings benefits. What does that mean? It takes away pain for the customers. For the organization, there are benefits. Lower production costs. Easier production pays. So those are the benefits for the business or the enterprise. Elaborating further, the process of innovation results through translation of an idea or invention into a good service that creates value for which customers will pay for. So it's an idea or invention. Will a new material result to a higher quality product? Take note that the materials to make the bodies of planes were also used to make arms, weapons, rifles. Why? Because these materials are lighter weight but are more durable and therefore they will create better rifles for soldiers. Create value. What does that mean? For the companies, it means greater profits. For customers, as I said earlier, it means taking away the pain. Or in other words, also innovation are like vitamins. It makes one more productive. For example, we all know that financial spreadsheets allow us to easily process numbers. I remember when I was in the undergrad, more than three decades ago, when we do financial analysis, we have to use the paper, a 16 column journal. So it's very hard to really process numbers. But now with the computer and the appropriate financial software, you can easily compute for your balance sheet, for your income statement, for your cash flow. And it eliminates errors. So the computer cannot make an error in computing sums, in division, in multiplication. Innovation is also called, for innovation to be successful, it must be replicable. It must be able to serve the needs of a wide audience. So just imagine, in the case of Steve Jobs, when he was still alive, he came up with the smartphone concept. His iPhone is the first smartphone really that catered a wide audience. So because it was able to satisfy a large need, it resulted to a large revenue for the company. So what are the manifestations of innovation? It can be new products and services to conquer new markets. It can be smarter cars. The cars today have sensors. So when you're backing up, it will tell you if you will crash to something at the back. There's also a camera at the dashboard. Therefore, you can park your car. If you're backing up, you can park your car in the appropriate spaces. Whereas if you don't have a camera, then you have to look at the back and estimate the spaces. Innovation also manifests itself through improved products and services that stand out from the competition. Before the smartphone, what do we have? We have separate devices for calling and texting, a separate device for listening for music, separate device for taking cameras, for searching the internet for information. Now with a smartphone, you can all do these things and more. Of course, there are complementary technologies. The internet is very important to facilitate mobility and the use of these smartphones. Innovation also may be manifested through improved internal processes to strengthen the company from inside or to save costs. Insurance companies, banking institutions, they have data about us. They have data about our expenses. So they know what we want to consume, what we spend on. And they can communicate this data to advertising agencies and the advertising agencies can show us the appropriate ads in our cell phone. Innovation also may mean development of a new business model. I'm referring to Airbnb and also to Amazon. Before Amazon, how do we buy books? You have to go to a department, to a brick and mortar bookstore, like national bookstore. So you'll have transportation costs. If there's a crowd in that store, well, you just have to bed with it. You have to line up. With the advent of Amazon, you can place your order via the internet. Now you can also receive books in PDF format. So they will just stream to you the books and items that you purchase. Airbnb. Before Airbnb, how do we select accommodation? So you want to go to Rome, to Japan, or to Boracay. You have to book your hotel. Now we know hotels are very expensive. For me, at least, it's very expensive to book a hotel. So Airbnb is heaven sent. Airbnb, I probably spend only half of what I would spend for a hotel. Now how does Airbnb do it? Remember, who are the dominant hotels? You have the intercontinental and what have you. Airbnb does not have a single hotel. And yet, it is dominating the hotel industry. Why? Because it has many partners. And the partners rent out a house or maybe just a room in their house. So what's the consumer experience like? You book via the internet. You pay via the internet. But the rate is very low. You go to the destination. You are not treated like a guest. You are treated like a visitor. For some, they might not like that experience. But if you are cost-conscious, then that's just okay. So there are a lot of innovations right now. Information technology has enabled a lot of these innovations. Software apps. If you are not good at taking pictures, there are apps that can manipulate your pictures. And those pictures will just turn out right. Social media. Social media is being relied on by the advertising sector. Before social media, how do you advertise? You have TV. Very expensive. Print. Again, very expensive. The reach is very wide. But you don't know if you are reaching your target segment. Social media enables you to have a very limited expense as far as advertising is concerned. And there's a way to really target your promotions. In TMC, we don't advertise through the traditional media. We use Facebook. We can tell Facebook that we want to target the millennials. So those who are 24 years old to probably 35 years old. Those residing in the NCR. We can't do anything about those living in the Visayas or Mindanao. I don't think they can attend the classes in Dileman. So we have a very targeted advertising program. And we pay Facebook only a few or a couple of thousand pesos. So a really big bang for a few thousand pesos. Take note that before we used to print, we used to use the printed media for our advertising. And we pay about forty thousand pesos per issue. So really it's a big savings. And the reach and the targetedness is very, very improved. Telecommunications. All of us have cell phones. All of us value mobility. You don't want to go back to your office in the late evening just to do an email. Of course if you have desktop at the home, you can do that. But you can also do that, maybe send a brief message via your phone. You can use the messenger or you can write a short email via your smartphone. So that's how telecommunications deliver more value. Whether you're a student, a faculty member, a manager, biotechnology. Now this field has some level of controversy. I remember a European once told me that he prefers to eat an apple that has a worm in it. It means that there are no chemicals in that apple. Of course the European can afford to eat that apple. He will not go hungry. But what about the other countries who are not growing enough food? So biotechnology enables us to grow more food. But there's a danger of developing cancer. So technology can have negative externalities. There are also a lot of innovations right now in the energy sector. We need more renewable energy. We need solar panels. Hopefully the cost of installing solar panels will go down. Remember earlier I said that innovation for it to be successful. It should have a wide market. But of course cost will always be a barrier. Therefore the cost of developing and installing solar panels will have to go down. So that there will be more widespread adoption of technology. Various perspectives and examples. So innovation is very important for private enterprises. The arena is highly competitive. You look at smartphones. What do you see? There's Apple, there's Samsung, and there are Chinese brands. So competition is there. Who will win the one that delivers more value? The one that's more innovative? NGOs or non-government organizations also need to be innovative. If they want to deliver value to their targeted segment, then they should also use technologies and innovation. So information technology can be used. Social media can be used among others. Academic institutions also need to be more innovative. As we know academic institutions have several programs. Teaching, research, extension or public service. In teaching we now have the distance learning. So in UP we have the UP Open University. It is delivering distance learning. Here at the TMC we have what we call the blended learning program. In my case 70% of my interaction with my students are face-to-face. And then 30% I use Facebook for my interaction with my students. We cannot do away with the face-to-face interaction. Students learn not only from their professors, not only from their materials, but also from their interaction with other students. So in TMC, in the Technology Management Center, we have students coming from a variety of industrial sectors. Some are in banking, some are in government, some are in the fast food industry or the quick service industry. Some are in IT companies among others. Also in terms of experience, it varies. The young guy probably has very little business experience, but he is very technically sound and an expert in a certain technological field. Maybe biotechnology, maybe IT, maybe pharmaceuticals. Now the older students, 35 and above, they may not be that technically competent, but they have the strategic business experience. Because by now, their job entails more of strategic management, deciding what markets to conquer, deciding how the product development should progress, deciding how much budget should be allocated for whatever innovation project. Government agencies also are now utilizing innovation. So we have the government agencies using social media to communicate with its stakeholders. It also uses a lot of information technology to process data and information, and hopefully this information will be used for better programs. Why is innovation important? From a national perspective, there's a strong link between the level of technological innovation and the quality of living and national economic development. You look at South Korea, they are highly innovative, and they enjoy a high quality of life. They also have a very high gross domestic product. Same for countries like Japan, US, and other European countries. Economist Robert Solow showed that the growth in GDP, or gross domestic product, was not solely on growth in labor and capital inputs, but technological changes as well. Technology and innovation has a strong correlation. When we talk about something new, a new service, a new product, usually it relies on a technological development. So technology can be both radical or incremental, slight improvement from the previous version. So if a country has many innovative and competitive companies, you can be sure that that country will also be quite prosperous. Why? Because these companies are able to generate a lot of employment. They pay a lot of taxes, therefore wealth is created for many stakeholders. At the firm level, innovation is really very, very important. Companies that do not innovate will die, and we have seen that again and again. It is the companies that innovate that dominate their industry. So Apple and Samsung for communications. In social media, we have Facebook and a few others. So innovation is very, very important. The consumers are very fickle, new trends keep on coming up, and companies everywhere have to have that market orientation. I'll get back to that idea of market orientation in the second half of my talk. Continuing further, globalization has increased the competitive pressures. Philippine companies cannot be complacent. They cannot say that we are only competing in the Philippine market and therefore we don't have to be innovative. The Philippine market will be invaded by foreign competitors. Thus, the Filipino company has no choice but to innovate and prepare for a globally competitive business arena. So far, we've been talking about innovation in the business arena. What about the government? Governments also need to be more innovative. There's a high demand for services and solutions to a myriad of social problems. We have traffic, poverty, insufficient infrastructure, education, malnutrition, peace and order among others. We know that the budget of the government is limited. Therefore, you have to deliver more value given the level of budget. How do you do that? Again, by innovation. So you have to use a lot of information technology. Why? Because IT enables innovation. IT enables gathering of data, the accurate data that will be used by decision makers. And if there's database solutions, database decisions, then the impact will be optimized. There are other stakeholders of course, very important stakeholders, consumers. We are consumers or customers. We want more value for our money. We want a higher quality of living. So if I spend about 40 or 50,000 for that phone, I want to know how that will make me more productive. If I spend about 800,000 or more for a car, I want to know how that car will help me in my career. If I spend several hundred thousand pesos for a solar panel roof, I want to know if there will be sufficient return on my investment, such that the cost of my energy consumption will go down in the long term. Other stakeholders are the employees. So employees that adapt innovation need to find out if their productivity will increase. I think nobody among us wants to work harder. We want to work smarter. I've been talking about the importance of innovation. Now let's talk about some types of innovation. We have product innovations, the iPad, which was released in 2001. So portable players had been around for many years before Apple launched its version in 2001. But what makes the iPad different? Well, together with Apple iTunes software was the technology that really transformed the way people listened to music. Next one, we have Skype. I remember two decades ago when I had projects in Europe or in other parts of Asia that there's a budget to travel to other parts of the world. But with the development of Skype, the proponent and the sponsor will just tell me, Edison, you don't need to come to France or fly to Thailand or Jakarta. We can just do Skype. So Skype has transformed the way people communicate across borders. You can use Skype to communicate with a girlfriend, boyfriend, wife, or father overseas. But of course now we have Facebook live, so even better. Next, we have of course Facebook. What does Facebook do to us? It connects us. Now Facebook is also venturing into an online marketplace. You want to sell your old shoes or your old bag. You can sell that via Facebook. YouTube is also another major innovation. In my teachings, in my PM 206 and PM 251 courses, I use a lot of YouTube videos. There are interviews of business leaders, innovation leaders, and their insights are very, very helpful in my class discussions. Remember my first smartphone? It was in 2011. I love the camera feature of that smartphone. Before that, I cannot take a picture that I'm happy with. It's always blurred. But with that smartphone, I can take pictures that are not blurred. So it's just a point and click and that's it. I have the picture I want. Of course in the internet, you have a lot of online shops and marketplaces. Again, these are major innovations. But as before, we have to go to the brick and mortar store. Now we can just scan the internet. And then there are online communities for books, for clothes, for shoes. Operating systems. There are operating systems for our major gadgets, whether they're phones or their desktop. So these are major innovations because the operating systems are necessary for apps development. Applications are very important because it takes away the pain in our daily existence. We have apps for sending private messages. We have apps for taking pictures. We have apps for music and so on and so forth. In any business arena, there are dominant players. These are the large companies that enjoy the large revenues. They are able to serve the bigger market. In the last two, three decades, we witnessed the ascension of what we call disruptors. They disrupted the industry and I don't mean that in a negative sense. One such disruptor to my mind is Spotify. Spotify enables us to just pay and select the music that we want. We don't have to buy all the music in that selection. So Spotify empowered the consumer to choose and pay for only for the music that they prefer. 4G is also a very important innovation. As we know, there's a need for a faster internet, an internet that can process more data. Nowadays, we're not happy with just texting and calling and audio data. We want to see videos. We even create our own content. We film ourselves doing an activity and we stream it through Facebook Live. There's a need for internet that can process all this data very quickly. So 4G is another major innovation. Now, it's not always the case of having cutting edge or rocket science. Sometimes you can win the day not because you have the best technology. Rather, you can have a technology that's not cutting edge, but you have the most innovative business model. So again, going back to Amazon. It's one of the companies that are the first in developing an online market presence, and then the others follow suit. Airbnb is also another disruptor. It's a very innovative business model, and that's why it has disrupted the hotel industry. You don't need to have a thousand hotels scattered globally. You just have a thousand or more partners willing to rent out a room or the entire house. Same with Grab and Uber. You don't need to have 5,000 taxis all over the world. You just have to have a community of partners willing to be part of the system and willing to be part of Grab or Uber. We know now why innovation is very important. We know what is innovation. So how do we manage innovation? Number one, there's a need for strategic direction. The top guy should be the champion of innovation. The top guy should say that innovation is very important. Otherwise, we will not be in existence maybe five years from now. I remember Manny V. Pangilinan. For one, he has redefined the DNA of his companies. For him, Meralco is not anymore an energy company. It is a technology company. Manny P. Pangilinan, according to an interview which I accessed, he said that what keeps him awake at night is the fact that all these companies are approaching the mature industry. How do you manage innovation? Number one, there's a need for strategic direction. There's a need for a champion. Top management should value innovation. Top management should set the path towards how the company will manage innovation. For example, Manny V. Pangilinan. He has several companies under a conglomerate. He realizes that his conglomeration are composed now of companies that are in mature industries. So now they're still making money. But in 10 years time, who knows? They might die a natural death unless they revitalize the companies and become more innovative. Meralco, I believe in MVP's mind, is not anymore an energy company. He said that he considers it as a technology company and therefore they have to be nimble. They have to be prepared to innovate. Sometimes they have to unlearn or do away with what worked in the past. They have to do away with certain competencies that serve them well in the past and develop new competencies. So innovation is also a mindset. What worked in the past might not work anymore in the future. You have to embrace change. You have to embrace uncertainty. And you have to be agile. If something doesn't work, then you have to change direction. By the way, IBM in the 1990s, they almost closed shop. They almost became bankrupt. Why? Their traditional businesses, the hardware is not anymore generating revenues. You have Chinese manufacturers producing lower cost laptops and IBM simply cannot compete with them. So what did IBM do? It had to sell off its hardware business. It had to unlearn that particular competency because it does not work for them anymore. So IBM re-engineered themselves. In 1990s, they told themselves that we are not anymore a computer company. We are now a solutions company. We will now highlight our competencies in generating new knowledge, in integrating solutions that cover not only hardware but also software and the talent from our people. Next, when you manage innovation, you have to be prepared to invest in R&D. You have to be prepared in generating new knowledge. You have to be prepared in developing new products and processors. That means money. If companies view R&D as an expense, then they will probably require short-term return on investment. And if they do not generate that, they will be disappointed. So I think companies investing in R&D should be in there for the long haul. R&D is not an necessary expense, it is an investment. Also, companies should be prepared to collaborate. I remember one time Steve Jobs, when he was meeting with these people, Steve Jobs liked to have a fancy meeting with him on the stage and all the Apple employees in front. And then he showed on the screen his newest collaborator. And guess who that was? It was Bill Gates, the arch enemy of Apple. In my mind, I think Bill Jobs recognized that Apple cannot do it alone. It has to have collaborators. Also in the mind of Bill Gates, he knew that Steve Jobs had the design competence. Microsoft dominated the business. It generated a lot of revenues. It earned a lot more money than Apple. But it does not have the design genius of Steve Jobs. Therefore, there was a rationale for that collaboration. And it was a successful collaboration. Next item, protection of intellectual property. You are generating new knowledge, new designs, innovative products. You have to protect that intellectual property. Patents, copyright. In the management of innovation, there's a clear need to protect the intellectual property arising from these R&D activities. Protection of intellectual property will allow the company that invested in that R&D to exploit the commercial potential of the R&D outputs. If the company doesn't have the knowledge or the competency to protect IP resulting from its R&D investments, then what will happen is probably another company will exploit the fruits of their labor or worse another country will be able to exploit the IP arising from the R&D investment of that company or that country. There are now conversations going on wherein China is being accused of fueling their economic development via the intellectual property generated by American and European countries. We will know for sure what's the truth behind it probably in the next 5 to 10 years. The management of innovation also entails that there should be a process for managing new product development. So there are various stages from idea and idea generation, idea selection, testing the business concept until launching the new product or even a new enterprise. So all these activities at various phases should be managed. I'm reminded about the development of the Samsung 2 view camera. So Samsung realized that as far as cameras are concerned, initially they were not doing very, very well. The dominant players, you have Canon, you have Nikon or Nikon. Samsung, they don't have brand recall at that time. But if you take away the branding and you just compare the technical features, Samsung camera fares equally well vis-a-vis the competitors. So how do you explain that Samsung is in the 11th spot as far as market share is concerned? So Samsung did some market study. They realized that maybe the market doesn't need another high-tech phone, but rather a phone that can be suited to their changing lifestyle. So Samsung realized from the market study that people want to take pictures of themselves. And they have fun doing that. They want to take pictures of themselves, drinking or tending their garden, et cetera, whatever. So as a result of the insight from that market study, Samsung developed a camera that will allow you to take pictures of yourself. So it's not about technical innovation. It's about supporting a particular lifestyle of your target market. Same with Nintendo Wii. Nintendo Wii is a poor follower compared to Sony as far as game consoles are concerned. So Sony is for the hardcore gamer. The hardcore gamer, it wants an environment that's very realistic. I remember watching my son's God of War games in his laptop, and the protagonist will fight, and one warrior will cut off the head of the other warrior, and you see blood spilling all over, and then the sounds are very, very realistic. And then I think real actors are part of that game. So Nintendo Wii is now faced with a dilemma. How do you compete with Sony? Nintendo Wii decided we will not compete in the same game, in the same manner of Sony. Nintendo Wii will compete differently. How do you do that? Not by coming up with high-definition games, not by employing Hollywood actors, lending their voices to the game. Nintendo Wii decided they will target a separate market segment. Not the hardcore gamer, but a separate market segment. So who are these? These are the non-gamers. These are the Titos and Titas and even the daddies and the mummies. What do you want to do with your daddies and mummies? These are older guys, older women, like me. They cannot follow the hardcore game. We will lose. But we will have value in playing a computer game that allows us to also exercise at the same time. So Nintendo Wii has computer games that will simulate a tennis match or a baseball match or another sport. So because of that, Nintendo Wii was able to make money not by being more like Sony, but by being different from Sony, by competing differently and eyeing a different market segment. So there's a lesson there. Nintendo Wii asked the non-consumer why are you not playing games? And then what will compel you to try playing games? So the non-gamer, the older people said that, well, if it allows us to do exercise, then probably we will consider it. And the sound Nintendo Wii was able to generate revenues. We now go to the second half of my talk, Innovation and Philippine Universities. Is innovation also very important for the academic community? The answer to that is yes. And it's very, very important. Why? Innovations have been introduced in the various programs of the university. I'm talking about teaching, research, and extension. But before we go into detail on innovation and its role in the university, I'd like to mention that while business drives the innovation process, there are other key players in what I call the innovation ecosystem. So aside from business, you have the government, the banking sector, among others. So for government, we know now that the Department of Science Technology sets the policies for R&D in the Philippines. As such, they can allocate financial resources to further develop a particular sector. They invested a lot in the space R&D. They are now investing also a lot in developing technology startups. They invested more than half a million for the operation of technology business incubators. They want about 500 to 1,000 startups among the country in the next two years. That will really make us more technology innovative and entrepreneurially minded. So in the ecosystem, you have the business sector, you have the government, you have the academy. The academy also is very important. Why? Because we train engineers, we train scientists. But sad to say, I think that the Philippine University right now are into adoption of technology, but we're not really actively participating in the generation of innovations. I would like to clarify that the academic community produces a lot of research, and we have seen the increase in research publications, especially in UP, but publications do not equal innovations. So when you have a publication, you increase the amount of knowledge, but it does not result automatically to new products and new process. It does not result to more revenues for companies, and there lies the problem. And I would like to expound on it in a little while. But for now, let me just discuss to you what are the innovations that are being adapted by the universities. Of course, in teaching, we now have more digital content coming from the social media. We have interviews that are recorded, and we can show it in class. If you're a PhD student, you won't feel bad if you are not supervised by a legendary doctoral faculty of Harvard or MIT, because chances are, there are interviews of these prestigious faculty members that you can access via YouTube. I mentioned earlier, distance learning. UP OpenU offers the program for distance learning. So the combination of all these programs, online schools, blended learning, open educational resources like our very own TV UP, and the use of digital resources all add up to more innovative teaching practices. Also, in our research, several technological innovations have also been adapted. Of course, software we have since the 60s, I'm referring to the SPSS, but this statistical software has become more powerful, such that it can now analyze a lot more qualitative data. Lastly, the third major program of the university are the extension or public service programs. Again, we use a lot of IT and social media to make our services better and better to support the needs of our targeted stakeholders. I now go back again to my thesis. Philippine universities, like UP, are adapting innovations in our key functions, research, extension, teaching, but are we generating innovations? MIT, Stanford, they are able to generate revenues from their R&D outputs. I'm referring to their patents. So they're able to sell patents. This means revenue that's pulled back to their R&D efforts. They're able to generate licensing revenues. Again, this means return on investment on their R&D budget. University of Philippines, I think we already have spent billions in R&D in the last decade for research. We have a lot of publications, and that's good because it has elevated our ranks among the best in universities globally. But are we able to generate private return on investment in our R&D? I do not question that we're able to generate social returns on investment. We have better students, better faculty members. We have generated new knowledge that benefited mankind. But that's mankind. What are we doing for our private sector, for our businesses? I argue that we also have to help them become more innovative. They generate wealth. They pay taxes. They hire people. So employment is very important for us. Please note that other countries, they value the fact that University R&D are exploited by their own private sector. So Thailand, Vietnam, Indonesia, they make sure that R&D produced by their universities are commercialized as products and processed. In Vietnam, when you are called an engineer, the chance at your mindset is I will create my own technology and going up a step further, I will create a business wherein that technology of mine is the major source of products and processes. So that's how they think. They are advanced. I would like to see the day when our own engineers, UP engineers, are focused on developing inventing technologies that will be the cornerstone of a future tech startup that they will head. And that there will be continuous innovation so that we will have our local bill gates, our local Google, our local Airbnb, our local version of Grab and Uber. So Vietnam, China has turned up a lot of engineers with that kind of mindset. Actually, China's developed dramatically in the last 30 years. Why? Because of entrepreneurship. So a lot of Chinese started setting up their own companies. Of course they know how to manage the innovation process, how to select, evaluate, and adapt technologies, and then develop the right business model. In some instances, they are not original. They are just copy. And that served them well also because the Chinese market is a very, very big market. You can get rich just by serving the billion Chinese. You don't even have to compete outside of China. And that's how Alibaba grew. I remember reading an interview of Jack Ma. He said that he's not interested in becoming the shark that owns the seas. He's already very happy becoming the dominant player in the Yangtze River because the Chinese market is very, very big. There was talk before that Chinese entrepreneurs do not need markets outside of China. They can grow rich and powerful just by serving the Chinese market. Now moving forward, first that facilitates a culture of innovation are those present in the University of the Philippines. Top management attention. We have champions in teaching. We have champions espousing quality teaching. We have faculty members that are checking the quality of teaching. We have also champions espousing research productivity. We also have champions espousing extension. But do we have a champion espousing innovation in the University? Again, I go back to my definition of innovation. It has to be a new solution introduced to the market and the market will appreciate it such that they will pay for it. So our technologies being bought and paid for by the industry who will now supposedly turn it into new products and processes. I think we need to do a better job. There needs to be a champion focusing only on innovation. That will entail commercialization of technologies developed by the UP faculty, scientists and engineers. I would like to see a more vibrant technology commercialization activity in the University. If we can generate more resources financial resources from our technologies then we do not have to increase tuition fees. We can rely on our other assets. There's also a need to change the mindset and the culture of the University of the Philippines faculty. I'm not saying that we go away from our academic disciplines, but we have to be more imaginative and creative in how we can transfer our technologies. There should be also compensation for innovation. In other universities you have faculty members who are teaching in the University but they are full-time universities but they are also vice president of the R&D department of a corporation. What are the benefits of that type of arrangement? For the faculty he enjoys the best of both worlds. The academic environment generating new knowledge the corporate environment new knowledge is deployed in terms of new products and new processes. Where a certain product or process is really valued by the industry. There's also a need for market orientation among the professors, scientists and engineers. How is this manifested? Scientists when they craft their research agenda they also have to get the voice of the user of that technology who are the users? Who are the potential users? It's the industry. So at the onset you ask the industry what kind of technological know-how do you need to make your company more competitive? What kind of R&D in terms of materials would you want us to focus on? What kind of product development would be valuable to you? I am now coming to the last part of my second half of my talk and I would like to put forth this call to AAPSHA. I think in the university there's a need for development of innovation strategy. There's a need to plan our innovation activities. There's a need to prioritize which technological sectors should be focused on R&D in the future. We should not be content of publication but we should encourage our faculty members to apply for patents for intellectual property protection and also for mechanisms to transfer the technology. I'm aware that the OBCRD has already an organization tasked with facilitating the virtualizing of our technological outputs. That is a step in the right direction but take note that if we cannot change the mindset of our scientists and engineers then that particular OBCRD unit will have no technologies to work with. So first of all there's a need for an innovation strategy and also a need to change the culture within the university and in these systems. Aside from having that organization we have to further fine tune the process of technological innovation and technology commercialization in the universities. We should have a better framework for selecting ideas to develop and to further and commercialize. Also we should have a better innovation process for transforming ideas into a successful innovation, concept development, business plan, solution development, prototyping, implementation and marketing. Again I go back to our culture so we should change the mindset we should design an innovation culture that promotes innovation. In Taiwanese universities of course they also idolize the athletes but surprisingly they also idolize the innovators among the young people. They have posters in the campuses. I remember when I go to Ateneo they have posters hanging on their trees and the posters show their basketball heroes their track and field heroes. In Taiwan aside from idolizing their athletes they also idolize their innovation heroes among the students. So I guess we have to do that too. We have to consider as rock stars not only those who can sing and dance, not only those who can play basketball but also those who can set up companies who can commercialize technologies. In closing I would like to summarize my talk. Innovation means developing something new that will be translated into better solutions that the customers will pay for. Businesses drive the innovation process but the academy also has a very important role to play. In the university we develop technologies we do R&D. We should not stop at just publication we should have a different mindset. How can our research be translated into new products and new process we have to work with businesses we have to collaborate further with the private sector in that way we can have a more innovative University of the Philippines. Thank you.