The CHIPS Act was a good start—now we can take these three steps to further supercharge innovation

With the recent passage of the CHIPS and Science Act of 2022, the U.S. has made the most ambitious push in science-driven innovation in the 75 years since the days of Vannevar Bush’s Endless Frontier report and the creation of the National Science Foundation. Make no mistake: This is a watershed moment in the “new space race” between China and the U.S.

But this funding increase is only the first step. To supercharge America’s innovation prowess, we must build on the good existing aspects of the U.S. innovation system and develop a modern innovation ecosystem that will once again lead the world into the future. Doing so depends on proceeding with three core imperatives in mind.

Cultivate strategic opportunities broadly

Once upon a time, bold declarations in JFK’s moon-shot speech were representative of the climate that extended across the American innovation landscape. Yet more recently, the American innovation system has spent several decades playing small-ball—which has resulted in the so-called “Valley of Death” that continues to kill and/or delay promising early-stage innovations.

This incremental innovation approach has resulted from several trends. Increasingly, we see governments partnering with a narrow set of preferred large corporate partners, often through special contract vehicles meant to fast-track purchasing, but having the cooling effect of pushing out innovative small- and mid-sized businesses. Of course, the largest of public corporations are first and foremost responsive to short-term profit motives to please investors; government funds a wide variety of scientific projects with scant strategic coordination across agencies and at times crowding out innovation. Second, governments are developing new programs and building laboratories to innovate in replacement of commercial efforts. Although we understand the impetus, all too often direct government innovation efforts have led to bloated and slow (and eventually failed) programs concentrating large sums of money on internal efforts and/or “trusted” partners—including, famously, the Langley Aerodrome (among many others).

America must resist both over-dependence on short-term profit motives and over-dependence on sprawling government intervention. Instead, it needs to release pent-up entrepreneurial and patriotic spirit across the country. There need to be incentives throughout the ecosystem for long-term research and technology programs designed to focus on large-scale societal problems and opportunities—in which the potential strategic gains must be considered alongside (or in place of) the financial payback period. Importantly, this is in the best interests of industry just as much as the government: The creation of strategic innovation assets led by entrepreneurial enterprises and pioneering companies comprises the most powerful lever for retaining competitive advantage over the mid- to long-term.

Strengthen the scientific process

To remain the world’s pre-eminent innovator, the U.S. will need to build the deepest possible talent base, and then clear the way for that talent to do its best possible work. Much has already been written about the need to expand access and equity for careers in science and technology—and rightly so. But if we succeed in broadening the bench, what sort of professional levers will this influx of talent have at their disposal? Quite a number of distinguished commentators have lamented that perhaps the funding process, from government acquisitions to innovation programs to academic grant-making, itself is fundamentally flawed and badly in need of overhaul.

An influx of government money, and the creation of new technology directorates, creates an ideal moment for us all to assess whether the system is set up to for the community to do its best work. We might heed the warnings of Vannevar Bush, the architect of our modern government research enterprise: The government’s role is best suited to funding bold initiatives, and empowering companies and universities to perform inspirational work.

Leverage ecosystem-wide data

Supporting the previous two goals is an underlying prerequisite for success in the modern innovation economy: using systematic data to drive insights and transparency. How can we know which strategic bets might bear fruit? How can we assess which innovators are doing the best work? Still today, most innovation partnerships—especially those that bridge industry, academia, and/or government—tend to be among “the usual suspects.” Why? Because even industry leaders and senior officials do not have proper intel around what’s happening in the long tail beyond the brand-name players.

Still today, if you ask leadership at leading corporations, granting agencies, or research institutions, “what’s the future impact of your current innovation portfolio?” you’ll either get educated guesses, or blustering, or polite shrugs. Why? Because very few organizations have assembled the comprehensive data sets and analytics capabilities to return clear answers. If the U.S. is going to achieve moonshots and lead the world in innovation, everyone must do better. Fortunately, the data do exist, and a growing cohort of companies have assembled comprehensive big-data sets and AI-driven analytics capabilities with the horsepower to drive foundational insights at every stage of the American innovation pipeline. But institutions and corporations must be ready to take these nascent advantages and run with them. Throughout the innovation economy, output and quality will improve the more that organizations gain the insights required for strategic decision-making, and build the transparency required for a level and competitive playing field among innovators.

Now is not the time to sit on the sidelines; the new great-power competition for technological supremacy is already afoot. We are entering a new golden age of innovation, in which the need for R&D will accelerate across technology categories and industries. Furthermore, none of the issues mentioned above can be addressed unilaterally by the federal government, even if it tried. Rather, these are whole-of-society imperatives. And the surrounding incentives are already shifting in favor of these imperatives—for academic leaders, industry executives, and policymakers alike. Strategic innovation and technology development are becoming more critical across sectors, and it is in everyone’s best interests to anticipate the changing environment and move proactively. Thankfully, doing so is also in the best interests of America and the world, and in line with the strategic goals of the CHIPS Act.

Robert Lowe is a co-founder and CEO of Wellspring, a provider of web-based software systems for managing research and technology commercialization.