From precincts to ecosystems: How universities can build the connective tissue of innovation

What turns a collection of institutions into an innovation ecosystem?

In this podcast episode, John Howard, Visiting Professor at UTS and Leader of the Acton Institute for Policy Research and Innovation, explains how orchestration, collaboration, institutional diversity, and outcome-focused policy can help universities contribute more effectively to their regions. You can listen to the conversation in our new episode or read the summary below:

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Summary

A university, hospital, research institute, and company can share a precinct while operating behind closed doors. Their location creates opportunities for contact, yet collaboration still requires incentives, leadership, and a reason to work together. John Howard, Visiting Professor at the University of Technology Sydney and leader of the Acton Institute for Policy Research and Innovation, has spent much of his career examining how universities, industry, government, and communities turn proximity into useful outcomes.

His view of innovation ecosystems places relationships at the centre. Physical assets matter, but the system becomes productive through knowledge flows, joint ventures, worker mobility, and institutional ties. Universities contribute most effectively when they retain their own missions, develop purposeful connections with other actors, and pursue outcomes that reflect the needs of their place. That combination also challenges policies and metrics that encourage institutions to look alike.

Proximity creates potential rather than an ecosystem

John defines an innovation ecosystem as a complex adaptive system involving universities, firms, entrepreneurs, intermediaries, government agencies, capital providers, and communities. Its value lies in the way these participants interact and respond to one another over time.

An innovation ecosystem is actually an adaptive system rather than simply a collection of institutions, and the issue is connection and connectiveness.

He illustrates the distinction through precincts that contained the expected organisations but lacked meaningful interaction. In one case, a university, hospital, and medical research centre occupied the same location, yet locked doors reflected how independently they worked. At Melbourne’s Parkville precinct, medical research institutes, a university, a teaching hospital, and the company CSL were also present, but scientists and clinicians used different languages, working practices, and approaches to data.

There was no incentive or reason why people wanted to interact and achieve collaborative outcomes.

The Bio21 initiative helped change those conditions. Former University of Melbourne Vice-Chancellor David Pennington worked to connect the institutions, with support from the Victorian Government and its innovation minister, John Brumby. John describes this as orchestration: deliberate work to align leadership, funding, and collaboration around a clearer purpose. Philanthropic funding played a similar role in Queensland, where support was conditional on participants working together.

These examples show why buildings and co-location cannot carry the whole strategy. A precinct can assemble the ingredients, while an ecosystem needs people and organisations to establish relationships, remove practical barriers, and agree what joint work should achieve. Orchestration gives potential partners a reason to move beyond adjacency.

Collaboration connects institutions without erasing their missions

John distinguishes between engagement as a practice and convergence as an outcome. Convergence does not require universities, businesses, and governments to become alike. Each institution has its own purpose, standards, and responsibilities; the connections between them should support those differences rather than dilute them.

Engagement is a practice. It’s what you do, and convergence is the outcome.

Collaboration forms the connective tissue. Meetings and informal contact can help people know one another, but the relevant test is whether participants identify common interests and create value. A university needs to understand how engagement supports its teaching, research, or community role. A business must also be able to see how the relationship serves its own objectives.

The financial services cluster in central Sydney demonstrates that connection can take several forms. Banks and other institutions locate close together and compete vigorously, while drawing from a common talent pool supplied by nearby universities. Employees move between organisations and meet socially, although competitive information remains protected. Over time, the concentration contributes to capability by supporting access to skilled people and professional mobility.

This broader view keeps collaboration from being reduced to formal partnerships. Talent flows, shared infrastructure, joint work, and repeated institutional relationships may all strengthen an ecosystem. Their contribution depends on the value they create and the missions they serve.

Uniform systems weaken place based contributions

Innovation ecosystems are rooted in particular cities and regions, so universities may need to play different roles according to their surroundings. John argues that Australia’s policy settings often push in the opposite direction. The unified national system established common funding rules, research assessment methods, and expectations, encouraging institutions to pursue similar measures of success.

Institutions tend to copy what they’re rewarded for.

Global rankings and research-output metrics reinforce that pattern. Universities still develop distinctive strategies, and research-intensive institutions may also undertake substantial community engagement. Yet the incentives make diversity harder to sustain, especially when research commercialisation is treated as the primary route from knowledge to value.

John cautions that research reaches use through many mechanisms beyond start-ups, spin-outs, and licensing. Universities work with businesses and communities on environmental and renewable-energy challenges, for example, even when those contributions are harder to capture. A narrow set of indicators can therefore hide activity that matters to a regional ecosystem.

Australia’s federal structure adds another complication. National government can influence universities through funding and tax concessions, while state and local governments hold policy levers that shape land use and what can be developed in particular locations. Effective place-based innovation policy consequently requires engagement across levels of government.

Greater institutional diversity would allow universities to pursue roles suited to their histories and communities. John points to James Cook University and Central Queensland University as institutions whose civic or location-specific work coexists with research ambitions. Their examples resist a single hierarchy in which every university is judged against the same model.

Outcomes give orchestration and measurement a purpose

Ecosystem activity should ultimately produce something of value. Research papers, events, and interactions may record what participants did, but they do not establish whether the system achieved a useful result. Depending on the ecosystem, outcomes could include employment, investment, environmental improvement, or resilience.

The idea is that you create more value through connectivity and connectedness.

Resilience has become more prominent in John’s account of Australian and European policy, particularly where security, manufacturing capacity, and sovereignty influence innovation strategy. It also exposes the limits of measurement. Outcomes do not always need to be expressed as a single number; policy narratives can explain how research and innovation contribute to a society’s ability to respond to change.

John is sceptical of economic impact reports that rely heavily on multipliers. Their assumptions can produce totals that appear implausible when the claimed contributions of individual programmes are considered together. Such figures may offer guidance, but they should not automatically determine policy.

You have to be careful what you measure and just be careful about making generalisations from those indicators.

The same discipline applies to research commercialisation. Start-up numbers and licence income are easy to count, while engagement in complex fields may unfold through different channels and over longer periods. Orchestrators therefore need measures that match the ecosystem’s purpose rather than adopting available metrics because they are convenient.

A theory of the university must include engagement

The pressure to demonstrate immediate value can narrow expectations of universities. John defends investigator-led research because knowledge that lacks an obvious current application may become useful years or generations later. The history of technology repeatedly shows discoveries being revisited when a new problem or product creates a need for them.

If a university is there to create the stock of useful knowledge, some of that is not gonna be immediately useful.

He also questions the view of universities as job factories. Professional preparation matters, but graduates often work outside the field named on their degree. John recalls consultants with backgrounds in organic chemistry whose ability to classify information, connect evidence, and think through problems proved valuable in professional services. Higher education also develops judgement, wisdom, and the capacity for critical thought.

These varied contributions lead John to call for a renewed account of what society expects universities to do. Teaching and research receive dedicated funding in Australia, whereas community engagement is recognised in university statutes without equivalent support. That mismatch limits the resources available for one of the functions on which place-based ecosystems depend.

I think we need a theory of the university.

Such a theory would state the outcomes expected from higher education and identify the people meant to benefit, including students, staff, and wider communities. It would also create room for different institutions to fulfil different parts of that purpose. John Howard’s argument places diversity and connection together: universities need a clear identity of their own, and ecosystems need the relationships that allow those identities to contribute to shared outcomes.

Ready for more?

Innovation ecosystems do not emerge simply because organisations are located near one another. They develop when universities, businesses, governments, intermediaries, and communities create the relationships, incentives, and shared purpose needed for knowledge, talent, and ideas to flow across the system.

• The university as a catalyst: Knowledge, ecosystems and impact explores how universities can strengthen entrepreneurial and innovation ecosystems by acting as connectors rather than simply generators of startups or commercial outputs. Marcelo Tedesco argues that universities create the greatest value when they sit close to the centre of collaborative networks and help knowledge move between different actors.
• Building and orchestrating university–industry collaboration ecosystems at Siemens provides a practitioner perspective on how large organisations and universities can move from isolated collaborations to coordinated innovation ecosystems. The case study highlights the importance of orchestration, long-term relationships, ecosystem leadership, and creating the conditions that allow collaboration to thrive at scale.

Stay tuned for the next episode on this series and don’t forget to follow us on your preferred podcast platform!