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TTOs reach for new metrics to document their value

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The articles below appeared in the September 2009 issue of Technology Transfer Tactics. Click here to subscribe.

Most TTOs continue to dutifully count up and report on licenses, patents, and revenues — and to a large extent, these metrics continue to form the basis of how performance in the technology transfer arena is gauged. But there is a growing drumbeat of dissatisfaction with these traditional measures because they no longer adequately account for the kinds of activities that tech transfer personnel find themselves increasingly engaged in.

“In the 1980s, many of these offices were started with the idea that they would generate money, and so we built [TTOs] around these sorts of law firm metrics that focus on money transactions,” explains Dana Bostrom, director of innovation and industry alliances at Portland State University in Portland, OR. “But now we are a long way from 1980, and it is time to change; conditions have changed.”

For example, many TTOs are heavily involved in the educational mission of their institutions, preparing and even launching students into technology careers. Further, they’re helping industry partners develop new products, promoting the university’s accomplishments and resources, and attracting research dollars from both the public and private sectors. Such activities are clearly valuable over the long term, but not always so easy to measure. “People are really reaching for the easy metrics, and I don’t think there are any,” adds Bostrom. “The economy is a complex thing.”

Consider the ‘dark matter’

Recognizing that patenting and licensing activity represent only a subset of TTO activity these days, the Association of University Technology Managers (AUTM) has been looking at the issue of metrics for three years. In a draft proposal for what it calls the “Institutional Economic Engagement Index,” the organization has outlined a range of metrics for research institutions to consider in assessing the impact of their technology and knowledge transfer efforts on the communities they serve. (See sidebar below.)

These range from “value creation” activities, job creation and other impacts from startups, “institutional support for entrepreneurship and economic development,” relationship-building, consulting agreements, and community engagement, among others.

Such themes represent a much broader mission for TTOs than the traditional “money” metrics. But a broader view is more in line with reality, according to Michael Szarka, PhD, manager of technology transfer and commercialization at the University of Ontario Institute of Technology in Oshawa, ON. “What is changing is the realization that we need also to track some of what I refer to as the ‘dark matter’ of technology transfer; that is, all the other things most TTOs do that have nothing to do with selling technologies,” he says. “None of us have a good grip on how our industry divides its resources between the technology licensing activities and all the other things most of us do such as processing agreements, supporting contract research, economic development activities, and other supports of the innovation agenda that do not relate directly to IP management.”

Without metrics to document time spent on these ‘dark matter’ activities, Szarka says, it’s tough to make appeals for new resources or to explain why technology commercialization activities often get placed on the back burner in favor of activities with shorter time-lines, such as research contracts. “Also, if an office is responsible for multiple functions, it is unreasonable to compare its staffing levels and outputs to offices which only do commercialization,” he says. “We want to increase awareness of the resources required and value attached to these other activities.”

Take a ‘holistic’ view

Documenting the value of these ‘dark matter’ activities is difficult to do without hard data, and that data is challenging. For example, most TTOs would agree that building relationships with business and industry is important, but how do you attach value to time devoted to this task? “Any outcome is likely to be indirect at best or significantly separated in time from the activity,” says Szarka. “People tend not to care about input measurements in a ‘results oriented’ business like technology transfer. But if we ignore these activities we are selling ourselves short because they may, in fact, be more important to some of our stakeholders than licensing technologies.”

While there may be no perfect way to collect data for such metrics, some TTOs are making progress. The technology licensing and commercialization division at Ohio State University (OSU) in Columbus, for example, views material transfer agreements (MTAs) and confidential disclosure agreements (CDAs) as key leading indicators for economic activity. “These [agreements] show you where the early conversations are happening,” stresses Jean Schelhorn, PhD, associate VP for technology licensing and commercialization at OSU. “And they are great indicators of your university’s outreach to others as well as the importance with which the external community is viewing the information you are sharing.”

Further, while new business start-ups are easy enough to document, university administrators also need to be made aware of the TTO’s outreach to existing business and industry. “If we can make existing industry in the state more competitive so that they can retain and add jobs, that is huge. If we can do new companies that over time will grow, that is huge. And if we can become a center that people will want to affiliate with and to be near, that is huge,” she says. “I think what is important is how many people we are helping.”

To document this more “holistic” view of technology transfer, Schelhorn looks at CDAs, MTAs, sponsored research contracts, repeated research contracts, licenses, start-ups, and the percentage of time faculty engage in consulting activity. In fact, in what would be a boon to the technology transfer division’s larger efforts as well as the need to attach value to its myriad functions, the colleges of engineering and medicine at OSU are currently looking at ways to credit faculty for entrepreneurship and commercialization activities, perhaps as a substitute for more traditional factors used in tenure decisions.

“Right now there is one pathway [for tenure and promotion], and that is through grants, publications, and matriculating students. And I think people who engage in commercialization underperform in that path for a reason,” explains Thomas Rosol, DVM, PhD, special assistant to the VP for research for technology licensing and commercialization at OSU. “People are afraid to engage in commercialization until they are professors, and this is an attempt to get people to engage in commercialization at an earlier stage.”

Another TTO-related task that too often gets ignored, according to Rosol, is education. “What amazes me is that we don’t put more credit on our major business as a university, and that is graduates,” he says. “Can you imagine what would happen if we didn’t graduate technology-oriented students? They are our real product. Businesses need a workforce, and that is our major business model.”

Unique role; new metrics

In fact, education is a top priority for Scott Forrest, PhD, Lt. Col, USAFR (ret.), the director of technology transfer on the Shreveport campus of Louisiana Tech University. The university’s primary campus is located about an hour away in Ruston, LA, and while the TTO there is primarily concerned with traditional metrics, Forrest is more focused on helping the northeast region of the state transition to a technology-based economy. “I don’t want to downplay those [traditional metrics]. They are very important, but my charge is different. It is to be the point man for this area,” says Forrest. “Anything engineering and technology related — I’m involved in it.”

For example, Forrest plans technology conferences in the region, and makes sure that technology-focused program offerings are both appealing and easily accessible to a rich local talent pool that is expected to expand since nearby Barksdale Air Force Base has been selected by the Pentagon to house Global Strike Command, a new unit that will oversee the nation’s nuclear-equipped bombers and intercontinental ballistic missiles. “There will be an influx of new talent in addition to the [experienced veterans] who are already here,” says Forrest. “These are people who are smart and already technically minded, and I think they would make excellent engineers and scientists.”

In his unique role operating as an extension of the TTO on the main campus, the metrics that apply to Forrest have to do with recruiting new student talent to the university, building relationships and partnerships with local industry and government, and nurturing technology-based start-ups.

New importance for jobs

In this economy, job creation has emerged as a top priority for universities and the communities they serve. Further, many research projects that are receiving stimulus funds must document the number of new positions they are creating. Consequently, TTOs are feeling some heat to demonstrate their impact on the local and regional job market. While nailing down a direct link between TTO activity and jobs may be impractical if not impossible, you can use proxy measures that infer an employment affect. For example, Rick Silva, PhD, the director of technology transfer at the University of Colorado in Denver, tracks capital investment into start-up companies. “Wherever the flow of a dollar can be tracked, we try to document that so that we can draw inferences about what that means,” he says. If investments are being made in start-ups, he reasons, the jobs can’t be far behind.

While traditional metrics, and especially exclusive licensing deals, still receive top priority, Silva also has metrics for longer-term projects that may not produce revenues for many months or years. “We have a pipeline that shows all of our products in clinical trials and pre-clinical development,” he explains. “It is useful to show our leadership the things coming through the pipeline, and spin that in the context of pipeline maturation.” Silva adds that this kind of metric demonstrates to university administrators the likelihood of financial, societal, and clinical-impact benefits down the road.

Having tools and metrics to show how you move from pure research into clinical and commercial applications is critical, he emphasizes. “For us, it has been a process of getting people familiar with what we do, and demonstrating that we are able to create value for the institution over the long haul,” says Silva. “It’s about having an ongoing dialog with the leadership and helping them to understand the importance of funding applied research.”

Contact Bostrom at 503-725-8466 or bostrom@pdx.edu; Szarka at 905-721-8668 ext. 2523 or mike.szarka@uoit.ca; Schelhorn at 614-688-0189 or schelhorn.1@osu.edu; Rosol at 614-292-4265 or rosol@cvm.osu.edu; and Silva at 303-724-0222 or rick.silva@cu.edu.

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Institutional Economic Engagement Index”
AUTM unveils a draft proposal for new metrics

Recognizing that the mission for many TTOs has broadened well beyond licensing and patenting, the Association of University Technology Managers has been exploring new measures that do a better job of capturing the many different activities technology transfer professionals typically engage in. To accomplish this task, AUTM has partnered with Unico, AUTM’s counterpart in the United Kingdom, and multiple stakeholders in the US, including higher education associations, governmental organizations, and non-profit groups.

One result of this ongoing exercise is a draft proposal for what AUTM is calling the “Institutional Economic Engagement Index” — a collection of themes and measures aimed at better describing economic and community impact.

The draft proposal emphasizes that Unico’s prior work in this area “has helped to demonstrate that reporting only on licensing activity seriously understates university contribution and that reporting the broader range of activities better demonstrates the knowledge transfer achieved, which occurs through many more channels than simply intellectual property licensing.”

The draft proposal then defines a series of metrics for documenting those activities, including:

  • number of agreements that enable external use of institution technology;
  • number of companies in the region who have contractual relationships with the institution for technology use or development;
  • number of new companies per year with contractual relationships;
  • number of companies with recurring contractural relationships;
  • number of consulting agreements per year with faculty or staff;
  • number of faculty engaged with community in consulting or other knowledge transfer activites;
  • companies launched per year that are associated with institution technology;
  • number of start-up companies that are still in business and still associated with the university;
  • jobs associated with start-ups;
  • research projects that include a strategy for distributing research assets;
  • number of economy-focused community engagement events convened by institution;
  • measures of business support services and activities made available to the community;
  • measures of incubator activity;
  • measures of seed and venture fund activity in the local area;
  • knowledge transfer-related income stemming from consulting, training, SBIR funding, and spinout investments.

Other areas for metrics posited in the document include institutional policies and procedures that are conducive to business and entrepreneurship, certain program offerings that support innovation, students enrolled and graduated, and other indicators of community engagement.

While the list of proposed metrics is fairly exhaustive, it is by no means final. In fact, AUTM invites further comment and discussion on the subject. Contributions can be sent to newmetrics@autm.net.


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