Arkansas's Needs for Economic Growth and Competitiveness

1. Arkansas's Needs for Economic Growth and Competitiveness John W. Ahlen, Ph.D., President Arkansas Science & Technology Authority before the Task Force on Higher Education Remediation, Retention & Graduation Rates October 8, 2007 Do it right the first time.

2. Seeing the Future The future is already here. It’s just not evenly distributed yet. William Gibson

3. Three Things to Know • The Knowledge-Based Economy is real and it is here. • Good News: Arkansas can compete in the KBE. Bad News: We need to be much more competitive. • The Knowledge-Based Economy is fundamentally different from the industrial economy it is overtaking. January 24, 2005

4. The Quiet Crisisfrom The World Is Flat “… we should be embarking on an all hands on deck, no holds barred, no budget too large crash program for science and engineering education immediately. The fact that we are not doing so is our quiet crisis. Scientists and engineers don’t grow on trees. They have to be educated through a long process, because, ladies and gentlemen, this really is rocket science.”

5. The Value Added Imperative from Trent Williams Export Goods and Services Import Cash Create Jobs; Pay Higher than Average Wages Create Wealth Create a Primary Enterprise that Supports a Cluster of Secondary Firms The Fundamental Rule Extract/Grow/Manufacture/Know

6. The System Skills before jobs Growth Entrepreneurs

7. R&D Demand Supply S&E Workforce Workforce Continuum Individual Choice The Life Cycle Production Talent The Twin Challenges The Perfect Storm Product Sales Skills before jobs Scale-Up Talent Scientific Talent Entrepreneurial Talent Engineering Talent Time Development Introductory Growth Maturity Decline Citizenship

8. Baccalaureate Some High School The Workforce Academic Leadership Corporate Leadership Project & Engineering Management Project Management Research & Development Lead Engineer Senior Engineer PhD Knowledge Worker Engineer MS Workforce Continuum Technician 2-Year Degree Tradesman Certificate High School Laborer Individual Choice

11. 2004 14 grades The Shifts 1970 12 grades 1940 8 grades 1800-1815 Regional Specialization NE – machine based manufacturing S – cotton, cheap labor 1941 WWII 1957 Sputnik 1836 Statehood 1874 AR Constitution 1955 AIDC 1880 Census 1983 ASTA The New Deal 1933 1964 The Great Society 1983 A Nation at Risk 1990 Who will do science in 2010? 2005 The World Is Flat 2030 PCs 1990 Digital Content Software New Media 1900 Electricity Chemicals Internal Combustion 1950 Petroleum Electronics Aviation Automation Biology Materials 1845 Steam Power Railroads Steel 1785 Water Power Textiles Iron ------------------------ ------------------------ ------------------------ ------------------------ 1830 1930 2030 1989 The Flatteners

12. The Flattenersfrom The World Is Flat Genesis: The Flat World Platform Emerges • Windows (11/9/89) • Netscape • Work Flow Software The Flatteners • Open-Sourcing • Outsourcing • Offshoring • Supply-Chaining • Insourcing • In-forming (search engines) The Steroids: Digital, Mobile, Personal, and Virtual

13. African Proverbfrom The World Is Flat Every morning in Africa, a gazelle wakes up. It knows it must run faster than the fastest lion or it will be killed. Every morning a lion wakes up. It knows it must outrun the slowest gazelle or it will starve to death. It doesn’t matter whether you are a lion or a gazelle. When the sun comes up, you better start running In his earlier book, The Lexus and the Olive Tree (1999), Tom Friedman contrasts the globalized fast world and the slow world; he suggested that people choose the slow world because the fast world is too fast, too scary, too homogenizing, or just too demanding. Individual Choice

14. R&D S&E S&E S&E S&E Can We Do It Here? Case Study • $70,000 Applied Research Grant; $70,000 matching funds from industry • $420,000 NSF Grants (2) – professor and graduate students • $1.35 million in SBIR Grants (4) – PhDs, MSs, entrepreneur • $1 million early-stage risk capital being sought – PhDs, MSs, 2-year college technicians Growth Entrepreneurs Three faculty; four companies; 32 employees

15. The STEM CoalitionApril 24, 2007 • “This is urgent business that needs immediate attention.” • “This is a competitive threat.” • “What we have here is a bunch of perfect storms.” • “We need to carry the realization of this threat to the rural schoolhouse.” • “We simply must connect opportunities to minority and disadvantaged students in our communities.” Many communities and educators seem too comfortable with an Industrial Age model of mass production learning and an Agricultural Age calendar that bind educators and students in time, place, and purpose. Embracing the Information Age (2001)

16. The Risk of Inaction Arkansas - Percent of National Income Per Capita Alternative 85.0% 75.0% Baseline 65.0% 55.0% 45.0% 35.0% 1957 1965 1969 1973 1985 1989 1993 2009 2017 1961 1977 1981 2013 1953 1997 1933 1937 1941 1949 2001 1929 1945 2005 Source: U.S. Bureau of Economic Analysis

17. Baseline Insanity is when you keep doing the same thing over and over again, each time hoping for different results. Edward Deming

18. Alternative “Many mainstream organizations could use additional resources to revitalize their current offerings. But when the objective is to get a system unstuck, it is time to go in search of catalytic innovations.” Clayton M. Christensen, Heiner Baumann, Rudy Ruggles, and Thomas M. Sadtler, “Disruptive Innovation for Social Change,”Harvard Business Review, December 2006.

19. One Final Question: Do you see it now? Comments / Questions? Thank You! John W. Ahlen, Ph.D. Arkansas Science & Technology AuthorityLittle Rock, Arkansas 501.683.4400 john.ahlen@arkansas.gov