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Picking apart Israel's culture of innovation

Sunday June 14 2015

By BITANGE NDEMO
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On top of Israel’s Mt. Arbel, the view in all directions is overwhelming. Below, to the East, I can see the Sea of Galilee with its many fishing villages on its shores.

Many of these villages were significant theatres of events and stories in the Gospels. They are part of the so-called “Jesus Trail.” There is Ginosar, a fishing town also known asGennesaret in Latin; Tabgha, the very place where the miracle of the multiplication of the loaves and fishes took place, as did the fourth resurrection appearance of Jesus after his Crucifixion; Capernaum, which became Jesus’s new home after his expulsion from Nazareth and which was also the scene of many acts and incidents of his life; and, finally, Bethsaida, where Jesus healed the blind man. To the South East is the city of Tiberius. 

In this small dry land, Jesus lived and started the great Christian religion. His Jewish people have been the butt of persecution over the centuries, but they have thrived and are distinguished for  their ability to innovate.

Innovation in Israel dates back to an era before the Roman conquest and the imposition of their rule and civilisation headed by emperors represented by regional kings.  Before Jesus was born, King Herod, an insecure man, was the Governor of Galilee and later King of Judea. 

He governed with great cruelty, killing most of his relatives and the Zealots, most of who were Pharisees. Rabbi Ken Spino describes him as "a madman who murdered his own family and a great many rabbis."

Historian Brian Tiemey described him as "the evil genius of the Judean nation", while the Jewish encyclopaedia noted that he was "prepared to commit any crime in order to gratify his unbounded ambition."

However, despite his murderous reputation, Herod  was very innovative.  Rabbi Spino agrees that Herod was "the greatest builder in Jewish history.” He is known for his colossal building projects throughout Judea, including his expansion of the Second Temple in Jerusalem (Herod's Temple). 

According to our tour guide, Carmiel, when Herod realised that he couldn’t reach some fugitives who were hiding inside the hanging caves at Mt Arbel, he improvised a pulley system to slowly lower the army into the caves. The army killed his “enemies,” wiping out many Pharisees. 

Herod was so innovative that some of his works that still stand in Jerusalem continue to confound modern architects.  Over 2000 years later, it is clear that this innovativeness never quite left this holy land.

We are here as a team from the University of Nairobi to learn from their success.  Leading us is our Chancellor Dr. Vijaylaxmi Rattansi, and Vice Chancellor Prof. Peter Mbithi.

We have been invited by the University of Tel Aviv and Start-up Nation Central, started by the authors of the book Start-up Nation: The story of Israel’s Economic Miracle.

The university leadership includes Prof Lucy Irungu, Deputy Vice Chancellor for Research, Prof Timothy Waema of the School of Computing, Dr Tony Omwanza who is the head of the University’s tech incubator, C4D, Dr Kamau Gachigi of the School of Engineering, Brian Ouma from the newly created University Advancement Office, myself, representing the School of Business, and Rachel Adelman a Nairobi based tech enthusiast and our link person in Israel. 

Our team increased by two with entry of our driver Eli, a very jovial man, who like every Israel man you meet, is ex-military with great knowledge of his country, and Carmiel our guide, a friendly young man with great passion in what he does and highly dedicated to his work and country.

From Left standing Prof Waema, Dr Omwansa, Vice
From Left standing Prof Waema, Dr Omwansa, Vice Chancellor Prof Mbithi, Prof Ndemo, Prof Irungu and Mr. Ouma. Seated is Saul Singer and to his right is Dr Rattansi. PHOTO | COURTESY

We landed in Tel Aviv and drove to Jerusalem where our schedule started. What strikes you in Israel, as mostly in Kenya, is how safe you feel inside the country.  Yes there are challenges, but at times media overblows the issues. 

Perhaps the major difference between Kenya and Israel is their optimism that they will overcome any challenge that arises.  In Kenya we dwell on doom. We spend too much time and space driving fear into our people.

We have now spent months re-emphasising the tragic events that happened in Garissa. There has hardly been any columnist writing any encouraging piece. 

ADVERSITY: MOTHER OF INNOVATION

Adversity, as you will see later in this write-up, has made Israel.  They see opportunity where others can’t, because others spend their time mourning. 

If you gave a lemon to an Israeli and a Kenyan, the Israeli would take it and make lemonade, whilst the Kenyan would likely complain that he would rather have an orange since the lemon is sour.

There is opportunity in adversity. God never gives you tasks that you cannot manage. It is true for countries as well. It is perhaps our purpose on earth to seek knowledge and change the world for the better.

In my view, God has deliberately given us the problem of Al Shabaab in a similar way he gave Israel its troublesome neighbours.  In our case, the terror group should make us stronger.

To defeat their tactics, however, we need to be innovative.  This is what Israel has done to succeed in spite the fact that all its neighbours are not friendly. 

Dan Senor and Saul Singer, authors of the bookStartup Nation rhetorically ask in their book “why Israel and not anywhere? One explanation is that adversity, like necessity, breeds inventiveness.” Most of the civilian technologies that we rely on today were made out of adversity.

The government needs to unleash the latent potential in our youth to come up with innovations that deal with our security problems.  Insecurity is a collective problem and we all must play our individual role, remain patriotic in the face of threats, and develop solutions like the Israelis have done.

Our schedule started on Monday morning with Wendy Singer, Executive Director ofStartup Nation Central.  Considering the organisation’s success, she is a humble woman who warmly received us with her assistants. 

She tells us that the success of Israel was mainly due to three factors: government’s deliberate policy to succeed, immigration and the Jewish culture. 

Since Israel’s independence in 1948, the people have relied on their innovativeness to deal with the harsh conditions facing them. The founding fathers started to build pipelines to take water from the North in Galilee to the Negev desert in the South for farming. Israel’s innovations in agriculture are second to none.



The author and Mr Saul Singer. PHOTO | COURTESY
The author and Mr Saul Singer. PHOTO | COURTESY

Soon after the establishment of the State of Israel, the country heavily invested in Research and Development (R&D) and created the Office of Chief Scientist that basically invests public resources in research outputs. 

Although the office was critical, it wasn’t until the 1990s when it started to invest heavily in technology start-ups and attracted significant amounts of money in venture capital.  According to Senor and Singer:

 “in 2008, per capita investments in Israel were 2.5 times greater than in the United States, more than 30 times greater than in Europe, 80 times greater than China and 350 times greater than India.  Comparing absolute numbers, Israel – a country of just 7.1 (now 8.5) million people – attracted close to $ 2 billion in venture capital, as much as flowed to the United Kingdom’s 61 million citizens or to the 145 million people living in Germany and France combined.”

Such success would not have been achieved if the entire nation had not been totally committed.  At theMunicipality of Tel Aviv, we met with Inbal Naveh Safir, a kind and outgoing young woman commanding so much knowledge about the city that you would think she was the Mayor of Tel Aviv.

She tells us that the municipality supports start-ups by giving tax concessions on property tax of up to 50 percent.  They also provide working space for early start-ups.

Virtually all the groups we met said the return of the Jewish diaspora, mainly  from Russia, has paid off.  A 2013 report by the Adva Center, an Israeli social policy think tank, says 56 per cent of Russian immigrants in 1992 were in the poorest third of Israeli society — below the poverty line or at risk of poverty.

By 2010, the figure had dropped to 38 per cent. Over the same period, the percentage of Russians in the upper third of Israeli earners grew from 10 to 27 per cent. According to the same report, Ethiopian immigrants who arrived in Israel in large numbers at around the same time have not been as lucky, and they still face significant challenges.

More than half of Ethiopian Israelis live below the poverty line. Ethiopians also lag behind the broader Israeli public in education and have salaries about one-third lower than the average Israeli.

There is no easy explanation for these disparities, but the fact that Russians are on average better educated than Ethiopians might provide a clue. Income disparities in Israel are high.  Forbes Magazine reports that the 41 richest Israelis control about 50 per cent of the GDP.  Although national per capita income is $25,000, a great number of people are still poor.

MILITARY SERVICE AND INNOVATION

Another factor that has led to many people becoming innovators is their conscription into the Israel Defense Forces (IDF). 

With respect to military service, Senor and Singer say, “as for many other conscripts, the IDF provided him with an exciting opportunity to test and prove himself.  But the IDF offers recruits another valuable experience: a unique space within Israel society where young men and women work closely and intensely with peers from different cultural, socio economic, and religious backgrounds” presenting them with lifelong networks that later become important in the business environment.

Indeed our visit was made possible through Rachel’s networks.  Everybody in Israel knows someone somewhere or someone who knows someone somewhere.

Israeli people encourage a unique culture where young people are encouraged to take responsibility early.  At around 18 years, they join IDF.

They are also encouraged to take risk and to question authority.  While referencing to one of the success story, Senor and Singer say “success lie in the stories of individual entrepreneurs … which are emblematic of the state itself… it is a story not just of talent but of tenacity, of insatiable questioning of authority, of determined informality, combined with a unique attitude toward failure, teamwork, mission, risk, and cross-disciplinary creativity.” 

UNIVERSITY AND INNOVATION

The universities here are major contributors to economic growth and the collaboration between them, industry and policymakers is admirable. 

At Hebrew University, we get to learn that its strong office of technology transfer organisation (TTO) is self-sustaining with more than $200 million in licensing fees and royalties. It has accumulated billions of dollars  and its annual research product sales are in excess of $2 billion. 

The story in Tel Aviv University is not any different.  Tel Aviv University and the Technion, a national polytechnic, both claim to contribute more than 50 per cent of young people in start-ups.  Sales from some of the companies emanating from Tel Aviv University is in excess of $10 billion and many are listed on the NASDAQ. 

At the Interdisciplinary Center, Herzliya, a private elite college that emphasises interdisciplinary studies, we learned about a unique program that prepares young people to become entrepreneurs. The Zell Program is in its fourteenth year and students have made in excess of $200 million, while the companies they have started are valued at $1 billion.

WHAT KENYA CAN DO

In 2013, Kenya formally passed a legal framework that creates several institutions that support innovation.  These include National Commission for Science, Technology and Innovation (NACOSTI), Kenya National Innovation Agency (KENIA), and the National Research Fund (NRF).

Although this is a good beginning, creating so many offices may end up paralysing the innovation ecosystem. What we need now is to consolidate research and innovation resources spread across different ministries and start supporting innovation just like Israel has done.

The following recommendations are key to improving the research and innovation in Kenya:

  • Foster a culture which encourages risk taking and celebrates failure as a mandatory milestone on the way to success

  • Incentivise experienced young professionals to start companies and not burden just college graduates. College students and young graduates should be given an opportunity to work alongside more experienced individuals who can help them develop an aptitude for innovating.

  • Consolidate funds from Biashara Kenya, Enterprise Kenya and the NACOSTI budget under one body that could be renamed the National Research Fund to provide support to research and innovation.

  • Encourage closer collaborations between the universities, industry and the government and encourage research collaborations within and outside the country. Create offices in each university to commercialize and patent innovative research. Add number of patents registered as a performance indicator and standard in our universities.

  • Redesign performance  for the Ministries of Agriculture, Education, Industry, Health, and Information and Communication technologies and start measuring it based on how many start-up enterprises they create every year as well as how active they are in mentoring young entrepreneurs.  It is no longer fashionable to be told that the Ministry has performed well by simply shuffling papers around and setting below minimum performance targets. Measuring the number of start-ups will be the only sure way of creating employment.  Research shows that for every one job created through start-ups, four other jobs are created through sub-contracting and other services.

  • Develop a mandatory one-year national service during the gap year before college-bound students enrol at universities and colleges or a voluntary boot camp for all high school graduates.  Just like in global elite universities, entry into elite programs at local universities should be based on voluntary contributions to the Nation. National service programs, besides helping forget a national identity and common ethos, fosters leadership and independence and these resource can be leveraged to build infrastructure, support services especially in hospitals.  Virtually all elite universities no longer admit students based on academic qualifications alone.

The writer is an Associate Professor at the University of Nairobi’s School of Business. Twitter: @bantigito