‘Innovation Index’ puts a number to Israel’s tech prowess

Innovation — a concept much revered but difficult to measure — is, for the first time, being subject to a highly innovative approach that seeks to define, quantify and qualify it. In this effort, the United States and Israel, leaders in innovation, have collaborated on a new project called the US-Israel Innovation Index. 

The project has something for everybody, said Ann Liebschutz, one of the index’s architects. It will show Israeli entrepreneurs, American investors, and government officials from both countries that the US is still the best destination (for partnering, sales, or exits) for an Israeli start-up to set its sights on, despite very tempting offers from the Far East and Europe. For American companies, especially mid-size and smaller ones, the index will highlight Israel’s strength as a tech partner, seeking to encourage US businesses to further embrace Israeli tech companies and to partner with them.

The Index is the brainchild of the US-Israel Science and Technology Foundation (USISTF), which Liebschutz chairs. Now a private nonprofit organization, the group was once a joint project of the Israeli and US governments and still retains strong ties to both; the index was introduced this week at a gala event attended by the cream of Israeli academia and technology and presided over by US Ambassador to Israel Dan Shapiro.

“The political issues dominate the front pages, making us lose sight of the great cooperation between our two countries in technology,” said Shapiro. “I am proud of what we are doing in the area of tech cooperation.”

Also speaking at the event was Israel’s Chief Scientist Dr. Avi Hasson. “Looking around tonight I see many of the leading lights of the Israeli tech industry. Many of you have stories to tell about collaboration with American companies, and how it has benefited you on an individual and professional basis. But stories are anecdotal, and with the index we now have a way to quantify those benefits,” he said.

Ann Liebschutz (Photo credit: Courtesy)

The mission of the USISTF is to encourage R&D partnerships between Israeli and American companies to advance a wide range of technology areas, such as high-end computing, autonomous unmanned vehicles and neuroscience, in deals that benefit both countries. The index, its most recent project, benchmarks the US-Israel innovation relationship against similar relationships between the United States and eight other countries, said Liebschutz, “in order to give both countries an idea of their strengths and weaknesses, allowing them to ameliorate problems. This is not meant to be a public relations piece, but a way to measure the US-Israel relationship over time, and see how we are progressing in our tech relationship.”

The index, meant to come out bi-annually, examines 20 indices that are considered important in the US-Israel tech relationship. The indices analyze statistics such as articles co-authored by American and Israeli scientists, US patent applications by Israeli companies, bilateral treaties in science and technology, participation in distributed computing projects (where data crunching is done on multiple servers in different locations), higher education expenditures on R&D, and many others — most of them intangibles that were either not examined at all, or not examined for their value as a measure of innovation.

Taken together, said Liebschutz, the indices should make a case for how strong the US-Israel innovation relationship really is, show what areas Israel performs well and areas that need improvement, and suggest ways to make the tech relationship between the two countries even stronger.

The indices were decided upon after a lengthy deliberation by the USISTF and an all-star roster of Israeli tech executives, government officials, and academics, including Dr. Ruth Arnon, president of the Israel Academy of Sciences and Humanities, Dr. Eugene Kandel, head of the National Economic Council, Dr. Eitan Yudelevich, head of the BIRD Foundation (which has been encouraging US-Israel technology partnerships since the 1970s), “Start-Up Nation” author Saul Singer, and many others.

As befits a project that is all about the numbers, the Index compares Israel as an American partner to other developed countries, including Canada, Singapore, Germany, Switzerland, South Korea, Sweden, Finland, Japan, Brazil, Turkey, and Russia. With the index, said Liebschutz, Israel can at last know where it truly stands as an innovation power compared to others who call themselves “start-up nation.”

Coming in first as the country with the strongest innovation relationship with the US was Switzerland, followed by Canada, which Israeli trailed by a very small percentage.

Overall, Switzerland ranked highest scoring 131.05 points, which the organization attributes to the strength of the pharmaceutical industry. Canada scored 100.50, marginally stronger than Israel’s baseline 100 point ranking (as the Index focuses on the Israel-US relationship, other countries are measured against Israel’s numbers). Other countries ranked in the survey included Singapore at 85.60; Germany at 74.34, South Korea at 72.27, Sweden at 71.71, Finland at 67.19, Japan at 60.92, Brazil at 29.86, Turkey at 27.37 and Russia at 13.60. Chile, Hong Kong, South Africa and the United Arab Emirates were also studied, but did not make the Top 12 list.

For Leibschutz, that indicates just how viable Israel is as an innovator.

“Canada borders the US and is our largest trading partner, while Switzerland is the world center of pharmaceutical production. For Israel to rank nearly as high as these two countries in its tech relationship with the US is quite an accomplishment,” she said.

Indeed, she added, Israel also performed very strongly on nearly all the indices measured by the index, indicating that the image of Israel as a country of innovation was not just PR talk, but could be backed up with solid numbers.

In an era when China is offering Israeli start-ups tens of thousands of dollars basically for just showing up and opening an office, and European countries are rushing to Israel to offer incentives for opening up shop in their countries, it’s easy to lose sight of the core strengths of the US-Israel technology relationship, said Leibschutz.

“The US has the best scientific institutions and the best universities, and most of the world’s important multinational tech companies are located here.

“Once that was more than enough to attract companies to pursue their future in the US, but times have changed, and we realize it. Countries around the world are incentivizing the tech to go their way, and now we have to deal with competition,” said Leibschutz. “That’s why the index is so important. Seeing the statistics will focus the conversation among our potential partners, showing just how much we have to offer.”