Fostering Innovation to Strengthen US Competitiveness Through the National Science Foundation

Technology innovation is one of the twenty-first century’s key economic battlegrounds. After decades of concern that America’s competitiveness in the global economy is at risk, China’s economic expansion—coupled with the recent military conflict in Europe—have heightened the exigency of debates about America’s leadership in innovation in both economic and national security-related realms. 

Against this backdrop, Congress is engaged in complex negotiations to resolve differences between the Senate-proposed United States Innovation and Competitiveness Act (USICA), passed on June 8, 2021, and the House of Representatives-proposed America COMPETES Act, which passed the Senate on March 28, 2022. The proposed legislation has implications for many federal agencies, in particular the National Science Foundation (NSF), Department of Energy, and National Institute of Standards and Technology. 

Although both USICA and COMPETES echo calls for NSF to be more transformative and less conservative, their visions for achieving this are different. USICA proposes the formation of a new NSF Directorate for Technology and Innovation with new funding of $26 billion for fiscal years 2022 to 2026. COMPETES, by contrast, proposes to create a new NSF Directorate for Science and Engineering Solutions with funding of $13 billion during the same timeframe. NSF recently announced its own preliminary idea for a new directorate called Technology, Innovation, and Partnerships (TIP). The future of NSF’s new efforts to foster innovation, however, will hinge on a confluence of USICA and COMPETES, which is anticipated to occur when the bills are conferenced and passed into law later this year. As acknowledged by NSF director Sethuraman Panchanathan: “We look forward to the passage of the Bipartisan Innovation Act, which will be the next critical step in ensuring TIP can generate a transformational evolution in translating America’s research to expand our economic leadership in the technologies of the future.”

Creating the conditions for an institution to accomplish these innovation goals will be a difficult and complex endeavor. Drawing from scholarship about the drivers of the innovation process, as well as our own leadership experiences at research universities, industry research laboratories, and national laboratories, we offer six evidence-based principles for an “organizational architecture” to guide institutions engaged in promoting innovation. Although we operationalize the six principles in terms of the new NSF directorate, they may also apply to existing NSF directorates and other governmental agencies as well.