Horizon 2020: what’s not to like for industry? Well, one or two things

We are now well into the first furlong of the EU’s Horizon 2020 research and innovation programme. The interest has been overwhelming, with a deluge of 45,000 proposals received in the first 15 months. We know just how competitive it is, with success rates hovering between 14-15 per cent so far, which is lower than Framework Programme 7 (FP7).

More interesting however, is whether the European Commission has succeeded in increasing industry participation, which was one of the key objectives of the reform of EU research following all-time low industry involvement in FP7. The final numbers are not available as yet, but various presentations given by the Commission seem to show a (slight) increase compared to FP7.

For GE, I can confirm that our participation compared to FP7 has increased substantially. This is both a result of the improved conditions and programme content, as well as GE’s improved internal processes.

A global company like GE, with roots in sectors including energy management, water and aviation, always has a choice when it comes to deciding where to invest in R&D. The most important factors for us are proximity to markets and availability of talent. Funding programmes can be decisive if these two main requirements are available in a number of locations.

The conditions of Horizon 2020 on first sight seem attractive: a 100 per cent funding rate for research and innovation actions and 70 per cent for innovation actions, topics with higher technology readiness levels, which gauge proximity of products to the market, and challenges that are highly relevant to industry.

However, this increased attractiveness can be self-defeating: low success rates can hang like a cloud.

The problem with two-stage evaluation

As we know, most topics attracted an overwhelming number of applicants, both in more generic fields, such as the first ICT calls, as well as very specific ones, for example competitive low-carbon energy calls. This begs the question: are topic texts either too broad, too fuzzy, or are budgets spread out too much?

The amount of work that comes with a full proposal is substantial, at approximately 500-700 hours. In order to reduce this load, the Commission introduced two-stage proposals. So far, in practice, this has not worked.

The number of projects that pass the first evaluation stage is simply too high. This leads to false hopes and a low success rate in the second stage. Even though content can be reused in the second stage, the amount of legwork is in fact higher and total cycle time is longer since there are two evaluations to go through.

It may make sense conceptually, but it is clear that the way the two-stage methodology is being implemented needs to be revisited.

The success rate needs to go up, which means that either fewer proposals are submitted or the budget is increased. This, of course, is a genuine paradox: whereas the objective of Horizon 2020 is to improve the attractiveness of EU research to industry, making it too attractive is actually detrimental to the success rate.

Another paradox is the willingness of the Commission to take risks when it selects projects to fund. Too often it seems that evaluators and the European Commission are looking for strong evidence that the project will be successful.

At one level this is understandable - spending European tax payers’ money should obviously be done in a responsible and viable way. However, we know that innovation and GDP growth are strongly correlated and one of the key ingredients of innovation is entrepreneurship. Risk taking, both technologically and financially, comes with the territory.

You would expect the Commission to set a target for the number of successfully executed projects, but quite honestly, do we want to spend money on safe bets? If an R&D funding programme does what it’s supposed to, shouldn’t we actually expect a number of glorious failures and a more trial-and-error approach involving very short cycle times? Perhaps the programme’s fast track instrument could be tailored for this purpose.

Playing the game

In order to be successful in the Horizon 2020 game, we have found two elements are of crucial importance:

1. In house expertise
2. A strict internal selection process.

One could either build up knowledge on Horizon 2020 internally or hire an expert consultant – or preferably both – in order to dream up high quality proposals for submission.

The selection process is essential in order to avoid ‘defects’ – submitting proposals that will not make the funding cut, or worse, the threshold.

This also means that being part of various relevant groupings in Brussels (technology platforms, industry associations and so on) is of vital importance, since it provides us with the right interpretation of work programmes and topics.

It is not just about the bottom line

As a large and established corporation, we do not just participate in a programme like Horizon 2020 for the money. Being a part of Horizon 2020 allows us to work closely with customers, suppliers and research partners on challenging topics. It provides visibility for us in the research community and adds credibility to our efforts.

All told, despite the small quibbles outlined above, Horizon 2020 has so far been a positive experience for GE and we intend to make the best of it in the coming years.