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Indiana Alumni Magazine

Advancing Indiana

IU investing in the future economy of the state

By Steve Kaelble

Everyone from civic leaders in Kokomo, Ind., to the city's hourly laborers pays attention to the plight of Delphi Corp., the giant automotive supplier that found itself in bankruptcy court in late 2005. That's because more than 5,000 people make a living at Delphi Electronics & Safety, a Kokomo-based division known for years as Delco Electronics.

It seems fitting, then, that the future of manufacturing-heavy Kokomo is being written inside a former Delco headquarters building. The donated, nearly 100,000-square-foot facility is now known as the Inventrek Technology Park, a high-technology incubator that plays a key role in the region's economic-development strategy. There, entrepreneurs hoping to launch new technology companies will be able to set up shop, borrow lab space, and pick the brains of technical and business experts from Indiana University Kokomo, Purdue University, and successful area corporations.

Why is IU tinkering with new-business startups on East Firmin Street in Kokomo, along the downtown canal in Indianapolis, in northern Fort Wayne, and elsewhere across the Hoosier state? Call it enlightened self-interest. “What’s good for the state of Indiana in terms of economic growth is good for Indiana University,” says Kyle Salyers, executive director of IU’s Advancing Indiana economic-engagement initiative. “It’s good for our graduates, and it’s good for our finances as the tax base grows.”

“IU cannot be a great public university in a state that is not advancing and progressing economically,” agrees Bill Hunt, BA’66, JD’69, who serves as volunteer chairman of Advancing Indiana. “It’s about having sufficient state resources to support two world-class public research universities — IU and Purdue. The state’s ability to do that is a function of how strong the state’s economy is. The economy has to get bigger, and the state’s piece of the economic pie has to get bigger.”

Thus has grown the mission of the university — beyond educating students and conducting useful research — into the realm of local and statewide economic development. “We’re not just educating students on campus but engaging the entire state in mutually beneficial activities that improve the quality of life in all 92 counties,” says Hunt, a lifelong Hoosier with a seat on the board of the IU Foundation and a resume that includes a stint as CEO of Arvin Industries, which before it was acquired was one of the state’s largest manufacturers.

IU has long been intimately involved in boosting its home state’s economic fortunes, but Hunt believes a lot of its efforts have escaped the notice of many Hoosiers. “We think the research activities of universities are not fully appreciated for their economic-development impact,” he says. “Last year IU brought in $477 million in research funding, the vast majority of which came from out of state.”

That’s a big deal because “those research dollars are basically payroll dollars,” he says. In that sense, IU’s success is not unlike luring a giant manufacturing employer to Indiana. “If we look at a typical manufacturing company with a billion and a half dollars in revenues, each year we’re like a big company. Our impact on the economy is incredible, and it’s growing.”

University officials hope to further grow that harvest of research dollars. Salyers cites a goal of $800 million annually by 2013. “The need to then have the state benefit from the fruits of that research is another great challenge and opportunity,” Hunt says. “Once research is done and intellectual property is created, the question is, ‘How will it be fully developed?’ There are two choices: licensing technology to a company that will utilize it, or creating companies where the technology will reside and developing those companies.”

Giving Birth to New Businesses

Bringing great IU ideas to the marketplace is the mission of the IU Research & Technology Corp., a not-for-profit agency with headquarters along the canal near downtown Indianapolis and the IUPUI campus. “We manage the university’s intellectual property, all of the inventions and patents and copyrights,” says Mark Long, president and CEO of the IURTC.

It’s an area of growing importance both for the university and the state’s economy, as IU researchers are turning out more and more technologies and inventions with commercial promise. One way to measure such activity is to count what Long refers to as “invention disclosures,” filed by IU researchers when they come up with something promising. The first quarter of fiscal year 2006, which began July 1, 2005, saw 128 invention disclosures, according to Long, compared with 127 in all of fiscal 2005.

Among the latest innovations are a nano-material to restore tooth enamel, a device to deliver bone grafts, and a biocompatible coating for artificial implants. It’s the IURTC’s job to figure out how to bring such innovations to market. “We give preference to Indiana companies,” Long notes.

As part of that endeavor, the IURTC operates the IU Emerging Technologies Center, located amid the growing technology magnet at the north end of the downtown Indianapolis canal. The ETC is a business incubator and accelerator for life sciences, bio-technology, and bioinformatics companies, offering them shared support services and enhanced IU connections. “We have 23 businesses in the building and have graduated one company already,” Long says.

Among the tenant companies are OptoSonics Inc., which is developing thermoacoustic molecular imaging technology; Safis Solutions, a provider of regulatory compliance, quality assurance, and other technical services; and DynoMed, creator of patient-education materials. The “graduate” of the ETC is The Haelan Group, which helps employers and health plans identify and better serve high-risk and high-need individuals. It strives to cut health-care costs while providing more effective care.

Another prominent economic-development activity involving IU is BioCrossroads, the state’s life-sciences initiative. Launched in 2002, it’s a collaboration involving IU, Purdue, the Central Indiana Corporate Partnership, the city of Indianapolis, the Indiana Health Industry Forum, and a variety of Indiana life-sciences businesses.

The mission of BioCrossroads is to capitalize on Indiana’s foundation in the life sciences. According to the Milken Institute, the state has the second-largest concentration of biopharmaceutical jobs in the country, and it has been adding life-science jobs at more than double the national rate in recent years. The organization has been busy arranging life-sciences business financing, identifying potential areas of growth, and making strategic plans to achieve that growth. Many of its plans have an IU connection.

For example, IU researchers are among those involved in the Indiana Centers for Applied Protein Sciences, a contract research organization with expertise in such things as protein analysis, proteomics, technology validation, and biomarker collaborations. Also, the IU School of Medicine is one of the partners in the Indiana Health Information Exchange, which aims to electronically link area health-care providers and researchers to boost research and further solidify Indiana’s place on the innovation map.

IU’s Kelley School of Business also is heavily involved with growing the state’s businesses. A hub of activity is its Johnson Center for Entrepreneurship & Innovation, headed by Donald F. Kuratko, who earned wide acclaim leading entrepreneurship efforts at Ball State University before moving to the Kelley School at the start of 2005. Among other efforts, the Johnson Center’s Entrepreneurial Innovations Laboratory focuses the Kelley School’s resources toward supporting the commercialization of high-potential research technologies.

Life-sciences opportunities are a target of particular interest to the Kelley School’s leaders. The school recently picked Lawrence S. Davidson as a liaison to its life-sciences initiatives, charging him with creating new ways to assist the state’s life-sciences companies. Providing business-oriented services is a helpful addition to the technological resources that IU already shares with life-sciences players, and it fits many students’ interests, Davidson says.

“We’ve got at least 50 students who have a very passionate desire to be in the life-sciences industries,” he says. “They may be adding an MBA to a master’s degree in biosciences or health-care administration, and a number of them have backgrounds in chemistry and biology.”

All Campuses Involved

Efforts to work with local officials to achieve economic and business development are blossoming at IU campuses across Indiana. The Kokomo effort, for example, partners IU’s regional campus with Purdue University and the Kokomo-Howard County Development Corp.

Ruth Person, chancellor of IU Kokomo, says the need to expand the local economy becomes clearer all the time. “We are heavily dependent on a couple of big employers and heavily dependent on manufacturing and agriculture,” she says, noting the recent bankruptcy filing of Delphi. “We had better see what we can do to help the region diversify.”

Amenities at Inventrek Technology Park range from office and light manufacturing space to a variety of shared and support services, and even include “hotel laboratories” that entrepreneurs and inventors can use for development and commercialization of technology. “We will also be establishing a regional center for economic development and entrepreneurial studies that will be based in the incubator,” Person says.

In addition, IU Kokomo is enhancing what Person acknowledges is its “core business” of educating students. “We went through the process of adding close to a dozen academic programs in conjunction with the local workforce-investment board,” she says. For example, a bachelor’s degree in medical imaging technology will help fill local workforce needs. And a 15-credit certificate in entrepreneurship aims to better equip local students with skills they need to succeed in a changing economy.

Encouraging entrepreneurship also is a primary economic-development focus at IU East in Richmond, says Chancellor David Fulton, MA’68, PhD’75. “We are trying to develop an entrepreneurial program that is going to focus not just on our business division but encourage all of our students to learn entrepreneurial skills,” he says. “We need to make sure our graduates can build the 21st-century economy in this part of the state.”

IU East also operates a data center that analyzes information, turns out reports, and assists with the strategic-planning efforts of economic-development groups in the area. And campus leaders have been trying to help bring local communities onboard the state’s life-sciences development efforts by linking to such IU resources as the School of Medicine and the IURTC. “It’s an initiative to start connecting us with the rest of the state,” Fulton says.

IU’s economic-development efforts take on a different twist in the northwest corner of the state, a region widely known through the years for government cronyism and impropriety. Whether or not such impressions are accurate, they can stand in the way when the region tries to lure new businesses, according to Anna Rominger, interim vice chancellor for academic affairs at IU Northwest in Gary. “It’s very important for economic development that companies perceive that it is an ethical environment and that the government will serve them,” she says.

That’s one reason the campus and several other area institutions launched a Local Government Academy. The effort strives to improve the quality and performance of local government in Lake, Porter, and LaPorte counties, helping elected officials and employees learn appropriate skills and explore ethical matters. “It’s important for any community to do this, and it’s an important economic-development piece,” Rominger says.

Advancing Indiana Is Born

IU’s increased involvement in economic development coincided with the arrival of President Adam W. Herbert in the summer of 2003. Within his first few months on the job, the new president was spreading a vision of economic engagement, which he shared in a major address at an Economic Club of Indianapolis luncheon in November that year.

“We not only have a compelling responsibility, but also a sacred obligation to future generations to transform the Indiana economy to make it more globally competitive,” Herbert told about a thousand attendees. “To accomplish this goal as quickly, thoroughly, and effectively as possible, we must pool our collective strengths and resources. Ensuring that Indiana University is a major contributor to these efforts is among my highest priorities as president of this great institution.”

The speech served as a formal announcement of Advancing Indiana, which the president promised would be an institution-wide effort to more effectively plug the university into Indiana’s economic-development efforts. “President Herbert assembled an economic-development task force and challenged that group with the task of creating an economic-engagement strategy for the university,” says Salyers, who also serves as special consultant to Herbert for economic development.

Salyers observes that such activities were not uncommon among land-grant institutions, including Purdue University, but were unusual among institutions such as the eight-campus IU, which has neither a land-grant history nor an engineering tradition. “It was quite a progressive step,” he says.

While various parts of IU have been working to boost the fortunes of Indiana for some time, what’s new is a centralized coordination of those activities and an effort to both build upon them and create new programs. “The goal is to ensure that the university’s resources and assets are aligned with job creation and the growth objectives of the state of Indiana,” Salyers says.

Adds Hunt, “We are engaging significantly with the Indiana Economic Development Corp., the (Gov. Mitch) Daniels administration, and the General Assembly to make sure this connection of assets with opportunities is as tight and efficient as it can be.”

Steve Kaelble, BA’85, is publication manager and senior writer/editor for Community Health Network in Indianapolis. He lives in Indianapolis with his wife, Teresa Stackhouse, BA’85, MSW’91, and sons: Ian, 16, Owen, 12, and Neal, 6.

 

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