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What are innovation labs and how can they improve development?

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This summer in Addis Ababa, 12 organizations including the World Bank Group launched a call for increased innovation in international development to solve the world’s most complex challenges, including the new sustainable development goals.  There is a need to invest in new technologies and innovations that have the potential to deliver both social impact and economic returns. One of the ways the Bank Group is tackling this challenge is through “innovation labs” that help integrate emerging innovations into our work.
We’ve had a lot of questions about how we define and integrate innovation in a large institution. Here are some answers:  

How do we define innovation?
Simply put, innovation is finding and applying new approaches to address existing problems or serve unmet needs. From a development perspective, an innovation is a new solution with the transformative ability to accelerate impact. Innovation can be fueled by science and technology, can entail improved ways of working with new and diverse partners, or can involve new social and business models or policy, creative financing mechanisms, or path-breaking improvements in delivering essential services and products. Innovation has been and will be pivotal for reaching sustained, scalable solutions to the world’s complex problems. This definition was published in the call for innovation in international development by USAID, Gates Foundation, DFID, Canada, Sweden, UNICEF, Canada, Australia, Rockefeller Foundation, Results for Development, and the World Bank Group.
What is the objective of the World Bank Group Innovation Labs?
Our objective is to: (i.) accelerate the adoption of emerging innovations in Bank operations; (ii.) create a culture that’s more conducive to innovation and informed risk-taking; and (iii.) develop institutional capabilities to make innovation more strategic and systematic, in the World Bank Group. We have seen in numerous surveys over the years that there is wide recognition from our staff of the need for innovation to solve the intractable problems that our clients face. However innovation remains ad-hoc, fragmented, and often under the radar.  
What role does the Innovation Labs play?
We act as a bridge between our project teams and these emerging innovations that we believe could have big impacts on development. The Bank Group could play a pivotal role in bringing these innovations to our clients and helping scale them up. Almost all of our work is demand driven, with strong support  from senior management in operations.
How do you work with World Bank Group Operations?
We focus on select areas — emerging innovations (for example, big data, social enterprises) — and work towards accelerating their adoption in and through our operations. We do this by creating awareness and providing knowledge, expertise, tools, and connections with relevant external actors. We support our operational colleagues’ efforts to incorporate these in their operations. We believe that for any innovation to matter it has to be field tested and must offer potential to be scaled up.
What are these areas of emerging innovations?
They include:  
  • Big data analytics focusing on specific sector problems in energy, urban, transport, poverty, and other areas.
  • Social enterprise innovations that bridge the service delivery gaps
  • Open data and geo-mapping for improving aid effectiveness and transparency in client countries.
  • Other areas we are looking at including: unmanned aerial vehicles (aka friendly drones ), advanced manufacturing (e.g. 3D printing, robotics), artificial intelligence (e.g. IBM Watson, Google self-driving cars), digital economy, clean tech (e.g. solar, wind), as well as financial innovations (e.g. crowdfunding, social impact bonds, mobile money).
 Why do the World Bank and other development institutions need Innovation Labs to focus on this?  
 Emerging areas that could have a big impact on development are not always adopted quickly. Some of the reasons we found are: 
  • Emerging innovations seem initially far-fetched and therefore appear less relevant; however these things grow exponentially – 1% penetration means you are already half-way through to 100%
  • They are seen as more relevant for the developed economies; however some of these actually offer opportunities for low and middle-income countries to leapfrog the more traditional paradigms (e.g. mobile vs landline)
  • There is a perception that it’s largely the domain of the private sector, and development impact or policy implications, aren’t immediately evident. 
Emerging innovations often cut across several sectors. The Bank’s Innovation Labs can help the Bank’s teams consider whether innovations such as advanced manufacturing or artificial intelligence have relevance and impact across various sectors including urban, education, skills, jobs, social protection, trade and competitiveness, climate, transport, and others.


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