Alan Ryan: Business lessons for Oxford and Cambridge

From time to time, something astonishing happens. It has happened with Richard Lambert's review of industry-university relations: his final report is a strikingly good read. It makes a few obligatory references to the need for Oxford and Cambridge to organise themselves so that the colleges help the university as a whole to function effectively - on which more later - but it is an elegant tour of the issues (why swathes of British business are unable to take advantage of the commercially usable research going on in universities), intelligent, and rightly stronger on the dilemmas than on the solutions. Whether it is what Gordon Brown wanted when he commissioned it is less clear.

The Chancellor's mode is to look for someone to blame, and then claim that he has a magic bullet to cure ailments that date from the dawn of the Industrial Revolution. Lambert's is to observe that everything comes at a price: the desire to promote a few institutions as very expensive research universities that can compete with Stanford and MIT is in tension with the desire to promote regional alliances between local businesses and consortia of local universities. The first suggests devoting 80 per cent of public funding of research to Oxbridge, Imperial and UCL; the latter suggests spreading it among several dozen universities. You can't do both, and a compromise will ensure that everything is done badly.

Equally problematic is the role of institutions with no pretensions to blue skies research excellence that do useful work for industry. Oxford Brookes works on yeasts to the great benefit of the brewing industry, but won't be able to do so if its lowish scores in the Research Assessment Exercise mean that the unit has to shut. Greenwich does research into the handling of bulk solids in a project with GlaxoSmithKline; GSK funds a lot of upscale research in 5* departments of chemistry, but Greenwich's researchers will struggle if the search for centres of international excellence moves all the money to the golden triangle.

Anyone who seeks enlightenment about so-called "Third Stream" funding dedicated to immediately useful research could hardly have a better guide than Lambert. And readers in universities will be consoled by his observation that the problem is much more one of demand than supply; universities can be over-bureaucratic, but the deeper problem is the inability of small and medium enterprises to see what they need and their unwillingness to get it - even though all the figures suggest that those that do grow faster, make larger profits, and survive better than their competitors.

Commentators will scour the report to find unkind words about Oxford and Cambridge. They won't find them. Both have been highly successful in developing hi-tech industries in their immediate locations, they have led the way in fundraising, and, along with Imperial College, have gone to all lengths in developing business partnerships. What Lambert wants from Oxbridge is rather different. On the one hand, he wants - as do we all - continued progress towards getting the two collegiate universities to function as smoothly co-operating outfits, where colleges and university play to each other's strengths and don't get under each other's feet. He has discovered, in compiling his report, how much effort has been going into creating a more smoothly functioning system. Just where to head is debatable; my own preference would be to rethink ourselves as a system of world-class liberal arts colleges clustered about a world-class research graduate school.

Lambert's other passion is for Oxbridge to lead the way in pulling private money into research-heavy higher education. Stanford certainly shows the benefits of having the young Packard and Hewlett on your campus; and Harvard, Yale and Princeton produce wonderful work in the humanities because they have managed to attract private money to support expensive science. What is hard to see as clearly is how we can shift to Britain the high-spending American research culture that depended on the anxieties of the Cold War to get started before it became self-sustaining. That, after all, did as much for the success of the publicly funded Berkeley as for the private MIT.

The writer is warden of New College, Oxford

education@independent.co.uk