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EFFECTIVE ENGINEERING EDUCATION AND PRACTICE FOR
SUSTAINABLE DEVELOPMENT OF SMALL AND MEDIUM
ENTERPRISES [SMEs] IN NIGERIA
By
Engr. Dr. Okopi Alex Momoh FNSE, FNIMechE, FNIM
Coordinator
Research, Innovation and Technology Transfer Office,
Kaduna Polytechnic, Kaduna
INTRODUCTION
• Discussion focuses on:
 Contribution of SMEs to Global Economy
 SME Development Policy lessons from Japan
 The state of SMEs Development in Nigeria
 Engineering Education and SMEs Development
 The Triple Helix Model
 The Role of Stakeholders in Engineering
Education
 Conclusion
 Recommendations
CONTRIBUTIONS OF SMEs TO GLOBAL ECONOMY
Contributions of SMEs to Global Economy
Contributions of SMEs to Employment in USA
Contributions of SMEs to Employment in USA
In 2012, as shown in the table above, large
enterprises employed 59.9 million people
(51.6 percent of all employees), very small
enterprises employed 20.4 million people
(17.6 percent), small enterprises employed
19.4 million people (16.7 percent), and
medium enterprises employed 16.3 million
people (14.0 percent).
Contribution of SMEs to the Economy of Japan
 According to SMEA & METI (2013), SMEs and Micro
Enterprises account for 99.7 % of all companies, 70%
of all employees, and more than 50% of all added
value (manufacturing industry) in Japan and form the
very basis of the Japanese economy.
 Famous large enterprises (LEs) such as Toyota, Honda,
and Sony originally began as small family businesses.
Among Japan’s 4.2 million SMEs, 3.66 million
companies are classified as micro enterprises.
 Unemployment rate in Japan is about 4.2 percent with
reported labor shortage in the non-manufacturing
industries (METI & JSMRI, 2013).
DEVELOPMENT OF SME POLICIES IN JAPAN
Japan has a very consistent policy framework
for the development of SMEs starting from the
end of the 2nd World War in 1945.
The SME policies and instruments deal with
Basic Philosophy, Financial Policies, Business
Promotion Policies, Organizational Policies and
Fair Transactions.
Development of SME Policies in Japan
• Basic Philosophy
Establishment of Antimonopoly Act (1947)
Establishment of the SME Agency (1948)
Establishment of SME Basic Act (1963)
Amendment of the SME Basic Act ( 1999 &
2013
Development of SME Policies in Japan
• Financial Policies
 Establishment of SME Insurance Act (1950)
 Establishment of Credit Guarantee Association
Act (1953)
 Introduction of Finance for Management
Improvement (1973)
 Japan Finance Corporation Act (2007)
 Act on Enhancement of Credit Insurance System
(2007)
Development of SME Policies in Japan
• Business Promotion Policies
 Establishment of SME Consultation Centre (1948)
 SME Consultant Registration (1953)
 Establishment of the Act on Temporary Measures
for Promotion of the Machinery Industry (1956)
 SME Modernization Act (1963)
 Small Enterprises Mutual Relief Projects Act
(1965)
 Finance for upgrading Programs (1966)
Development of SME Policies in Japan
 Establishment of Small Business Promotion
Corporation (1967)
 SME Business Conversion Act (1976)
 Establishment of SME Universities (1980)
 Act on the Promotion of new Business Activities
(1998)
 Act on the Promotion of new SME Business
Activities (2005)
 Act on the Advancement of SME Core
Manufacturing Technology (2006)
Development of SME Policies in Japan
• Organizational Policies
Establishment
of
SME
Cooperatives
Association Act (1949)
Act on the Organization of SME Association
(1957)
Act on Societies of Commerce and Industry
(1960)
Advanced Cooperative Support (2005)
Development of SME Policies in Japan
• Fair Transactions
Act on the Prevention of Delay in
Subcontracting Proceeds, etc to SubContractors (1956)
Act for ensuring the receipt of Public
Procurement information for SMEs (1966)
Agencies for Implementation of SME Policies in
Japan
• Japan has a very comprehensive SME policies
implementation program. Policy implementing
agencies include:
1. Prefectures (47nos) – formulate local SME
policies
2. Ministry of Economy, Trade and Industry (METI)
– has 8nos Regional Bureaus
3. SME Agency – formulates SME national policies
4. SME Regional Support Centres (103nos) – 60 at
Prefectures and 43 at Districts
Agencies for Implementation of SME Policies in
Japan
5. Japan External Trade Organization (JETRO) -1no
HQ and 37 Domestic offices (Support for overseas
business)
6. Shoko Chukin Bank – 1no HQ, 100 Branches ( for
business financing)
7. Japan Finance Corporation – 1no HQ, 152
Branches (Business financing)
8. Chambers of Commerce and Industry - 514
(Business consultation, organizing seminars,
providing information and specialist services
Agencies for Implementation of SME Policies in
Japan
9. SME Universities – 9 (Human Resource
Development and Training programs)
10. Credit Guarantee Corporations – 51 (for
credit guarantee)
11. Organization for Small and Medium
Enterprises and Regional Innovation – 1no HQ
and 9 Local Branches
12. Societies of Commerce and Industry – 1,719
THE STATE OF SMEs DEVELOPMENT IN NIGERIA
 SMEs account for approximately 96% of all
enterprises with the folding up of many giant
industries
 The
SMEs
represent
about
90%
of
manufacturing/industrial sector in terms of
number of enterprises in Nigeria.
 However, in spite of the fact that the SMEs
constitute more than 90% of Nigerian businesses,
their contribution to GDP is only about 1%
(Ghandi & Amissah, 2014).
The State of SMEs Development in Nigeria
• The sector is characterized by huge gaps in the
provision of infrastructure, poor financial
support system, high levels of unskilled
workforce from a disarticulate educational
system, low level of appropriate research and
low investment commitment to bring pilot
schemes to commercial scales and
discontinuities in government development
policies.
Failure of SME Development Policies in Nigeria
• Policy discontinuities and political instability have
caused the failure of many SME development
programs for poverty alleviation such as:
1. Operation Feed the Nation
2. Green Revolution
3. Structural Adjustment Program
4. Better Life Program
5. Rural Electrification Scheme
Failure of SME Development Policies in Nigeria
6. Rural Banking Program
7.Directorate for Food, Roads & Rural Infrastructure
(DFRRI)
8. Peoples Bank of Nigeria
9. Community Banks
10. National Agricultural Land Development
Authority (NALDA)
11. Family Support Program
12. Family Economic Advancement Program(FEAP)
Failure of SME Development Policies in Nigeria
13. Poverty Alleviation Program
14. National Poverty Eradication Program (NAPEP)
15. National Economic Empowerment and
Development Strategy (NEEDS)
16. National Directorate of Employment (NDE) and
17. Small and Medium Enterprises Development
Agency of Nigeria(SMEDAN).
18. Vision 2010 was never implemented and Vision 2020 was
abandoned after the death of President Musa Yar’Adua
• Only very few of these schemes are still operational
Ranking of Countries by Overall Government
Support to SMEs
• The development of a dynamic SME sector of
a country depends on the level of support
given by the country as shown below
ENGINEERING EDUCATION AND PRACTICE FOR
SUSTAINABLE DVELOPMENT OF SMEs IN
NIGERIA
 Nigeria’s education system not producing enough
skilled manpower
 Low level SME development partly linked to poor
state of engineering education
 Advocate for repositioning of engineering
education with simultaneous advocacy for urgent
strengthening of Technical and Vocational
Education and Training (TVET) as engineers need
technicians and artisans to work with.
Changing Paradigm in Engineering Education
 Engineering programs are faced with the need to
diversify their instructional methods in line with the
demands of globalization and competitive skills.
 A new set of improved pedagogies for teaching in
response to the demand for better and deeper learning
is emerging.
 In addition to the standard lecture method, a diverse
set of methods such as the case method, the
discussion method, active learning, cooperative
learning, experiential learning, and problem and
project based learning are being employed
Changing Paradigm in Engineering Education
 A strong focus on the development of academic
entrepreneurship through the commercialization of
higher education research with campus and graduate
enterprise development.
 Emergence of the ‘entrepreneurial university’, whose
purpose is to transform academic knowledge into
economic and social utility (Clark, 1998).
 Entrepreneurial higher education institutions focus on
effective knowledge transfer and the creation of new
campus businesses, and also enhance the competitive
advantage of existing enterprise entities both in and
outside the institutions.
Changing Paradigm in Engineering Education
The typical entrepreneurial higher education
institution is involved in:
(i) spin-offs and spin-ins;
(ii) Entrepreneurial Education;
(iii) links with SMEs and industry;
(iv) the development of diverse income streams;
and
(v) campus incubators
Changing Paradigm in Engineering Education
• Van der Sijde and Ridder (1999) argue that the
best guarantee for sustainability of
entrepreneurship within a higher education
institution is to change it into an
entrepreneurial organization; that is, what
holds for the integration of entrepreneurship
in the academic curricula also holds for the
commercialization of research via spin-off
companies.
Attributes and Competencies of Engineering
Graduates of the 21st Century
• Nasr (2014) reported a study conducted by
the U.S. National Academy of Engineering in
2004 - “The Engineer of 2020: Visions of
Engineering in the New Century” –
• The report stated that “technology has shifted
the societal framework….. [with] new
developments in nanotechnology, logistics,
biotechnology,
and
high-performance
computing.
Attributes and Competencies
• The impact will be seen in medical
breakthroughs, new energy devices, materials
with characteristics not available today,
remarkable light sources, and next-generation
computers
and
telecommunications
developments.
Attributes and Competencies
• The economy in which we will work will be
strongly influenced by the global marketplace for
engineering services, a growing need for
interdisciplinary and system-based approaches,
demands for customerization, and an increasingly
diverse talent pool. The steady integration of
technology in our infrastructure and lives calls for
more involvement by engineers in the setting of
public policy and in participation in the civic
arena.”
Attributes and Competencies
• In another study carried out by the UK’s Royal
Academy of Engineering (2007) on “Educating
Engineers for the 21st Century” and reported
by Nasr (2014), it is emphasized that
“university
engineering
courses
need
redesigning for the modern economy”.
“Industry wants graduates with more
experience of problem solving, group ‹design
and make› projects, and applying theory to
real industrial problems
Attributes and Competencies
• Students need opportunities to work in genuine
industrial environments through work placements
and projects and university staff need to be able
to develop new teaching material with input from
companies, learning from the success of
academic-industrial research links.” This new
approach towards entrepreneurial universities
requires a pragmatic review of our engineering
education system curriculum in order to produce
engineers with the requisite knowledge to meet
the demands of the 21st century innovation work
place.
Development of an innovation system and the
Triple Helix model
• Educating the engineer of the 21st century
requires collaboration among the Academia,
Industry and Government.
• The concept of a ‘national system of innovation’
was proposed by Freeman and Lundvall in the
early 1980s.
• That the innovation process should be treated in
a systemic manner.
• In their pioneering work, Lundvall et al, (2002, p
215, cited in Varblane, 2012), stated that
Triple Helix Model
• ‘It seemed obvious that most of the new
knowledge needed for innovation did not
come directly from universities and technical
research and in many industries not even from
research and experimental development, but
rather from other sources like production
engineers, customers, marketing, etc. The
problem was to integrate these broader
contributions into a concept of the innovation
process.’
Triple Helix Model
• This national innovation system model focuses on
the need for a systemic approach which
integrates institutions with the aim of creating,
storing and transferring knowledge and skills.
• The fundamental idea of the Triple Helix model is
interaction between academia, industry and
government.
• This interaction is seen as the most important
factor in facilitating conditions for innovation in a
knowledge-based society
Triple Helix Model
• According to the model, universities, industry and
government perform additional roles as well as
their traditional functions:
• Thus universities take on entrepreneurial tasks
like generating innovative knowledge and
creating companies, while industries develop
academic dimension with inputs to curriculum
development, share knowledge among each
other and train employees at ever higher skill
levels.
Frame-Work Approach for Systematically Analyzing
Links Between Academia and the Industry
The framework incorporates the following four broad
channels for generating useful economic and social
outcomes:
1. Knowledge diffusion: encouraging the broad industrywide adoption of research findings through
communication, building capacity in industry through
extension in spin-offs, education and training.
2. Knowledge production (the standard model of
research commercialization): selling or licensing the
results of research in the form of commodity
knowledge.
Academia – Industry Linkage
3. Knowledge relationships: providing services that
indirectly exploit broad intellectual property
platforms, consisting of trade secrets, know-how
and other forms of tacit knowledge (this
approach centres on cooperation, collaboration,
joint ventures and partnerships).
4. Knowledge engagement: universities and
research organizations generating useful
economic outcomes as a by-product of shared
interests and concerns that transcend the
boundaries of the university
Stakeholders’ Responsibilities for Effective
Engineering Education
• Considering the Triple Helix Model as an
important model for Academia-IndustryGovernment collaboration for effective
engineering education delivery, what specific
roles should each play?
• Consider the following imaginary scenarios:
Imagine This!
• Federal and State Governments
 Give priority attention to engineering and technology
education as a vital component of the Nation’s
economic and technological development
 Invest a significant percentage of the national budget
on functional education that produces entrepreneurial
graduates
 Establish and implement consistent policies for the
development of SMEs
 Create financial incentives and easy access funding
windows for establishment of innovative SMEs
Government
 Adopt (adapt) global best practices in Technical
and vocational Education and Training (TVET) and
Engineering Education and Training (some
Governors visited Germany recently to study the
Country’s TVET system)
 Aggressively support research and innovation and
partner with the academia and industry on
commercialization of research outputs
 Exercise the requisite political will to engage
Nigerian Engineers to reconstruct the national
economy
Government
• Identify their respective competitive advantages
and strategically develop their resources using
SMEs (e.g Benue State developing `agricultural
value chains through mechanized farming, fruit
juice processing factories, crop preservation
technologies etc)
• Reduce wasteful political spending and channel
funds to infrastructure development that
supports the establishment of dynamic SMEs
Imagine This!
• A Nigerian Education System that:
 Focuses on innovation
 Emphasizes competency based education (‘Brain &
Hand Alliance’)
 Creates entrepreneurial institutions with diverse
income streams (e.g Cranfield Institute of Technologynow Cranfield University, England in its Annual
Financial Report in 1985 declared a profit of over ₤5M.
This came from its diverse income streams – designing
Aircrafts for the Aircraft Industry, short training courses
for national and international workers, demand driven researches for industry etc)
Academia
 Eradicates institutional dichotomies and builds
capacity for healthy competition in innovation
(the inferior status of Polytechnics has not helped
our
technological
development.
Many
Universities in Europe and America are now
renaming to ‘Polytechnic University’ –
harmonizing
Polytechnic
and
University
mandates.
 Ensures optimum utilization of teaching and
learning facilities
Academia
 Produces entrepreneurial engineering graduates
with every graduating student having a skill set
(some private Universities in the country e.g
Covenant University and Redeemers University
already have this program in their curriculum.
Kaduna Polytechnic is about to start)
 Encourages commercialization of research results
by training institutions as campus enterprises for
internal revenue generation
Academia
 Makes tertiary institutions market their research
results
in collaboration with industries and
government agencies for commercialization of their
research outputs
 Encourages academic excellence through innovative
researches
 Stipulates that a candidate for promotion to the post of
Professor in a University or Chief Lecturer in a
Polytechnic shows proof of an outstanding innovation
(patent)
 Replaces ‘Publish or Perish’ with ‘Patent or Perish’
Imagine This!
• Nigerian Society of Engineers that:
 Collaborates in research and innovation activities of
tertiary institutions and invests in commercialization of
research results
 Establishes industries in partnership with tertiary
institutions, private investors and government with
massive employment opportunities for engineers
 Interfaces with engineering education and training
institutions and industry for regular review of
engineering education curriculum in response to global
development trends
NSE
Is an active participant in the Triple Helix
Model to create entrepreneurial engineering
education institutions
Reduces running cost expenditures and
invests part of our Annual Dues in creating
partnership businesses in which all engineers
can own shares and get annual dividends
Establishes a Microfinance Bank for funding of
engineers’ innovative businesses
NSE
 Reduces the ‘Nigerian Content’ in its politics of
Regional Caucuses which has blinded the Society
against professional development and meaningful
contributions to engineering education and
national development
 Is in very strong alliance with COREN in designing
and reviewing the curriculum for educating the
engineer of tomorrow in collaboration with
industries, training institutions and government
• Has an SME Development and Financing Unit
interfacing with government SME agencies
KADUNA POLYTECHNIC RESEARCH COLLABORATION
WITH ORGANIZATIONS
The Polytechnic has received acceptance from
13 organizations willing to collaborate with it
in Research and Development activities.
The
collaboration
will
result
in
commercialization of our research results
An International Research and Innovation
Conference with Exhibition is being planned to
hold in the 1st quarter of 2017
Kaduna Polytechnic Mobile Fruit Juice Machine
CONCLUSION
1. The role of the SME sector is very significant for
overall growth and development of a nation’s
economy
2. Sustainable economies emerge from indigenous
entrepreneurial ventures.
3. If our engineering education is to contribute
significantly to Nigeria’s economic recovery, it
needs to produce graduates capable of applying
their knowledge to start and grow their own
businesses.
CONCLUSION
4.Increasing the supply of entrepreneurial talent
through a more dynamic engineering education
system to create and grow new businesses is seen
as one way of generating large employment and
rejuvenating a beleaguered economy.
5.We need more initiatives in engineering education
delivery
to
cultivate
innovation
and
entrepreneurship at both undergraduate and
postgraduate level through regular reviews of
curriculum.
RECOMMENDATIONS
1. Assess global
experiences in
SME
development
to
identify
successful
approaches which can be adopted (adapted)
2. Our tertiary institutions should engage more
in the development of an enterprise culture
through entrepreneurial education and
setting up of spin-off enterprises from
research outputs.
RECOMMENDATIONS
4. Engineering education curricula should be
made more dynamic through frequent reviews
in line with technological development and
our development needs.
5. The Triple Helix Model is strongly advocated
for
production
of
innovative
and
entrepreneurial graduate engineers capable of
setting up technological enterprises.
RECOMMENDATIONS
• 6.Tertiary institutions in the country should
engage in aggressive marketing for
commercialization of their research outputs in
collaboration
with
industries
and
organizations in their catchment areas in order
to make researches more useful for economic
development.
END
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