Transcript Technology Absorption by Innovative SMEs KEF VII

KEF VII:
Technology Absorption by Innovative SMEs
Concluding Remarks
F. Montes-Negret
Director, Private and Financial Sector
Europe and Central Asia, The World Bank
June 19, 2008, Ancona, Italy
Agenda
• Globalization & Technology Absorption
• Technology Absorption Channels
• Clusters & Global Supply Chains
• Competitiveness & Human Capital
• Responsive HEIs & Industry
• Regional Innovation
• Partnerships
• Quality Standards
• Start-Ups & Spin-Offs
Technology diffusion in the developing world
• Globalization has been a main driver of technological
•
•
•
•
progress;
The technology gap between rich and poor countries
has narrowed -- but remains large;
Progress in developing countries reflects the
absorption of pre-existing technologies – not at-thefrontier inventions;
Technology diffusion across countries has picked up,
but diffusion within countries remains slow and
penetration rates uneven;
Persistent weakness in technological absorptive
capacity may constrain further technological progress.
Key features of a pro-technology policy stance
• No detailed roadmap for promoting technological
progress, but certain policy directions are indicated:
– Maintain openness to trade, foreign direct investment and
participation of diaspora
– Further improve the investment climate so as to allow
innovative firms to grow and flourish
– Improve basic infrastructure (roads, electricity, telephony)
– Raise the quality and quantity of education throughout
economy not just major centers
– Emphasize technology diffusion by reinforcing
dissemination systems and the market-orientation of R&D
programs
Technology progress is mainly about absorbing
and adopting technologies developed elsewhere
Exposure to
foreign
technology
+
Capacity to
absorb
=
Technological
progress
Technology in the developing country
In-country diffusion
Source: World Bank, Global Economic Prospects (2008)
Technological Flows
• Unbundling of Productive Activities
• Technology transfer strongly affected by North/ South
firm interaction;
• Unbundling of production has created extraordinary new
opportunities for technology diffusion;
• Technological flows no longer unilateral;
• Many countries or part of countries still excluded.
Policies for K Absorption
• Absorption depends on Local R&D
• China’s “Sea Turtles” Expatriates Role
• ECA: proximity to EU:
→ return migration
→ outsourcing
→ absorption
• R&D reform →R&D collaboration
• R&D-driven FDI effects
• Sequencing: R&D→ deal flow→ seed→ VC
Patents & Co-Invention
•Patents provide rich information on technological
development, even in “follower” countries, and (some) patents
can even provide direct measures of technology absorption;
•Patents can be quite useful in filling in the gaps in our
knowledge surrounding technological development and
technology absorption in ECA and other developing regions
•A large fraction of ECA patents are made up of multinational
inventor teams: “international co-invention”;
•Much of it takes place under the auspices of Western
multinationals
•Are ECA inventors increasingly participating in an
international division of R&D labor?
Patenting Trends
• The growth of ECA patenting is decelerating, even as
Chinese and Indian patenting accelerates
• Indigenous ECA patenting continues to lag in quality,
quantity, and connectedness to the global state of the
art
• Multinational R&D in ECA raises the quality and quantity
of ECA patenting
• ECA inventors are participating in international
coinvention networks, a phenomenon worthy of further
study
• Increasing (but few) international patents
• Relative importance of Eastern & Central Asia for EU
core: decreasing; while role of Asia for EU core countries
is increasing.
Clusters & Collective Efficiency
External
economies
Joint actions
Collective
Efficiency
Italian “Smallness Trap” Lessons for emerging countries?
… in particular, for countries emerging from transition
private SMEs are the necessary antidote to the old
model of large and inefficient state-owned firms
As soon as the private sector has consolidated, and the
economy has reached a middle-income level of
development, how to stimulate the endogenous
dimensional growth of firms should become a policy
priority
Otherwise, as the recent Italian experience shows, an
economy about to approach an advanced development
stage may enter a “smallness trap”
Short & Medium term challenges for SME policy in Russia
• Differences in enabling environment across Russian regions
and clusters is key challenge for national SME policy
• National SME policy should be more focused on stimulating and supporting
regional SME policy
• Regional and local governments will play more important role in
SME development
• Regional SME policy (short and medium term) can be focused on
some important issues: infrastructure (i.e. industrial/suppliers
park), availability of financial resources, regional innovation
infrastructure and administrative barriers
KraussMaffei Message
HR Development should not be delegated:
It has to be made a priority by top management
Improve top-down communication within organization
Listen to your own people and have a look at things from their perspective
Appraisal interviews are a chance to give orientation to both of employees and
organization
Improve customer orientation of staff
Benchmark on all hierarchy levels (plant visits, common projects like quality,
service, cost awareness, etc.) with other companies of the same size and with a
similar structure; it is not mandatory to be in the same business
Integrated Talent Management
Learning
Performance
Management
Recruiting
Talent
Management through a
competency framework
Retention
Compensation
Succession
Planning
Innovation-led Growth: Four Pathways (MIT)
Indigenous
creation of
new
industry
- Create
entirely
new
industry
Exogeneous
creation of
new
industry
- Import
new
industry
to the
region
Diversification
of existing
industry into
new
- Use the core
technologies of
an existing and
declining
industry
Upgrading
existing
mature
industry
- Enhance
products,
services or
production
technologies
From Core Values to Business
Competitiveness
How we develop our
human capital
What we want
People
Development
to be
Core
Values
Knowledge
Enhancement
Business
Competitiveness
What we need to
know & to do
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Le Marche Specific and Perhaps Exclusive Features!
• The cluster is mainly based on a cultural approach:
- creativity and entrepreneurship are the ground skills
for the spin-off
- imitation and emulation effects push newcomers
- competition & cooperation allow for the distribution of
production phases among many firms
- traditional and non hi-tech industries involve low
entrance barriers
- high specialization in each production step needs a
low plant cost
Le Marche: Public-Private Partnership!
• The cluster is an endogenous and self-governing
phenomenon: the public role is rarely a decisive start-up
factor
• Nevertheless, the policy maker may offer strong support to
strengthen the external economies (the core of a cluster!)
• External economies change continuously: establishment
areas, basic services, worker availability and suitable
education, material and immaterial infrastructures, quality
and environmental certification…
• As the cluster grows, the governance becomes more and
more relevant: in the Marche Region the “Technological
Center System” as well as the “District Council” are
composed of local stakeholders (such as representatives of
Public Boards and social and economic actors)
Institutions & Infrastructure
for Global Quality Standards
• Metrology, standards, testing and certification
– help diffuse technology to SMEs
– provide the technical infrastructure for innovation
– increase trust between SMEs and their buyers
• Quality, testing and certification service platforms can act as important
facilitators of SME innovation in clusters
• Public-private partnerships can play an important role in helping clusters
define the types of services that can help foster regional innovation
• BUT metrology, standards, testing and certification CAN ALSO HAMPER
technology absorption and innovation when imposed on a top-down
basis by the government
– by placing barriers to trade in technology
– by limiting “freedom to innovate”
Business Incubators
Business incubators are a leading instrument used by
European governments to facilitate technology
transfer from public research organizations
Commercial risks pose a greater problem than
technical risks when taking R&D results to market, not
least because spin-offs are often founded by scientists
with technical capacities but without business skills
Connecting the “dots”
•
•
•
•
Complexity => No single path or model;
Key to facilitate enterprise entry and , critically, their growth;
Multiple tools: Incubators, spin-offs, …
Innovation and Absorption
– COMPLIMENTARY NOT EXCLUSIVE PATHS
• All industries must innovate in products and processes
– BRANDING & DESIGN increasingly differentiating element
• Core of Innovation and Sustained Enterprise Growth
– CONTINUOUS & ADAPTIVE INVESTMENT IN TALENT
• MODERN HEIs embody entrepreneurial and technological
leadership to serve Local SMEs (INCENTIVES) rooted in 3Ts:
– TALENT, TECHNOLOGY, TERRITORY