Gilbert Nicolaon Ancona June 19, 2008 The World Bank Knowledge Economy Forum VII Plenary session VII Nurturing Partnerships between SMEs & Technology Transfer Institutions Gilbert Nicolaon Ancona June 19, 2008

Industry in Europe Large Multinational groups SMEs Medium Size Entreprises Small Entreprises Based on size (Nb. Of Employees)

Firms’ « Internal » expertise Large Medium High T. S.E Trad. S.E. Technical Y Economical Financial ? Legal N I.P.R. Internat.

Industry in Europe Multinational : a few hundred Medium Size E. : a few thousand High Tech SEs : a few thousand Traditional SEs : several hundred thousand (+ Recently, Services sector SMEs) TRADITIONAL SECTOR S.E.s OFFER A VERY LARGE POTENTIAL, USUALLY UNDERESTIMATED

SMEs COMPETITIVENESS IS ESSENTIAL SMEs in Europe In most country SMEs(*) represent : More than 50% of GNP More than 50% of industrial employment In recent years : Employement by large groups decreased Employement by SMEs increased SMEs COMPETITIVENESS IS ESSENTIAL FOR EVERY NATIONAL ECONOMY (*) Including commercial SMEs

The diversity of S.E.s S.E.s : extremely diversified Size Industrial sector Market Technological level International experience There is no such thing as a « typical » S.E. 200000 industrial S.E.s in Europe : Not 2 are alike

SEs’ challenge BUT… In order to stay competitive S.E.s must : Innovate Absorb technology BUT… ….They usually do not have « internally » all the needed expertise

A « UNIVERSAL » CHALLENGE A gap between Research and Economy Limited impact of R&D on competitiveness Limited cooperation between RDI and SMEs A challenge all over the world Most countries support R&D Gvts. expect to get R.O.I. from their R&D spending A UNIVERSAL CHALLENGE ALL OVER THE WORLD

A « DOUBLE » CHALLENGE Res. Scientists are not motivated to work with S.E. S.E. are not motivated to work with « academic » scientists STRONG INCENTIVES ARE NEEDED

Push or Pull ?

(Technology absorption) Push or Pull ? Market Pull (Technology absorption) From market needs to the lab AND Back to market Need identified by industry Limiting step : Identifying the customer Identifying the need BOTTOM UP Technology Push From the Lab to the market Idea of a scientist Limiting step : selling the idea (and the project) to industry TOP DOWN

Push or Pull ? Technology Push Give more « fancy » results but it will take more time and it is very risky Market pull (Technology absorption) Give less « exotic » results but much more frequent + a higher success rate

Market pull offers a potential usually underestimated Push or Pull ? SUCCESS RATE : Technology push : Low (a few %) Market Pull High (50%, with some experience) Market pull offers a potential usually underestimated

A Challenge !!! RDIs think almost exclusively…. « TECHNOLOGY PUSH » S.E.T.S(*) are more interested by «  MARKET PULL » (*)S.E.T.S. : Traditional Sectors Small Entreprises

A 3 Partners cooperation Technological Institutes (RDIs) Provide the appropriate technology services S.E.s Identify the market needs Manage innovative projects The Government (Ministries, agencies ..) Stimulate the process to boost the economy Provide incentives (for Scientists and for Industry) Provide assistance Often provide some funding

Targeting SEs The main issue is to : Identify potentially interested S.E.s AND « Sell » them technology services

Targeting S.E. Conferences, seminars… Commercial fairs Brokerage events Existing networks Regional networks (Chambers of commerce) National networks (Innovation agencies) European networks E.U. « networking » activity (ERA-NET) V.C. forums Private consultants Data Banks ? ……

Targeting S.E. Communication towards S.E.s BUT : The most efficient way to communicate is not to present what an RDI can do BUT : To ask the manager of an S.E. who has had a successful partnership with an RDI to testify in front of other S.E.s managers

The « next » step Building up mutual respect It takes some time Personal contacts Usually the first cooperation are « modest » At that stage Gvts. Support is needed

S.E.s –RDI cooperation Numerous way to cooperate R&D contracts Consulting Technology « diagnostic » …… Licensing

The role of Governments: Public-Private Partnerships

Governmental programs Many programs to support SMEs: National Regional International One common goal : to bring assistance to SMEs to improve their competitiveness

Governmental programs To strengthen SMEs competitiveness Assistance for: Identifying partners Preparing a Business Plan IPR and legal matters To provide some public funding Financial support for project preparation Matchning grants Soft loans

A few National Programs United States : SBA Europe : Finland : TEKES France : Oséo-Innovation The Netherlands : Senter Spain : CDTI ….. + Numerous Regional programs Ex. Flanders

International Programs World Bank projects on Tech. Dvp. Far East (India, Korea…) Latin America (Mexico…) Eastern and Central Europe (Croatia, Ukraine…) European Union Framework Program Research for the benefit of SMEs Other European programs Eureka initiative Intergovernmental (Mkt. Oriented, nationally funded) European Space Agency Technology Transfer program

E.U. programs for SMEs Research for SMEs (former CRAFT) Coordination of SMEs RTD co-operation ERA-NET Eurostar SMEs participation to RTD projects + Various supporting actions Network of National Contact Points Coordination and support actions

The role of Governments To create a favourable environment Fiscal laws Patent laws Encourage mobility R&D funding allocation

The role of Governments To provide infrastructures Incubators Technology parks To provide assistance Financial Legal Economical

The role of Governments Incentives, Incentives Incentives…. Incentives for SEs Incentives for Scientists

The role of Governments A stable legal framework over a long time A rigorous monitoring process To follow progress To learn (from failures)

To conclude

To conclude BUT BUT : ? The question is not : can they do it ? A fascinating topic A large potential for SEs-RDIs cooperation Mutually potentially very profitable BUT Which faces some « misunderstandings » ? The question is not : can they do it ? BUT : Do they want to do it ? ? ? ?

will gain a major competitive advantage To conclude A « tough » challenge BUT : A major tool for development Countries, or Regions, which will succeed will gain a major competitive advantage

Thank you for your attention Gilbert Nicolaon Win.tech@club-internet.fr