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Expert Group Meeting Enhancing Competitiveness through the promotion of Innovative Approaches in SMEs Manama, 10-12 June 2002. ESCWA. New technology-based institutional forms as instruments to enhance innovation and competitiveness of SMEs.
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Expert Group Meeting Enhancing Competitiveness through the promotion of Innovative Approaches in SMEs Manama, 10-12 June 2002 ESCWA New technology-based institutional forms as instruments to enhance innovation and competitiveness of SMEs Omar Bizri and Mansour FarahTechnology Section ESCWA NTIFs as instruments to enhance innovation and competitiveness in SMEs
Contents • Introduction • What are NTIFs? • Technology parks and SMEs • What? Why? • Tenants; Roles • Examples • Technology incubators and start-ups • What? Facilities and services • Modalities; Roles; Organization • Examples • Conclusion NTIFs as instruments to enhance innovation and competitiveness in SMEs
Introduction (1) • Innovation leads to productivity, competitiveness and economic growth • Dynamic system of national innovation and S and T policies to focus on: • Dissemination of new technologies • Incentives for SMEs to innovate • Lifelong learning • Investment in innovative inputs • Adequate institutional structures and networks NTIFs as instruments to enhance innovation and competitiveness in SMEs
Introduction (2) • Robust cost-effective participatory approaches between capacity building institutions (universities, research centers, industry, government, investors) are needed • New technology-based institutional forms proved to be effective in creating strong bonds between complementary institutions NTIFs as instruments to enhance innovation and competitiveness in SMEs
What are NTIFs? • Technopoles • Technology parks • Science/research parks • Science cities • Centers of excellence • Technology incubators • Innovation centers • … NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksWhat? • Property-based initiatives with formal links to universities and research institutions • Encourage formation and growth of knowledge- based businesses • Actively support technology brokering and enhance business skills in tenant firms • Provide assistance and advice for new technology-based firms NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksWhy? • Catalyst for local development and employment • Hasten technology transfer to SMEs • Facilitate formation of networks/linkages based on mutual needs and benefits • Provide access to research facilities • Constitute a center of innovation • Give prestige and status to tenant firms + collective identity NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksTenants • Firms: diverse in size, business interest, technological status and future ambitions; including start-ups • Research institutions • Universities: branches for education and training; may host the park • Incubators: related to research on the park • Standardization/calibration and testing labs • Services: gov. agencies, finance institutions, conference services, business center, … NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksRoles • Technological support to SMEs • Business linkages • Counseling services (financial, administrative, technical, legal, …) • Technology transfer • Local development: catalyst for enterprises NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksExample: Malaysia Multimedia Super Corridor • Established starting in 1996 – Multimedia Development Corporation • 15 km wide X 50 km long zone • Hosting high technology firms • Excellence in multimedia applications • Modern infrastructure with “smart” homes, schools, cards and partnerships • Test-bed for inventions NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksExample: Dubai Internet City • Launched in October 1999 • Free-trade zone • Hosting international ICT firms • Modern infrastructure • Web-based businesses • E-commerce regional cluster • 100% foreign ownership, 50 year land leases, tax exemptions NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology ParksExample: India’s Software Technology Parks • Flourishing Indian software industry (over $5 billion export and local market) • Thousands of SMEs engaged in software development • Government initiative (1986): Software Technology Parks (STPs) initiative launched • Nearly 20 STPs established, providing: • Modern infrastructure, incl. high speed int’l gateway • Assistance in project approvals, imports/exports and bonding certification • Incubation schemes NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubators and start-upsWhat? • Creation and nurturing of new technology-based enterprises • Means for promoting innovative firms and commercialization of research results • Job creation through start-up companies • Increase the chances of new firm survival and growth NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubatorsFacilities and Services • Shared physical facilities and infrastructure • Management support • Access to basic business related services • Technology expertise • Guidance and support for venture capital • Legal assistance • Market information • Networking NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubators and start-ups Modalities NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubatorsRoles • Overall economic development • Development of entrepreneurial culture • Promotion of SME productivity and competitiveness • Transforming research results to products and services • Dissemination of technical skills • Strengthening public-private cooperation and effective utilization of capital NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubatorsOrganization • No single organizational format: flexibility, versatility and dynamism are the key criteria • Management is responsible for policy, strategy and regulatory aspects • Main considerations: • Networking and resources • Occupancy period, rent, etc. • Graduation and follow-up NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubatorsExample: Malaysia’s SIRIM incubator • Launched by SIRIM Berhard Institute in 1986 • Entrepreneurial and SME development • Focus on classical technologies first • Moved to advanced technologies: mechatronics, CAD/CAM, robotics, multimedia, polymers, … • Incubation process: from technical conception to commercialization over period of 1-2 years • Expansion to 8 locations NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubatorsExample: Israel’s technology incubator programme • Started in 1990 to create a sheltered environment for nurturing innovative ideas, employ qualified immigrants and boost Israeli exports • 1990: $1.8m & 50 projects - 1999: $30m & 200 projects • Incubators: 10-15 projects each • Projects: innovative ideas leading to products, an entrepreneur with 3-6 developers • In 2000: 900 professionals employed NTIFs as instruments to enhance innovation and competitiveness in SMEs
Technology incubatorsExample: Egypt’s Tala incubator • Launched in 1998 by the Social Fund for Development • Tenants working in various fields: metal sheet works, automotive parts, fiberglass, computer training and software development, assembly of electronic components, … • Business plan required for projects • Services provided: counseling, training, marketing, information provision and pro-active support of graduates • Challenges: delivery mechanisms, financial sustainability, customer-focused projects NTIFs as instruments to enhance innovation and competitiveness in SMEs
Conclusion (1) • NTIFs proved to be effective instruments to implement S and T policies and strategies through: • Accelerating technology transfer • Reforming education • Facilitating knowledge acquisition by SMEs • Enhancing innovation and competitiveness of SMEs • NTIFs needed in ESCWA member countries to face socioeconomic challenges NTIFs as instruments to enhance innovation and competitiveness in SMEs
Conclusion (2) • NTIFs require adaptation to technological maturity level of member countries • Partners in NTIF initiatives: government, NGOs, professional societies, academic institutions, … • Great care needed in planning, design and implementation of NTIFs • Feasibility studies, demand-side considerations, proper management, partnerships are crucial elements for NTIF success NTIFs as instruments to enhance innovation and competitiveness in SMEs