May 15-2008ICSTI Conference Alexandria-Egypt Amir Wassef Egyptian Industry and Academic Research An...

May 15-2008ICSTI Conference Alexandria-Egypt Amir

Wassef

Egyptian Industry and Academic Research

An Industry PerspectiveBy

Amir Wassef


Wassef

Development of Economies

Industries in Factor Based

Economy

Industries in Growth Based

Economy

Industries in Innovation Led

Economy

Industries In Wealth Based

Economy

TIME

VA

LUE

AD

DE

D


Wassef


Factors Phase

Land Natural Resources Human Resources / Labor Capital

Characteristics:

Basic / Low tech industry

Low value added

Price sensitive Imported

Technology


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Growth Phase (Investment Driven Growth) Economies of Scale and

Economies of Scope Aggregation and Clustering

of Industries Learning Curve Dynamics Improved Quality Improvement of basic factors

Characteristics

Applied Research in Products and Process Improvements

Lower Mobility Barriers of Labor and Researchers


Wassef


Innovation Based Economy Knowledge Based value

added Close ties across the

Supply Chain High degree of Clustering,

Consolidation, and Vertical Integration

High circulation of Information

Characteristics:

Capitalizes on Innovation and Revolutionary Products and Materials

State of the Art R&D Activity

Close ties between industries and Academia

Stable IPR Environment


Wassef

Industry Distribution

Industries in Factor Based

Economy

Industries in Growth Based

Economy

Industries in Innovation Led

Economy

Industries In Wealth Based

Economy

TIME

VA

LUE

AD

DE

D


Wassef

Classification according to Generic Strategy

Economies of Scale

Differentiated Industries

Focused Industries

Porter Classification by Generic Strategy

Low Cost&

Focused

Differentiated&

Focused


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Commodity Producers with Economies of Scale

Characteristics: Stable production lines, limited flexibility, little innovation in core products

High switching costs Price sensitive

Research activities

Centered on piecewise improvements in materials, products and processes.


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Differentiated Industry Characteristics:

Competitive strategy based on increased value added and customer value

Flexible production environment

Lower production volumes Higher profit margins

Research needs: Innovative

applications in materials, know-how and Processes.

Advanced Features rather than Revolutionary / Innovative products


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Niche Industries Characteristics: Based

on specialized skills Special materials Narrow scope of

application ,usually small market size, high value added, commands premium prices, high profit margins.

Research Needs : Very innovative

applications Narrow

specialization and skills

R & D costs spread over limited production quantities


Wassef

Industry Evolution

Cost Leadership

Differentiated

Marketer

CaretakerHi Volume / Continuous Flow

Innovator

Reorganizer

1

42

3

Differentiated and C

ost Leader

Low R& D

Product R& D

Process&

Manuf.R& D

MaterialsProcesse

sRevolutio

nary Products

R& D

2-3 Transition thru Supply Chain efficiency


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Issues Characterizing Industry’s Cooperation with Academia

Fragmentation No clear market leaders No significant market share for any

particular firm Fragmented and diversified markets

(Diverse market needs) Low entry barriers Absence of Economies of Scale Lack of Standards


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No appreciable Clustering of Industries, thus reduced economies of scope (Same product or technology used across a wider spectrum of products and industries)

Weak links between Academia and Industry

Intellectual Property Rights procedures need improvement (Patents, Trademarks, Copyrights etc…)


Wassef


Limitation of Finance by Industry in Academic R&D.

Several Industry Modernization Programs (IMP) support research activities


Wassef

Industry and Research Institutions Joint Plan: Overcoming Fragmentation

Clustering Consolidation Vertical Integration and industry

growth: Forward and Backward increase entry barriers

Promoting Standardization


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Industry and Research Institutions Joint Plan: Sustaining Transition between

Factor Economy and Growth Economy: Improving Technological Content Continuous Product improvements Process improvements Materials Improvements Investing in the Learning Curve Innovation Management


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Industry and Research Institutions Joint Plan: IPR Processes and Procedures :Find

suitable model and formula Contractual relationships between

Industry and Academia (Model contracts , best practices applied elsewhere)

Increase Rate of Diffusion of proprietary knowledge: (Academia might have solutions to problems Industry did not know they had!)


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Industry and Research Institutions Joint Plan:

Lobby for improved Government policies vis-à-vis R&D:

Research Funding The IMP research and Development

Support Incentives for Industry to use Own funds Subsidies and Government Support Offering Grants for government supported

research programs (Ex : A National program to reduce reliance on imports)


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Research Institutions need to adapt to a Paradigm Shift : Lack of Economies of Scale in

research: Work with different industries to reduce fragmentation and improve Standardization-


Wassef


Research Institutions need to adapt to a Paradigm Shift : Research Institutions need Broad

Problem Solving skills in view of Industry Fragmentation and Differentiation strategies


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Critical Factor ! Standardization

Standards are Know How Standards are Best Practices Standards enhance Quality Standards Preserve the Knowledge

base of Industry Standards promote Consolidation

and Defragmentation of industry


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Proposal: Bibliotheca Alexandrina with ICSTI support

BiblAlex establishes a Standards Dissemination Library to serve Industry

Concentrate on Electronic Dissemination

Capitalize on Support available to Developing Economies ( ex. ISO)


Wassef

Thank you

Amir [email protected], Economic Committee,Board of Trustees of Borg el Arab

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