Public Sector Research and Industry Linkages in the...
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Journal of Scientific & Industrial Research Vol. 58, May 1999, pp349-354
Public Sector Research and Industry Linkages in the Context of Indigenous Innovation Diffusion
S Suresh Kumar and KG Satyanarayana Regional Research Laboratory (CSIR), Thiruvananthapuram 695 I) 19
Received : In April 1998. accepted : 26 October 1998
A norm oriented survey conducted in the context of public R&D system in the coulllry vis-a- vis industrial illleraction, aimed at innovations and technology diffusion as a pan of techno logy transfer efforts, has been presented. The resul ts are compared with those reported in a developed coun try contex t. Avail able models on publi c sector research- industry linkages have been di scussed fo r analytical purpose to deri ve informati on on factors criti cal to technology management and in novati on diffusion for industri al competitiveness. Norms and pattern s for info rmat ion tl ows, interaction capabil it ies and lin kages mechani sms have been identi fied to assist in effective technology transfer management efforts in the context of pu blic funded R& D (Publi c Sector Research)
Introduction
Technology innovation is not iso lated fro m social
capac ity. The latter is required fo r prov iding the stimul us
fo r technological innovation I and is acquired to commu
nicati on network, knowledge or experts leve ls, socia l
mobility and political or decision-maki ng structures. In a developing coun try like Indi a, socia l environment and
ambience is not ve ry much fac ilitated because of lack of
strateg ic think ing directed at structuring socio- technica l
conditi ons and necessary linkages a imed at tec hnology
and its diffusion into soc iety. It has been demonstrated
that the techn ical behav iour of an industria l firm in
ass imilating innovat ion in a third world context is different from that in a deve loped countrl-3. Studies concernin g gene rativity and receptivity of R&D (i.e. the
potenti a l for generating and ass imil ating or absorbing innovations) in a developing country contex t S&T and
industrial sectors respecti ve ly show th at in the case of state-funded sectors, thi s is rathe r poolA. Since over 70 per cent of R& D is state-funded, thi s w ill definit ely mean low orders of research effec ti veness, in te rms of indus
tri all y re levant R&D and the ir commerc ia l leve l utili sation. In thi s contex t, norms and patte rns of public sector
research (PSR) and industry linkages are anal ysed to draw compari sons with c riti ca l fac tors in the Indi an
situat ion as identified through a survey. Public sector R&D effecti veness may be low. But , industry o ri enta
ti ons is al so to blame. Earli er studies5 have ide ntified
certain conditi ons de te rmining industry innovati veness.
These conditions are: knowledge intensity in the firm, communication networks, nature of market and its dynam ics, capita l intensity and organi sational structures.
Di ffusion patte rns are partl y in fl uenced by ind igenous competiti ve forces and part ly by informati on transfer channe ls and in stitu tional structures like banks , financing agencies , Engineering firms, and research capabilit ies, as wel l as t ra nsfer mec hani sm s. Ne twork of re lati ons among the vari ous ' ac tors' in vo lved like R&D centres, ban ki ng and f inanc ing institutions, and channels of d iffus ion, assume much importance6. According to concepts in fie ld theory and sys te m theory, network behaviour creates a synerg ic surplu s if supported with low - level protocols in the fo rm of well formulated programmes, te rmed monitori ng of progress, interaction fo r feed back, transfer mechani sms, flex ibili ty in st ructures, effect ive communicati on channels, and socio-cultural e nvironments through technology learning7 .
A norms - ori ented survey in the Indi an context to identify critical fac tors influenc ing diffusion of indi genous R& D in te rms of effecti ve techno logy transfer has been undertaken. M ode ls on public sec tor research (PSR) - indu stry linkages have a lso been di scussed for understanding the ir norms and patterns and deri ve suitable opti ons.
A sampl e of 50 respondents was se lected so as to have majo rity representation from CSIR labs, be ing the main public- funded research agency . T he questionnai re was based on a re levant literature survey undertaken to identify the factors to be add ressed , while explaining issues
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related to PSR - industry linkages as effecting technology innovation, diffusion and transfer management. thirty five responded with the majority coming from CSIR labs and a few from public sector R&D and major academic centres (with their own industrial consultancy activities). This is felt to be sufficiently representative of technological innovations in Indian Industries based indigenous R&D since 75 per cent of R&D effort in the country emanates from public funded centres, Anonymity was maintained as requested by the respondents. The respondents were mainly scientist- administrators, in their capacity as dealing with coordination ofliaison and information activities, as well as Technology Transfer efforts.
Public Sector Research-Industry Linkages
Research literature on industry - PSR linkages highlights five important elements:
(i) Industry - PSR linkage from the perspective of the innovating from
(ii) Linkage mechanisms by which industry interacts with PSR to understand the institutional barriers preventing firms from utilising PSR inputs.
(iii) Scientific and technological inputs (ST!) analysis of knowledge flows from PSR which companies utilise in the course of new product development.
(iv) Diversity in the nature and extent of industryPSR linkage and
(v) Selectivity in PSR - industry linkages in respect of skills and knowledge.
An appropriate framework for considering the industrial view is provided by the innovation literature, starting from the early of Languish, et al. 8. A brief analysis of the models revealed:
(a) Rather than attempting to identify the original source of a single piece of knowledge of idea leading to innovation, Gibbons and Johnston9
fought to capture some of the social and cognitive complexity of the innovation process within the firm. Around one third of these inputs were obtained from forces external to the firm, another third derived from inhouse R&D, and the remaining arouse from the education, awareness and work experience of the individuals involved. The contribution of the Public Sector Research (PSR) was only one-
third of all externally funded. Science and Technology Information (STI) Personal contacts in the PSR was used to mutually generate ideas in response to specific problems. In addition to actual technology transfer contribution, the role of PSR consists in providing an access to knowledge and to provide advice and assistance for industrial firms.
(b) Further insight into the cogniti ve character of the PSR contribution to industrial innovation have emerged from research on the science -technology relation. Barnes and Edge IO challenged the linear model which implied that technological innovation lies in a single idea or scientific discovery. The major thrust of this research has been to emphasise the two-way flows between science and technology. The two-stream model proposed by de Solla Price I 1 noted that science and technology are linked inseparably by instrumentalities.
(c) Metcalfe and Gibbons I 2 have investigated industry PSR linkages from the perspective of the innovating organisation and noted that a firmlRs ability to move into new areas of innovative activity is constrained by its existing capacity, its paradigmatic view oftchnological options, and its gate keeper activities.
(d) List of main mechanisms by which companies interact with PSR is graphically depicted below. Formal mechanisms of linkages vary in scale and duration. On-off consultancies based on personal contacts is very frequent. Largescale and stable investmentsin 'hybrid' research facilities is the other extreme.
Existing contacts Informal: New contacts
Semi nars/meeti ngs Consultancy Contracts
Formal: ' hybrid' I consortia arrangement collaborative research training
The success of formal collaboration relies on the strength and friendliness of the informal contacts between partners 13 .
Expensive collaboration may bring little or no substantive benefit, where personal relations at bench level are not strong and positive. Companies generally orient
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themselves most purposefully towards the external research community when undertaking search activity. Large companies with expensive R&D facility have sophisticated information.
Results and Discussion
Technology Planning
Several respondents of the Survey felt that there is a vital need to incorporate the commercialisation dimensions at the planning stage itself of the R&D projects . But it turned out that this practice is very low in the context of indigenous R&D projects.Though they agreed that there is a strong need for R&D being market-oriented, and for the commercialisation dimension to be incorporated sufficiently early in the R&D stage, there is a conspicuous absence of formal systems and mechanisms to bring this about within the public funded R&D centres. There are also practically no other systematically stmctured effort for project initiation. Although Technology Forecasting (TF) has been hailed as a powerful tool in identifying future needs and research opportunities, the fact remains that very few are employing any such techniques.
Management stmctures for S&T systems were also found to be less organic and flexible than what would be desirable, though there is general awareness regarding the advantages of organic systems in management. Formal methods are considered requisite by the respondent and the criteria that have been opined as most important in performance effectiveness assessment are levels of (a) interdisciplinary effort (b) application effectiveness, (c) Knowledge effectiveness and (d) training effectiveness. It is equally important to note that quite a few respondents pointed out the need for more emphasis on research oriented towards adaption and modification in important high tech areas, so that the country's R&D capabilities are developed to an extent where generic technologies are exported from the country at least in the near future .
Technology Transfer and Innovation Diffusion
Organisational and Institutional arrangements for technology transfer were found to be inadequate in most of the state funded centres. Output is usually transferred to user groups at bench scale; there was not proper follow up after that through the commercialisation stage; nor was there adequate engineering support from the R&D centres. In fact process engineering and design expertise was one of the areas identified by the survey for general development, through extra-centre set ups, existing out
side the mbic of the R&D centre. This could be established through agreements or contracts with consulting and manufacturing firms for demonstration level or intermediate scale trials and involving agencies providing risk capital funding, commercialisation / marketing support in the form of intermediary mechanisms like Technology Commercialisation Co. This can be a specially equipped venture capital concern which supports industrial innovations through equity participation as well as through research sponsorship; another mode is the Technopolis, which is an exclusive research city having new universities, science centres, joint R&D units, venture capital firms and other social overheads to form a critical mass supporting and sustaining the innovation diffusion. However, these will take time to evolve given the current levels of technological dynamism, fund mobilisation and entrepreneurial atmosphere in the country, though they are catching up well in the West. Research consortia and Business incubators were felt by the respondents as more relevant alternatives in the near term to stimulus in ventiveness and entrepreneurship .
Technology Marketing
Yet another lacuna, identified by the survey IS In
respect of the organisation of marketing effort, particularly in the national laboratories. Commercilization efforts did not involve monitoring mechanisms for technology up gradation as a continual process. Marketing expertise was also sparse. Lack of operational support vis-a-vis informational inputs was cited as one of the reasons for inadequate marketing data generation efforts, since innovation-based products address to an entirely new genre of clients. One of the other reasons for ineffective marketing of product related information diffusion was found to be lackadaisical communication channels 13. Among the various types of methods of information propagation which have a real utility function in innovation diffusion, person - to- person contacts, ad-hoc team visits and demonstration plants were found to be most effective to be followed by ordinary print and electronic media as identified by the Survey. Seminars and exhibitions figured low in the resource constrained context of the developed countries like India particularly for marketing of know-how and stimulation of industrial effort for innovation.
A survey among technology buyers carried out by some of the respondents and as reported by some of them revealed that flexibility of laboratory know-how, avai lability of exclusive production and marketing rights as well as arrangements for venture capital financing and
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engineering and consultancy through institutionalised would go a long way in ensuring technology transfer success. The lack of adequate market information for new products and high capital requirements of innovative technologies are usually considered as the major problems in successful technology transfer l4 . However these do not figure high among the problems in technology diffusion cited by the respondents. At the same time, incentive like tax concessions easy R&D credit, exclusive right etc. would be greatly benefit and motivate technology buying organisation . Many of the above cited organisational mechanisms are only in a rudimentary stage of conceptualisation and implementation in the Indian context, where as greater progress is required if only to develop adequate capabilities to take advantage of the globalisation phenomenon. International technology transfers are seldom effective if not complemented with indigenous adaptive research and a sub technology learning process supported with directed basic research as demanded by the socio - technical situation.
Comparisons broad
Looking at an industry in the developed country, it is apparent that improvement / innovations are needed conti nuously. For basic innovation there is only discontinuous demand . But when needed basic innovations are urgent ly required. The assumption here is that firms run a technological rat race with each other, though these are not strictly valid for the LDCs due to low technological dynamism. However due to influx of foreign capital and the technology learning process, coupled with supportive social ambience, it is probable that in the near future simi lar scenarios can come about in the context of Th ird World Development. Consequently the permanent search for an implementation of technological innovation is an essential precondition of a finn's survival in a competitive market either through own development or international transfer (al so necess itates adaption effort)
Though incremental innovation s are firm-initiated, basic innovations have to be deve loped elsewhere( I 0), as part of PSR. A firm's R&D department tend to concentrate on marginal improvements. Thi s sort of de lineation is di scernible in the Indian context also, since most of the literature on in-house R&D effort in manufacturing firms pertained to incremental process or product modification for marketing plus points. This was also true till recently of corporate R&D centres of multinationals in India. Most of the expertise-development in high - tech and frontier areas were sought through the S&T capabilities in state - funded R&D sectors, through
there were many associated sector, inadequate institutional mechanisms for mobilising resources or diffusion of innovation 15.
One of the important contributions of organisations of organised research has been the satisfaction of the tech
nological demand of the economy, as the history of institutionalisation of science in countries like Gennany,
U.K., France, and U.S.A would vouchsafe for, Social patronage for science produced basic innovations which imparted technological dynamism, spurred on by incremental innovation and finally culminating in the transfer of major capabilities to newer mechanisms (or hierarchies) which combined the research and commercialisa
tion dimensions. These trends are discernible in the developing country context to newer mechanisms (or hierarchies) which combined the research and commercialisation dimensions. These trends are discernible in the developing country context, though in a protean state, since only an awareness has been created in the form of
socio-cultural awareness and nucleation of techni cal sk ill s. It only remains for organisational and institutional
a1Tangements to further develop and sustain the same.
Public Sector Research had been accumulated a stock of knowledge awaiting technological app lication . This sit uation led to the emergence of industrial research laboratories and organi sed science . Techno logy transfer mechanism between universities and industries were institutionalised as informal but dense personal network.
This survey has shown that in the Indian context also simi lar person-to-person contexts are vi tal to technology
d iffusion through personal network in the developing world context, which however is very much lacking.
Si nce the most important transfer-oriented research institutions in the developed world were estab l ished after the lInd world war in the form of the improvement
innovation centres, and the big sc ience centres (for generic technologies) in the 60s and ear ly 70s, there was also an intensification of direct technology transfer from PSR and uni versit ies to industry during this transit ional phase l5 . Many mechanisms like the Incubators and
Parks were promoted particularly in USA, UK and Germany for strengthening thi s link ., which has been crucial to some of the innovation based firms. These also facilitated personnel transfer which led to a two-way communication process, thus contributing to the innovation and diffusion process 16. The need for such mechanism in the context of Third World development is imminem as has been highlighted by the present study as well.
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Conclusions
The survey has identified that inadequate Public Sector Research (PDR) - industry linkages is contributory to poor diffusion dynamics in the country . In this context, the survey has highlighted particular norms and features enabling an understanding of the nature of linkage mechanisms, knowledge information flows and capabilities required for effective interaction. Analysis draw from the study in the context of available models and comparisons abroad had identified the following essential features:
I . It was widely felt that commercialisation aspect should be included at the planning stage of R&D project itself. But the analysis of the questionnaire revealed that it is very low in the case of indigenous R&D as it exists, Further, it is revealed that both formal systems and mechanisms for market oriented and commercialisation aspect of the R&D are conspicuously absent despite their necessity as agreed to by most of respondents. It thus becomes evident that formal methods of initiating a dialogue through all stages of innovation process and between all concerned (R&D) institutions / user / funding agency) is to be consciously engineered.
2. The analysis of the survey also revealed that management structures for S&T systems were found to be less organised and flexible than what is desirable despite the general awareness of advantages in respect of organic system of management. In the case of developing countries such as India, a continuous monitoring with necessary follow up is essential. The survey has brought out the necessity for formal methods of evaluation and the followin cr have been termed as a set of important criteria for R&Db performance evaluation viz.(i) inter - disciplinary effort, (ii) application effectiveness, (iii) knowledge effectiveness and (iv) training effectiveness . Parameters (i) and (ii) relate to applied research while the latter two (iii) and (iv) relate to basic research.
3. Further, it was also observed that most of the R&D labs, lack engineering expertise for commercialisation efforts and hence process engineering and design expertise are identified as areas for future development. This could be through extra centre set ups existing outside the rubic of the R&D units . The study also brings out the inadequacy of organisational and institutional arrangements for TT.
These are not viewed as major problems in technology diffusion in our country due to poor public sector research industry linkages as well as the particular sociotechnical situation with its inherent features .
4. It was revealed by the survey that lack of operational support vis-a-vis informational inputs and communication channels are important reason s for ineffective market and product diffusion. The survey also pointed out that most effective methods of dissemination of information for innovation diffusion are person to person contact, ad-hoc team visits and dem~nstrati?n plants followed by ordinary print and electron~c medIa. On the other hand, despite widely used, semmars and exhibitions figured low in the priority categorisation. With increasing dynamism in industry and state sponsorship, it would be possible to improve the sophistication of indigenous technologies so as to be competent from the internationalisation dimensions with essential technology trans fer follow up and feedback.
The active role of technology policy is however reflected through all this. Mechanisms and systems have been initiated by policy and there is global policy perception of even larger collaborations through multiple government involvement for promotion of high - funded research, in fundamental particles, new materials and devices, and biotechnology. These are primarily meant to intensify the transfer of basic innovation to the economy but can confornt policy with problems of immediate relevance and industrial application . This is pertinent to the situation in LDCs not only in respect of technologies new to their context but also for generic development for global competitiveness . This is an arena where S&T policy has a vital role to play.
Acknowledgements
Authors are grateful to Dr A.D. Damodaran, director of RRL, for permitting to publish this study. They are also grateful to M. Tajudeen, T. Vimal Ghosh, A.V. Philip and M.P. Varkey for their cooperation and help in this work.
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