Dhaka Courier

Progression from Technology Innovation to an Innovation Economy

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The 2-day conference designed to come up with a Bangladesh Industries Globalization Initiative (BIGI) was held on the 12th and 13th June at the Daffodil International University in Dhaka. The conference was chaired by Daffodil Group of Enterprises Chairman M Sabur Khan where Industries Secretary Md Abdul Halim was the chief guest and Bangladesh Small and Cottage Industries Corporation (BSCIC) Chairman Md Mustaq Hassan was the special guest. Prof Dr M Nawaz Sharif, a US based internationally famed expert on technological innovation management, provided all the baseline information material for an interactive discourse among the innovation stakeholder representatives. Some 65 senior level participants from 20 organizations belonging to the partners in innovation in Bangladesh attended the conference. The following are the highlights of the presentation made by Prof Dr M. Nawaz Sharif.

BIGI rationale for consideration by stakeholders

Historically, technological innovations and human lifestyle betterment have been co-evolving. In earlier days technological advancement followed societal development, but nowadays technological innovation is leading our societal progress. To an enquiring mind, past worldwide evolution phenomenon shows that the ‘gap’ between the now developed and the not-developed nations of the world is in fact represented by the difference in technological capacity for societal wealth generation. Therefore, it is now widely recognised by the development planners that technological innovation capacity building constitutes the foundation on which socio-economic development efforts are based.

It is obvious that technologies are (a) human-made mostly derived from matter and created by people (b)  intelligence-based acquired through practical and theoretical learning, (c)  application-centric being used for human endeavors and (d)  the helpmates that make our work, directly or indirectly, more convenient, efficient and effective. It is apparent that making and improving technologies meaning innovation represents the hallmark of human characteristics i.e. creativity and competitiveness, because technological innovations enable us to do more things, better, newer and faster than before that encompasses the whole range of all organized and collective human endeavors.

However, due to brainpower and material resources constraints at any given place, no country in the world could produce all technologies it needs and wants. Moreover, to attain economic efficiency, factor endowment-based specialization is critical from the viewpoint of competition. Thus, all countries have to import some technologies that are not profitable to produce locally  and simultaneously  have to export  some technologies that are efficiently produced locally to pay for those imports, and thereby moving to the mutually interdependent growth mode. This is the rationale behind the “make some and buy some” technology strategy whereby countries focus on leveraging competitive technological innovations to carry on international trade built around very selective goods and services that are destined for the global marketplace. Goods producing enterprises utilize technological systems as the transformation mechanism for converting inputs into desirable outputs while service providing enterprises use technological systems as the platform for satisfying customer demands. Studies confirm that in the global marketplace the value of a product depends more on the technology content than on the material content.

It is recognized that in the present day globalized socio-economic interdependent milieu, highly successful countries are those that are expanding and exploiting frontier knowledge driven technological innovations through investments in R&D designed to build technological capacity for gaining competitive advantage that in turn leads to favorable international trade performance. One may surmise that industrialized countries are miles ahead in this situation and their dominant systems erect barriers for the developing countries. Yet, one should realize that their enormous “sunk cost” and “lock-in position” of the developing countries offer opportunities for “leapfrogging” to late starters.

A careful analysis of the industrialization patterns of currently developed economies leads one to conclude that late developers have no options other than to launch all-out campaigns to (a) set up industrial enterprises that will become an integral part of the global value chain encapsulating an universally aspired and established consumer goods such as apparels, appliances, food, energy, information and communication equipment etc. (b) build their own “winning the future” oriented “digital” industries and (c) as global players, form a number of their own GLOBAL CORPORATIONS in terms of input sourcing, output marketing and workplace locations.

Description of the Developing Country Situation

Academic stakeholder related predicaments-

1. Limited number of research oriented universities with negligible number of high-potential ideas necessary to produce productisation through incubators.

2. With scarcity of resources, universities’ attempt to become centers of excellence in numerous areas is often frustrated.

3. Handicapped by lack of resources, research activities are determined by external funding sources’ interests.

4. Frontier knowledge specialization areas have inadequate faculty members.

5. Academic programs emphasize only “Knowing” but almost no “Doing”

Enterprise related predicaments—

1. Private enterprises do not have any market pressure for developing competitiveness through R&D.

2.  Private SMEs do not have necessary financial resources for product innovation related investments.

3. Private sector enterprises do not try to join the global value chain through buy and make technology efforts.

4. Even for catching up through technology transfer, enterprises do not get help for bargaining with TNCs.

5. S&T parks are used by multinational companies mostly for tax benefits.

Government support related predicaments—

1.Collaborations are managed through high-powered councils or committees with inactive ex-officio members.

2.Pre-occupation with establishing regional industry clusters for local employment generation and investment distribution to the detriment of setting up the essential related industry cluster for technological factor creation.

3.Pursuing public sector R&D institutional reforms by simply changing names generally end up as lip service only.

4.Absence of realization that the purpose of public sector R&D investment is indeed to foster R&D work by private sector.

5.Failure to ensure synergy among the S&T and R&D institutions’ expertise.

National innovation system related predicaments—

1. Elements of national innovation system infrastructure in terms of institutions do exist in most developing countries but  there is hardly any  concerted effort for prioritized industries focus. R&D investments are very general, diffused, and almost  insignificant.

2. Most S&T and R&D institutions are divested of “Minimum Critical Mass” consisting of expertise, equipment and money. Meetings are frequently held for ensuring linkages among innovation stakeholder partners with rarely any legal agreements for R&D results commercialization in place.

3. R&D institutions are often seen to practise wrong type of reward system. Critical absence and serious limitations of the full complement of active intermediaries to commercialize R&D results. Specifically missing are local design engineering and tool building companies.

4. In addition to critical deficiency of incubators and startup companies, absence of a local culture of SELF-RELIANCE is a bottleneck.

5. Also, national consumer population in general tends to prefer imported products. PPP projects for creation of own global corporations are almost non-existent.

Way forward for the developing countries

(a) FUNDAMENTAL RECOGNITIONS

1. As people are creative and they like to compete, technology innovation is in perpetual motion thereby contributing to intensification of globalization. In the current innovation-economy-order, all entrepreneurs attempt to achieve sustainable economic growth through ‘product-process innovations’ that can bestow global competitive advantage.

2. Competing enterprises are found to pay attention to the ‘technological systems’ innovation by technology components (Technoware-Humanware-Inforware- Orgaware-Cysnetware) sophistication integrated with  complementarily  tied technology capacities elevation and market based technology strategies progression as levers in their toolbox. This should be diligently followed by our aspiring global enterprises.

3. Enterprises acquire goods and services innovation  through  commercialization of R&D results in ‘incubators’ that are legally  joined  work-facilities  bringing together professionals from four NTIS infrastructure—research universities, R&D institutions, goods and services providing enterprises and government regulatory and facilitating agencies for product-process technology innovation.

(b) MITIGATING ROOT CONSTRAINTS

1. Creativity promoting STEM-concentrated higher education institutions have to emphasize ‘doing’ over ‘knowing’ by integrating state-of-the-art knowledge acquisition with interdisciplinary scientific-laboratory based practical research programs of world class PhD level for selective high-potential  product-process  innovations.

2. Cutting-edge Research and Development (R&D) activities performed in the advanced academic institutions as well as public and private R&D institutions have to be at state-of-the-art level frontier knowledge driven in carefully caliberated and selected priority areas followed in STEM PhD education. Ensure R&D work at the intersection of market pull and knowledge push as well as PPP areas strictly ensuring all R&D work-client secrecy.

3. Establish ‘incubators’ as legal entities—not just verbally agreed with no collective investments for joint returns. Provide support facilities for tool building and designing, prototype building and testing and the ‘startup’ unit development.

4. Provide the most important ingredients of S&T park and the TT office: IPR protection service. Overcome chronic problems with the agencies like lack of minimum critical mass and   legal linkages with shortage of venture financing. Avoid  paying ‘lip service’ to organizational reform and instead embark on comprehensive and useful reform agenda.

(c) STRENGTHENING CORE COMMITMENTS

1. Wholehearted commitment at every level enterprise, industry and nation for winning the future through prioritization.

2. Nationally supported innovation project selection areas based on global foresight that takes into account both opportunities and threats combining national insight that weighs both strengths and weaknesses corroborated by studies undertaken by knowledgeable national professionals.

3. Mandatory application of a transparent decision-making criteria function incorporating factors  Innovativeness, Attractiveness, Competitiveness and Responsiveness.

4. Have in   operation   a   regulatory oversight function that  safeguards  intellectual property rights and give fiscal/financial incentives to buy national products rather than imported ones.

5. Promoting a culture that demands total commitment for continuous improvement (Kaizen). And, making disproportionately high allocation of resources for selected national priority areas to foster competition.

6. Make self-reliance and self-confidence the mantra for development in a competitive setting. It is worth noting that no organisation can expect to become a globally competitive entity unless it can depend on its own resources and national expertise. q

  • Progression from Technology Innovation to an Innovation Economy
  • Vol 35
  • Issue 51
  • DhakaCourier

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