Hotz-Hart 1

6CP, Parallel Session 1, 21th April 2005Socioeconomic Institute – University of Zurich

‚Entrepreneurial Universities‘ – Lessons from Swiss Universities of Applied Sciences

Swiss Federal Office for Professional Education and Technology OPET

Socioeconomic Institute – University of Zurich

beat.hotz@bbt.admin.ch; andreas.reuter@bbt.admin.ch

homepage: http://www.soi.unizh.ch/chairs/hotz/index/html

Parallel Session 1, 21th April 2005

Six Countries Programme Conference ‚The Future of Research‘,Rotterdam, 21-22th April 2005

Beat Hotz-Hart(in co-operation with Andreas Reuter-Hofer)

Hotz-Hart 2

6CP, Parallel Session 1, 21th April 2005

Table of Content

1. Entrepreneurial Public Research Organisations

(EPRO): its meaning and trends in Europe

2. Situation in Switzerland: the example of Universities

of Applied Sciences

3. Lessons from Swiss experience on UAS and

implications for successful EPRO

4. Summary and outlook into the future

Hotz-Hart 3

6CP, Parallel Session 1, 21th April 2005

1. Entrepreneurial Public Research Organisation: its meaning

• University reform of organisational setting according to

managerial principles

Customer orientation and marketing of R&D findings, of

competences and infrastructure

Adjustment of employment contract of R&D personel

Creating independent KTT-Offices with a broad portfolio of

services

Build up of its own portfolio of licences and investments

Extending joint finances in teaching and R&D with business

sector

Hotz-Hart 4

6CP, Parallel Session 1, 21th April 2005

... and its major success factors as a ‚Business Model‘

,Entrepreneurial‘ = market-oriented!

• Customer focus / driving forces behind innovation

– Need for stronger science-based knowlegde / fusion technologies by firms

– Need for extensive external enabling services by firms

– More outsourcing and flexibility, acquisition of exclusive market-oriented external knowlegde and expertise by SMEs (‚Open innovation‘, Chesborough)

• Excellent base of human capital and knowledge

• High flexibility

• International network

Hotz-Hart 5

6CP, Parallel Session 1, 21th April 2005

Trends in Europe: Stronger differentiation of institutions

• Build up and expansion of KTT-Offices at Universities and

Universities of Applied Sciences

• Creation of independent KTT-organisations close to

Universities

Build up and internationalisation of large scale R&D-Institutions

• Expansion of R&D-service provider in the private sector (KIBS)

• etc.

Hotz-Hart 6

6CP, Parallel Session 1, 21th April 2005

Trends in Europe: Attempt to classify important examples

Degree of freedom of R&D

Financing R&D

Low(commercialfocus)

High(no commercialfocus)

public privat

Universities of Applied Sciences(incl. their KTT-offices)

KTT by naturalscience-oriented Universities

Big ResearchInstitutes in R&D

Private R&D services

Autonomous KTT-organisationswith own R&D-capacities andstrong relationship to university

GWT Dresden: 79% by firms, total R&D

contracts:100%

FH Schweiz: less than 20% by firms; total R&D contracts?, 5 spin-offs, 5

license agreements

GermanFhG: more than 30% by firms, total R&D contracts: 60%

Imperial College London: 20% by firms; total R&D contracts: more than 40%, 50 spin-offs, 60 license agreements

Hotz-Hart 7

6CP, Parallel Session 1, 21th April 2005

2. Situation in Switzerland

Degree of freedom of R&D

Low(commercialfocus)

High(no commercialfocus)

public privat

ETH Zurich and Lausanne

CantonalUniversities

Big ResearchInstitutes in R&D

Private R&D services

Autonomous KTT-organisationswith own R&D-capacities andstrong relationship to ownuniversity

Universities of Applied Sciences(incl. their KTT-offices)

Financing R&D

Hotz-Hart 8

6CP, Parallel Session 1, 21th April 2005

Situation in Switzerland: The ,political‘ view

... The Example of Switzerland (2) – The ,Political‘ View

Economic System

Knowledge-Transfer

ETH

Cant. Univers.

Scientific System

SME

MNE

UAS

• Performance contract KTT• Practical orientation• ,Transformer‘ of basic research• Political solution of EPRO

Hotz-Hart 9

6CP, Parallel Session 1, 21th April 2005

Situation in Switzerland: The ,true‘ story is more complex!

Economic System

Knowledge-Transfer

FH

MNE

Start-ups

privat R&D

services

Scientific System

Spin-offs

County Univers.

SME

ETH

Hotz-Hart 10

6CP, Parallel Session 1, 21th April 2005

Situation in Switzerland: Empirical Evidence in 2002

R&D contracts,numbers

Patent declaration

Patent portfolio

Licenses and Options

License portfolio

Start-ups by Licensesin 2002

Source: CESTSwiss Fed. Inst. of Technology County Universities UAS

Hotz-Hart 11

6CP, Parallel Session 1, 21th April 2005

Explanation (I): Basic research-oriented innovation processes

Free Basic Research

Applied Research: Technology Development

Product Development

Market Sales

Knowledge-orientiented basic research

proactiv, targeted basic research Product and

Process Development

Market Salesreactiv, targeted

basic research

,Classical‘ approach

The new mode

ETH and Universities

Universities for Applied Sciences Private R&D Services

Hotz-Hart 12

6CP, Parallel Session 1, 21th April 2005

Explanation (I): … and its consequences

Free Basic Research

proactiv, targeted basic research Product and

Process Development

Market Salesreactiv, targeted

basic research

Universities for AppliedSciences

Private R&D Services

ETH and Big Universities

Customer focus: need for …

• stronger science-based knowledge / fusion technologies by firms

• extensive externalenabling services by firms

InstitutionalConsequences!

Customer focus: need for …

• extensive external enabling services by firms

• exclusive market- oriented knowledge

Hotz-Hart 13

6CP, Parallel Session 1, 21th April 2005

Strongly science-based

Empirical Evidence: Outsourcing of R&D expenditure acc. Economic sector und recipient, 2000, in mio CHF

important role of private R&D-services

major EPRO-competition from abroad

Hotz-Hart 14

6CP, Parallel Session 1, 21th April 2005

Empirical Evidence: Major clients of innovation agency, CTI, according to project contracts

0

10

20

30

40

50

60

70

Num

ber

2002

2003

Hotz-Hart 15

6CP, Parallel Session 1, 21th April 2005

Explanation (II): the impact of Bologna – Relationship between teaching and R&D

Bachelor Master

• UAS mainly teaching

• Related to practical and a_R&D

• No research on top level needed

• Missing incentives for staff with aR&D interests

• Mainstream in the eyes of Unis

• Teaching including R&D

• Active R&D on top level needed

• Strong staff with R&D-potential

• Links to companies

• Knowledge base and competences finned out

• Growing separation of aR&D from top level research

Customer focus: Second best solution as partner in transfer of scientific knowledge

• Scientific knowledge base and competences are renewed regularly

Customer focus: First best solution as partner in transfer of scientific knowledge

Hotz-Hart 16

6CP, Parallel Session 1, 21th April 2005

Explanation (III): Education, Labour Market and Competition in R&D

Economic System

Universities

Teaching on tertiary level

UAS

Start-ups

private R&D

services

Spin-offs

Firms

Flow of research-trained

human capital

Competition in KTT

Hotz-Hart 17

6CP, Parallel Session 1, 21th April 2005

3. Lessons from Swiss Experience on UAS

• Driving forces behind innovation and research are interrelated !

– Innovation depends on basic research and a strong science-based knowledge

– Fusion technologies

• Political vision of UAS in danger with respect to R&D and KTT

- Bologna weakens science base of UAS

– Service activities of top universities in KTT are increased

– Firms look for internationally oriented first best-solutions with public or private partners

– Increasing competition of UAS through private services and increasing number of academics

Natural selection of autonomous RTOs brings best results on successful EPRO-Business Model

Hotz-Hart 18

6CP, Parallel Session 1, 21th April 2005

Implications for Successful Business Model on EPRO

• Competition pressure through ….

• growing supply in KTT from private side

• foreign institutes in basic research with potential for transfer increases

• Strength of RTOs is based on basic research

• Customer focus by looking for institutional partners in science-based knowledge transfer

• Its own strong human capital base

• Specialisation and focussing needed -> Build up of new institutions

• Overall supply of services needed (enabling customers!)

Hotz-Hart 19

6CP, Parallel Session 1, 21th April 2005

Summary and outlook

• Growing differentiation between universities and R&D-institutions

• Growing differentiation within research based top universities

• Increasing supply of private services in R&D

• Intensified international competition amongst the best EPRO

• UAS lose relevance in R&D -> Trend towards teaching universities

• R&D of major research institutions focuses more on basic research