Fostering industrial diversification and social inclusion in the 4IR era

Olga Memedovic

June 2019

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4IR difference: Accelerating technological change: from incremental to exponential

Closed innovation model

qFirms select desiredtechnologiesqFirms perform R&D in-houseqFirms put technologies in productsqProduct revenues fund additional R&DqGlobalisation (1): adjusting products to markets

Open innovation model

qStrategic R&D – integral to business strategyqTechnology acquisition, licensing, corporate venturing, alliancesqExternalisation of R&D: outsourcing, firms research institutes, university centres of excellenceqTapping global talent pools

Cooke, 2006

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Moving to open innovation and ecosystem: connectivity and collaboration crucial to strengthen resilience

Source: WEF, AT Kearney

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Industry 4.0 is re-shaping innovation focus and evolving ecosystems

Innovation system approachDigital business ecosystem

approach

UNIDO response:

To achieve ISID and 2030 Agenda, programs mobilizing all forces and actions at the local level is an Imperative!

In the present global setting (GVC), countries compete based on their local assets, talent pool, interactive learning processes by SMEs/clusters, in collaboration with research institutes, technology labs, productivity canters, venture capitalist, and other providers of business development services.

Specific location and SMEs become the strategic level at which industrial innovations and upgrading takes place.RIS as organizational structures with potential to mobilize local assets and SMEs for achieving innovation-driven growth

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Driving Economic Transformation

TRADE FACILITATION

INVESTMENT & TECHNOLOGY INDUSTRIALIZATION

QUALITY & STANDARDS

GLOBAL VALUE CHAINS

INNOVATION

CLU

STER

ING

MODERNIZATION

SMEs & clusters

Industrial / TechnologyParks/Zones

CustomsMarkets

Universities

Supply chains

SmartCities

Labs & Certification

Technology centers

Venture capital

Venture capital

Regional Innovation System

Flows of resources:

knowledge, finance & skills

Building trust and confidence in

institutions and their reliability

Customers

Collaborators

Knowledge application & exploitation and

transformation subsystem

Knowledge generation &

diffusion subsystem

Contractors

Competitors

Technologymediating

organizations Workforcemediating

organizationsPublic researchorganizations

Market mediatingorganizations

Education provisionorganizations

Memedovic after Cooke 2006, UNIDO

Governance system embedded structure

local politicians

park mangers

cluster organizations

SMEs/Clusters)

ICT

ICT

Venture capitalist, Lawyers for patents and

IPRBusiness incubators

Regional Innovation System

ICTBiotechNano

Variety of related or non related industries

Stakeholder Platform: planned and systematic cooperation

and interaction

Universities Industry Governance

Policy Platform

innovation Skills

Vertical & Lateral

Industry/technology Platform

National and Regional Constructed Advantage

Triple Helix

Infrastructure

CognoSocial/HumanitiesDigital

Stakeholder engagementüSystemic and dynamic collaboration between

businesses/industry, local government and academia (triple helix)

üBuilding solid partnerships

üCapacity to pull stakeholders together.

üBuilding on the history, and culture of the location and is also confirmation of the long-term trend.

üBuilding institutions: norms, standards, shared values, attitudes to ensure coherence and nurture the culture of innovation, knowledge transfer and SME entrepreneurship.

Industry/Technologies platforms: exploring related variety of industries based on local knowledge bases, talent, history, particularities of location

SymbolicPharmaceuticals

Advertisement

Film

Automotive

Food

Analytical Symbolic

Synthetic

Biotechnology

Art and design

Platform Policies: The case of Japan

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Open Innovation approach Austria

Fast and Open

Innovation

CoopetitionConnected valuecreation systems

Industry on CampusCollaboration industry

and research

ExcelleratorCooperation with

Start-Ups

Innovation NetworksFounder network

Innovation WorkshopsBusiness InnovationEngineering Center

Customer InteractionInteraction with customer

for customer excellence

MakerspacesUtilization of creative space

with Design-Thinking

Co-WorkingTemporary use of

on-demand resources

Source: on the basis of Bauer, Zukunftsforum 2017

EU Policy strategies and initiativesØThe EU “Smart Cities & Communities Initiative”ØThe EU “smart specialization” strategies and policies for smart growth

•

Global Innovation Index 2018

Cornell University, INSEAD and the World Intellectual Property Organization (WIPO, a specialized agency of the United Nations) co--publish The Global Innovation Index (GII).

The GII measures 126 economies around the world, using 81 indicators, which include the quality of universities, availability of microfinance and venture capital, to gauge innovation capabilities and measurable results.

Thank you for your attention

• o.memedovic@unido.org

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Clusters and RIS: conceptual differences

nClusters and RIS can coexist in the same territory. RIS can host severalclusters but cluster is not RIS.

nThe governance structure in clusters and RIS is different.

nRIS governance structure is more formal with a meso-governmental bodyhaving responsibility for policy coordination and resources to facilitatesystem coherence.

nCluster may have some kind of governance but this is more of informalcharacter (e.g. cluster association, etc. )

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HOLISTIC APPROACH : PROMOTING SME DEVELOPMENT and entrepreneurship

Improving Business

Environment

Create business infrastructure: soft and hard

to support SMEs development and entrepreneurship; Policy advice f or

SMEs Dev. business

ecosystems

IndustrialModernization

& SME Clustering

Process , product and value chain modernizationand industrial agglomeration through SME Clustering/

Entrepreneurship

Mobilizing Responsible

Investment & Sustainable Technology

Diversify the economy and

industrial base through creating

new jobs, mobilization of

investment; promotion of new technology uptake

BoostingInnovation

Promoting innovation and technological

learning of SMEs to enhance productivity

though various platforms and

networks

PromotingQuality &Standards

Ensure quality and compliance with standards

and market requirements for

enhanced competitiveness

and integration of SME into regional

& global value chains

Framework conditions

Industrial strategies, policies and programmes

Local industries

SMEs and clusters

RVC/GVCInternational Domain

National Domain

Business Environment

National public goods

Role of multilateralism & regionalism/

bilateralism

Role of public and

private sector

SMEs-Clusters/GVC linkages