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Information Innovation Policy
2006.11.10
Hannam University
Ph.D. Shin Cheol Kang
Agenda
1. APEC Informatization Survey for SMEs in 2003
2. Information Innovation Policy in Korea3. What we have learned from experience
APEC Informatization Survey for SMEs in 2003
• The purpose is to analyze and evaluate– ICT Strategies– Infrastructure readiness– Information systems building and utilization– ICT education and training
APEC Informatization Survey
• Focused on– National ICT infrastructure– Business environment– Supporting organizations
APEC Informatization Survey
• Data was gathered by– Web-site searches and email questionnaire from
21 economies– Interview with 12 government officials– 18 case studies in 10 economies
APEC Informatization Survey
Group I
• High tier in the NII and SME-focused ICT policies • Japan, Korea, Chinese Taipei and the United
States • ICT information and resources, financial support,
on-site training and consulting • Take proactive stance towards supporting SME
informatization• various private and public intermediaries
Group II
• high tier in NII level and takes general ICT policy • Australia, Canada, Hong Kong, New Zealand and
Singapore • provide useful information to SMEs and help them
to enhance the basic capacity of SMEs• a matter of choice for individual firms • the public intermediaries in this group of countries
play a smaller role
Group III
• low tier in the NII and generic ICT policy • The remaining 11 APEC member countries • The governments set up few supporting
policies • the roles of public and private
intermediaries are very limited
Suggestions for APEC SMEs
• Recognize the need for informatization, and raise the ICT awareness and knowledge of SME CEOs.
• Use ICT for integrating SMEs and business partners into the value chain
Suggestions for APEC Governments
• should give priority to enhancing the national ICT infrastructure.
• try to lower Internet access fees and improve Internet access speed.
• should develop policies and projects that can promote the ICT market
Suggestions at the APEC Level• Improve the ICT infrastructure across the APEC region.
• Lower the cost of computers by reducing the tariff rates on PCs, or outdated computers
• need to provide software at low prices to SMEs in the low tier member economies through license arrangements
• prepare collective measures at the APEC level to enhance the effectiveness of supporting intermediaries.
• should lead the efforts to make this forum an officially held event.
Korean Government Policy Makers
• MOCIE (Ministry of Commerce, Industry, and Energy)
• MIC (Ministry of Information and Communication)
• SMBA (Small and Medium Business Administration)
Public Intermediaries
• National Computerization Agency (NCA) =>National Information Society Agency (NIA)
• Korea Association of Information and Telecommunication (KAIT)
• IT Research and Consulting (ITR) • Korea Technology and Information Promotion
Agency (TIPA)
Korean Government Policies for SME Informatization
MOCIE: e-Commerce policy, Demand of traditional firms MIC: Technology development, Standardization, Human resource MOCIE: B2B for large-scale firms, National industry complexes SMBA: B2B for smaller firms, Regional-local industry complexes MOCIE: Informatization of 30,000 SMEs: 2001-2003 MIC: ASP-based e-Business Projects SMBA: - TIMS(total information management provides)
- e-manufacturing Projects
The Initiative for Informatizationof 30,000 SMEs (2001-2002)
• support for IT consultants • Support for construction of IT infrastructure • subsidies for education, consulting, and
customization.
Pros and Cons• Pros
– an important tool to create an awareness of informatization in SMEs– establish a solid base for growth in terms of capital and technology for
the IT industry – In terms of the market, IT firms and individual SMEs did
autonomously form linkages. – The project was also rated favorably by both demand side SMEs and
supply side IT firms.
• Cons
– the level of satisfaction with consulting, educational support, and after services was very low.
– More than two thirds of those softwares have not been used – This project teaches the SMEs to depend on government support
rather than their own budget in introducing information systems.
SME Informatization Projects 2003-2005
• subsidies were increased • New support for comprehensive trade
management solutions and mobile business linkages
• Support for the development of Supply Chain Managemen
• Support for the upgrading of IT systems • Develop industry-wide networks • set up a cyber learning center • SME Informatization Call Center
ASP based e-Business Projects 2001 by MIC
• ASP based e-Business Project for Small Business
• Pilot Project for the Promotion of ASP Industry
• ASP Training Project for Vocational High Schools
ASP Project
• Five consortia of major telecommunication carriers and IT service companies provide services such as accounting and customer management
• The consortia provide user-training sessions up to a maximum of 7 hours and the project supports 60% of training expenses.
• Business solutions development is subsidized up to 70%.
Results of ASP Project
• 229,000 subscribing firms in May 2004 • 120,000 small firms had received training as
of 2003 • overall generated business ROI of 740% on
government expenditures • By 2008 one million SMEs
SMBA: e-Manufacturing Projectsby SMBA
• CIM (Computer Integrated Manufacturing)• MES (Manufacturing Execution System)• POP (Point of Production)
E-Manufacturing Project
• provide the new production modes of consumer-centered from producer-centered
• small quantity of many varieties from mass production of small number of products
• provide the quality control systems that increase transparency and flexibility in the process of production
TIMPs Projects by SMBA
• establish informatization strategy plans and construct information systems for the SMEsusing their own fund, experts and technologies
• reimburse the investment fund only if SME makes informatization a success
Policy Evaluation 1
• The MOCIE, with the 30,000 SME Informatization and other projects, has shown direct and resolute support, leading awareness of informatization, and guiding the basic direction of SME informatization.
• However, the participation of so many firms in such a short period of time must be further improved upon, and because of its emphasis on basic informatization, more advanced measures are now needed.
Policy Evaluation 2
• The SMBA’s production informatization, consulting projects, etc., aided in raising productivity and promoting IT systems by focusing on manufacturing, as well as offering support for system consulting.
• However, its emphasis on production created problems with networking between ERP and other areas; and by focusing on consulting, inadequate resources were devoted to systematic support for such areas as system upgrades.
Policy Evaluation 3
• The MIC’s ASP and small enterprise networking projects offered access at the lowest price, as companies could select only their needed modules.
• However, firms paid the price of releasing valuable asset information, and the results of informatization were small compared to the investment cost.
Lessons 1) put more efforts in analyzing business processes than
developing and installing information system itself. 2) developing a pool of qualified IT experts to implement the
government support programs should be ahead of developing a policy itself.
3) rather than being concerned too much about the number of beneficiaries of the government support, the government should do their best in making successful cases, even the number is a few.
4) continuos maintenance and monitor of the SMEs' information growth stage should be guaranteed once a company is registered as a beneficiary of the government support program.
Lessons5) be cautious in danger of weakening both independency
of the IT industry and SMEs in terms of information innovation competency.
6) need to build database of SMEs for systematic analysis of their characteristics in finding proper beneficiary firms.
7) periodic readdress of the informatization level of SMEsshould be assured to realize continuos improvement of management effectiveness.
8) outside CIO system should be considered to realize management innovation through informatization. Her or his role is to develop information strategy planning to comply with organizational vision and strategy, then to keep track of the daily processes of the company in practicing information management systems.
