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Competitiveness

Lessons from innovators

Study maps the strategies of seven countries that produce world class research and makes recommendations for Brazil

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How can Brazil be inspired by the example of countries that have managed to improve their academic and business environment, producing world class research and innovation? Released in late April, Mobit, the Brazilian Mobilization for Innovation Study compiled the initiatives of seven countries in establishing research networks, articulating resources and public and private efforts, and above all, establishing agreement on the required objectives. The study compared the industrial and innovation policies in the United States, France, Canada, Ireland, the United Kingdom, Finland and Japan. It also covered Brazil, where businessmen and authorities were interviewed. The result is a diagnosis of what brings our environment closer and what keeps it apart from that of the other nations.

The study avoids establishing categorical solutions for Brazil, since the initiatives were successful in countries with very different cultures and development stages. “One can’t carry out mechanical transpositions, or state that there are specific and perfect solutions. However, these countries share a group of strategies and behaviors that provide lessons,” says sociologist Glauco Arbix, coordinator of Mobit coordinator and of the Innovation and Competition Observatory, headquartered at IEA/USP, the Institute of Advanced Studies at the University of São Paulo. The study was commended by ABDI, the Brazilian Agency for Industrial Development, and carried out by Cebrp, the Brazilian Center for Analysis and Planning.

During ten months, researchers lead by Arbix went to the seven aforementioned countries, interviewed authorities and public policy makers and surveyed data on the plans that were embraced and their results. Researchers found, for instance, that all countries consider innovation the most important factor of their competitive strategies, involving players such as the business world, universities and the government. “Each one in its own way, these countries managed to turn towards a paradigm in which knowledge plays a crucial role in the reproduction of new social and economic relations,” says Glauco Arbix. According to the study, this took place through mobilization that improved the national science and technology systems, so that world class research and innovation could be produced. “They are concerned with what is the best in the world,” says the sociologist.

A significant characteristic is the role attributed to companies in these strategies: the private sector plays a central role. All efforts center on improving research, development and innovation activities within the corporate environment. There is an understanding that it is through companies that the economy will be affected and result in economic well-being. In the seven researched countries, universities are pressured to collaborate. “It’s not a matter of discussing the university’s autonomy, but its research aims. Universities are encouraged to adapt to changes and to help companies, and are increasingly fulfilling this role,” says Arbix.

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The public sector is responsible for the crucial mission of articulating the efforts, supporting public policies and laws that lessen the obstacles in the corporate and academic world , and of course, to invest in basic and higher education and in research infrastructure. “Concerning public agencies in the countries visited, innovation is no longer seen as technology. Innovation means including new or mature knowledge in an unprecedented manner, through processes that may become manifest in all sectors. In the United Kingdom, for instance, emphasis is placed on innovation in the financial sector, since the country intends to become the world’s largest financial center,” says the research coordinator.

Another important common element is the persistence and durability of public innovation policies. One of the most eloquent examples among those mentioned is the United States, where the Bush administration’s innovation policy is strictly the same as that of the Clinton administration in the 1990’s, despite the differences that separate both governments. In some cases, the “concentration” is older, though this is not a rule. If Finland arrived at this understanding decades ago, Ireland established its Social Partnership in 1987 – an experience deemed central for the economic growth of the past years. Until the mid-1980’s, Irish universities focused far more on teaching than on research, resorting to the technological advances of their influential neighbor, England.

Incubators
Brazilian difficulties were also mapped out and assessed from the viewpoint of the countries visited. The study indicates issues such as the Brazilian habit of confusing industrial policy and cutting the so-called “Brazil cost,” the small number of innovative companies that export and the obstacles to the growth of cooperation between companies and universities. The list is longer, including the lack of political coordination, the limited use of the government’s bargaining power, the long time it takes to release funds, legal uncertainty, managerial and entrepreneurial deficiencies and the insufficient effect of technology incubators…

The diagnosis is followed by a list of recommendations, such as developing dialogue with corporate leaders further, doing a survey of Brazilian researchers living abroad and trying to bring them into domestic networks, and creating a national innovation fund, with a strong bias on risk capital, in order to encourage the development of new companies and projects.

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The study suggests incentives for the development of complexes, arrangements and networks aimed at innovation and that should perforce include companies and research institutions. The proposal is based on the French experience of the Competition Complexes and the Finnish model of the Strategic Centers for Science, Technology and Innovation. “However, there will be no advances in our technological complexes or regional production arrangements if we don’t make choices. Specialization is essential in order to achieve results,” says Arbix. Furthermore, ten large technological development projects should be selected for financing. They should be connected with real issues, as was the case of France in the creation of its TGV high-speed train, and of Japan, in its research into supercomputers.

The results of the Mobit study were positively accepted by the innovation experts. Carlos Américo Pacheco, a professor at the Economics Institute of the State University of Campinas (Unicamp) and former executive secretary of the Ministry of Science and Technology, recalls that part of the diagnosis was already known, but that the study reflects progress in that it points to possible paths. “The study’s most relevant element is its emphasis on the need to redesign innovation-related institutions, to close down things that are open and start new ones, in addition to developing a strategic consensus about the objective. It is extremely difficult to do this in Brazil,” he says. Another important lesson, according to Pacheco, is the need to discuss medium- and long-term strategies. “We’re always busy discussing instruments and there are too many available. If a company follows all the public announcements and calls published every year, it will do nothing else. However, we don’t take time to debate strategies and find mechanisms to implement them. In which sectors do we want to excel within the next twenty years” Which institutional mechanisms do we need to attain this?” questions Pereira.

David Kupfer, a professor at the Economics Institute of the Federal University of Rio de Janeiro (UFRJ), sees certain difficulties in implementing some of the experiments of the countries assessed in the study. “Brazilian economy is undergoing the transition to a services economy, but we’re not a post-industrial economy like these countries. We still have to go through another twenty years as an industrial economy in order to reach this point,” he says. He believes that the ‘concentration’ observed in the innovating countries is only beginning in Brazil. “There is no such consensus even within the government regarding macroeconomic policy – the Brazilian Central Bank believes in one thing and the Finance Ministry in another. Innovation policies are long-term policies. And there is enormous difficulty in establishing long-term policies in a country that needs to deal as fast as possible with underdevelopment-related issues.”

Cultural obstacle
According to FAPESP’s scientific director, Carlos Henrique de Brito Cruz, a crucial aspect of the study is the central role attributed to companies in the innovative environment of the seven countries. “Brazil wasted a lot of time believing that universities and research institutes were the focus of innovation development,” says Brito Cruz. Changing the focus of innovation in Brazil from universities to companies began in 1999 and became stronger in 2001, during the 1st National Conference on Science and Technology. The idea that the public and private sectors should interact was also highlighted. “There is still a cultural objection to this in Brazil. There is a belief that the private sector wants to profit from the public sector, or that the public sector wants to put itself up for sale. The examples from these countries show that they can collaborate, for the benefit of both public and private interests, and that this can be good for the country.” Brito also mentioned that it is necessary to understand and respect the different roles institutions should play in an innovation system. Concerning cooperation between companies and universities, one must avoid the idea that there is an attempt to turn the university into an appendix of companies. Even in the United States, where the costs of academic research are mostly covered by the State, only 7% of these costs are financed through partnerships with companies. “It’s not a matter of transforming universities into the corporate R&D labs that the companies want to create. It is necessary to have universities dedicated to the progress of knowledge, so that they can continue to create relevant knowledge for the benefit of society, and not only to help companies.”

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