Strategic Public/Private Partnerships: For Innovation
Strategic Public/Private Partnerships: For Innovation
Strategic Public/Private Partnerships: For Innovation
STRATEGIC
PUBLIC/PRIVATE PARTNERSHIPS
FOR INNOVATION
Mario Cervantes
Senior Economist
Directorate for Science, Technology and Innovation
OECD
2 November 2016
Outline
2
Business-funded R&D in the higher education sectors,
2000-2012
Japan
Source: OECD, Main Science and Technology Indicators (MSTI) Database, October 2016. 3
Why focus on P/PPs in STI now?
5
Strategic P/PPs in STI
Defining characteristics:
• Co-operative and contractual agreement to accelerate innovation
more effectively than a government lab or a firm could achieve on its
own. Goal
/challenge
Driven PPPs
talent.
Large-scale,
high cost,
• primarily initiated by the high risk
projects
government and aligned with Efficiency/ Rate of
innovation
industrial and innovation strategies
.
6
Characteristics of Strategic PPP’s in
STI
• Not only efficiency or value for money but a focus on
strategic goals
• More on the direction of innovation, than the rate
• Multi-actor, multi-disciplinary and systemic
• Considers the value chain (producers – public research
– consumers) ; demand-oriented
• A vehicle for transition and systemic innovation
• Policy rationales go beyond market and systems
failure, also
– Failures in demand
– Technology lock-in
• A focus on opportunities!
7
What sets Strategic P/PPs in STI apart from other
forms of industry-science collaboration?
8
Examples of specialisation and
diversification
Moving from
nails to eye-
glasses
CH Inventing
medical
technologies
DK
Moving from
Boat Helices
Discovering
to Windmill
the potential
Blade
of nanotech.
Technology
in pulp &
KR
paper
FI
9
Example of P/PPs – Lead Market
Top consortium Knowledge & Innovation (TKI) Maritime in the Netherland
Scope of research • the whole ‘knowledge chain’, i.e. a mix of fundamental research, applied
research and innovation.
Duration • No fixed duration of the programme. The underlying ‘innovation contract’ is
renewed every two years.
Governance • Having a light governance structure which gives a large degree of freedom in
organising the way in which their participants collaborate and how they arrange
their funding and spending, leaving much room for bottom-up project ideas.
• Using different collaboration modalities for each stage of the knowledge and
innovation chain.
Finance • The government gives a TKI allowance (a 25% top-up) on the cash contribution
of the companies to the collaboration, which provides an incentive for industrial
commitment.
Management of IPR • The TKI Maritime follows the general ‘rules of play’ for IPR including
background knowledge and foreground knowledge, which helps to streamline
IPR arrangements within and between top sectors.
Monitoring and • Delivering an annual report to show how the resources have been used and what
evaluation the results are, which is also used in learning activity on how to set-up and
manage P/PPs.
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Source: case study report provided by Dutch delegate for OECD Working Party on Innovation and Technology Policy (TIP)
Other Examples
• Belgium’s CINBIOS
• China’s Strategic Alliances for Industrial
Technology Innovation
• The Danish Innovation Consortia
• EU’s Joint Technology Initiatives (JTIs)
• Finnish-Russian Innovation Alliance on
Nanotechnology
• Germany’s National Electric Mobility
Platform
• Japan’s global nanotechnology complex
Tsukuba Innovation Arena (TIA)
• The Netherlands Ecogenomics Consortium
• Spain’s National Strategic Consortia for
Technical Research
• US’s National Additive
Manufacturing Innovation Institute
(NAMII) 11
Example of P/PPs - institutional level
The Christian Doppler Research Association (CDG) in Austria
Scope of research • Application oriented basic research (performed by CD Laboratories)
• Application oriented research (performed by JR Centres)
Have to be based on the demand of a company.
Duration • Maximum 7 years (CD Laboratories), Maximum 5 years (JR Centres)
Governance • The composition of steering elements consists of companies and academia as
well as representatives from the responsible ministry.
• Integration of all stakeholders allows for a highly flexible response to
environmental changes and individual circumstances.
Finance • Public-Private Partnership with usually 50% financed by each, the public as
well as by the commercial partners.
• SME involvement increases public share to 60%.
Management of IPR • Based on specified fields of interests, results from research activities (e.g.
patents, software) have to be handed over to the commercial partners or may
be utilised by the academic partner.
Monitoring and • Mid-term evaluations are based on scientific results and the development of
evaluation basic research.
• The final evaluation report has to be structured along clear defined guidelines,
including indicators on scientific output and economic activity.
12
Source: case study report provided by Austrian delegate for OECD Working Party on Innovation and Technology Policy (TIP)
Focus: US’s National Additive Manufacturing
Innovation Institute (NAMII)
Actors:
• Consortium of manufacturing firms, universities, community colleges, and
non-profit organizations primarily from the Ohio-Pennsylvania-West Virginia
‘Tech Belt’.
Budget:
• An initial $30 million Federal award
• The members of NAMII will co-invest $40 million
Key technology:
• Additive manufacturing, often referred to as 3D printing
Government initiated:
• The Department of Defense, The Department of Energy
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Major issues of P/PPs
Project
selection
and design
Finance Governance
Managing
IP P/PPs Human
resources
Openness
Internation to
alisation participatio
n
Evaluation
and impacts
14
Implications for actors in P/PPs
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Implications for actors in P/PPs
(2) Finance
• Ensuring financial transparency:
– It is important to establish a mechanism for ensuring financial
transparency and preventing moral hazard which might occur under a
collaborative programme,.
• Ensuring financial sustainability:
– It is important to design a strategic P/PP in a way that incentivises the
participants to collaborate closely.
– Excessive shifting of risk to the private sector will reduce their
incentives to participate in the P/PP. In general, a well-established
financial and business infrastructure (re-insurance, contract resolution
and renegotiation) plays a catalytic role in increasing the success of the
partnerships.
– Ensuring multiple sources of funds is important.
– It is also important to develop clearer measures of outcomes to justify
investment. 16
Implications for actors in P/PPs
(3) Governance
• Ensuring strong governance arrangements:
– Successful P/PPs require strong governance arrangements, especially
when they involve a wide number of actors.
– Regarding government-supported partnerships, governments can act as
leader and orchestrate processes in support of the overall goal of the
partnerships. Complex and strategic P/PPs may also require the
commitment and active involvement of more than one ministry to
achieve desired outcomes.
– Establishing strong and horizontal governance within the HEIs and
PRIs is important to manage the partnership.
17
Implications for actors in P/PPs
(7) Internationalisation
• International partnerships:
– International P/PPs have increased in the context of cross-border EU
programmes (FP7, Horizon 2020) whereas national P/PP programmes
tend to be focused on national actors. At the same time, private
foundations (e.g. Gates Foundation) are establishing international
P/PPs around global challenges like health.
• Considering the differencies in legislation, rules and procedures:
– Differences in legislation, rules and procedures for P/PPs in OECD and
non-member countries may make the establishment of cross-border
P/PPs difficult at best given the lack of standards. These differences
make the management of P/PPs in the STI area more complex than in
other areas and deserve particular attention from policy makers.
20
Implications for actors in P/PPs
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Summary of P/PPs Good Practice
(1) Project selection and • Establishing well-designed partnership (including clear goals and
design timelines)
• Taking into account eco-system and value-chain perspective
(2) Finance • Ensuring financial transparency
• Ensuring financial sustainability
(5) Human resources • Creating incentives for researchers to collaborate with private firms
(Including promoting careers of those scientists who choose to
work on collaboration)
(6) Openness to participation • Enabling a wide range of actors to participate
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Concluding remarks
• Strategic PPPs represent a major shift in STI policy from an approach that
promotes collaboration in innovation towards one that links public research
with companies in order to achieve strategic goals such as revitalizing
industrial production or tackling social and global challenges; P/PPs can be
more flexible than tax credits or direct subsidies.
Contact
[email protected]
[email protected]
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ADDITIONAL REFERENCES
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Standard definition of Smart
Specialisation
26
Key elements of smart specialisation and
their theorectical underpinnings
27
Archetypes of innovation system, 2010
University-centred
public research
Public lab-centred
public research
28
Source: Commercialising Public Research (OECD, 2013)
Firms engaging in collaboration on innovation, by R&D
status, 2010-12
29
Firms collaborating on innovation with higher education
or research institutions, by firm size, 2010-2012
As a percentage of product and/or process-innovating firms in each size category
31
Source: Science, Technology and Innovation Scoreboard 2015 (OECD, 2015)
Patents citing non-patent literature (NPL), selected
technologies, 2007-13