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Highlights of Presentations and Discussions
Glenn E.Schweitzer
National Research Council
We have considered a wide variety of technologies of commercial interest, from space communications systems to radioactive isotopes for health applications to food supplements. Also, we have considered different organizational forms of companies, management approaches, and marketing efforts. The experiences of technoparks that are not linked to Minatom facilities have helped broaden the discussion, and the geographical and historical differences in the cities that were represented have helped us appreciate the pitfalls inherent in making generalized statements about the reasons for successful and unsuccessful commercial activities.
I was very pleased by the broad interest in educational issues, in terms of both linking higher education facilities to industrial activities and establishing new types of curricula for the preparation of a new generation of scientific entrepreneurs. The youth are the managers of tomorrow, and there is a serious need for stimulating greater interest among young scientists and engineers in innovating for profit to help offset common tendencies for well-trained technical specialists to seek jobs as traders and bankers.
While efforts to create new job opportunities have apparently been modestly successful in the nuclear cities during the past two years, we were warned of likely large-scale unemployment during the next several years as Minatom begins implementing its plans for downsizing the weapons complex. Unemployment is in many ways the overriding challenge that should encourage greater attention to the creation and expansion of small innovative firms. At the same time, we learned that the Minatom
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conversion program, which has funding of about $80 million annually,
was having difficulty attracting good proposals from within the
Minatom complex. Of special concern is the lack of attention to the
development of long-term customer bases in parallel with the
development of new or improved commercial technologies.
The overall status of the economy is obviously important in
determining the likely success of small firms. In recent months the
economic indicators for Russia show that the situation has stabilized
and is indeed improving. Clearly, increased world prices for oil have
been a major factor in this gradual turnaround. As to the future,
there is no reason to believe now that the situation will soon
deteriorate.
There was a consensus that technoparks can provide important pathways
for marketing the products of research activities. While the position
of each firm is rather unique, two general principles concerning
technoparks emerged. First, technoparks should have the capacity to
expand as new firms are born and old firms find new customers. Second,
technoparks should only accept firms that have a reasonable chance for
market success. While technoparks can provide secure space,
communications infrastructure, and sometimes advisory services, they
cannot change the basic technical capabilities and customer
orientation of a firm.
Tensions that exist within Russia concerning privatization of
technological activities that have roots in government facilities were
apparent during the discussions. Many officials and managers within
the Minatom complex seem to believe that technologies developed within
a Minatom facility should be commercialized by the facility and not
handed off to a private firm that has its own profit motivations.
Others argue that only through privatization efforts will technologies
be brought to the marketplace at an affordable cost without the
benefit of government subsidies. Two approaches were cited in
attempting to reduce this tension. In Sarov, the All-Russian
Scientific-Research Institute of Experimental Physics (VNIIEF) has
established a daughter company that serves as a holding company for
several granddaughter companies, with VNIIEF retaining from 10 to 80
percent ownership interest in the latter firms. In Obninsk, the
Institute for Physics and Power Engineering (IPPE) has spun off
technologies to private firms with negotiated agreements concerning
compensation to IPPE for its technological contributions. An
assessment of the successes of these approaches would seem
appropriate.
Another area of major concern was the almost exclusive focus of both
the Russian research institutes and the Department of Energy programs
on “technology push,” whereby technologies are developed
and then customers are sought. No examples were cited of the research
institutes responding to “market pull,” or indeed of even
consulting with potential customers prior to developing technologies
intended for the commercial marketplace. However, the three small
innovative firms the Western
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participants visited in Obninsk in connection with the workshop seemed
well linked to potential customers, even though they had initiated
their activities through a technology push orientation.
There is one final concern related to efforts to attract foreign
partners in the nuclear cities. Zarechny scientists have had
considerable success in this regard, widely marketing inert gases and
related analytical technologies. As to foreign investment, only
Obninsk has managed to attract Western partners that have made
significant investments in Russia. While Russian institutes and firms
in all of the cities have received grants and contracts from Western
organizations, the economic impact of these arrangements beyond
providing income for a limited number of participants is small. Only
when investment leads to production in Russia, as is the case in
Obninsk and Zarechny, will there be significant economic impact. Also
of concern is the relatively short duration of grants and contracts
from abroad, which does not augur well for sustainability.
The small business sector is still in its early stage in Russia.
Nevertheless, there are a sufficient number of commercially viable
innovative activities with production in Russia to indicate that this
sector should play an ever-increasing role in accelerating economic
growth on both a local and national basis.
Representative terms from entire chapter:
potential customers
