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272 TECHNOLOGY TRANSFER SYSTEMSIN THE UNITED STATES AND GERMANY
a marked increase in the production of European suppliers of computer
memories like SGS-Thompson, which became the leading supplier world-
wide for EPRON in 1993.
the specification for the 0.35-micron CMOS logic process. For this project,
industry, institutes, and universities were joint partners.
In the field of equipment and materials, one can see the benefits even for
smaller equipment manufacturers. Various companies have strengthened their
global competitive position through international cooperation with users, co-
producers, and research institutes and through new innovative technologies. They
include the following:
.
ASTI, which introduced its all-plastic ultraclean chemical pump with a
favorable global market response;
AST, which is now accepted as one of the leading suppliers of rapid ther-
mal processing equipment;
· Plasmos, whose share of the worldwide ellipsometer market has increased
to about 32 percent; and
Successful sales of GEMATEC's ELYMAT machine, which is used for
. . .
mapping on silicon.
JESSI cooperation with SEMATECH in the field of minienvironment and
mask technology resulted in internationally accepted standards, an increased un-
derstanding of U.S. market requirements, and increased European access to U.S.
markets.
Even though JESSI's funding ended in 1996, the program has accepted a
variety of new projects and decided to continue others. These focus on important
application-oriented topics like digital audio broadcasting and also on new devel-
opments in integrated circuit technology and equipment for integrated circuit
manufacturing.
The main achievement of JESSI is that the major suppliers in microelectron-
ics and information and communications technologies have been brought together,
forming a critical mass for large-sized research projects.
TECHNOLOGY TRANSFER FROM UNIVERSITIES
Universities
HISTORY OF TECHNOLOGY TRANSFER
The development of German universities in the nineteenth century was influ-
enced by the idealist philosophers as well as the growing industrial sector's need
for well-trained personnel.
Philosophers like von Humboldt, Fichte, and Schleiermacher influenced
OCR for page 273
TECHNOLOGY TRANSFER IN GERMANY
273
decisively the organization and orientation of the German university system. The
idealists, who were involved in the founding of the Berlin University (1809-
1810), viewed research at universities as an important element of teaching. At
the outset, however, German academic research was focused primarily on areas
such as philosophy, mathematics, and humanities; empirical research had to fight
for recognition. Nevertheless, by the end of the nineteenth century, German
university research had achieved world leadership in several major fields of sci-
ence, including medicine, chemistry, and physics. Due to rapid increases in stu-
dent enrollments, particularly since 1870, many universities created separate de-
partments and institutes with laboratories for natural sciences.
Through the mid-1800s, the idealist orientation of German professors and
administrators led them to elevate the natural sciences and neglect the "less-dig-
nified" engineering sciences. Ultimately, it was the demand of German industry
for skilled engineers that led the German states to establish special polytechnical
schools outside universities. In the 1870s, the polytechnical schools were el-
evated to higher status, becoming technical higher education schools (Technische
Hochschulen). Initially, the efforts of these new institutions to achieve academic
recognition led them to overemphasize theory and neglect research targeting in-
dustrial needs. At the end of the nineteenth century, however, the establishment
of engineering schools in the United States induced German technical higher edu-
cation schools to begin introducing research laboratories. The main benefit to
industry of universities and technical higher education schools was the provision
of trained personnel. Even at this early stage of the development of the German
academic research system, professors had consultancy arrangements with indus-
try. In other words, the first forms of technology transfer appeared.
Universities and technical higher education institutes focused on education,
whereas the central government and the states established a variety of research
institutes in applied areas. A prominent example of the latter is the Imperial Insti-
tute for Physics and Technology (Physikalisch-Technische Reichsanstalt), which
served as a model for the National Bureau of Standards in the United States. In
addition, some smaller research institutes were financed jointly by government
and industry. Finally in 1911, the Kaiser Wilhelm Society, the predecessor of the
Max Planck Society, was founded, at that time with a strong focus on applied
science and nearly totally financed by industry.
The increasing engagement of industry in government or industry institutes
outside universities was stopped by the economic problems caused by the two
world wars. Following World War II, the government and the states assumed
important roles in the national innovation system through such institutions as the
Max Planck Society, the Fraunhofer Society, and the National Research Centers,
today called Helmholtz Centers, which are described in more detail in the follow-
ing sections. Increased public investment in R&D, beginning in the 1970s, was
motivated by a perception that Germany was lagging technologically compared
with the United States.
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274 TECHNOLOGY TRANSFER SYSTEMSIN THE UNITED STATES AND GERMANY
In the educational sector, the main development after World War II was the
official recognition of technical higher education schools as equivalent to univer-
sities. By integration of other nontechnical disciplines some of them officially
became "Technical Universities" or even normal universities.
In the 1970s, German universities began to consider seriously their role in
technology transfer, and university-industry relationships grew. Between 1970
and 1980, industry support of universities increased by 25 percent, and between
1980 and 1990, such support grew by 44 percent. In addition, universities' needs
for external funds increased with student enrollments and, in recent years, be-
cause of a scarcity of public funds. Both factors have created pressure on aca-
demic research.
Beginning in the 1980s, initiatives on a number of fronts document Ger-
many's increasing interest in technology transfer. Early in the decade, German
universities established a special working group of university chancellors to look
into the topic (Selmayr, 1987), and the former Ministry of Education and Science
(BMBW) initiated a research project called Projakt Wissenschaft (PROWIS) that
had a strong technology transfer focus (see the publication list in Allesch et al.,
1988~. In the mid-1980s, the German Science Council issued a statement on
technology transfer (Wissenschaftsrat, 1986~. These efforts led to the easing of
very strict regulations concerning the budget and personnel structures of univer-
sities, recommendations on how to handle technology transfer instruments (e. g.,
the establishment of external institutes), the establishment of technology transfer
units at universities, and a generally more open-minded attitude in universities
toward technology transfer.
STATISTICS ON GENERAL RESEARCH STRUCTURES
This section presents information about the development of research funding
at universities and the distribution of money among research fields. It also ana-
lyzes the sources of external funds, which are good indicators of the major chan-
nels of technology transfer. Data are not available, however, on the four focal
areas of this study.
A main characteristic of the German research system is the public funding of
most universities; students do not have to pay tuition fees. It is the states, not the
national government, that are responsible for education and hence for the support
of universities. According to the principle of equality of research and teaching,
the states assign general budgets to each university without dictating how the
money should be used. Since universities are not required to report how much of
their general budget they allocate to research and its associated overhead, there
are no precise statistical data, only general estimates, on this base of institutional
research funding. The latter are based on the assumption that a certain share of
the total general budgets is used for research, with the share differing from disci-
pline to discipline (Wissenschaftsrat, 1993a). In addition, research funds from
OCR for page 275
TECHNOLOGY TRANSFER IN GERMANY
10 ~
9:
8t
7 1
Total
- - - Basic funds
--- External funds
2t
1
oL
275
/
. . . . . . . . . . . . .
. ~. . ~. . . . . ~.
80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95
year
FIGURE 3.14 Research funds of German universities in constant 1980 DM.
SOURCES: Bundesministerium fur Bildung, Wissenschaft, Forschung und Technologie
(1996~; Bundesministerium fur Forschung und Technologie (1993a); Wissenschaftsrat
(1993b); calculations of the Fraunhofer Institute for Systems and Innovation Research.
third parties (Drittmittel), called external funds (contracts and grants), have to be
taken into account.
Between 1980 and 1990, the overall research budget of universities increased
nominally by 59 percent; in constant 1980 DM, the increase was 21 percent (Fig-
ure 3.14 and Table 3.2~. The sharp growth that followed in 1991 and 1992 was
mainly due to the inclusion of the new states in the former East Germany. At
about 12 percent, however, the share of research conducted by former East Ger-
man universities is quite small. In 1990,49 percent of the total research budget of
German universities was related to natural sciences and engineering (Figure 3.15~.
This has to be taken into account when a direct comparison between the total
R&D budgets of industry and universities is made, because industrial research
focuses primarily on these two areas. If only the natural sciences and engineering
are considered, the relative share of universities in the German R&D system is
much lower than suggested in the general comparison presented in the "General
Structures" section, above. (See in particular Figure 3.2.)
In real terms, university institutional research budgets grew by 15 percent
and the external funds by 42 percent between 1980 and 1990. Hence, the share of
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276 TECHNOLOGY TRANSFER SYSTEMSIN THE UNITED STATES AND GERMANY
TABLE 3.2 Research Funds of German Universities in billions of DM
Nominal values Real values (1980)
Indexes (real, 1980)
Year Basic External Total Basic External Total Basic External Total
1980 4.82 1.36 6.18 4.82 1.36 6.18 100 100 100
1981 4.92 1.47 6.39 4.69 1.40 6.09 97 103 99
1982 5.08 1.51 6.59 4.68 1.39 6.07 97 102 98
1983 5.26 1.54 6.79 4.71 1.38 6.09 98 101 99
1984 5.31 1.73 7.04 4.69 1.52 6.21 97 112 100
1985 5.51 1.78 7.29 4.75 1.54 6.29 99 113 102
1986 5.86 1.95 7.81 4.95 1.65 6.60 103 121 107
1987 6.19 2.15 8.34 5.11 1.78 6.89 106 131 112
1988 6.53 2.26 8.78 5.31 1.84 7.15 110 135 116
1989 6.83 2.40 9.23 5.38 1.89 7.27 112 139 118
1990 7.29 2.56 9.85 5.53 1.94 7.47 115 142 121
1991 8.64 3.53 12.17 6.27 2.56 8.83 130 188 143
1992 9.33 3.83 12.16 6.50 2.67 9.17 135 196 148
1993 9.59 4.25 13.84 6.41 2.84 9.26 133 208 150
1994 10.06 4.48 14.53 6.53 2.91 9.44 136 213 153
1995 10.31 4.56 14.90 6.56 2.93 9.49 136 215 154
SOURCES: Bundesm~nisterium fur Bildung, Wissenschaft, Forschung und Technologie (1996);
Bundesm~nisterium fur Forschung und Technologie (1993a); Wissenschaftsrat (1993b); calculations
of the Fraunhofer Institute for Systems and Innovation Research.
external funds within the total budget became more important, increasing from
22 percent of the total in 1980 to 26 percent in 1990. These figures have to be
interpreted with care, however, because the apparent growth in external funds is
partly due to more complete publication of financial sources (Wissenschaftsrat,
1993b). Furthermore, the method of calculation used by different statistical
sources varies, leading to different results (Selmayr,1989~. The following analy-
sis of external funds is based primarily on data compiled by the German Science
Council (Wissenschaftsrat,1993b), which seems to be the most consistent source.
The external funds come chiefly from semipublic agencies, federal minis-
tries, foundations, and industry (Figure 3.16~. The major semipublic agency
(Forderinstitutionen mit uberwiegend stuatlicher Finanzierung) is the DFG,
which provides about 90 percent of the funds in this category. The DFG is the
~ _
_
most important central orgamzatlon tor science promotion and IS, to a certain
extent, comparable to the National Science Foundation in the United States. The
largest part of its budget comes from the central government and the states, each
of which usually makes an equal contribution for the support of individual projects
(see Meyer-Krahmer, 1990; Wissenschaftsrat, 1993b). The DFG supports all
areas of science, including the humanities and social sciences, and is generally,
but not exclusively, oriented toward basic research. The coordination of univer-
sity research at the federal level is one of its major statutory tasks. In this context,
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TECHNOLOGY TRANSFER IN GERMANY
30
25
20
15
10
5
A
277
natural engineering medical agricultural humanities
sciences sciences sciences and social
sciences
FIGURE 3.15 Distribution of research funds at universities, according to major areas,
1993. SOURCE: Bundesministerium fur Bildung, Wissenschaft, Forschung und Tech-
nologie, 1996.
an effective instrument is the special research areas (Sonderforschungsbereiche),
representing about 25 percent to 30 percent of DFG's budget (Bundesministerium
fur Forschung und Technologie, 1993a). The special research areas are tempo-
rary institutions at selected universities, established for a period of 12 to 15 years,
where scientists from different disciplines cooperate in joint research programs
(Deutsche Forschungsgemeinschaft, 1993~. Focal programs (Schwerpunkt-
verfahren) are another instrument for supporting the supraregional cooperation of
scientists of different universities.
In the case of external funds from federal ministries, the former Ministry
for Research and Technology (Ministerium fur Forschung und Technologie
[BMFTi), now the BMBF, contributed the largest share, about 86 percent. The
BMFT support of university research increased by about 110 percent between
1980 and 1990. In other words, the general increase in external university funds
is due largely to the increase in BMFT support. A major reason for this growth
was the introduction of collaborative research projects in 1984, whereby several
industrial partners as well as university institutes work together (Bundesmin-
isterium fur Forschung und Technologie, 1993a; Lutz, 1993~. The projects of
BMFT/BMBF are generally quite application oriented, but they also support many
basic research projects, for example in the area of marine science. BMFT fund-
ing of university research in 1990 equaled about 67 percent of what the DFG
invested in this area. Thus, BMFT/BMBF became a second major force in the
external funding of university research.
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278 TECHNOLOGY TRANSFER SYSTEMSIN THE UNITED STATES AND GERMANY
1
l ~ ~
1980 1985 1990
Year
() th e r
International
organizations
· Ind u stry
~ Foundations
C1 Federal m inistries
Semi-public agencies
FIGURE 3.16 External research funds of universities, according to major sources, 1980,
1985, 1990. SOURCE: Wissenschaftsrat (1993b).
The Ministry of Defense invests relatively little in university R&D. In 1990,
the ministry's contribution represented just 10 percent of all federal funds sup-
porting university research.
The Volkswagen Foundation (VW-Stiftung) accounts for 70 percent of all
foundation financing of research at universities. Although it was founded by a
private company, the foundation generally supports basic research projects.
According to data of the German Science Council, in 1990, industry contrib-
uted 15 percent of all external university R&D funds, an 80-percent increase (in
real values) from 1980 and a 115-percent increase from 1970 (Wissenschaftsrat,
1993b). This means that funding from industry has become both absolutely and
relatively more prominent, particularly since 1980. Compared with the total re-
search budget of universities including institutional funds industry support
represents a mere 4.4-percent share. The industrial funds can be divided into
donations, money for collaborative research, and money for contract research.
Most industry support (81 percent in 1990) went to contract research. In addi-
tion, 11 percent of industrial funding went for "cooperative research" linked to
projects of the AiF (see "Federation of Industrial Research Associations," be-
low). Donations from industry or industrial associations accounted for a modest
share, 8 percent, of all industrial funds for universities in 1990.~2
Recent data of the BMBF based on a more complete survey than that of the
German Science Council provide different figures for the industrial contribution
OCR for page 279
TECHNOLOGY TRANSFER IN GERMANY
279
to the university R&D funds.~3 According to the BMBF, in 1990, industry sup-
port represented 7.7 percent of the total research budget of universities or 25
percent of the universities' external R&D sources. In 1995, these figures increased
to 8.7 percent of the total funds or 28 percent of the external sources (Bundes-
ministerium fur Bildung, Wissenschaft, Forschung und Technologie,1996~. With-
out including the contribution of industry-financed foundations, in 1995, the in-
dustry support represents about 7.5 percent of the total funds. To sum up, the
BMBF data indicate that in recent years, industrial funding of universities has
reached a significant level.
Among the international organizations that contribute to university research,
the EU is the most important (about 85 percent of total international funding).
According to the Science Council, EU funding for universities amounted to DM
23 million in 1990, or 0.8 percent of all external university funds. In contrast to
that figure, Reger and Kuhlmann (1995) estimated, using data from the European
Commission, that EU funding of German universities came to DM 170 million in
1991. Compared to the average situation, this value may be artificially high,
since in 1991 the Second and Third Framework Programs of the EU overlapped.
But even if EU contributions came to roughly DM 100 million, this is still a
relatively small amount compared with total external funding for German univer-
sities (see "Impact of European Research," above). According to recent BMBF
data, the EU funding amounted to about DM 130 million in 1995, or 2.7 percent
of all external university funds. This means that the contribution of the EU to
university funding has increased considerably in recent years (Bundesministerium
fur Bildung, Wissenschaft, Forschung und Technologie, 1996~.
The only other significant external source of academic research funding is
project-related funding from the states, which represented about 4 percent of the
total external funding in 1990. Finally, it should be noted that not all external
funds are linked to research activities: Only 86 percent of those funds were so
linked in 1990. This reduced share has already been considered in Figure 3.14
and Table 3.2.
For the analysis of technology transfer, it is important to note that the exter-
nal funds are not equally distributed across disciplines. For example, in the hu-
manities and social sciences, the absolute and relative volume of external funds is
rather low; in law, the external funds are about 4 percent of the institutional re-
search funds; and in economics, they are about 9 percent (Wissenschaftsrat,
1993a). As Figure 3.17 shows for selected areas, the level of external funding in
the natural sciences and engineering is much higher. The greatest amount of
external funding, DM 266 million, or 41 percent of the total research funds, is
apparent in mechanical engineering. This high proportion of external funds can
be taken as a strong indication of considerable industrial funding of technical
disciplines; the proportion is much higher than the overall 4.4 percent share of
university research funding contributed by industry. In physics and electrical
engineering, external funding represents about 29 percent of university research
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280 TECHNOLOGY TRANSFER SYSTEMS IN THE UNITED STATES AND GERMANY
budgets. In absolute terms, external support for physics R&D is second only to
that for mechanical engineering. This outcome is quite remarkable because of the
generally basic orientation of physics research; unfortunately, more detailed sta-
tistics on the industrial funds in physics are not available. External funds amount
to about 25 percent of the total research budget in computer science, chemistry,
and biology. Thus, all focal areas of this report have above-average levels of
external funding and probably relatively high contributions from industrial
sources.
These budget statistics, however, can lead to an underestimate of research
activities supported by external funds. In the German system, external sponsors
pay only direct personnel costs and, to a limited extent, costs for facilities. They
generally do not pay any overhead costs (e.g., for buildings, administration, cen-
tral services). This is true for public and semipublic as well as private sponsors.
Therefore, research with external funding has to be cofinanced, or matched, by
infrastructure funds of about the same amount. Universities must take these in-
frastructure funds from their base-institutional support. These infrastructure funds
can be considered cross-subsidies to external funds. To sum up, the share of
research supported by external funds is about twice as high in terms of time and
personnel than it is in terms of budget. This relationship is indicated in Figure
3.17. For example, in terms of time and personnel, the real share of research
supported by external sponsors is equivalent to 82 percent of university research
funds in mechanical engineering, 58 percent in physics and electrical engineer-
ing, and 50 percent in computer science, chemistry, and biology.~4 The German
delegation is of the opinion that the shares of external support in those areas have
increased since 1990 and in many technical institutes have reached 100 percent.
Many of these institutes often have the opportunity to acquire additional external
funds but cannot take advantage of them because of insufficient infrastructure
funds; this insufficiency generally is manifested by a lack of space (see also
Hochschulrektorenkonferenz, 1996~.
Against this background, the overall figure of 4.4 percent of industrial funds
within the research budget of universities, according to the data of the German
Science Council, has to be adjusted to at least 8 percent in terms of research
personnel and time. In other words, the industrial share can be considered equiva-
lent to the U.S. share of 6.9 percent, because in the United States, industrial sup-
port generally covers the full cost of research, including overhead. If the more
realistic share of 7.5 percent of industrial funds, according to the BMBF data, are
taken, the German level including related infrastructure funds is even substan-
tially above 10 percent.
On the basis of available statistics, it is quite difficult to assess the growth
rates of external funding for specific disciplines because the disaggregated fig-
ures for 1980 and even 1985 are quite incomplete. According to a survey of the
Science Council (Wissenschaftsrat, 1993a) and the German delegation's own es-
timates, computer science shows the highest increase in external funding, and the
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TECHNOLOGY TRANSFER IN GERMANY
Mechanical
engineering
Electrical
engineering
Physics
Computer
science
Chemistry
Biology
_
...................................................................................................
...................................................................................................
0 100 200 300 400 500 600 700
Million DM
281
External funds
Infrastructure funds
Institutional funds
FIGURE 3.17 Relation of external, related infrastructure, and institutional base R&D
funds of universities in selected areas in 1990 in current DM. SOURCE: Wissenschaftsrat
(1993a).
increase in electrical engineering seems to be considerable, too. It is, however,
not possible to say to what extent the increase in electrical engineering is related
to (traditional) energy technology or (modern) electronics. The external funding
in mechanical engineering shows only a moderate growth rate, probably because
the rates at the beginning of the 1980s were already quite high.
In order to provide at least a rough estimate of industrial funding in different
disciplines, the data for the University of Karlsruhe, one of the largest technical
schools in Germany, are presented in Figure 3.18. The school of mechanical
engineering receives the largest volume of industrial funds, but the growth rate in
the 1980s was quite modest. These findings support the general results for exter-
nal university funds. Electrical engineering, computer science, chemistry, and
biological sciences (including geography occupy the next positions, whereas
physics is quite low on the scale. This can be taken as an indication that the high
general level of external funds in physics does not necessarily reflect a high share
of industrial funds. The high absolute level of industrial funding for computer
science is due to specialization in this area at the University of Karlsruhe. The
highest growth rates can be observed for computer science, electrical engineer-
ing, and biological sciences (including geography), which confirms the upward
trend found in the general data for computer science and electrical engineering
for the total amount of external funding.
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282 TECHNOLOGY TRANSFER SYSTEMSIN THE UNITED STATES AND GERMANY
8
7
6
o 5
o 4
-
._
O
~10
~10
I ~
Mech.Eng. Elect Eng. Physics
Cater Cbendstry Biology/ CivilEng.
Science Geography
FIGURE 3.18 External funds from industry at the University of Karlsruhe, for selected
areas, 1980 and 1990. SOURCE: Universitat Karlsruhe (1995~.
A special finding at the University of Karlsruhe is the extremely high level of
industrial funds in the school of civil engineering. (The level is twice as high as
that in mechanical engineering.) However, the majority of these funds are raised
as a consequence of the activities of two departments, which act as official certi-
fying institutions in the field of building materials. Also, according to the chan-
cellor of the university, many construction companies expect universities to con-
duct the bulk of needed civil engineering research. The general statistics of the
Science Council for "other engineering," however, indicate that the dominance of
civil engineering as a recipient of industrial funds cannot be generalized to Ger-
many as a whole.
To sum up, the major external sources of funds linked to technology transfer
between universities and industry are collaborative research funded by BMBF
and, at a much lower level, contract research paid for by industry. These activi-
ties are concentrated in the natural sciences and engineering, especially the latter,
leading to distinctly higher rates of industry funding than the average rates sug-
gest. The funds for collaborative research as well as for research contracts in-
creased considerably during the 1980s; the greatest growth was in the areas of
electrical engineering and computer science.
ADMINISTRATIVE STRUCTURES
The different means of technology transfer at German universities are largely
determined by the public status of these institutions. This obliges the universities
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TECHNOLOGY TRANSFER IN GERMANY
29
TABLE 3.4 Percent Share of University External Funds in Four Focal Areas,
1995
Share of External
Funds Within
Share of Industrial
Funds Within
Share of Secondary
Activities Within
Area Total Budget Total Budget Industry Contracts
Production technology 68 25 11
Microelectronics 63 18 10
Software 43 13 16
Biotechnology 69 12 25
Total 62 17 15
Two reasons may help explain these differences:
.
· laud to the increasing number of students, the relative share of research
funds from institutional sources has diminished since 1990, and the uni-
versities have become more active in the acquisition of external funds.
Since the questionnaire was clearly oriented toward technology transfer,
primarily institutions with a high level of external funds answered (re-
spondent bias).
However, the main reason for the disparity is probably different. Expert
interviews revealed that many professors are not aware of the real cost structures
and do not sufficiently take into account the contribution of institutional funds to
universities' overhead costs (see the related discussion in "Statistics on General
Research Structures". Only some respondents answered in terms of money. In
consequence, the results presented in Table 3.4 are a little bit lower than the real
values in terms of personnel and time.
Among the focus areas, the high share of external funds in production tech-
nology is closely related to a high share of industrial income. It seems to be
easier in biotechnology research than other technology areas to acquire external
funding through BMBF, KU, DFG, and other sources.
The average level of industry-related research within the total research ac-
tivities is (as explained above) probably a little higher than 17 percent.2i In any
case, it is far above the average level of about 8 percent for universities alto-
gether. The industrial budget does not include collaborative projects with indus-
trial partners funded by public sources (e.g., BMBF, KU), so the actual rate of
industry-related activities is even higher.
Production technology, microelectronics, software, and biotechnology are
ranked first through fourth, respectively, in terms of the percentage of industrial
funds that make up their total budgets. This ranking results because the focal
areas are at different stages of their technology cycles, reflected by different de-
grees of concentration on basic research. For example, in production technology,
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292 TECHNOLOGY TRANSFER SYSTEMS IN THE UNITED STATES AND GERMANY
TABLE 3.5 Orientation of University R&D Activities, by Percent, 1995
Area Basic Research Applied Research Experimental Development
Production technology 29 53 18
Microelectronics 41 47 12
Software 50 38 12
Biotechnology 66 27 7
Total 47 41 12
29 percent of R&D activities can be labeled as basic research; the amount of
basic research is much higher in biotechnology (66 percent; Table 3.5~.22 Thus,
biotechnology is still at an early stage of development, whereas production tech-
nology has already matured. It is interesting to note that in all areas, the univer-
sities do not restrict their activities to basic and applied research but devote some
effort to experimental development work.
A rather interesting result shown in Table 3.4 is the relatively low level of
secondary activities within industrial contracts (average 15 percent) compared
with the results of Allesch et al. (1988), who found an average share of 40 per-
cent. A partial explanation is that the relative share of regular activities has in-
creased since 1984, when Allesch et al. conducted their survey. The greater flex-
ibility of university administration has made the integration of industrial contracts
into regular work easier (Wissenschaftsrat, 1993a). Second, Allesch et al. fo-
cused on individual professors, whereas the present questionnaire included whole
research teams. Thus, with respect to professors, the level of secondary activities
is more important than Table 3.4 suggests. Secondary activities are still a rel-
evant incentive for technology transfer.
Survey respondents also were asked to assess the importance of different
channels of technology transfer. As it is not possible to measure and compare the
various channels using common quantitative units, the respondents could choose
from among the statements "very important," "important," "somewhat impor-
tant," and "not important." These assessments were meant to reflect the specific
importance of the industrial contacts for the institution, not general opinions. For
the analysis of the results, the statements were arranged in an ordinal scale from 1
(not important) to 4 (very important). In Table 3.6, the assessments of the differ-
ent channels and the overall mean scores are recorded.
The respondents regarded collaborative research as the most important trans-
fer channel, with a mean score of 3.2. Despite the various points of criticism
raised in accompanying interviews, this type of technology transfer, which is
primarily supported by BMBF programs, seems to be very effective. Informal
channels (e. g., telephone conversations or informal meetings; see also Rappa
and Debackere, 1992) are second in importance, with a score of 3.0. Thus, the
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TECHNOLOGY TRANSFER IN GERMANY
TABLE 3.6 Channels of University Technology Transfer by Percent and
Mean Score
293
Very Somewhat Not Mean
Important Important Important Important Score
Cooperative research 53 25 12 10 3.2
Contract research 35 25 18 22 2.7
Consultancy 21 31 36 12 2.6
Informal contacts 34 39 20 7 3.0
Industry-related committees 10 23 32 35 2.1
Workshops, conferences 24 35 28 13 2.7
Organization of seminars 14 30 32 25 2.3
Exchange of scientists 16 25 30 29 2.3
Provision of personnel
for industry 27 31 24 17 2.7
Exchange of pubications 10 25 36 28 2.2
Industrial participation in
master's and doctoral
theses 29 33 20 17 2.7
establishment of appropriate conditions for the arrangement of informal meetings
is important (e.g., the availability of travel funds and meeting rooms). With scores
of 2.7, 2.6, 2.7, 2.7, and 2.7, respectively, contract research, consultancy, work-
shops and conferences, provision of personnel for industry, and industrial partici-
pation in master's theses and doctoral dissertations are quite important, too. In
contrast, participation in industry-related committees and the organization of
seminars for people in industry generally are viewed as only somewhat impor-
tant. The same applies to the exchange of publications, which is a major instru-
ment for information exchange in academia but obviously is less important for
industry contacts. The exchange of scientists was given a low score, a result that
confirms the outcome of other studies. This low score means that the temporary
exchange of scientists is rarely used. But according to the interviews with profes-
sors, when used, the exchange of scientists has been very effective.
The results, disaggregated according to the four focal areas, are similar to
those for the total sample, but not completely uniform. For instance, contract
research has a high score in the application-oriented area of production technol-
ogy, and a low score in biotechnology with its distinct focus on basic reasearch.
A detailed discussion of these differences, however, lies beyond the scope of this
study.
Not suprisingly, university researchers saw the availability of additional
funds as the most important advantage of industry contacts (Table 3.7~. How-
ever, the opportunity to confer with industry had almost the same impact. Thus,
technology transfer does not only flow from universities to industry, but aca
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294 TECHNOLOGY TRANSFER SYSTEMS IN THE UNITED STATES AND GERMANY
TABLE 3.7 Benefits to University Researchers from Contacts with Industry,
by Percent and Mean Score (percent total sample), 1995
Very Somewhat Not Mean
Important Important Important Important Score
Additional R&D funds 66 22 8 5 3.5
Flexibility of industrial funds 51 25 14 10 3.2
Additional facilities 31 30 26 13 2.8
Opportunity to confer with
industry 54 33 11 3 3.4
References for acquisition
of public funds 22 33 27 18 2.6
demic researchers receive new intellectual input from industry as well. This find-
ing was confirmed by interviews, in which university scientists emphasized the
relevance of information from industry for their research and for improved, prac-
tice-oriented teaching. As already explained in the context of administrative struc-
tures, the flexibility of industrial funds compared with public funds is a major
incentive for German universities to undertake contract research for industry.
As to the barriers to industry contacts (Table 3.8), university researchers
regard only the short-term orientation of their industrial partners as relevant (mean
score of 2.9~. All of the other reasons were "somewhat important" or even "not
important" (scores between 1.8 and 2.3~. The low score for administrative barri-
ers confirms interview results indicating that today's university administrations
cope better with the problems of industrial contracts than in the 1980s (Selmayr,
1986~. University researchers' assessment of a limited indigenous industrial base
as a barrier (mean score of 2.3) showed interesting differences in the four focal
areas. (This internal differentiation is not indicated in the tables.) In biotechnol-
ogy, the mean score was 2.6 (still an "important" barrier); in microelectronics, the
TABLE 3.8 Barriers to Industry Contacts, by Percent and Mean Score, 1995
Very Somewhat Not Mean
Important Important Important Important Score
Less interesting topics 8 23 34 35 2.0
Industry's short-termorientation 35 32 21 12 2.9
Restrictions of publications 10 26 39 25 2.2
Administrative problems 7 17 38 38 1.9
Unfair contracts 4 14 38 44 1.8
Limited industrial base in
Germany 20 28 17 35 2.3
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TECHNOLOGY TRANSFER IN GERMANY
295
TABLE 3.9 Reasons for Industry Interest in University Research, by Percent
and Mean Score, 1995
Very
Important Important
Somewhat Not Mean
Important Important Score
Observation of scientific
development 40 42 16 3 3.2
Solution of technical problems 39 36 20 6 3.1
Personnel recruitment 26 43 25 5 2.9
mean score was 2.5; in software, it was 2.4; and in production technology, it was
1.9 ("somewhat importantly. These results reflect the strong focus of German
industry on all areas of mechanical engineering and a lower level of specializa-
tion in information technology, microelectronics, and biotechnology.
The university researchers were asked to describe what they believe to be the
reason for industry's interest in their research (Table 3.9~. It is interesting that
they ranked "observation of scientific development" even higher than "solutions
to technical problems." This ranking confirms once again researchers' belief in a
scientific dialogue between universities and industry on mid- and long-term ques-
tions and an acknowledgment that industry needs solutions for its immediate tech-
nical problems. In addition, the provision of qualified personnel a basic func-
tion of universities plays an important role.
As mentioned above, the relative importance to universities of different trans-
fer channels, industry contacts, and barriers to working with industry are gener-
ally the same in all selected areas. Nevertheless, differences in the absolute val-
ues of the scores can be observed (Table 3.10~. To demonstrate this effect, the
mean scores of all responses to a group of questions were combined and then
averaged. In the case of transfer channels, those working in production technol-
ogy generally saw the different channels more positively than did those in bio-
technology. The similarity of this result to the differences in industrial funding in
these four areas is obvious. The same phenomenon emerges with respect to the
TABLE 3.10 Average Mean Scores in Major Question Groups
Area Channels Benefits Barriers
Production technology 2.8 3.3 2.1
Microelectronics 2.8 3.2 2.2
Software 2.6 3.0 2.3
Biotechnology 2.3 2.9 2.2
Total 2.6 3.1 2.2
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296 TECHNOLOGY TRANSFER SYSTEMS IN THE UNITED STATES AND GERMANY
benefits of industrial contacts, but to a lesser extent. In the group of questions
dealing with barriers to industrial contacts, the differences between the areas are
negligible although the scores are generally low.
All in all, the contacts between universities and industry in the selected areas
are above average, and universities are more engaged in technology transfer to
industry than generally assumed. Of course, the differences between the ana-
lyzed institutions are large, and technology transfer could be improved in many
cases. Nevertheless, the potential for a further increase in technology transfer
seems to be limited at least in the selected focal areas. It is important to take the
different stages in the technology life cycle into account. In biotechnology, for
instance, a great increase in applied research and a corresponding reduction in
basic research would be detrimental to the quality of research given the present
stage of the area's technology life cycle.
Comparison with the American Situation
The results presented above give interesting insights into how technology
transfer occurs at German universities. It is informative to compare this with the
situation at American universities. A direct comparison is not possible, because
an equivalent U.S. survey does not exist. But Cohen et al. (1994) conducted a
survey of the University-Industry Research Centers (UIRCs), which are in many
respects comparable to German university institutes. For the purpose of the
present study, Cohen et al. (1995) prepared a special analysis for the four focal
areas.
UIRCs are research centers at U.S. universities that get base funds from the
federal government, mostly the National Science Foundation, on the precondition
that they also raise money from industry. In most cases, the industrial funds are
base funds, too, and are not linked to contracts with clearly determined deliver-
ables. The funding companies, however, are involved in the general planning of
research activities and have early access to research results.
With respect to the four focal areas, Cohen and his colleagues received input
from 411 UIRCs (Table 3.11), a magnitude of response comparable to the Ger
TABLE 3.11 Responses to the Survey of UIRCs, 1990
Area
Number of UIRCs
Production technology
Microelectronics
Software
Biotechnology
Total
109
64
129
109
411
SOURCE: Cohen et al. (1995, Table 3.1).
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TECHNOLOGY TRANSFER IN GERMANY
TABLE 3.12 Industrial Contributions to UIRCs,
Percent Share by Area, 1990
Area
Share
Production technology
Microelectronics
Software
Biotechnology
Total
41
30
33
21
31
SOURCE: Cohen et al. (1995, Table 2).
297
man survey (Table 3.3~. Only in software was the German absolute response rate
distinctly lower, but the remaining sample is still sufficiently large.
A revealing outcome of the U.S. survey is the share of the industrial contri-
bution to the funds of the UIRCs (Table 3.12~. Like in Germany, U.S. centers
devoted to production technology receive the highest share, those for biotechnol-
ogy the lowest, and the area of microelectronics falls in the middle. The share of
U.S. industrial funds for software R&D are comparable to, or even a little higher
than, that for microelectronics, whereas in Germany funding for microelectronics
research is near the level of funding for biotechnology. This difference may be
due to closer university-industry relations in U.S. software development.
The level of industry contributions to the UIRCsis generally higher than the
average level of industry contributions to German universities, because the spe-
cial mission of UIRCsis to improve technology transfer.23 In contrast, the Ger-
man survey sample covered all types of university institutes and also included
institutes with few industrial relationships. The U.S. survey, like the German
one, asked respondents about the distribution of their R&D activities in basic
research, applied research, and experimental development (Table 3.13~. The dif-
ferences between the four focal areas are less distinct in the United States than
they are in Germany (Table 3.5), but the level of basic research in production
technology is lowest in both Germany and the United States.
The distribution of the three types of R&D activity in the United States is
comparable to that in Germany for production technology and microelectronics.
But the U.S. orientation toward basic research is clearly less pronounced in soft-
ware and biotechnology. Of course, such comparisons are of limited usefulness,
because the German and American interpretations of the different R&D types
might be different. The higher U.S. level of applied R&D in software, however,
correlates to the higher share of industrial contributions in this area. In the case of
biotechnology, the difference between Germany and the United States is so large
that it cannot be explained by a methodological bias. To summarize, the applica-
tion orientation in German academic R&D is apparent in production technology
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298 TECHNOLOGY TRANSFER SYSTEMS IN THE UNITED STATES AND GERMANY
TABLE 3.13 Orientation of R&D Activities at UIRCs, Percent Share, 1990
Area Basic Research Applied Research Expenmental Development
Production technology 32 46 22
Microelectronics 44 42 14
Software 38 44 18
Biotechnology 44 41 15
Total
18
SOURCE: Cohen et al. (1995, Table 3.3).
and microelectronics and just as it is at U.S. UIRCs (Table 3.13~. In contrast, the
German university research in software and microelectronics appears to have a
distinctly basic orientation. Unfortunately, the available U.S. data do not shed
light on the extent to which other academic research outside UIRCs is oriented
toward more basic activities.
Like the German survey, the UIRC survey asked about the relevance of dif-
ferent transfer channels (Table 3.14~. Because of the different structures of Ger-
man university institutes and American UIRCs, responses to the UIRC survey do
not always have a counterpart in the German survey. Nevertheless, some com-
parisons can be made. The U.S. scores, however, seem to be generally higher
than the German ones (Table 3.6~. This is due to different ways of analyzing the
questionnaires. According to the German approach, all questionnaires are in-
cluded as long as the respondents assessed the importance of some channels of
technology transfer. The channels not marked by respondents were considered to
be "not important." According to the U.S. approach, however, only questions
with a definite answer were included. If the German questionnaires are dealt with
according to the U.S. method, the scores of German respondents rise and become
comparable to the U.S. figures (Table 3.14~. The only distinct difference con-
cerns the temporary work of UIRC/university personnel in industry laboratories,
where the U.S. score is clearly higher; in other words, the movement of personnel
is less often a mode of technology transfer in Germany.
The approach of the UIRC survey to assessing the benefits of industry con-
tacts was different than that of the German survey, and the U.S. data are com-
bined rather than separated out by the four focal areas (Table 3.15~. The U.S.
questionnaire asked whether or not the UIRCs see a benefit, without further dif-
ferentiation, so that only the percentages of positive answers are available. The
outcome, however, indicates that the U.S. and German respondents gave similar
rankings to the value of "R&D funds," "opportunity to confer with industry," and
"equipment." In other words, the U.S. survey, like the Germany survey, revealed the
importance of dialogue with industry for the advancement of academic research.
As to the barriers to industry contacts, the U.S. survey asked only about
restrictions on publication. Thirty-nine percent of UIRCs reported that partici
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TECHNOLOGY TRANSFER IN GERMANY
TABLE 3.14 Channels of U.S. UIRC and German University Technology
Transfer, Mean Score in the Four Focal Areas
299
U.S. Mean Score (1990) German Mean Score (1996)
Collaborative R&D projects 3.4 3.5
Seminars, workshops, symposiums 2.9 3.0
Research papers, technical reports 2.8 2.6
Telephone conversations 2.9
UIRC personnel in industry labs 3.3 2.8
Industry personnel in UIRC 3.5
Informal meetings withindustry people 3.3 3.2
Delivery of prototypes or designs 3.4
NOTE: German mean scores are calculated according to the method used in the U.S. survey.
SOURCES: Cohen et al. (1995, Tables 18 to 22); survey by the Fraunhofer Institute for Systems and
Innovation Research.
patina companies can require information to be deleted from research papers be-
fore they are submitted for publication; 58 percent said that companies can delay
the publication of research findings, and 34 percent indicated that companies are
able to both delay publication and have information deleted. The data do not
indicate the actual frequency of these interventions. In Germany, the problem of
publication restriction exists, too, but is generally less important (see Table 3.8~.
However, the Geramn and U.S. data sets are not really comparable due to the
different types of questions asked.
TABLE 3.15 Benefits of Industry Contacts at UIRCs, by Percent, and at
German Universities, by Mean Score
Percent Share of UIRCs
German Mean Score
R&D funds 91 3.5
Opportunity to confer with industry 70 3.4
Equipment 68 2.8
Information on industry needs 56
Operational funds 49
Access to industrial facilities 45
Practical experience for students 38
Research direction 36
Industry personnel loaned to
academic programs 22
Other 6
None of the above 1
SOURCES: Cohen et al. (1994, Table 3.29); survey by the Fraunhofer Institute for Systems and
Innovation Research.
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300 TECHNOLOGY TRANSFER SYSTEMS IN THE UNITED STATES AND GERMANY
All in all, the results of the U.S. survey confirm the German outcome. They
emphasize the importance of collaborative research and informal contacts for
technology transfer and highlight shortcomings of the German system with re-
spect to the difficulty of temporarily moving academic researchers into industrial
laboratories. The data seem to indicate that German universities have less of an
orientation toward applied research in software technology and biotechnology
than their U.S. counterparts, a result that might be due to a lack of complete data
for all types of research units of U.S. universities (i.e., not only UIRCs).
PATENTS AND PATENT STATISTICS
Intellectual property rights, especially patents, play an important role in tech-
nology transfer. The particular situation at German universities is characterized
by the privilege of professors to exploit for their own benefit inventions created
during their work on institutional base funds at the university (Verwertungs-
privileg). The consequences of this policy for technology transfer are contradic-
tory. On the one hand, the private holding of patents can be an incentive, if the
invention is generated within the framework of existing ties to industry. In this
case, the patent is licensed or transferred directly to the industrial partner, leading
to a generally moderate extra income for the professor. On the other hand, if no
industrial partner is directly available, the professor has to pay the patent applica-
tion fees at his or her own risk. Therefore, many inventions at universities are not
patented. Later on, as a result, companies may not be interested in investing in
further development because the basic idea has not been protected.
If the research is funded by external sources, especially the BMBF, the uni-
versity, not the professor, is responsible for patent protection. Due to the increas-
ing relevance of external funding, the significance of the exploitation privilege is
diminishing. However, the incentives for patenting by the universities themselves
are low due to various factors. Among the most important are that most universi-
ties have neither funds nor infrastructure to support patenting and licensing ac-
tivities; inventions resulting from federally funded academic research generally
can only be licensed on a nonexclusive basis to industrial partners; and a portion
of any licensing income earned from developments with federal government funds
must go back to the funding agency.
In recent years, the University of Karlsruhe and the University of Dresden
established patent and licensing offices comparable to those at American univer-
sities. These offices offer professors advice on patent affairs and, if the invention
seems to be marketable, provide financing for the patent application and search
for potential licensees. (For more details, see Schmoch et al., 1996a.) Some
federal states plan to start similar programs, with the aim of better supporting
inventors at universities. The states do not wish to abolish professors' exploita-
tion privilege, but rather to offer institutional support.
It is not possible to directly track German academic patents. However, the
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TECHNOLOGY TRANSFER IN GERMANY
301
German database PATDPA allows one to search for the title "Professor" among
inventors or applicants. Such a search turns up not only university-related pat-
ents, but also inventions by former professors now working in industry. Thus, the
search sample is somewhat too broad and does not include inventions by scien-
tific assistants at universities. Nonetheless, it can be assumed that the largest part
of the search sample adequately reflects university patents.24 From 1980 to 1990,
the number of patent applications registered for professors jumped by 46 percent
(Figure 3.19~. This rate of increase is comparable to that for external university
funds (42 percent), lower than that for industrial funding (80 percent), but higher
than that for overall university research budgets (21 percent). Obviously, the
number of patents is linked primarily to the share of external funds. Remarkably,
54 percent of university patents are applied and owned by companies (Becher et
al., 1996~. These patents are obviously sold directly by the professors who have
taken advantage of the exploitation pnvilege.
It is interesting to note that the number of patent applications by German
professors in 1992 was about 1,000, whereas the number of patent applications
originating in American universities was about 2,500 (Association of University
Technology Managers, 1993; Schmoch et al., 1996a). Despite the absolute dif-
ference in patent activity between the two countnes, the relative number in Ger-
many in relation to the gross domestic product seems to be quite high. However,
it has to be taken into account that U.S. universities reported about 8,000 inven
1400
. .
~ 1200
o
c. 1000
cow
-
~ 800 _-
0 600
400-
Z; 200-
~ ~ ~ Professors
(total)
Professors
(private)
· ~
O' 1 1 1 1 1 1 1 1 1 1 1 1 1
80 81 82 83 84 85 86 87 88 89 90 91 92 93
Application year
FIGURE 3.19 Patent applications to the German Patent Office by German university
professors. NOTE: private = application by the professor; total = includes applications by
firms or other institutions. SOURCE: Schmoch et al. (1996a).
Representative terms from entire chapter:
german universities
