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From Phileas Fogg to Yuri Gagarin: ...
Prologue:
“ … Has the world grown smaller?
Certainly, returned Ralph. I agree with Mr. Fogg. The world has
grown smaller, since a man can now go round it ten times more
quickly than a hundred years
ago. …
You have a strange way, Ralph, of proving that the world has
grown smaller. So, because you can go round it in three months.
In eighty days, interrupted Phileas Fogg. …
It's absurd! cried Stuart, who was beginning to be annoyed at
the persistency of his friend.”
Jules Verne, Around the World in Eighty Days, 1873
© Kari Liuhto 27.10.2011, Moscow
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Russia in the 1970-1990s: Russia’s
industrialcompetitiveness
deteriorates
Russia in this millenium:
How to turn Russia more
innovative ?
Russia tomorrow:
two major pathsin modernisation
??
State-led, military-oriented reform
vs
Private firm dominated, civil society-
oriented reform
Russia’s modernisation path(s)
-
Modernisation is not self-evident pathfor Russia, though it
would be highly needed
Source: Liuhto 2009
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Russia’s innovation / R&D activity today (1)
Figure 1
Expenditure on R&D
BelarusHungary
Germany
Israel
India
Kazakhstan
Canada
China
Poland
Russia
USA
Turkey
Ukraine
Finland
France
Czech Rep.
Chile
EstoniaSouth Africa
South Korea
Japan
0%
1%
2%
3%
4%
5%
-0,5% 0,0% 0,5% 1,0% 1,5% 2,0%
Country’s share (%) of world’s GERD in 2007
Change of the country’s share in world’s GERD between 1997 and
2007
-16%-9%-5%
0%1%5%
13%23%
38%40%
79%103%
-40% 0% 40% 80% 120%
FranceUSA
RussiaGermany
IndiaJapan
FinlandSouth Korea
IsraelSouth Africa
TurkeyChina
Source: UNESCO Institute for Statistics, World Bank
Gross expenditure on R&D as share of GDP in 2007 and
relative change in 1997-2007, percentage points
(circle size corresponds to total GERD, USD mln.)
Change of the share of GERD in GDP between 1997 and 2007,
percentage points
Gro
ss e
xpen
ditu
re o
n R&
D as
sha
re o
f GDP
in 2
007,
%
0,25%0,43%0,72%0,79%0,88%1,35%
3,13%4,43%5,06%
7,88%14,04%
34,13%
0% 10% 20% 30% 40%
South AfricaTurkey
IsraelFinland
IndiaRussia
South KoreaChina
FranceGermany
JapanUSA
High
Low
HighLow
Source: Prazdnichnykh & Liuhto, PEI 2010
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Russia’s innovation / R&D activity today (2)
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Russia’s innovation / R&D activity today (3)
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Companies in Fortune Global 500
Companies in top 1,000 R&D investors
2005 2009 2005 2009
Brazil 3 6 3 3
Russia 3 8 2 1
India 5 7 1 12
China 16 37 3 5
Europe * 175 180 294 333
USA 176 140 423 378
* Europe excluding RussiaSources: DIUS (2009); Fortune
(2009)
Russia’s innovation / R&D activity today (4)
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Figure 4
Sample characteristics (innovation), %
Source: Bauman Innovation and OPORA – Russian Innovation Survey
2009-2010
В компании существует исследовательское подразделение,51%
В компании нет исследовательского
подразделения,49%
*
* The sum exceeds 100%, since up to three options were
allowed
Presence of R&D department
Presence of innovation strategy
The company has an R&D department,51%
The company doesn’t have
R&D department,49%
Documented as a separate strategy,5%
Documented as a part of overall strategy,20%
Innovation strategy exists only in top
managers' minds,51%
The company doesn't have innovation strategy,
24%
Main sources of innovation
3 %
5 %
6 %
8 %
15 %
16 %
25 %
28 %
38 %
47 %
0 % 10 % 20 % 30 % 40 % 50 % 60 %
Foreign institution of science and technology or universi ty
Acquisition of patents, licenses and know-how from foreign
companies (with
or without Russian presence)
Acquisition of patents, licenses and know-how from Russian
companies
Foreign engineering, design and other specialized companies
Russian institution of science and technology or university
Russian engineering, design and other specialized companies
Company's own departments, except R&D
Russian companies - suppliers of equipment or parts
Foreign companies - suppliers of equipment or parts
Company's own R&D department
Source: Prazdnichnykh & Liuhto, PEI 2010
Russia’s innovation / R&D activity today (5)
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Figure 6
Obstacles to innovation
Main obstacles to innovation activities for mid-sized and large
companies in Russia
4%
5%
5%
6%
6%
8%
12%
19%
23%
33%
33%
62%
0% 10% 20% 30% 40% 50% 60% 70%
Board of Directors doesn't recognize innovation as priority
Ineffective innovation management
No demand for new products and services
Restricting standards and industry regulations
Difficult to find suppliers
Lack of market information
Lack of technology information
Lack of qualified human resources
Uncertainty of demand for a new product or service
Difficult to get external financing
Too large cost of innovation activity
Lack of funds available within the company
*
* The sum exceeds 100%, since up to three options were
allowed
Source: Bauman Innovation and OPORA – Russian Innovation Survey
2009-2010; Community Innovation Survey 2004-2006, Central
Statistics Office
Rankings of obstacles to innovation for EU- companies
Innovative companies* Non-innovativecompanies*1
2
3
4
5
6
7
8
9
10
Lack of funds available within the companyDifficult to get
external financingUncertainty of demand for a new product or
serviceDifficult to find suppliers
Too large cost of innovation activityLack of qualified human
resourcesNo demand for new products and servicesRestricting
standards and industry regulationsLack of market information
Lack of technology information
1
2
3
4
5
6
7
8
9
10
No demand for new products and servicesLack of funds available
within the companyDifficult to get external financingDifficult to
find suppliers
Uncertainty of demand for a new product or serviceToo large cost
of innovation activityRestricting standards and industry
regulationsLack of qualified human resourcesLack of technology
information
Lack of market information
* See Community Innovation Survey 2004-2006 for explanations
Source: Prazdnichnykh & Liuhto, PEI 2010
Russia’s innovation / R&D activity today (6)
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Figure 7
Barriers to innovation: human resources and education
Availability of engineers and technicians
Cost to hire engineers and technicians
Low High
Too high, inacceptable Acceptable
6%
4%
8%
2%
8%
11%
13%
17%
8%
21%
14%
18%
26%
12%
18%
24%
24%
25%
32%
23%
23%
18%
16%
20%
17%
18%
19%
6%
14%
10%
5%
4%
2%
13%
3%
Education quality in vocational schools and technical
colleges
Quality of higher education in natural sciences and
engineering
Quality of math and science education in school
Source: Bauman Innovation and OPORA – Russian Innovation Survey
2009-2010
Low High
Low High
Low High
Source: Prazdnichnykh & Liuhto, PEI 2010
Russia’s innovation / R&D activity today (7)
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Figure 8
Intellectual property protection
12%
13%
8%
21%
31%
11%
18%
10%
15%
24%
18%
19%
16%
18%
14%
27%
27%
22%
24%
14%
13%
12%
18%
13%
10%
13%
10%
18%
7%
4%
4%
2%
7%
3%
3%Intellectual property protection in general
Intellectual property protection: patents for invention and
prototypes
Intellectual property protection: registered trademarks
Intellectual property protection: authors’ rights
Intellectual property protection: business secrets and
know-how
Weak Strong
Weak Strong
Weak Strong
Weak Strong
Weak Strong
Source: Bauman Innovation and OPORA – Russian Innovation Survey
2009-2010
Source: Prazdnichnykh & Liuhto, PEI 2010
Russia’s innovation / R&D activity today (8)
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Figure 10
Cooperation with foreign companies in area of technology and
innovation
42%
42%
43%
53%
Upgrading production processes
Designing and implementing new
production processes
Developing new products and services
Upgrading products and services
Technological cooperation with partners abroad (during last
three years) Areas of cooperation
*
48%49%
YesNo
Location of main technologypartners
5%14%
5%5%
5%8%8%9%10%
16%23%
36%
Other non-Europe
Other Europe
Sweden
India
France
Japan
Italy
Finland
CIS countries
China
USA
Germany **
Source: Bauman Innovation and OPORA – Russian Innovation Survey
2009-2010
* The sum exceeds 100%, since multiple options were allowed
** The sum exceeds 100%, since up to two options were
allowed
Source: Prazdnichnykh & Liuhto, PEI 2010
Finland is R&D superpower in industrial cooperation with
Russia
Russia’s innovation / R&D activity today (9)
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INTER-ENTERPRISE JOINT INNOVATION ACTIVITY* Flagship: Nokia in
Skolkovo
INNOVATION FINANCE* TEKES-FASIE* Rusnano-Finnish Industry
Investment Ltd
NETWORKING * FinNode Russia (match making)* Technopolis
(technopark)* Finnish-Russian Innovation Centre (regional
cooperation)
PR- ACTIVITIES* EU-Russia Innovation Forum (mainly bilateral
annual event - third time in June 2011)
JOINT RESEARCH* Academy of Finland and the Russian Foundation
for Humanities (2006-2009)* Various universities and their
Russia-units
EXCHANGE OF RESEARCHERS* Various universities
Finnish-Russian innovation cooperation:Some examples
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(1) Establish a Joint EU-Russia Innovation Centre both in Russia
and in the EU.
(2) Support the internationalization of innovations.
(3) Turn the innovations conducted in the military sector into
civilian use.
(4) Improve intellectual property rights (IPR) and the
investment climate.
(5) Institutional innovations are needed.
(6) Design a service innovation policy.
Some policy considerations based onFinnish-Russian cooperation
(1)
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( 7) Enhance management innovations.
( 8) Create innovation competition.
( 9) Establish innovation journalism to share best
practices.
(10) Do not concentrate on radical innovations.
(11) Teach creativity and entrepreneurship in universities.
(12) Avoid political stagnation.
Some policy considerations based onFinnish-Russian cooperation
(2)
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From Phileas Fogg to Yuri Gagarin –but what after Gagarin ?
Epilogue:
50 years ago, the Soviet cosmonaut, Yuri Gagarin, flew around
the world in less than two hours.
Lesson: reaching “the impossible” is possible but it takes time
and requires foreign cooperation / competition.