ICIE 2013 Proceedings of the International Conference on Innovation and Entrepreneurship

Proceedings of the International Conference on Innovation and Entrepreneurship Hosted by

The Hashemite University in cooperation with The Arab Administrative Development Organization

Amman, Jordan 4 5 March 2013 4-5

Edited by Radwan Kharabsheh

A conference managed by ACPIL

Proceedings of the International Conference on Innovation and Entrepreneurship Hosted by The Hashemite University in cooperation with The Arab Administrative Development Organization Amman, Jordan 4-5 March 2013

Edited by Dr. Radwan A. Kharabsheh The Hashemite University Amman, Jordan

Copyright The Authors, 2013. All Rights Reserved.

No reproduction, copy or transmission may be made without written permission from the individual authors.

Papers have been double-blind peer reviewed before final submission to the conference. Initially, paper abstracts were read and selected by the conference panel for submission as possible papers for the conference.

Many thanks to the reviewers who helped ensure the quality of the full papers.

These Conference Proceedings have been submitted to Thomson ISI for indexing.

Further copies of this book and previous year’s proceedings can be purchased from http://academic-bookshop.com E-Book ISBN: 978-1-909507-05-0 CD Version ISBN: 978-1-909507-07-4 CD Version ISSN: 2049 6842 Book version ISBN: 978-1-909507-03-6 Book Version ISSN: 2049 6834 The Electronic version of the Proceedings is available to download at ISSUU.com. You will need to sign up to become an ISSUU user (no cost involved), and search for conference name.

Published by Academic Conferences and Publishing International Limited Reading UK 44-118-972-4148 www.academic-publishing.org

Contents Paper Title

Author(s)

Page No.

Preface

iii

Committee

iv

Biographies

v

Research papers New Directions for Saudi Women Entrepreneurial Intentions

Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot

1

Innovation and Entrepreneurship: Smart, Sustainable and Inclusive Growth

Hanadi Mubarak Al-Mubaraki and Michael Busler

9

New Service Development in Small and Medium Accounting Practice Firms: The Italian Case

Carlo Bagnoli, Maurizio Massaro and Filippo Zanin

18

How does the Work Environment Affect Physical Movement Behaviour during Communication?

Claudia Erni Baumann and Roman Boutellier

26

Corporate Web 2.0 Systems Adoption in Russian Companies: Testing the UTAUT Validity

Evgeny Blagov and Pavel Bogolyubov

37

Innovation, Entrepreneurship and Sustainability: “This is an Idea!”

Cláudia Fernandes and Luís Rocha

46

Business Opportunities Associated with Changes in Ecosystem Services

Giani Gradinaru

54

EIP@AUC: A Case Study of a University-Centred Entrepreneurship Eco-System in Egypt

Sherif Kamel and Ayman Ismail

63

Entrepreneurship Education: Shifting the Landscape through Embedding Practitioner Experience

Lester Lloyd-Reason

69

Innovation and Cooperation in Emerging Economies: Two Sides of the Same Coin?

Anne-Laure Mention, Serdal Temel and Marko Torkkeli

78

Integrating Information and Knowledge Created in Distributed Product Development

Jonas Rundquist

85

Optimal Quality Decisions for Elderly Service Integrators in Elderly Service Supply Chain

Yuan Shi, ZhiyongZhang, Jun Zhao and Riza Sunindijo

94

Social Technologies for Increasing Entrepreneurship in Public Administration Organizations

Aelita Skaržauskienė

102

Brain Drain as Brain Gain in Southeast Europe: Challenges Ahead

Mirjana Stankovic, Biljana Angelova, Verica Janeska and Bratislav Stankovic

109

ICBS Intellectual Capital Benchmarking System: A Practical Methodology for Successful Strategy Formulation in the Knowledge Economy

José M. Viedma Marti and Maria do Rosário Cabrita

119

Arabic Track

129

Application Study of Management Knowledge Cities to Improve Tourism Planning in Egypt

Hanan Hosny Soliman Elassar

PHD Papers

131 143

The Influence of the Organizational Culture on Academic Entrepreneur’s Knowledge Sharing Behavior: Case Study at Private University Colleges in Malaysia i

Hafiza Adenan, Dang Merduwati Hashim, Adnan Jamaludin and Haziah Sa’ari

145

Paper Title

Author(s)

Page No.

The Productivity of Innovation in Portugal

Nuno Araújo and Leonardo Costa

151

Business Incubators and Incubatees

Søren Berg Jørgensen

159

The Evaluation of Teaching in Higher Education Institutions

Ana Louro, Luís Lourenço and Pedro Saraiva

166

A Trust-based Framework for Enhanced Absorptive Capacity: Improving Performance, Innovation and Competitive Advantage

Athar Mahmood Ahmed Qureshi and Nina Evans

172

Leveraging Entrepreneurial Knowledge Competencies and the Outcomes among Academic Librarians in Malaysia

Haziah Sa’ari, Rusnah Johare, Dang Merduwati Hashim and Hafiza Adenan

180

ii

Preface These proceedings represent the work of researchers participating in the inaugral International Conference on Innovation and Entrepreneurship – ICIE 2013, which is being hosted by the The Hashemite University in cooperation with The Arab Administrative Development Organization, Amman.

The conference will be opened with a keynote from Prof dr M S S El Namaki from the Victoria University School of Management, Switzerland. The keynote address on the second day is delivered by Dr JosĂŠ M. Viedma from U.P.C., Polytechnic University of Catalonia, Barcelona, Spain.

The ICIE Conference constitutes a valuable platform for individuals to present their research findings, display their work in progress and discuss conceptual advances in many different branches of innovation and entrepreneurship in business and management. At the same time, it provides an important opportunity for researchers and managers to come together with peers, share knowledge and exchange ideas. ICIE builds on the now well established European Conference on Innovation and Entrepreneurship, and allows universities outside the European Boundaries the opportunity to host an academic conference on these important topics.

Following an initial submission of 87 abstracts that have undergone a double blind peer review process, 16 research papers, 6 PhD research papers and 1 work-in-progress paper are published in the ICIE 2013 Conference Proceedings, representing research results from Australia, China, Denmark, Egypt, France, Italy, Kuwait, Lithuania, Luxembourg, Macedonia, Malaysia, Poland, Portugal, Romania, Russia, Spain, Sweden Switzerland and the United Kingdom.

We hope that you have an enjoyable conference.

Dr. Radwan A. Kharabsheh

iii

Conference Committee Conference Executive Prof Refat Al-Faouri, The Arab Administrative Development Organization, Egypt Prof Hmoud S. Olimat, The Hashemite University, Amman, Jordan Dr. Husam Aldeen Al-Khadash, The Hashemite University, Amman, Jordan Dr. Ihab K. Magableh, The German Jordanian University, Jordan Dr. Talah Arabiat, The German Jordanian University, Jordan Dr. Haroon Alryalat, The World Islamic Sciences & Education University, Jordan Dr. Ghassan E. Abuyaghi Dr. Radwan A. Kharabsheh, The Hashemite University, Amman, Jordan Dr. Maher Al-Mahrouq, The Jordanian Chamber of Industry (JCI) , Amman, Jordan Dr Geoff Turner, University of Nicosia, Cyprus The 2013 conference programme committee consists of key people in the innovation and entrepreneurship community, both from the Europe and around the world. The following people have confirmed their participation: DR Ghassan E. Abuyaghi (The Hashemite University, Amman, Jordan); DR Husam Aldeen Al-Khadash (The Hashemite University, Amman, Jordan); Prof Refat Al-Faouri (The Arab Administrative Development Organization (ARADO), Cairo, Egypt); DR Haroon Alryalat (The World Islamic Sciences & Education University, Amman, Jordan); DR Talah Arabiat (The German Jordanian University, Jordan); DR Radwan A. Kharabsheh (The Jordanian Chamber of Industry (JCI) , Amman, Jordan); DR Ihab K. Magableh (The German Jordanian University, Jordan); Prof Hmoud S. Olimat (The Hashemite University, Amman, Jordan); DR Geoff Turner (University of Nicosia, Cyprus); Kamarulzaman Ab. Aziz (Multimedia University, Malaysia); Zafer Acar (Okan University, Istanbul, Turkey); Dr Bulent Acma (Anadolu University, Turkey); Mo'taz Amin Al Sa'eed (Al - Balqa' Applied University, Amman, Jordan); Mohammad Aladwan (hashemite university, Jordan); Saleh Al-Jufout (Tafila Technical University, Jordan); Randa Almahasneh (Hashemite University, Jordan); Ibrahim Al-oqily (University of Ottawa, Canada); Hussein AlYaseen (Al-Ahliyya Amman University, Jordan, Jordan); Dr Khitim Alzughoul (Hashemite University, Jordan); Omid Askarzadeh (Polad Saab Shargh, Tehran, Iran); Prof Alina Badulescu (University of Oradea, Romania); Dr Vibha Bhandari (College of Applied Sciences,Ministry of Higher Education,Oman, Oman); Eduardo Castro (National University de la Plata, Argentina); Toly Chen (Feng Chia University, Taichung, Taiwan); Shi-Jay Chen (National United University, Taiwan); Chuang-Chun Chiou (Dayeh University, Changhua, Taiwan); Costas N. Costa (Cyprus University of Technology, Lemesos, Cyprus); Fengzhi Dai (Matsue College of Technology, Japan); Rogerio Atem De Carvalho (Instituto Federal Fluminense, Campos, Brazil); Armando Carlos de Pina Filho (Federal University of Rio de Janeiro , Brazil); Salah Doma (Sinai University, El-Arish, Egypt); Dr. Aikyna Finch (Strayer University, Huntsville, USA); Ramaswamy Ganesan (King Saud University, Saudi Arabia); Ass.Prof.Dr. Adriana Giurgiu (University of Oradea, Romania); Dr Sayed Mahdi Golestan Hashemi (Iranian Research Center for Creatology , TRIZ & Innovation Management & Engineering, Iran); Dr Sayed Mahdi Golestan Hashemi (Iranian Research Center for Creatology, TRIZ & Innovation Management, Iran); Ebru Gunlu (Dokuz Eylul University Faculty of Business, Turkey); Kaled Hameide (Montclair State university in New Jersey, USA); Dr Mahmoud Hassanin (Pharos University,Alexandria, Eygpt); Prof Konstantinos Kalemis (National Centre For Local Government And Public Administration, Greece); Yusniza Kamarulzaman (University of Malaya, Kuala Lumpur, Malaysia); Prof Jesuk Ko (Gwangju University, Korea); Dr Yvonne Lagrosen (University West Trollhättan, Sweden);Brent Lane (Kenan-Flager Business School, University of North Carolina, USA); Angeline Low (University of Technology Sydney, Mosman, Australia); Randa Mahasneh (The Hashemite University, Jordan); Prof Carla Marques (University of Trás-os-Montes Alto Douro (UTAD), Portugal); Prof. Maurizio Massaro (Università degli Studi di Udine, Italy); Dr AnneLaure Mention (Centre de recherche public Henri Tudor, Luxembourg); Jens Mueller (Waikato Management School, New Zealand); Desai Narasimhalu (Singapore Management University, Singapore); Assoc. Prof. Abdelnaser Omran (Universiti Sains Malaysia, Malaysia); Mohand-Said Oukil (King Fahd University of Petroleum and Minerals, Dhahran, Saudi Arabia); Dr Nguyen Phuc (Asian Institute of Technology and Management, Vietnam); Ige Pirnar (Yasar University, Turkey); Jose Carlos Rodriguez (Economic and Business Research Institute - Instituto de Investigaciones Economicas y Empresariales, Mexico); Umar Sabo (ramat polytechnic , Nigeria); Prof Chaudhary Sarwar (Lahore, Pakistan); Dr Mandy Shi Yuan (South China University of Technology , China); DR Carmen Gabriela Sirbu (Danubius University, Romania); Padma Srinivasan (Manipal university, Bangalore, India); Khalaf Tarawneh (Hashemite university, Jordan); Dr Perera Tissa Ravinda (University of Colombo, Sri Lanka); Dr Hayfaa Tlaiss (University of New Brunswick Saint John, Canada); prof Milan Todorovic (union nikola tesla university, Serbia); Dr Jeff Vanevenhoven (University of Wisconsin-Whitewater , USA); Dr Ismail Wekke (State College of Sorong, Indonesia); Doan Winkel (Illinois State University, USA); Aziz Yahya (Universiti Teknikal Malaysia Melaka, Malaysia); Mohammad H Yarmohammadian (Health Management & Economic Research Center, Isfahan University of Medical Sciences , Iran); Shaker Zahra (University of Minnesota, USA); Dr Krzysztof Zieba (Gdansk University of Technology, Poland);

iv

Biographies Conference Co-Chairs Prof. Refat Abdelhalim Alfaouri a BA, Business Administration from Yarmouk University, MPA (Public Administration) from UCLA, USA and a PhD in Public Policy Analysis & Administration Saint Louis University, U.S.A. Dr. Refat Al Faouri is currently the Director General of the Arab Administrative Development Organization (ARADO) working under the umbrella of the Arab League. Previously he was the vice-president academic and administrative of Yarmouk University in Jordan. In his role as the Director General of ARADO he contributes to the administrative development of the Arab States.

Dr. Radwan A. Kharabsheh is the assistant dean (international affairs) at the Hashemite University in Jordan. He holds a bachelor of science with a major in physics, a masters and PhD degrees in International Business from Charles Sturt University, Australia. Dr Kharabsheh has supervised many masters’ students and has presented and published papers in numerous international conferences and refereed journals. His research interests include organizational learning, knowledge management and international joint ventures. He is a member of the Australia-New Zealand Marketing Academy, Australia-New Zealand International Business Academy and the Centre for Peace and Conflict Studies, Sydney University, Sydney, Australia.

Programme Chair Programme Chair Professor Basman Faisal Mahjoub Jasim Al-Taei holds a PhD in Strategic Management he works as an expert and consultant for the Arab Administrative Development Organisation.

Keynote Speakers Prof Dr M.S.S. El Namaki is Dean of the Victoria University of Switzerla nd. He has developed and introduced management degree programs (MBA, EMBA, DBA and Ph. D) at institutions in the Netherlands, China, Egypt, Brazil, Poland, Canada, Kazakhstan, Syria and Indonesia, among others.

Prof El Namaki taught globally at as recognized institutions as MSM (Maastricht), Kellog (Chicago), Jiao Tong University (Shanghai), Beijing University (Beijing), AIT (Bangkok), Helsinki School of Economics (Helsinki), Sheffield University (Sheffield) and several others. He assumed executive positions within Philips (Eindhoven), McKinsey (London and Dar es Salaam) and Time Inc. (Amsterdam).

Prof El Namaki consulted and delivered executive seminars on a wide scale and his clients included Fortune 500 companies as DuPont, Philips and Pepsi as well as landmark national corporations as China Pacific Insurance Corporation CPIC (Shanghai), Eastern Tobacco (Egypt) and Abraaj (United Arab Emirates). Prof El Namaki did consultancy missions for the European Union (EU), The World Bank, The United Nations Development Organization (UNDP), and the International Trade Center (ITC) among others. Countries covered in these missions included, among others, Egypt, Syria, Qatar, China, Thailand and Kazakhstan.

Dr.José María Viedma Marti is a Doctor of Industrial Engineering, a graduate in Economics and Professor at the U.P.C., Polytechnic University of Catalonia in Barcelona, Spain. He teaches on the subject of knowledge management, intellectual capital management and Knowledge-based development. He has held top executive positions in computer services and management consultancy firms. Actually he is the president of "Intellectual Capital Management Systems" and a founding partner of "M.A. Fusiones y Adquisiciones". He is an advisory board member of different journals. He is a regular speaker in international conferences and congresses, his current field of research and interest is focused on knowledge and intellectual capital management and he has consulted and developed management frameworks and systems worldwide on those matters.

v

Biographies of Presenting Authors Hafiza Adenan is a PhD student at Faculty Information Management of MARA Technology University, Malaysia. She has working experience in retailing industry and educational industry. In educational industry, she has experience as a lecturer at private university college in Malaysia.

Laurice Alexandre-Leclair is Associate Professor at La Sorbonne Paris Cité University in France. Her research fields are women entrepreneurship in the MENA region and social entrepreneurship. She is the Faculty Advisor of ENACTUS Paris Descartes University (working with students on social entrepreneurships projects). She is a permanent member of the editorial committee of two French journals Hanadi AL-Mubaraki is an Assistant Professor in Kuwait University. She teaches management course for undergraduate and graduate. She has published scientific articles in different academic journals, a book and has presented her research papers in many countries. She serves on the Editorial Board of international journals.

Nuno Araújo has a degree in Management and a Master’s degree in Economics. At present, he is collaborating at CATIM – Technological Centre for the metal Working Industry, as financial director, and European and National projects manager in the areas such as training, R&D and implementation of production technologies and methodologies in SME’s of Metal working industry sector.

Claudia Erni Baumann is a Research Associate and PhD student at the ETH Swiss Federal Institute of Technology Zurich. She holds MSc in Sports and Physical Education and a M.A. in Business Administration with specialisation in Information, Media and Technology Management. Her research interests include chance encounters, knowledge creation, innovation, learning and sports economics.

Evgeny Blagov obtained a PhD degree in technology innovation management at the Graduate School of Management of Saint Petersburg State University in 2011 and is currently working as an assistant professor at the Graduate School of Management of Saint Petersburg State University (IT in Management department) teaching technology innovation management and macroeconomics.

Pavel Bogolyubov is a Management and Business Development Fellow at Lancaster University Management School, UK. He gained his first degree in Physics at Herzen University in St. Petersburg, Russia, and an MBA from Bradford School of Management, UK. His research interests are centred around “softer” aspects of Web 2.0 and its role in KM. Michael Busler is an Associate Professor of Finance, Finance Track Coordinator and a Fellow at The William J, Hughes Center for Public Policy at Richard Stockton College. He teaches undergraduate courses in Finance and Game Theory as well as Managerial Economics and Corporate Finance in the MBA Program.

Maria Do Rosario Cabrita holds a PhD and is Assistant Professor and researcher at the Universidade Nova de Lisboa, Portugal, and teaches at the Portuguese Banking Management School in Lisbon. She has several years of experience in executive positions in international banks. Her current field of research is focused on intellectual capital, knowledge management and measuring intangibles.

Leonardo Costa is a faculty member of the School of Economics and Management, Catholic University of Portugal at Porto, since 1998. He received is Ph.D degree in Economics from the University of Arizona, USA, in 2001. His research interests and publications are on public policy analysis and efficiency and productivity analysis.

Hanan Hosny Soliman Elassar has a Bachelor Degree, (1993), MSc in Tourism Planning (1998), PhD in Tourism Planning and IT (2005) and Assistant Professor Degree in Tourism (2011) from the Faculty of Tourism and Hotels, Alexandria University. She now works as Assistant Professor in the Tourism Studies Department, Faculty of Tourism and Hotels, Alexandria University, Egypt.

Cláudia Fernandes has a degree in Psychology with specialization in Organizational Psychology, a Master’s Degree in Information Management and a specialization in evaluation by the American Society for Training and Development. At the present she is project manager in CATIM - Technological Centre for the Metal Working Industry in areas such as training, R&D, special projects, SME’s methodologies and intervention.

Giani Gradinaru is an Associate Professor of the Statistics and Econometrics Department, Academy of Economic Studies, Bucharest. He received the title of doctor in cybernetics and economic statistics in 2004. Postdoctoral scientific research is in the environmental statistics field. He is an expert evaluator and research project manager. vii

Ayman Ismail is the Assistant Professor of Management and Abdul Latif Jameel Endowed Chair of Entrepreneurship at the American University in Cairo School of Business, where he leads the School’s Entrepreneurship and Innovation Program (EIP).

Søren Berg Jørgensen is an Industrial PhD Fellow at Roskilde University in Denmark. He is doing his PhD in collaboration with Business Link Zealand, a regional business link organization that provides guidance to entrepreneurs and SMEs. His research is concentrated around how business incubators influence entrepreneurs.

Sherif Kamel has been Dean of the School of Business at the American University in Cairo (AUC) since 2009 and Professor of Management Information Systems at the Department of Management.

Lester Lloyd-Reason is Professor of International Enterprise Strategy, Director of the Centre for Enterprise Development and Research (CEDAR). He has had more than 150 publications in this field and serves on the Editorial Board of a number of Journals, including the International Small Business Journal (ISBJ).

Ana Isabel Carmona Pereira Louro Management and Financial Accounting Degree from the School of Management of Idanha-a-Nova (2003); Master Degree in Public Management from University of Minho (2008) and Phd Student at University of Beira Interior (2009-); Invited Assistant at Higher Institute of Languages and Administration of Leiria (2010-), Technician at Polytechnic Institute of Castelo Branco (2002-).

Maurizio Massaro, Ph. D., is aggregate professor at Udine University since 2008, having worked as teacher at Udine University since 2001. He was visiting scholar at the Florida Gulf Coast University, Florida, USA, in 2010. His academic interests are primarily in the field of measurement of business performance, intangible assets and entrepreneurship.

Anne-Laure Mention leads a research unit focusing on innovation economics and management within the Public Research Centre Henri Tudor (Luxembourg). She is involved in research projects, mainly focusing on innovation and performance measurement and management in the financial and B2B services industries. Her research interests concentrate on open and collaborative innovation, intellectual capital measurement and management, innovation and technology management.

Aneta Ptak-Chmielewska is Associate Professor at the Institute of Statistics and Demography at Warsaw School of Economy.

Her main research fields include applied demography, study of competitive careers with event history methods and models, multivariate statistics and advanced statistics application in economy and life sciences. She has been a member of the Network of Excellence RECWOWE project.

Athar Qureshi graduated with an Honours degree in Computer Sciences (2002), Masters in ICT Management (2007) and is now pursuing his PhD in Knowledge Management (2011+). He started his academic career with research and teaching assistantships, lectureship, consultation and now research. Along with his academic commitments, Athar advises voluntarily to non-profit academic associations.

Luis Rocha has a degree in Computer Engineering and a specialization in training evaluation by the American Society for Training and Development. At the present, he is collaborating at CATIM - Technological Centre for the Metal Working Industry, as project manager in areas such as training, R&D, implementation of production technologies and methodologies in SME’s.

Jonas Rundquist has a Ph.D. in industrial management and is assistant professor of Innovation Sciences at Halmstad University, Sweden. He has published articles in relevant journals as Journal of Product Innovation Management, European Journal of Innovation Management, and International Journal of Innovation Management. Current research interests include knowledge management and innovation at emerging markets.

Shi Yuan obtained her PhD from the University of Hong Kong in 2010. She joined South China University of Technology in Mainland China in September 2010. With substantial financial supports from various funding, Dr. Shi Yuan has conducted research in supply chain risk management, elderly service supply chain and tourism supply chain management.

Haziah Sa’ari is a full time student under Faculty of Information Management, Universiti Teknologi MARA (UiTM) Malaysia.

She has working experience about 14 years in Library and Information Management field for 14 years with multiple companies such as broadcasting and architectural organisation.

Aelita Skaržauskienė has a degree of Doctor of Social Sciences from University of Management and Economics, Vilnius, Lithuania. In her work, she applies knowledge of management and modern leadership-related disciplines such as Business dynamics, Systems thinking, Chaos and complexity theories. She was coach in the self-managing teams building project in the European Parliament, together with DEMOS Group Belgium viii

Bratislav Stankovic teaches genetics at University St Paul the Apostle, Ohird, Macedonia and at Loyola University Chicago. He serves as a Science and Technology Advisor to the President of Macedonia, Dr. Gjorge Ivanov. His experience includes intellectual asset management, innovation management and strategy, patent prosecution, and counselling in the fields of biotechnology, biochemistry, bioengineering, nanobiology, and pharmaceuticals Marko Torkkeli is a Professor of Technology and Business Innovations at the Lappeenranta University of Technology in Kouvola, Finland. His research interests focus on technology and innovation management, strategic entrepreneurship, growth venturing, and decision support systems. He has more than 200 publications under his name in these fields.

JosĂŠ Maria Viedma MartĂ­ is a Doctor of Industrial Engineering, a Graduate in Economics and Professor of Business Administration, at the U.P.C., Polytechnic University of Catalonia in Barcelona, Spain. He teaches and researches on the subject of knowledge management, intellectual capital and knowledge based-development. He is an advisory board member of the main Journals in his research field.

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New Directions for Saudi Women Entrepreneurial Intentions Laurice Alexandre-Leclair1, Wassim Aloulou2 and Renaud Redien-Collot3 1 Paris Descartes University Sorbonne Paris Cité, Paris, France 2 Al-Imam Islamic University at Riyadh, Saudi Arabia 3 Novancia Business School, Paris, France Laurice.alexandre-leclair@parisdescartes.fr Wassim.aloulou@gmail.com rrediencollot@novancia.fr

Abstract: Since 2002, Saudi Arabia has experienced an economic and societal turning point in encouraging women professional and entrepreneurial initiatives. As private companies and families may still be reluctant to promote female employability, Saudi Arabia has also stimulated female entrepreneurial spirit. However, Saudi Arabia female TEA (total entrepreneurial activity) is still very low. At the same time, media have diffused different examples of Saudi women’s entrepreneurial success stories. An important proportion of women though may wish to launch businesses but do not dare to concretize their projects. Therefore, we have decided to study Saudi women’s entrepreneurial intentions in order to understand better the present construct of their entrepreneurial motivations. Our study is focused on student population because it may reflect some changes that can guide policy makers and educators in the implementation of new support systems. In 2012, we have conducted a quantitative study of the entrepreneurial intention of 75 female university students. This study demonstrates that young Saudi students have a very high rate of entrepreneurial desirability.

However, a significant majority of these respondents are more reserved concerning the feasibility of their projects.

Moreover, if they are properly supported, they are ready to negotiate a set of compromises with collective norms in order to concretize their entrepreneurial self-accomplishment.

Keywords: entrepreneurial intention, gender, women entrepreneurship, culture, Saudi Arabia

1. Introduction According to the study carried out by the ILO in 2010 on global trends in female employment, Middle East countries have the lowest female employment rates in the world (37%). In comparison, female employment rates are 75% in Sub-Saharan Africa, and 80% in the European Union. According to the same source, the Middle East also has the highest female unemployment rate in the world, especially in the 15-24 age groups.

For these reasons, we think that the development of entrepreneurship in these countries could participate at the development of women employment and lead to an economic prosperity. In this article, we will study the case of Saudi Arabia because a substantial number of colleges and universities catering to women have been opened in Saudi Arabia since 2002. Nevertheless, while Saudi women account for 58% of the college student body, only 14% of the workforce is female, a rate much lower than that of neighboring Islamic countries. 85% of Saudi women work in the education sector, and 6% in the health sector. In total, 95% of Saudi women in employment work in the public sector (the World Bank 2009).

Furthermore, among the factor-driven economies in the region, Saudi Arabia had the lowest total entrepreneurial activity (TEA) rate. According to GEM 2009, only 4.7% of the adult population (18–64 years old) is actively involved in the start-up of a new business or owns a business less than three and half years old.

However, according to Hampole (2010), 72% of registered female-owned businesses operate outside the home making them one of the largest groups in the Middle East and North Africa regions according to a recent study undertaken by JCCI and the Monitor Group.

In a fast transforming era, the Saudi government has started pushing for reforms to bring more women into the workforce a push that is part of a larger campaign to increase the number of Saudi nationals employed in the private sector. (The current 8% employment rate of nationals is much lower than the government’s 30% target.) The Saudi government has already taken a small number of steps to address these challenges: The Labor Ministry has modified the Labor Law (2008) to make it easier for men and women to interact in a professional and business environment.

Likewise, women no longer have to get approval from their male guardians to accept or leave jobs.

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Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot Furthermore, Saudi Arabia has made considerable efforts to encourage entrepreneurship. In the report “Doing th Business, 2011”, the country is ranked 13 out of 185 countries in terms of resources facilitating business venture. In this context, female entrepreneurs’ situation is contrasted.The objective of this research is to examine unpublished data concerning the entrepreneurial potential of Saudi women in order to contribute to the study of international similarities and contrasts in the field. Furthermore, studying the entrepreneurial intention of Saudi women will enable us to gain a deeper understanding of the motivations that guide them and the obstacles that hold them back, with a view to, in fine, offering advice to legislators and educators about what new legislation to introduce to encourage Saudi women initiatives in entrepreneurship. As Binks et al. (2006) point out, typically in any national population, the longest-lasting, most innovative entrepreneurial initiative – those which create the most value – are launched by people between 18 and 27 years old.

Therefore, the purpose of our study is to measure the entrepreneurial intention of Saudi female students and to gain an insight into how the culture of the country affects female entrepreneurial intention. Social and cultural structures need to encourage shared attitudes and practices that make it possible to deconstruct the gender assigned to overly-defined functions and role models and to develop new needs and markets, or, in other words, new opportunities for a larger entrepreneurial population (Gundry et al. 2002).

Thus, after a literature review, we will present our research methodology, our results and, lastly, a discussion of our findings and their implications.

2. Literature review In this part, we will initially, examine the construct of entrepreneurial intention, and we will study different issues concerning women entrepreneurship.

2.1 Entrepreneurial intention Most studies in the field present entrepreneurship as the result of planned action guided by a certain degree of intentionality (Shapero and Sokol 1982; Gartner 1985; Bouchikhi 1993). Intentionality feeds into both the rational and personal aspects of the entrepreneur’s decision-making process in regard to the emerging opportunity that he or she has created or discovered (Hernandez and Marco 2006). Entrepreneurial intention is the dynamics that enables individuals to design their projects by encouraging them simultaneously to externalize their desire to become entrepreneurs and internalize a certain number of environmental constraints (De La Ville 2004). More generally, intention makes it possible for entrepreneurs to develop a strong, dialogical relationship with their projects, which enables them to incorporate a large number of changes and perspectives in order to make them viable (Bruyat 1994; Fayolle 2004).

As suggested in the model proposed by Ajzen (1985), for the individual, intention marks the moment when beliefs concerning desirability and feasibility converge. Desirability is what prompts the individual to perceive a certain number of desirable and positive (entrepreneurial) behaviors (Krueger and Brazeal 1994). Feasibility is what prompts the individual to consider (entrepreneurial) behaviors as belonging to his or her field of competence (Bandura 1977). Desirability and feasibility are both the object of a learning process (Fishbein and Ajzen 1975) and are strongly determined by cultural and social factors.

Desirability and feasibility are perceptions which, when combined, give rise to entrepreneurial intention (Fayolle 2002). It is important to situate the normative anchoring of these perceptions: it informs us about the way in which they are linked to affects (subjective norms) and cultural rules (collective norms). According to Bandura (1977), collective representations constitute the cultural matrix of a group or a nation. This makes it possible to measure the direct and indirect impacts of culture on the motivational and intentional schema. To a substantial degree, perceptions of desirability are defined by subjective norms, while perceptions of feasibility are defined by an (actionable) synthesis of subjective and collective norms (Ajzen 1985).

Nevertheless, Bandura (1977) observes that some perceptions are largely influenced by collective norms: perceptions of legitimacy or appropriateness (Radu and Redien-Collot 2008).

2.2 The entrepreneurial intention of women According to Brush (1992), the role of sex in the construction of the individual and of the entrepreneurial process is relatively easy to track. The specificities characterizing women’s access to the field of entrepreneurship are associated with socio-cultural constructs that often have deep roots in education and

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Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot childhood, even when the educational system proclaims perfect gender equality or a soon-to-be-successful assault on gender equality.

Meanwhile, the environment is characterized by the presence of substantial barriers that women entrepreneurs have to confront, namely the hostility of banks, suppliers and networks of entrepreneurs. Fisher et al. (1993), and Watson and Newby (2005) provide an overall vision of the studies carried out on obstacles to female entrepreneurship. They underline that, since the late 1980s, entrepreneurial studies have been characterized by two feminist currents: social feminism, which identifies differences in approaches to entrepreneurship located in early processes of socialization taking recurrent explicit and implicit forms. liberal feminism, which defends the idea of equal opportunities for men and women in terms of access to entrepreneurship and underlines the fact that women have more problems than men in developing their enterprises and, consequently, structure their firms differently because they find it hard to access certain kinds of resources and are victims of various kinds of discrimination.

When applied to entrepreneurship, social and liberal feminism postulate that, historically, inequalities exist and that a reformist approach applying egalitarian policies would make it possible to eradicate them (Baughn et al. 2006).

Nevertheless, in terms of entrepreneurial intention, there are still pronounced contrasts between men and women. Taking inspiration from the theory of planned behavior (Ajzen, 1985), Mueller (2004) carried out a comparative international study in which he highlighted that women’s entrepreneurial intentions were less ambitious than men’s. He explained this phenomenon in reference to a minor locus of control and a propensity to take fewer risks in the female populations studied. Nevertheless, as Bayad and Bourguiba (2006) observe, these two factors do not entirely explain why women are less involved in entrepreneurship than men.

Gundry et al. (2002) underline the degree to which the success of female entrepreneurs is conditioned by the economic context. Nevertheless, as Smith et al. (1997) point out, the economic context is organized in function of male and female role models in which, in the majority of cultures, stereotypes continue to attribute a wider range of legitimate professions, functions and sectors to men than to women. These stereotypes have a decisive influence on professional life and business culture (Gundry et al. 2002). According to Mueller (2004), the emergence of female entrepreneurial intention is, of necessity, affected by such stereotypes.

3. Research design As Mueller (2004) observes, all countries are characterized by cultural factors that either inhibit or encourage female entrepreneurial intention. According to the results of the comparative study by Langowitz and Minitti (2007), female entrepreneurial intention is always less pronounced than its male equivalent due to issues associated with their internal locus of control and their lesser propensity to take risks (Mueller 2004).

Nevertheless, the authors underline the fact that the contrast between men and women in terms of entrepreneurial intention is stronger in developed countries and less pronounced in developing countries. The Saudi Arabia of 2012 presents a particular case of an economy in transition which calls Mueller’s results into question. Our objective is, then, to advance our understanding of the role of the cultural context – linked to the question of gender in the development of female entrepreneurial intention.

Our study thus attempts to articulate a gender-based approach in order to better understand the role of the cultural context in the development of female entrepreneurial intention in Saudi Arabia.

In the field that interests us, it means culture, we can have three types of major impact on perceptions at the origin of entrepreneurial intention : 

the desire to become involved in entrepreneurship (desirability) nourished by the perceived attractiveness of entrepreneurship.



their capacity to take risks, or, in other words, not to (entirely) respect certain subjective and collective norms in order to achieve their goals ; in other words, their perception of appropriateness, which could prompt them to run the risk of, on occasion, seeming improper.

3

Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot 

their confidence in themselves (internal locus of control) and their feeling of self-efficacy when confronted by a new object (entrepreneurial project), nourished by a capacity to compare subjective and collective norms; in other words, their perception of feasibility.

4. Methodology As we mentioned earlier, in order to study the entrepreneurial intention of young Saudi women, we would like to analyze the desirability, and their perceptions of feasibility and appropriateness. We also intend to provide an overall view of the motivations of young Saudi women and their fears concerning entrepreneurship, as well as of their professional strategies and, more particularly, the perception of the resources which they are able to access to help them achieve their goals. So we chose a quantitative method in order to have a first overview of the entrepreneurial intentions of Saudi women. We will adopt qualitative methods in a second step and it would be the object of another research.

5. The sample In order to generate representative statistical data, we adopted a quantitative approach. So, it was necessary to constitute a significant sample which took into account the entrepreneurial intention of young Saudi women in both modest and more ambitious projects. We therefore targeted the student population, more particularly that part of the student population likely to have a more open attitude to the outside world, or, in other words, female students in international disciplines. Indeed, Kabasakal and Bodur (2002) observe that in these disciplines, young people have a greater propensity to become involved in entrepreneurship, whether it involves taking over the family firm, setting up a business, or focusing on innovation. Consequently, our sample does not reflect the young Saudi population as a whole, but the population likely to express the most advanced, and, at the same time, the most diversified desires in the field of entrepreneurship.

For reasons of convenience, we distributed the questionnaire to 75 female students in the University in which one of the co-authors teaches. The questionnaires were distributed to students from the first year through the sixth year where 80% of them are the third and fourth years of university, aged between 18 and 25 with a median age of 20, and studying different subjects: 90% in economics and management, and the rest in technical specialties and subjects in the human sciences.

6. The questionnaire and its distribution In order to provide a detailed panorama of the entrepreneurial intention of young Saudi women, we included in our questionnaire questions of a general order, as well as questions about desirability, appropriateness and feasibility. The principal themes were: the intention to set up a business; the period in which a business was set up; the motivations for setting up a business, the link between culture and intention; the field of setting up a business and difficulties encountered in setting up a business. In terms of questions, we opted for dichotomic questions or multiple choice ones with a view to making it easier to analyze the answers. All the questionnaires were translated into Arabic, handed out at the beginning of the course, and returned at the nd end of the 2 semester.

6.1 Data analysis The analysis was done on SPSS data analysis software (Version 19) using variables defined in the questionnaire, namely a causal link between gender and entrepreneurial intention, female motivations in entrepreneurship, perceived obstacles, culture and entrepreneurial intention, the capacity of women to set up a company, the field in which it is intended to set up a company, etc. The interpretation of results was based on frequencies and percentages of main variables related to the research questioning and also on main significant relations between variables by using cross-tabulations.

7. Results 7.1 Entrepreneurial intention According to our research, 70,6% of the respondents want to launch a venture against 23% who do not know if they will create a firm and 7% only who do not want to become entrepreneurs. As regards the timeframe of creation envisioned by students, 11% of women intend to create a new venture after their studies : 20% of female students have no opinion against. In contrast, we find female (47%) who feel unable to undertake before they have acquired some professional experience.

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Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot

7.2 Entrepreneurial Motivation Fourty percent of female students want to undertake a venture because they want to realize their dreams.

35% among them want to become entrepreneurs because they want “to evolve within an area they want”, followed by 33% of respondents who claimed that their entrepreneurial project was a quest for autonomy. In the same vein, there are 25% female respondents who seek the possibility “to have a good social status” in engaging into entrepreneurship. Finally, 9,3% female respondents are eager to become entrepreneurs because they do not want to have a boss over their head. No female students who would like to create a venture to do like their parents.

Table 1: Motivations for setting up an enterprise

Female

Motivations for setting up an enterprise Make my Don’t have a Be Do as my Enjoy a high dreams boss to autonomous parents do social status come true answer to 25 30 0 7 19

Work in an area that we Other like 26 1

No response

Total

3

7.3 Entrepreneurial feasibility Women are conscious of the external barriers that they will face if they launch a venture. 64% among them answered no to the question “do you think it’s easy for a woman to create her own venture in their country” against 21% who think it’s easy and 13% don’t know if it’s easy or not.

7.4 Perceived skills and Entrepreneurial capacity Saudi female students’ entrepreneurial self-confidence is relatively important. According to our research, around 59% among them think that they have sufficient skills to launch a business. 17% among them think that “no one will allow them credibility” and 17% think it’s frowned upon in her country to be a woman entrepreneur.

About 21% of these female students doubt about their ability to take in what they feel they cannot find the resources banking and / or financial resources. More surprising, only 3% quoted “ this is not a job for a woman”. According to these results, it seems that Saudi Arabian women are free to have their own business but they are not very confident in their skills and for some of them could have financial problems.

Four percent of the female sample did not answer the question concerning their sectorial preference for a business venture. Among the respondents, 44% would like to have a shop, 25,3% would run a service; 8% would launch a business in the sewing/handicraft industry, and 8% would create a company in the sector of tourism. Among the respondents, 10,6% gave a second answer and specified that they would launch a business such as art gallery, beauty salon, bookshops, education centers, integrated cafés for women , integrated commercial complex for women. One respondent has mentioned that she would create a business in the technological industry.

7.5 Entrepreneurial appropriateness in the cultural context It is possible that Saudi women students feel that they are determined in their career choice since they are 82,6% to formulate answer when they were asked about their careers projects. But, they feel certainly tugged between domestic duties and their possible professional ambitions. In addition, it is possible for a small number among them that they hesitate again between employment career and entrepreneurial project (13.3%). In contrary, for the 82,6% that clearly made state of their professional projects, the majority, having their own venture comes in the first position with 53.3%, when 29.3% prefer to be an employee and 13.3% would like to be employed and try to create has new venture. Anyway, only 2 women declared wanting to be a housewife (2,7%).

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Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot Table 2: The doubts expressed by female students about their self-perceived entrepreneurial capacity Total (*) This is not a job for a woman I do not have enough skills (I need to be better prepared) Nobody would find me me credible This is frowned upon in my country Others (financial Incapacity) Total female sample Total female sample with doubts about their capacity

1 17 5 5 6 75 29

% (75) 1.3 22.6 6.6 6.6 8

% (29) 3.4 58.6 17.2 17.2 20.7

7.6 Career orientation and sector for new business With this question, we wanted to confirm the quest of autonomy of Saudi women. So, 40% among them would like to create their own business. 22% to be employed, 10% to be employed and create their own business, and only 2% among them would like to be a housewife. As for the privileged sector, shops (20%) and services including tourism (around 16%), are the sectors designed by respondents. Only 4% among them quoted the sewing/handicraft as a possible future business.

7.7 External barriers 80% of respondents think that it’s difficult for a woman to create her own venture because it was very difficult to her administratively. Around 35% think that it’s frowned up by society. 23% answered that it depends on religion, 19% parents would not permit it and 7% “require a tutor for administrative operations”.

Table 3: External barriers This is frowned upon by society Parents did not permit it It is very difficult for her administratively It all depends on religion Other: Require a tutor for administrative operations, Lack of confidence…

Total sample (female)

Total 26 14 60 17 5

% 34.7 18.7 80 22.6 6.7

75

-

8. Discussion and conclusion According to our research, approximately 71% of women wish to create a venture. An important proportion of educated Saudi women seem to be eager to emancipate. Saudi women’s entrepreneurial desirability may be at the same time exacerbated by cultural constraints and new legal initiatives that attempt to encourage women’s business and professional initiatives. We can notice that the majority of the respondents locate the concretization of their entrepreneurial project immediately after their graduation: it stresses at the same time their eagerness for economic autonomy and their self-confidence. At the same time, the respondents seem to have clear ideas concerning their future entrepreneurial project. They convey desirability: 36% of the female students say that they want “to evolve in a domain which pleases them” and 33% that they want to “be autonomous”. In the same vein, only 2% of the respondents have declared that they long for housewife activities. If we focus on Saudi female students’ perceptions of entrepreneurial feasibility, we observe that 68% of the respondents are pessimistic concerning the external barriers, that is, the national conditions of assistance and support to their entrepreneurial initiatives. These perceptions are mostly due to their social and cultural environment which is not very favorable to women in general. This fact is confirmed by other figures hinting at entrepreneurial appropriateness: an important proportion of respondents (26%) does not feel at ease with their relatives’ and friends’ possible ironical comments and 31% of the respondents fear to hurt their family and to be in conflict with religious principles if they launch a business. Thus, the perception of appropriateness partially determines the respondents’ perception of feasibility in the context of business venture. Appropriateness also plays an important role in Saudi female students’ choice of their industry for their future business. A vast majority sees their business in the service and commerce industries because they are clearly feminized. They want to locate their entrepreneurial project in a sector where they can nurture obvious professional legitimacy.

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Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot As we can see in the context of Saudi female students’ entrepreneurial motivation, culture determines individual desirability and perceptions of appropriateness that encourage individuals to test their ideas and examine the feasibility of a venture project. The close examination of perceptions of appropriateness reveals that Saudi female students prefer to comply with mainstream norms rather than explore new domains of activities. In other words, the majority of respondents has developed an authentic entrepreneurial attitude but needs specific encouragement when they develop their entrepreneurial behaviors and postures. In order to reinforce individuals’ entrepreneurial self-confidence, Radu and Redien-Collot (2008) emphasize the importance of collective representations and models: institutional and media communication must offer a broad scope of situated female individual models who have succeeded in launching and developing their business in traditional and innovative industries. The situated entrepreneurial models must be integrated within present societal and cultural debates and challenges: they do not have to be heroic and prestigious; they should reflect market demand and point out the existence of various business opportunities so that future female entrepreneur see these opportunities accessible and their entrepreneurial initiatives feasible.

Public and media communication about female entrepreneurship should both consolidate its legitimacy and its accessibility. These strategies of communication must target men and women because male and female interactions produce gender norms in economic life.

Moreover, in order to encourage Saudi female students’ entrepreneurial feasibility, we would recommend the implementation of training programs targeting more specifically women holding an entrepreneurial project in order to validate their skills. These programs should also encourage female entrepreneurs’ situated leadership in addressing women’s interactions with their direct economic and social environment. There are some limitations in our research: it is based on a student sample. It may not reflect all the challenges that Saudi women may have to face today. In a future study, we would like to continue our investigations and lead a qualitative research among other samples of Saudi female population and among Saudi female entrepreneurs in order to identify similarities and contrasts in the construct of their motivations.

References Ajzen, I. (1985), From intentions to actions: A theory of planned behaviour, in J. Kuhl and J. Beckman (eds), Action-control: From cognition to behaviour, pp. 11- 39. Heidelberg, Germany: Springer.

Bandura, A. (1977), Self-Efficacy : Toward a Unifying Theory of Behavioral Change, Psychological Review, 84, 191-215.

Baughn, C., & Chua, B.-L., Neupert, K. (2006), The normative context for women’s participation in entrepreneurship: a multicountry study, Entrepreneurship: Theory and Practice, 30 (5): 687-708.

Bouchikhi, H. (1993), A constructivist framework for understanding entrepreneurship performance, Organization Studies, 14 (4): 549-570.

Brush, C. (1992), Research on women business owners: past trends, a new perspective and future directions, Entrepreneurship: Theory & Practice, 16 (4): 5-30.

Bruyat, C. (1994), Contributions épistémologiques au domaine entrepreneurial, Revue Française de Gestion, 101 : 113-125.

De la Ville, V-I. (2001), L’émergence du projet entrepreneurial : apprentissages, improvisations, irréversibilités, Revue de l’entrepreneuriat, 1 (1) : 43-60.

Fayolle, A. (2002), Insights to research on the entrepreneurial process from a study of perceptions of entrepreneurship and entrepreneurs, Journal of Enterprising Culture, 10 (4): 257-285.

Fayolle, A. (2004), Entrepreneuriat: Apprendre à entreprendre, Paris : Dunod.

Fishbein, M. & Ajzen, I. (1975), Belief attitudes, intention and behavior: An introduction to theory and research. Reading, MA: Addision-Wesley.

Fischer, E. & Reuber, R., Dyke, L. (1993). A Theoretical Overview and Extension of Research on Sex, Gender and Entrepreneurship. Journal of Business Venturing, 8: 151-168.

Gartner, W.B. (1985), A conceptual framework for describing the phenomenon of new venture creation, Academy of Management Review, 10 (4): 696-706.

GEM, (2009), Global Entrepreneurship Monitor, Global Report, edited by Niels Bosma and Jonathan Levie.

Gundry, L., Ben Yoseph, M, & Posig, M. (2002), Contemporary perspectives on women’s entrepreneurship: A review and strategic recommendations, Journal of Enterprising Culture, 10 (1): 67-86.

Hampole, N. (2010), Advancing Entrepreneurship with Women in Saudi Arabia, accessed 19 September 2012 bsr.org/en/ourinsights/blog-view/advancing-entrepreneurship-with-women-in-saudi-arabia Hernandez, E-M., & Marco, L. (2006), Entrepreneuriat et décision : de l’intention à l’acte, Paris : Ed. Eska.

ILO (2010), Women in Labour Markets: Measuring Progress, Identifying Challenges, http://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_elm/--trends/documents/publication/wcms_123835.pdf. accessed 20 September 2012.

Kabasakal, H. & Bodur,M. (2002), Arabic cluster: A bridge between East and West, Journal of World Business, 37 (1): 40-54.

Krueger, N.F., & Brazeal, D.V. (1994), “Entrepreneurial potential and potential entrepreneurs ». Entrepreneurship Theory & Practice, 18, p. 91-104.

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Laurice Alexandre-Leclair, Wassim Aloulou and Renaud Redien-Collot Langowitz, N., & Minitti, M. (2007), The entrepreneurial propensity of women, Entrepreneurship Theory and Practice, 31(3), 341–364.

Mueller, S.L. (2004). Gender gaps in potential for entrepreneurship across countries and cultures. Journal of Developmental Entrepreneurship, 9(3), 199–220.

Radu, M., & Redien-Collot, R. (2008), The social Representation of Entrepreneurs in the French Press: Desirable and Feasible Models, International Small Business Journal, 26 (3): 259-298.

Shapero, A., Sokol, L. (1982) The social dimensions of entrepreneurship, in C.A. Kent, D.L. Sexton and K.H. Vesper (eds), Encyclopedia of Entrepreneurship, pp. 72-90. Englewood Cliffs, NJ: Prentice Hall.

The World Bank (2009), The Status of Progress of Women in the Middle East and North Africa, Washington D.C, 2009.

Watson, J., & Newby, R. (2005), Bilogical Sex, Stereotypical Sex-Roles, and SME Owner Characteristics. International Journal of Entrepreneurship Behaviour and Research, 11 (2), pp. 129-43.

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Innovation and Entrepreneurship: Smart, Sustainable and Inclusive Growth Hanadi Mubarak Al-Mubaraki1 and Michael Busler2 1 Kuwait University, Kuwait 2 Richard Stockton College, USA2 pro5383526@yahoo.com michael.busler@stockton.edu Abstract: There is broad recognition today that entrepreneurial, knowledge-based enterprises are prime creators of economic growth and that such ventures need unique business development services. However, there is no accord yet on the most effective means of providing such support or on the methods for evaluating the performance of these services.

Innovation is a powerful engine for expansion and for addressing societal and global challenges. The innovation drives economic growth and job creation and is important not only for high-tech sectors but for all economic sectors. While economists and policymakers worldwide have recognized the importance of technological innovation for growth, the relationship between innovation and entrepreneurship has been appreciated recently because the entrepreneurs play an important role in fomenting innovation. This paper critically reviews, identifies and analyzes the literature related to the economy for 21st century economic development strategy. The authors examine the importance of three priorities: 1) Smart Growth, 2) Sustainable Growth, and 3) Inclusive Growth. The research methodologies adopted in this research study are desk-research and case study of selected five countries. This paper provides evidence which is based on current literature concerning entrepreneurship and innovation as an effective tool for economic developments. The aim of this article is to highlight and to provide guidance, suggestions and recommendations to change the adoption of such programmers in order to stimulate the economic development cycles in Europe and GCC member states.

Keywords: economic development, technology, entrepreneurship, innovation

1. Introduction Historically, business incubation programs are a fairly recent phenomenon. Not surprisingly, the history of incubator program evaluation is similarly short, beginning in the late 1980s with studies by Campbell and Allen (1987), and Allen and Weinburg (1988). These initial studies evaluated business incubation programs largely in terms of the number of new jobs created, and the success or failure rates of incubated business in comparison to some imputed success or failure rate for new businesses in general. An early objective attempt to evaluate business incubation programs in terms of their costs and benefits was a 1990 study of programs in the State of Michigan by Thomas Lyons.

It is well known acknowledged that business incubation is a tool for economic development. Business incubators help to strengthen the local economies because their small business tenants and clients survive inside the incubators the survival rate 90% (InfoDev., 2009; Molnar et. al., 1997; Al-Mubaraki. et. al., 2010).

This rate lead the governments fund and support business incubators to increase the demand of jobs creation, growth of successful start up companies, support the innovation to be converted to innovated product and st services. Finally, last not lest to fostering entrepreneurship in community toward 21 century.

InfoDev., (2006) defines Business & Innovation Center (Incubator) is a physical facility aimed promoting economic development of its community by supporting start-up companies and their business development.

These innovation centers provide set of services such as 1) start-up consulting, 2) business planning, 3) consulting in business development, 4) financing process, 5) shared services. In addition, the definition includes the reflection of the key elements of successful incubator. The letter I means Innovation and Entrepreneurship, the letter N means Networks and collaboration, the letter C means Competitiveness, the letter U Understanding the Roles: Public-Private, the letter B means Buy-In, the letter A means Access to resources, the letter T means Technologies, the letter O means Outreach and the letter R means Review: Monitoring and Evaluation.

The objective of this paper is twofold: 1) to discuss and analyze the adoption of innovation in Europe as success case studies, 2) to identify the indicators to be examine such as 1) Smart Growth, 2) Sustainable Growth, and 3) Inclusive Growth. The issue questions addressed are: 1) what are the benefits of innovation as

9

Hanadi Mubarak Al-Mubaraki and Michael Busler a value-added product for entrepreneurs, employment creation and enterprises, and 2) what are the best practices learned from the successful European case studies.

The remainder of the paper is as follows: Section 2 provides a thorough review of the literature. Section 3 shows the discussion of five successful European case. In section 4, the authors briefly discuss the research methodology used to facilitate the objectives. Section 5 discusses the study findings. Section 6 concludes on innovation and entrepreneurship as value-added from European countries.

2. Literature review The study indicated Business incubators can help young firms to survive and grow during their start-up years, and can play a key role in the economic development of a community or region. In developing countries including Kuwait and the other GCC member states, business incubators can be particularly valuable in helping to develop local economies, promote technology transfer, create new enterprises and generate jobs. In addition, the survey results are used to make recommendations for how to maximize the success of incubators, including matching services offered to the needs of clients and involving a range of community stakeholders in the development of their programs. A number of options are proposed for developing and expanding the business incubator concept in Kuwait and the GCC member states (Al-Mubaraki and Busler, 2010a).

Three practical business incubation European models have been discussed based on their adoption as a case study, examples: the United Kingdom, France, and Germany. These three countries contain approximately 83% of all the incubators located throughout Europe today. This study has focused on 1) the nature of incubator financing, 2) the incubator’s mission and strategy, and 3) graduation it in turn offers its incubatee clients. The S.W.O.T analysis of each case study reflects the strengths of each program and complies with its mission and objectives showing great opportunity with the future plans and performance of each program. In conclusion, business incubators contribute to the international economy and play a vital role not only in the economic recovery but also in economic development. International adaptation leads to the support of diverse economies, the commercialization of new technologies, jobs creation and wealth building. In addition, more than 7000 incubation programs worldwide is engaged in supporting the development of new high-growth businesses. Today, Europe has funding in incubators with the goal of job creation and economic recovery (AlMubaraki and Busler, 2010b).

This paper is based on a mixed-method approach. This study has clearly stated that the business incubation is a tool for economic development based on economic indicator from incubation outcomes such as 1) Entrepreneurs, 2) Companies created, 3) Jobs created, and 4) Incubator companies. This is evident in both the United States of America and the developed countries, but still taking shape in the developing countries such as the GCC member states (Al-Mubaraki and Busler, 2011).

Another recent study (Al-Mubaraki and SchrĂśdl, 2011; 2012) proposed measurement model is concerning the international context. The four measured indicators are Graduation of Businesses Incubated, Success of Businesses Incubated, Jobs Created by Incubation and Salaries Paid by Incubator Clients. The recommendations from the study could be a help to develop business incubation guidelines for best practice in GCC, which leads the economic development worldwide and GCC. The five strategic outcomes of the research findings are: 1) entrepreneurial climate 62% was the primary purpose of their incubator, 2) commercialization technologies indicate 55.5%, 3) employment 51.6%, and 4) innovation and diversifying local economies 46.1%. The research adds value to current literature on sustainability of incubators, and outcomes. It provides useful road map to both academicians and practitioners through experiences of worldwide incubator implementations (Al-Mubaraki and Busler, 2012).

3. Case studies For challenged rural communities, including many Native American reservations, incubators cannot be standalone solutions. Without good infrastructure, entrepreneurs cannot operate or sell competitively.

Without access to capital, start-up activity and growth of businesses will be limited. Without a trained work force and experienced managers, small businesses are competitively disadvantaged, and without the government and political support to minimize barriers, initiative is stifled. The profile of each case study provides a wide-ranging overview included the region of each innovation program, the number of companies

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Hanadi Mubarak Al-Mubaraki and Michael Busler in the region (2008), region population (2008), funded year, stakeholders and catchment area. Table 1 reveal the profile of case study source (EURO, 2010).

Table 1: Profile of case study

Source: (EURP, 2010)

Country Profile

Spain

UK

Austria

France

Italy

Region

Navarra

North East of England

Styria

Normandy

Companies in the region (2008)

43.847

-

51.000

13.200

Region population (2008) Founded year

620.377

2.515.442

1.200.000

220.000

Trentino Province 48.525 (registered at Chamber of Commerce) 470.000

1988

1994

1981

1987

1987

Stakeholders

45 companies and regional organizations; the Government of Navarra is the major Stakeholders

Existing and potential tenants, general public of North East England, members of the regional business community, existing and potential partner organizations

Styrian government, banks

Local government Enterprises

Catchment area

10.391 m

North East England

Styria

1.450.000 Citizens

Local Government (Provincia autonoma di Trento), Trento University, Provincial Research Centres, industrial and artisan associations Inconsistent with other examples

2

3.1 Spain: CEI Navarra The Centro Europeo de Empresas e Innovación de Navarra S.A. (CEIN, S.A.) is a non-profit making association that depends on the Department of Industry and Technology, Commerce and Employment of the Regional Government of Navarre. The region’s main private businesses, financial entities and associations participate in this association, the objective of which is to strengthen the economic development of Navarre through the promotion of entrepreneurs and by supporting new business projects and innovative activities among small and medium sized businesses (SMEs).

As managers of a European Business and Innovation Centre (BIC), CEIN has a European philosophy in terms of work methodology and its constant search for innovative services and the detection of opportunities for new businesses or economic development projects in collaboration with other regions in Europe. BICs, which were created in 1984 by the European Commission, are specially designed to promote the creation of small and medium sized innovative businesses and thereby contribute to the development of the local economy.

In Spain, CEI Navarra sign Strategic Partnerships with three bodies. 

Partnership with organizations such as, The European BIC Network (EBN), The Spanish Association of Business and Innovation Centres (ANCES), The National Association of Development Agencies, The Research & Development Information Points Network.



Partnership with Governmental bodies such as The Government of Navarre, The Council of Pamplona and, The Council of Tudela.



Partnership with Universities and Research Centres such as, Public University of Navarre (UPNA) and University of Navarre (UNAV) (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

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Hanadi Mubarak Al-Mubaraki and Michael Busler The CEI Navarra provides three major value added services as New technology-based innovative enterprises, Innovative Business Club and Seed capital services which aim to support the several regional public/private sector (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

3.2 UK: North east business and innovation centre The North East Business and Innovation Centre (BIC)’s story began in 1994, when the make-up of the North East region and British industry itself was undergoing a transformation. Traditional industries were being resigned to the history books, and with this followed a great deal of uncertainty. Eventually, however, their demise led to a new breed of businesses. Organizations like the BIC began to emerge, and helped to set the foundations for the development of an enterprising and innovative culture in the region. Designed to nurture new businesses by providing access to a network of experts, accommodation and business support, the BIC opened in June 1994, providing a home for 22 businesses and support for many more region wide. In 2010, the BIC site can accommodate over 160 businesses from a range of sectors and covers a 14-acre site. Their business support team assists over 300 businesses in the start up process each year (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

In UK, North East Business and Innovation Centre cooperate with three Strategic Partnerships bodies. First, Partnership with Networks such as the European Business and Innovation Centre Network (EBN). Second, Governmental bodies as the UK Government’s regional development agency for the North East and Sunderland City Council and Newcastle City Council. Third, Universities & Research Centres, The Sunderland Science Park belong the University of Sunderland and Sunderland City Council (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

The North East Business and Innovation Centre provide three major value added Services. First divisions services to provide the ideas of generation and youth enterprise facility, a product development company, a commercial marketing firm and an IT service provider. Second, Tenant business mentor services act as adviser to all incubated businesses and to create a gateway to a range of technical and business support services (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

3.3 Austria: SFG-Innofinanz GmbH The Styrian Business Development Agency (SFG) supports businesses and the Styrian economy as such in different ways, namely by: 

Granting subsidies to enterprises, especially for founders, R & D activities, qualification of employees, networking etc.,



Carrying out projects with companies (i.e., Technology Transfer Projects, Regional Development Projects) setting up networks, for example, cluster organisations, which are set up within a field of competence of Styria (Automotive, Timber Industry, Materials etc.),



Providing infrastructure, so called “Impulse Centres”, which comprise incubator centres, technology parks and innovation centres.

The Impulse Centres play an important role in Styria’s business strategy laid down in the strategic guideline ‘Regions and Infrastructure’. The 30 centres which are distributed over the whole of Styria, offer space for more than 460 companies with approximately 4.000 employees, allowing them to implement ideas, initiatives and innovations. It is SFG’s goal to further expansion of these platforms of entrepreneurial activity and to offer an improved general framework to innovative companies in their foundation, development and growth phase.

To make this possible, SFG maintains the already existing centres and promotes access to knowledge infrastructure for companies in the regions (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

In Austria, SFG-Innofinanz GmbH worked with three Strategic Partnerships bodies. First, Partnership with Networks such as, ACstyria Autocluster GmbH, Human technology Styria GmbH, Holzcluster Styria GmbH, Materialscluster Styria GmbH, TechforTaste.net GmbH, NanoNet Styria, and Creative Industries Styria GmbH. Second, Government of Styria. Third, Universities and Research Centers such as Joanneum Research and Universities, for example, Montanuniversitat Leoben, Technische Universitat Graz, Karl-Franzens-Universitat, Medizinische Universitat (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

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Hanadi Mubarak Al-Mubaraki and Michael Busler

3.4 France: SYNERGIA - Agence de developpement Synergia is the economical development agency of the city of Caen in France. Synergia supports the creation of innovative companies and accelerates the development of existing ones by supporting any innovative initiative. Its missions are the following: 

To accelerate innovation,



To support the creation and the development of companies,



To attract and establish national and international projects,



To promote and animate the territory.

Synergia manages 5 incubators: 

Emergence



Iliade



Odyssey



Norlanda, recent incubator dedicated to nautical activities



Plug n’ Work, incubator and business premises for technological companies; recently integrated to the Effiscience Science Park (October 2008).

Synergia is a member of the ESINET network. Synergia contributes to the reinforcement of performance zones and competitiveness clusters and plays an active role in territorial marketing and events, focused, in particular, on encouraging the development of innovation and the networking of partners from local business, research and further education institutions (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009). In France, SYNERGIA-Agence de developpement cooperate with three Strategic Partnerships bodies. Partnership Networks such as European Business & Innovation Centre Network (EBN), International Association of Science Parks (IASP),Technology Development Network (RDT). Local Government and University Basse Normandie, for example, Normandie Incubation and GANIL-ENSICAEN (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

The SYNERGIA-Agence de development provides three major value added services. Innovation through accompanies to create innovative businesses and accelerates companies growth, public and private technological and social potential such as, Development of infrastructures and Creation of new activities and the strategy of these services is economic diversification in the Industries and concludes by Relying on business, research institutions, training industries and industry development such as Nano electronics, Boat industry, Eco industries, and Archives and Multimedia and Technology commercialization (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

3.5 Italy: TRENTINO SVILUPPO S.P.A. Trentino Sviluppo is the agency set up by the Autonomous Province of Trento to foster the sustainable development of the Trentino system by taking action and providing services aimed at supporting the growth of business skills and the capacity for innovation. Trentino Sviluppo S.P.A. recognised in 1992 by the European Business and Innovation Centre Network (EBN) in Brussels as Full Member within its European Network, runs six Business Innovation Centres (one main site in Rovereto plus five satellites) in the Trentino Province. It supports incubation of new start-ups, and it fosters innovation in existing SME’s. BIC’s are set up in modular units, equipped and ready for use, and tenants are provided with support services related to business start-up, partnership with Universities, technology transfer, technology plants funding, training schemes, information offices, equity capital, etc. One of the most effective tools used by Trentino Sviluppo for the support of local development is the management of Real Estate activities (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

In Italy, TRENTINO SVILUPPO S.P.A cooperates with three Strategic Partnerships bodies: 

Network with EBN (European Business and Innovation Centre Network), IASP (International Association of Scientific Parks), Enterprise Europe Network, and IBAN (Italian Business Angels Network).



Governmental bodies such as Provincia autonoma di Trento.

13

Hanadi Mubarak Al-Mubaraki and Michael Busler



Universities & Research Centre, for example, Trento University, Fondazione Bruno Kessler, and Fondazione Edmund Mach (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

It provides four major value added services such as Support for industrial R&D to provide information to companies, national and European funding opportunities for industrial research, Technology transfer to support local companies in identifying effective improvement programmes, Senior Innovation Advisors to supporting innovation and technology transfer, Innovation Lab to innovate products and services by learning creativity-based techniques by using experiment to develop and share new proposals (EURP, 2010; EBN, 2010; EBN, 2008; 2009; Vanrie, 2009).

4. Research methodology The research methodology that has been used in this research study is compromised of desk-research, interviews and case study of 5 incubator organisations in Europe such as 1) Spain, 2) UK, 3) France, 4) Italy, and 5) Austria.

Table 1 shows the analysis of the case studies divided to the three categories in each country such as smart growth, sustainable growth and inclusive growth. Each category used several indicators to be measured. First, smart growth used three indicators: 1) Number of tenants in incubators, 2) Number of tenants since the beginning of the incubator, and 3) Number of business plans produced during the year. Second, Sustainable growth used three indicators: 1) Number of start-ups created during the year, 2) Number of start-ups created since the beginning of the incubator, and 3) Enterprise Survival Rate. Finally, inclusive growth used five indicators: 1) Total employment by tenants, 2) Existing SMEs supported during the year, 3) Number of jobs created in the year in question (start-ups), 4) Number of jobs created in SMEs (client companies of BICs), and 5) Number of enterprise creation projects during the year. See Table 2.

Table 2: Case studies key indicators (all the results in 2009)

Source: (EURP, 2010)

Case studies (2009) No.

1

2

3

Categories

Key indicators

Smart Growth

Number of tenants in incubators Number of tenants since the beginning of the incubator

Sustainable Growth

Inclusive Growth

Spain

UK

Austria

France

Italy

18

105

170

33

83

109

489

800

33

105

Number of business plans produced during the year

58

111

3

47

77

Number of start-ups created during the year

11

111

3

31

13

Number of start-ups created since the beginning of the incubator

1716

4502

404

205

258

Enterprise Survival Rate

72%

75%

15%

90%

92%

Total employment by tenants

142

911

1750

99

650

Existing SMEs supported during the year

351

167

N.A.

87

62

22

115

7

61

69

N.A.

85

15

61

69

612

155

N.A.

72

223

Number of jobs created in the year in question (start-ups) Number of jobs created in SMEs (client companies of BICs) Number of enterprise creation projects during the year

5. Findings InfoDev. (2006) defines Business & Innovation Center (Incubator) is a physical facility aimed promoting economic development of its community by supporting start-up companies and their business development.

These innovation centers provide set of services such as 1) start-up consulting, 2) business planning, 3)

14

Hanadi Mubarak Al-Mubaraki and Michael Busler consulting in business development, 4) financing process, and 5) shared services. The Incubators are commonly linked with business support networks and technological innovation programs (Campbell, 1989; Petree, 1997). Furthermore, incubators fosters technological innovation and industrial renewal (Allen and Rahman, 1985; Smilor and Gill, 1986; Allen and McCluskey, 1990; Mian, 1996). Although, the technological innovation are supporting regional development through jobs creation (Allen and Levine, 1986; Mian, 1997; Thierstein and Wilhelm, 2001; Roper, 1999).

As can be seen in Table 3, all five cases presented here underscore the value of the innovation center in supporting the technological innovation through jobs creation and companies as well as through the nurturing of entrepreneurship spirit in a local community. To compare the maximum indicators among these innovation center, The North East Business and Innovation Centre (UK) present maximum indicators in the Number of business plans produced during the year 111 with an average for all case studies 59.2, Number of start-ups created during the year 111 with an average for all case studies 33.8, Number of start-ups created since the beginning of the incubator 4502 with an average for all case studies 1417, Number of jobs created in the year in (start-ups) 115 with an average for all case studies 154.8, and Number of jobs created in SMEs (client companies of BICs) 85 with an average for all case studies 157.5. The SFG-Innofinanz GmbH (Austria) present top performance in the three indicators such as Number of tenants in incubators 170 with an average for all case studies 81.8, Number of tenants since the beginning of the incubator 800 with an average for all case studies 307.2, and Total employment by tenants 1750 with an average for all case studies 710.4. The CEI Navarra present (Spain) two maximum indicators such as Existing SMEs supported during the year 351 with an average for all case studies 166.75, Number of enterprise creation projects during the year 612 with an average for all case studies 265.5. The SYNERGIA-Agence de developpement (France) present maximum percentage of survival rate 90% with an average percentage for all case studies 68.8 %.

Table 3: Maximum indicators with average of all case studies Categories

Spain 111 170

111

4502

800

Number of jobs created in SMEs (client companies of BICs Number of enterprise creation projects during the year

Number of jobs created in the year (start-ups)

115

85

54.8

57.5

1750

Italy

Average of indicator s over countries

61 2

351

UK Austri a

Existing SMEs supported during the year

Total employment by tenants

Inclusive Growth

Enterprise Survival Rate

Number of start-ups created since the beginning of the incubator

Number of start-ups created during the year

Sustainable Growth Number of business plans produced during the year

Number of tenants since the beginning of the incubator

Number of tenants in incubators

Countries

Max. indicators of all countries

Smart Growth

92%

81.8

307.2

59.2

33.8

1417

68.8

710.4

166.75

26 5.5

6. Conclusion In this systematic review, we have synthesized and analyzed concepts and problems related to innovation and Entrepreneurship research using, as our organizing guide, the three primary research orientations along which the literature has evolved.Innovation is the driver of the future growth, and it will shape the ideas and st technologies suitable for building the 21 century. Innovation outcomes will create new jobs and catalyze broadly shared economic growth. A business innovation centre is aimed promoting economic development of

15

Hanadi Mubarak Al-Mubaraki and Michael Busler its community by supporting start-up companies, and their business development and offers services to support the establishment and development of new as well as existing small and medium companies. Some innovation centre performs better than others. Several reasons may contribute to this difference in performance. 

If the innovation centre is established earlier than other centres, this will reflect positively on the sustainable survival rate.



Innovation center construct strategic relationship with an international organization such as European Business and Innovation Centre Network (EBN) and Governmental bodies and this led to technology transfer and successful best practices.



Countries offered value added services rather than others if the innovation centre received continues tangible, and in tangible services. This lead to a high number of tenant in incubators program and high number of start-up companies.



A case study such as UK present high numbers of jobs creation over the years.

Europe faces relentless global competition for talent, ideas and capital. At the same time, fiscal austerity requires governments to focus oftentimes scarce resources on a few areas and measures that have genuine potential to create sustainable jobs and growth. Most regions can only acquire a real competitive edge by finding niches or by mainstreaming new technology into traditional industries and exploiting their ‘smart’ regional potential. Smart specialization strategies can also be a powerful instrument to tackle social, environmental, climate and energy challenges, such as demographic change, resource efficiency, energy security and climate resilience. Entrepreneurship stands high on the political European agenda. The cases presented in this paper are all from Europe. Future work can be continued from other regions such as Middle East, and South America which will fetch positive lessons that are valuable for future expansion and development of science park or innovation centre.

References Allen, D. and Levine, V. (1986) Nurturing Advanced Technology Enterprises: Emerging Issues in State and Local Economic Development Policy, New York: Prager.

Allen, D. and McCluskey, R. (1990) Structure, Policy, Services, and Performance in the Business Incubator Industry, Entrepreneurship Theory and Practice. 15(2):61–77.

Allen, D. and Rahman, S. (1985) Small Business Incubators: A Positive Environment for Entrepreneurship, Journal of Small Business Management, 23 (July): 12–22.

Allen, D.N., and Weinberg, M.L. (1988) State Investment in Business Incubators, Public Administration Quarterly December (12), 196–215.

Al-Mubaraki, H., Al-Karaghouli, W. and Busler, M. (2010) The Creation of Business Incubators in Supporting Economic Developments, European, Mediterranean & Middle Eastern Conference on Information Systems 2010 (EMCIS2010), April 12-13, 2010, Abu Dhabi.

Al-Mubaraki, H. and Busler, M. (2010a) Business incubators: Findings from worldwide survey, and guidance for the G.C.C. states, Global Business Review, Vol.11(1), January-April, 2010.

Al-Mubaraki, H. and Busler, M. (2010b) Business incubators models of the USA and UK: A SWOT analysis’, World Association for Sustainable Development, WJEMSD Vol 6 No. 4 (335-354), 2010.

Al-Mubaraki, H. and Busler, M. (2011) The Incubators Economic Indicators: Mixed Approaches’, Journal of Case Research in Business and Economics, Published ISSN: 1941-3378 Online, Vol 4, August, 2011.

Al-Mubaraki, H. and Schrödl, H. (2011) Measuring the Effectiveness of Business Incubators: A Four Dimensions Approach from a Gulf Cooperation Council Perspective, Journal of Enterprising Culture, 19 (4), 435–452.

Al-Mubaraki, H. and Schrödl, H. (2012) Incubating Success towards Gulf Cooperation Council (GCC), International Journal of Innovation and Knowledge Management in Middle East & North Africa. Vol 1, No 2, 2012, Article 03 (31-56).

Al-Mubaraki, H. and Busler, M. (2012) Road Map of International Business Incubation Performance, Journal of International Business and Cultural Studies, Volume 6, 2012.

Campbell, C. and Allen, D.N. (1987) The Small Business Incubator Industry: Micro-level Economic Development, Economic Development Quarterly 1 (2), 178–191.

Campbell, C. (1989) Change agents in the new economy: Business incubators and economic development, Economic Development Review, 7(2), 56–59.

European Business and Innovation Centre Network (EBN), (2008) Business Innovation Centres (BIC) observatory facts and figures.

European Business and Innovation Centre Network (EBN), (2009) Business Innovation Centres (BIC) observatory facts and figures.

European Business and Innovation Centre Network (EBN). (2010) The Smart Guide to Innovation-Based Incubators (IBI) Available online at: http://ec.europa.eu/regional_policy/sources/docoffic/2007/working/innovation_incubator.pdf.

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Hanadi Mubarak Al-Mubaraki and Michael Busler European Union Regional Policy (EURP), (2010) The smart guide to innovation based incubators. Online available at: http://www.ebn.eu/assets/assets/pdf/news/final_case-studies-nma-07042010.pdf. [Accessed on August 5, 2012] InfoDev (2006) Online available at: www.idisc.net/en/DocumentArticle.38688.html InfoDev. (2009) Mixed-use Incubator Handbook: A Start-up Guide for Incubator Developers, JBV 2002. “Lesson 17: Business incubators.” Online available at: www.jbv.com/lessons/lesson17. [Accessed on July 5, 2011].

Mian, S. (1996) Assessing the value-added contributions of university technology business incubators to tenant firms, Research Policy, 25: p. 325-335.

Mian, S. (1997) Assessing and managing the university technology Incubator: An Integrative Framework, Journal of Business Venturing, 12: p. 251-285.

Molnar, L, Adkins, D, Yolanda, B, Grimes, D, Sherman, H and Tornatzky, L. (1997) Business Incubation Works, Athens, Ohio: NBIA Publications.

Petree, R. Petkov, R. and Spiro, E. (1997) Technology Parks-Concept and Organisation, Summary Report prepared for Center for Economic Development, Sofia. Online available at: http://www.ced.bg/. [Accessed on August 24, 2012].

Roper, S. (1999) Israel’s Technology Incubators: Repeatable Success or Costly Failures, Regional Studies, 33 (2): 175–80.

Smilor, R.W. and Gill, M.D. (1986) The New Business Incubator: Linking Talent, Technology, Capital, and Know-How, Massachusetts: Lexington Books.

Thierstein, A and Wilhelm, B. (2001) Incubator, Technology and Innovation Centres in Switzerland: Features and Policy Implications, Entrepreneurship and Regional Development, 13 (4): p. 315–31.

Vanrie, P. (2009) Case Studies a Survey of 14 BICs in Action, Europe Business & Innovation Centre Network (EBN).

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New Service Development in Small and Medium Accounting Practice Firms: The Italian Case Carlo Bagnoli 1, Maurizio Massaro2 and Filippo Zanin2 1 Venice University, Venice, Italy 2 Udine University, Udine, Italy bagnoli@unive.it maurizio.massaro@uniud.it filippo.zanin@uniud.it Abstract: Small and Medium Accounting Practice Firms (SMPs) have been recognized as a core element for fostering SMEs in order to keep their business economically and financially sustainable. Environmental change is pushing SMPs to innovate their services due to SMEs new needs and competitive challenge. Unfortunately, new service development has been recognized as a research field that requires specific approaches, also distinguishing between different service sectors. In order to fill this gap this paper analyzes the case of Innovation in Small Accounting Practice Firms. According to ResourceBased View using the Intellectual Capital framework, human capital, relational capital and structural capital are key factors for fostering innovation as well as strategic intent. Indeed, strategy is about the effort spent on being different, using internal and external resources. Thus, we analyze the role of intellectual capital and strategy intent on new service development. In order to test our model a questionnaire has been developed and provided in the North East of Italy to a sample of 11.267 small and medium accounting firms obtaining 2.266 responses and 961 completely filled forms. A logistic regression model was used to test our hypothesis considering the role of the SMPs’ size as a control variable. Results show how relational capital and human capital are key factors for fostering new service development. However if these variables are key elements in order to provide key sources for developing new service, the strategy intent operates as a prerequisite.

Indeed using the Treacy and Wiersema model we found that firms which carried out a service leadership strategy have a greater probability of developing new service than firms that compete following a cost leadership strategy..

Keywords: intellectual capital, strategy, new service development, innovation, LOGIT

1. Introduction Literature recognizes the increasing role of product innovation for fostering firms competitive advantage (Leitner, 2011) especially for Small and Medium Enterprises (SMEs). Due to their dimension SMEs usually use external firms for assisting them with accounting problems (Døving and Gooderham, 2008). Indeed, according to European Federation for Accountants and Auditors, Small and Medium-sized accounting Practices (SMPs) are European SMEs’ most important business advisors, since they support entrepreneurs keeping their grow economically and financially sustainable. Moreover, because of the expanded role beyond standard accounting services, SMPs have been recognized as multidisciplinary practices (Frank et al., 2001; Greenwood et al., 2002) whose service portfolio role has been enlarged overtime because of the changing needs in their clients.

Consequentially, SMPs have been pushed towards an increasing competition and an enlarged pressure on fees (N. Marriott and P. Marriott, 2000). Thus, the ability to manage new service development seems to be necessary for surviving. Unfortunately innovation in service industries seems to be an under-investigated topic (Ettlie and Rosenthal, 2011) especially since it has been written that it could require a specific theoretical approach “that demands distinctive theories of management” (Von Nordenflycht, 2010, p.155). Indeed, literature on product innovation recognizes that the ability to innovate is related to the capacity of creating a process that fosters intellectual capital (Leitner, 2011), but unfortunately only a few studies verify this linkage empirically (Aramburu and Sáenz, 2011; Leitner, 2011) and even fewer studies focuses on professional service business. Moreover, as recognized by Valencia et al., we assume that organizational culture is a key element for fostering or inhibiting innovation (Valencia et al., 2010). Indeed, intellectual capital gives the knowledge and offers a way for providing new services to firm’s clients in an easier way. For shaping a new service that could foster SPMs competitive advantage these opportunities need to be followed by some form of strategic decision (Døving and Gooderham, 2008; Grant, 1996). In the following section we are going to introduce a brief literature review in order to recognize the role of Intellectual Capital and Strategy for developing new services and we draw our hypothesis. Moreover, we are going to illustrate the methodology used showing major results obtained and to offer a conclusion paragraph.

18

Carlo Bagnoli, Maurizio Massaro and Filippo Zanin

2. Literature review and theoretical framework There is little understanding on how service companies develop their innovation processes (Ettlie and Rosenthal, 2011; Schleimer and Shulman, 2011). Indeed, it has been recognized that literature on product innovation does not fit, or at least not always, the specific context of service business (Zomerdijk and Voss, 2011). and Small and Medium-sized accounting Practices have been identified as a specific element in the service business (Jay and Schaper, 2003; Robson and Bennett, 2001). Indeed, business advice in general presents both the characteristics of being task-interactive and personal-interactive and it requires a close relationship with clients (Bennett and Robson, 2004). At the same time the ability for successfully using the strong ties with partners and clients seems to be related to the strategic intent adopted by small accountancy firms (Døving and Gooderham, 2008). Thus, on the one side intellectual capital provides knowledge and relationships required for developing new services. On the other side, strategy intent works as a preliminary factor for focusing SMPs action on innovation. In order to better encompass the connection among intangible resources and entrepreneurial innovation literature recognizes the Intellectual capital concepts and taxonomies as a good framework (Leitner, 2011). Indeed SMPs and more in general professional service firms, draw on it in order to create value for them and their clients (Chang and Birkett, 2004). According to Huang, Intellectual Capital is a wide concept which understanding depends on business related disciplines(Huang et al., 2007). Thus, several approaches are allowed but the most accepted definition of Intellectual Capital assumes three categories concerned with: 1) external relationships, related to relational capital; 2) internal infrastructure, related to structural capital; 3) people, related to human capital.

Human capital is usually recognized as a bundle of human resource elements, including competencies experience, skills and tacit knowledge (Choo and Bontin, 2002; Guerrero, 2003; Kong, 2008). It represents tacit knowledge not embedded within the organization but stored inside people’s minds. According to Resource Based View innovation is strongly connected to the human capital due to its inimitability (Hatch and Dyer, 2004; Laursen and Foss, 2003). Thus, we argue that: Hypothesis 1a There is a positive relationship between strength in human capital and the likelihood of a new service launch.

Structural capital refers to the knowledge embedded within the organization. It supports human capital in dayto-day activities (J. Roos et al., 1998; Stewart, 1997). Within this concept literature recognizes all store-systems of knowledge such as database, formalized routines, manuals, which are able to create value for the organization (Aramburu and Sáenz, 2011; Bontis, 1999). Unfortunately, due to their emergent approach, SMPs use a lower level of formalization for developing their innovation plans also for radical innovation. Thus, we argue that Hypothesis 1b There is a negative relationship between strength in structural capital the likelihood of a new service launch.

Relational capital has been connected with the bundle of formal and informal connections with organization’s external stakeholders (Bontis, 1999; J. Roos et al., 1998; Stewart, 1997). several studies have analyzed the role of customer involvement in new service development (Buganza et al., 2009; Carbonell et al., 2009). In our opinion, due to the existing relationship of trust, personal and geographical proximity among SMPs and Entrepreneurs (Bennett and Robson, 2004; Robson and Bennett, 2001) small accountancy firms can easier introduce new services that can be provided to existing clients. . Thus, we argue that Hypothesis 1c There is a positive relationship between strength in relational capital and the likelihood of a new service launch.

Analyzing the connection between innovation and strategy, (Ostrom et al., 2010) suggest that the service strategy is one of the three priorities in the service research agenda and the application of Treacy and Wiersema model to new service development literature reveals that the competitive strategy is a critical factor in the innovation activities to the extent that service innovation strategy should be considered during the service design process (Goldstein et al., 2002). Indeed, in order to achieve a market space where the competition is weak and the profitability very high a firm can challenge itself producing new solutions able to reinvent the way to satisfy existing client’s needs or to make explicit the latent needs. Thus we argue that: Hypothesis 2a. Firms that pursuit a service leadership strategy have a higher probability of developing new services

19

Carlo Bagnoli, Maurizio Massaro and Filippo Zanin

3. Methodology and sample In order to get an empirical analyses of our hypotheses we conducted a research using a structured questionnaire which was provided to some Italian SMPs. To develop the research we contacted the Italian Chartered Accounting Association, obtaining a list of 11,267 SMPs. We sent them through e-mail a structured questionnaire and obtained 960 questionnaires completely filled: 9% of the total population which is comparable to similar surveys (Døving and Gooderham, 2008; Mole, 2002). General information about respondents are offered in table 1.

Table 1: Descriptive statistic of the sample Variables Number of staff people Number of people including owners. internships and partners N. of Offices N. of Services Provided

Average 4.1 6.7 1.3 4.9

SD 6.8 10.6 1.0 2.6

Max 110 140 20 18

Min 0 1 1 2

4. Measurement 4.1 Dependent variables Our dependent variable is calculated as the number of new services provided by SMPs. New services are recognized counting each service that is going to be provided within the following year and that was not provided in the previous year. In order to develop a list of services that Italian accountants are allowed to provide to their clients we involved a group of 5 experienced authorized accountants and compared to the official website of the Italian Association of Chartered Accountant. Thus, for each service we obtained a dummy variable coded 0 and 1, respectively when a new service is introduced. Data were analized through a LOGIT regression.

Table 2: Number of PMSs which provide Service

PMSs that provide it

%

PMSs that will provide it

%

Real estate management Debt administration/closure of firms

100

Arbitration

82

Bankruptcy and crisis management Taxation/tax planning

192

Remuneration schemes/ salary administration

202

Financial auditing

594

Administrative routines

822

Valuation of firms/mergers/demerger

532

Administration of naval accident practice

14

Inheritance issues/generation transfer

140

Contracts and litigation

437

Strategic planning Marketing/sales

151

Management/organization/HRM

186

IT consultancies Financial management/budgeting

28

International business

75

10% 21% 9% 20% 63% 21% 62% 86% 55% 1% 15% 46% 16% 3% 19% 3% 17% 8%

147 202 192 245 362 191 371 388 386 119 205 300 248 141 269 133 225 187

15% 21% 20% 26% 38% 20% 39% 40% 40% 12% 21% 31% 26% 15% 28% 14% 23% 19%

205

605

24

165

20

Carlo Bagnoli, Maurizio Massaro and Filippo Zanin

4.2 Independent variables 4.2.1 Intellectual capital Literature on Intellectual capital has not provided a shared scale for measuring firm resources and competences embedded within the concept of Intellectual Capital. Thus, according to previous studies (Leitner, 2011; Spanos and Lioukas, 2001) we followed an approach of self-assessment based on a scale of 1 to 5 where respondents are asked to evaluate SMPs assets (appendix 1 reports a wider definition of single variable and their statistical significance). Thus, as developed in other studies (Subramaniam and Youndt, 2005) we decided to measure intellectual capital by formulating statements about typical characteristics of its components (human, relational and structural capital).

4.2.2 Strategy Service literature has traditionally paid little attention to strategic concerns and this topic has been underinvestigated with a paucity of empirically based researches (Papastathopoulou and Hultink, 2012). The interlacing of strategy, competition and profitability has been discussed further by Treacy and Wiersema (Treacy and Wiersema, 1993) study of the firm’s value generating mechanisms. They explain that the acquisition of superior performance depends on “delivering superior customer value in line with one of the three value disciplines – operational excellence, customer intimacy, or product leadership”. A self-assessment approach was used and appendix 1 reports variable we used to measure SMPs’ strategies and statistical significance.

4.3 Control variables According to previous studies firm size could influence SMPs innovation (Døving and Gooderham, 2008). Thus, we decided to test our model measuring firm size as a control variable. We decided to measure size in terms of number of people involved in the firm, number of offices and number of services provided by the firm.

According to data collected our samples shows an average employment of people (including senior partners) of 6.65 who work on an average of 1.28 offices providing an average of 4.92 services on a list of 18 services developed as described before. Table 3 reports descriptive statistics of the control variables.

Table 3: Descriptive statistics about control variables Variables Number of people Number of offices Number of services provided

Mean 6.65 1.28 4.92

SD 10.56 0.97 2.62

5. Results In order to test our hypothesis, regarding the association of service innovation and intellectual capital and strategy intent we carried out a logistic regression model. We tested correlations among independent variables in order to verify the existence of multicollinearity. Table 3 shows main results of our analyses and indicates that there isn’t any reason for concerning about multicollinearity.

Table 3: Correlation Matrix 1 1 N. Officies 2 N. People 3 N. Services provided 4 Relationa Capital 5 Structural Capital 6 Human Capital 7 Product Innovation 8 Customer Intimacy 9 Organizational Exc.

2

3

4

5

6

7

8

9

1 0,12 ** 0,11 .

0,34 *** 0,48 *** 0,11 .

1 0,11 .

0,24 *** 0,11 .

0,40 ***

1 0,36 *** 0,18 *** 0,10 .

1 0,15 *** 0,14 ***

1 0,07

1

1 0,38 ***

1 0,17

*** 0,00 0,01 0,06 0,06 -0,06 -0,06

0,30 *** 0,11 .

0,06 0,20 *** 0,19 *** 0,07 0,00

1 0,2 *** -0,01 0,16 *** 0,18 *** 0,16 *** -0,07

Signif. codes: 0 '***' 0.001 '**' 0.01 '*' 0.05 '.' 0.1 ' ' 1

21

Carlo Bagnoli, Maurizio Massaro and Filippo Zanin The first one shows a correlation index of 0.34 between number of offices and number of people. This could be easy to understand since it is plausible that a firm with more than one office employs a greater number of people. The second one is related to the connection between the strategy of customer intimacy and the importance assigned to relational capital. The value is anyway relatively low since it is 0.48 and it is also easy to imagine that firms that are developing a customer intimacy strategy consider as very important the relational capital.

Table 4: Role of intellectual capital and strategy for developing new services: logistic regression model Mod. 1 Costant N. Officies N. People N. Services provided Relationa Capital Structural Capital Human Capital Product Innovation Customer Intimacy Organizizational Exc. 2 Pseudo-R (Cox & Snell)

-2.790 0.182 0.057 -0.011

Mod. 2 *** *** *** **

0.011

-2.707 0.217 0.029 -0.017 0.361 0.015 0.200

0.1369

Mod. 3 *** *** * *** ***

Mod. 4

-2.771 0.229 0.034 -0.020

*** *** * ***

0.491 0.194 0.117 0.217

*** *** **

***

-2.729 0.236 0.021 -0.020 0.201 -0.117 0.059 0.449 0.108 0.156 0.269

*** *** *** *** ** *** * ***

Signif. codes: 0 '***' 0.001 '**' 0.01 '*' 0.05 '.' 0.1 Table 4 reports main results of the developed logistic regression. We ran four sets of analyses. The first model includes control variables only which measure SMPs dimension in terms of number of people, number of offices and number of services. The second model includes control variables and intellectual capital, while the last model is the completely one considering control variables, intellectual capital components and strategies.

2 Observing data in the table we can recognize that model 4 offers a greater R calculated according to Cox and Snell model. This approach is coherent with other studies developed in the field (Leitner, 2011).

According to data showed we can recognize that in model 2 Human Capital has a significant and positive correlation to service innovation. Unfortunately this condition is only partially true. Indeed in model 4 the coefficients are still positive but not statistically relevant.

Hypothesis 1b predicts an association between relational capital and the likelihood of developing new service.

The logistic regression models shows that relational capital has a positive effect on both model 2 and 3 offering a full support for our first hypothesis with coefficients at 0.361 in model 1 and at 0.201 in model 2 with a high significance p-value at 0. As can be seen from the coefficients in the variable structural capital has in model 2 a positive connection with the likelihood of introduction of new services, but it is negative in model 4. Neither model shows a statistically significant relationship. Moreover, table 4 shows that strategy is directly connected with the likelihood of new service development. Interestingly enough SMPs that pursuit a service leadership strategy have a higher probability of developing a new service. We conclude therefor that the developed logistic regression offers a full support to hypothesis 1a and 2a, a partial support to hypothesis 1b and 1c.

6. Discussion and conclusion Our study focuses on the role of intellectual capital and strategy on innovation in Small Accountancy Firms in Italy. A structured questionnaire was submitted to 11,297 chattered accountants obtaining 960 completely filled questionnaires. A LOGIT regression model was used in order to test our hypothesis.

Our empirical research demonstrates that relational capital is the fundamental determinant of SMPs new service development. This result confirms the prevailing evidences stemming from recent studies in the area of service innovation which strive to identify and analyze the antecedents of innovation in the service industry.

The strength of linkages with clients and suppliers is often recognized as the most important factor that trigger innovation activities especially for small service firms that typically face with resources constraints and compete with limited resources. Given resources limitations, SMPs choose to stress the interactive way of doing innovation by leveraging information and knowledge available in their social network. Our regression logistic model reveals that between quality of human capital and the propensity to innovate there is a weak association. At a glance, it is amazing that human capital has a weak impact on innovation capability for

22

Carlo Bagnoli, Maurizio Massaro and Filippo Zanin knowledge-intensive firms like SMPs. Indeed innovation lies in the ability to deploy the available stock of knowledge in order to develop a unique offering to the market. Despite the importance of service innovation, most of the SMPs of our sample declare to deliver mainly mandatory or standardized accountancy services that require a simple knowledge updating whiteout fostering a more robust knowledge development. Drawing on the strategic management literature the present study aims to verify the impact of competitive strategies in the new service development. Our results confirm that SMPs pursuing a service leadership strategy have a high propensity to innovate their offering since they focus on delivering unique offering to the market. These SMPs choose to reshape their offering by introducing business advisory services in order to better satisfy the constantly changing client’s needs. In model 4 customer intimacy has a positive association to service innovation but the statistical relationship is very weak. We can find a possible explanation of this incoherence emphasizing the weaknesses of human capital. In order to satisfy more and more sophisticated client’s needs, SMPs tend to develop an agreement with a specialized service provider and lose the control over the relationship with the client.

References Aramburu, N. and Sáenz, J. (2011), “Structural capital, innovation capability, and size effect: An empirical study.,” Journal of Management & Organization, Vol. 17 No. 3, pp. 307–325. doi:10.5172/jmo.2011.17.3.307 Bennett, R.J. and Robson, P.J.A. (2004), “The role of trust and contract in the supply of business advice,” Cambridge Journal of Economics, Vol. 28 No. 4, pp. 471–488. doi:10.1093/cje/beh021 Bontis, N. (1999), “Managing organisational knowledge by diagnosing intellectual capital: framing and advancing the state of the field,” International Journal of Technology Management, Inderscience, Vol. 18 No. 5/6/7/8, p. 433. doi:10.1504/IJTM.1999.002780 Buganza, T., Dell’Era, C. and Verganti, R. (2009), “Exploring the Relationships Between Product Development and Environmental Turbulence: The Case of Mobile TLC Services,” Journal of Product Innovation Management, Vol. 26 No. 3, pp. 308–321. doi:10.1111/j.1540-5885.2009.00660.x Carbonell, P., Rodriguez-Escudero, A.I. and Pujari, D. (2009), “Customer Involvement in New Service Development: An Examination of Antecedents and Outcomes,” Journal of Product Innovation Management, Vol. 26 No. 5, pp. 536–550. doi:10.1111/j.1540-5885.2009.00679.x Chang, L. and Birkett, B. (2004), “Managing intellectual capital in a professional service firm: exploring the creativity– productivity paradox,” Management Accounting Research, Vol. 15 No. 1, pp. 7–31. doi:10.1016/j.mar.2003.10.004 Choo, W.C. and Bontin, N. (2002), The Strategic Management of Intellectual Capital and Organizational Knowledge, (Choo,W.C. and Bontin,N.,Eds.), New York, Oxford University Press, p. 748.

Døving, E. and Gooderham, P.N. (2008), “Dynamic Capabilities as Antecedents of the Scope of Related Diversification : The Case of Small Firm Accountancy Practices,” Strategic Management Journal, Vol. 29 No. 8, pp. 841–857. doi:10.1002/smj Ettlie, J.E. and Rosenthal, S.R. (2011), “Service versus Manufacturing Innovation*,” Journal of Product Innovation Management, Vol. 28 No. 2, pp. 285–299. doi:10.1111/j.1540-5885.2011.00797.x Frank, K.E., Hanson, R.K., Lowe, D.J. and Smith, J.K. (2001), “CPAs ’ Perceptions of the Emerging Multidisciplinary Accounting/Legal Practice,” Accounting Horizons, Vol. 15 No. 1, pp. 35–48.

Goldstein, S.M., Johnston, R., Duffy, J. and Rao, J. (2002), “The service concept: the missing link in service design research?,” Journal of Operations Management, Vol. 20 No. 2, pp. 121–134. doi:10.1016/S0272-6963(01)00090-0 Grant, R.M. (1996), “Toward a Knowledge-Based Theory of the Firm,” Strategic Management Journal, Vol. 17, pp. 109–122.

Greenwood, R., Suddaby, R. and Hinings, C.R. (2002), “Theorizing Change : The Role Of Professional Associations In The Transformation Of Institutionalized Fields,” Academy of Management Journal, Vol. 45 No. 1, pp. 58–80. doi:10.2307/3069285 Guerrero, I. (2003), “How do firms measure their intellectual capital? Defining an empirical model based on firm practices,” International Journal of Management and Decision Making, Vol. 4 No. 2-3, pp. 178–193.

Hatch, N.W. and Dyer, J.H. (2004), “Human capital and learning as a source of sustainable competitive advantage,” Strategic Management Journal, Vol. 25 No. 12, pp. 1155–1178. doi:10.1002/smj.421 Huang, C.C., Luther, R. and Tayles, M. (2007), “An evidence-based taxonomy of intellectual capital,” Journal of Intellectual Capital, Vol. 8 No. 3, pp. 386–408. doi:10.1108/14691930710774830 Jay, L. and Schaper, M. (2003), “Which advisers do micro-firms use? Some Australian evidence,” Journal of Small Business and Enterprise, Vol. 10 No. 2, pp. 136–143. doi:10.1108/14626000310473166 Kong, E. (2008), “The development of strategic management in the non-profit context: Intellectual capital in social service non-profit organizations,” International Journal of Management Reviews, Vol. 10 No. 3, pp. 281–299. doi:10.1111/j.1468-2370.2007.00224.x Laursen, K. and Foss, N.J. (2003), “New human resource management practices , complementarities and the impact on innovation performance,” Cambridge Journal of Economics, Vol. 27 No. 2, pp. 243–263.

Leitner, K.H. (2011), “The effect of intellectual capital on product innovativeness in SMEs,” International Journal of Technology Management, Vol. 53 No. 1, pp. 1–18. doi:10.1504/IJTM.2011.037235

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Carlo Bagnoli, Maurizio Massaro and Filippo Zanin Marriott, N. and Marriott, P. (2000), “Professional accountants and the development of a management accounting service for the small firm: barriers and possibilities,” Management Accounting Research, Vol. 11 No. 4, pp. 475–492. doi:10.1006/mare.2000.0142 Mole, K. (2002), “Business Advisers’ Impact on SMEs: An Agency Theory Approach,” International Small Business Journal, Vol. 20 No. 2, pp. 139–162. doi:10.1177/0266242602202002 Von Nordenflycht, A. (2010), “What is a Professional Service Firm? Toward a Theory and Taxonomy of Knowledge-Intensive Firms,” Academy of Management Review, Vol. 35 No. 1, pp. 155–174.

Ostrom, a. L., Bitner, M.J., Brown, S.W., Burkhard, K. a., Goul, M., Smith-Daniels, V., Demirkan, H., et al. (2010), “Moving Forward and Making a Difference: Research Priorities for the Science of Service,” Journal of Service Research, Vol. 13 No. 1, pp. 4–36. doi:10.1177/1094670509357611 Papastathopoulou, P. and Hultink, E.J. (2012), “New Service Development: An Analysis of 27 Years of Research*,” Journal of Product Innovation Management, Vol. 29 No. 5, pp. 705–714. doi:10.1111/j.1540-5885.2012.00944.x Robson, P.J.A. and Bennett, R.J. (2001), “SME Growth : The Relationship with Business Advice and External Collaboration,” Small Business Economics, Vol. 15 No. 3, pp. 193–208.

Roos, J., Roos, G. and Edvinsson, L. (1998), Intellectual Capital – Navigating the New Business Landscape, Basingstoke, McMillan, p. 143.

Schleimer, S.C. and Shulman, A.D. (2011), “A Comparison of New Service versus New Product Development: Configurations of Collaborative Intensity as Predictors of Performance,” Journal of Product Innovation Management, Vol. 28 No. 4, pp. 521–535. doi:10.1111/j.1540-5885.2011.00823.x Spanos, Y.E. and Lioukas, S. (2001), “An examination into the causal logic of rent generation: contrasting Porter’s competitive strategy framework and the resource-based perspective,” Strategic Management Journal, Vol. 22 No. 10, pp. 907–934. doi:10.1002/smj.174 Stewart, T.A. (1997), Intellectual Capital: The New Wealth of Organizations, Performance Improvement, Doubleday, Vol. 37, p. xxi, 278 p. doi:10.1002/pfi.4140370713 Subramaniam, M. and Youndt, M.A. (2005), “The Influence of Intellectual Capital on the Types of Innovative Capabilities,” Academy of Management Journal, Academy of Management, Vol. 48 No. 3, pp. 450–463. Retrievedfrom http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=17407911&site=ehost-live Treacy, M. and Wiersema, F. (1993), “Customer Intimacy and Other Value Disciplines,” Harvard Business Review, Vol. 71 No. 1, pp. 84–93.

Valencia, J.C.N., Valle, R.S. and Jiménez, D.J. (2010), “Organizational culture as determinant of product innovation,” European Journal of Innovation Management, Vol. 13 No. 4, pp. 466–480. doi:10.1108/14601061011086294 Zomerdijk, L.G. and Voss, C.A. (2011), “NSD Processes and Practices in Experiential Services,” Journal of Product Innovation Management, Vol. 28 No. 1, pp. 63–80. doi:10.1111/j.1540-5885.2010.00781.x

APPENDIX 1a Variable

Scale

Definition, construction, coding and date of survey

Resources - Intellectual Capital Framework (Question: Please rate the importance of the following resources) Human Capital

Chronbach Alpha: 0.84 Rotation applied: Varimax

- Competences of Front-line Staff - Competences of internship people - Competences of associated authorized chartered accountants - Competences of not associated authorized chartered accountants

1-5 1-5 1-5

Factor Loadings: 0.53 Factor Loadings: 0.81 Factor Loadings: 0.676

1-5

Factor Loadings: 0.56

1-5 1-5 1-5

Chronbach Alpha: 0.81 Rotation applied: Varimax Factor Loadings: 0.68 Factor Loadings: 0.80 Factor Loadings: 0.61

1-5 1-5 1-5 1-5

Chronbach Alpha: 0.77 Rotation applied: Varimax Factor Loadings: 0.63 Factor Loadings: 0.66 Factor Loadings: 0.73 Factor Loadings: 0.54

Relational Capital - Close relationship with clients - Close relationship with others (partners, …)

- Firm’s brand and reputation Structural Capital - Procedures of interaction with clients - Harmonization of procedures among offices - Database and other knowledge repositories - Resources for managing fees (payments, …)

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Carlo Bagnoli, Maurizio Massaro and Filippo Zanin

APPENDIX 1b Variable

Scale

Definition, construction, coding and date of survey

Strategy - Treacy and Wiersema model (Question: Please the extent to which you use each of the following competitive methods) Customer intimacy - Client answer process management - Client answer precision management - Client relationship management - Associates reputation management

1-5 1-5 1-5 1-5

Chronbach Alpha: 0.86 Rotation applied: Varimax Factor Loadings: 0.60 Factor Loadings: 0.75 Factor Loadings: 0.73 Factor Loadings: 0.71

1-5 1-5 1-5 1-5

Chronbach Alpha: 0.83 Rotation applied: Varimax Factor Loadings: 0.71 Factor Loadings: 0.77 Factor Loadings: 0.67 Factor Loadings: 0.54

1-5 1-5 1-5

Chronbach Alpha: 0.57 Rotation applied: Varimax Factor Loadings: 0.55 Factor Loadings: 0.56 Factor Loadings: 0.47

Scale

Definition, construction, coding and date of survey

Product Leadership - Service range - Service customization - Service complementariness - Firm dimension Operational Excellence - Excellence in the client fee management - Excellence in the client dialogue process - Excellence in the client acquisition process

APPENDIX 1c Variable Firm Size - Number of People

Metric

Number of Front Office People Number of internship People Number of authorized chartered accountants Total number of people

- Number of Offices

Metric

Number of offices

- Number of Services Provided

Dichotomy

0-1 on a list of 18 services recognized by previous studies and from a preliminary interview with experts.

0 Not provided 1 Provided

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How does the Work Environment Affect Physical Movement Behaviour during Communication?

Claudia Erni Baumann and Roman Boutellier Chair of Technology and Innovation Management, ETH Zurich, Zurich, Switzerland cerni@ethz.ch roman.boutellier@sl.ethz.ch Abstract: For knowledge generation – a vital factor for R&D based companies – an efficient utilization of existing knowledge is crucial. As knowledge becomes more and more specialized, intensive communication between researchers from various disciplines is required. Communication is a key factor for process coordination and organisational creativity.

Although new channels of communication are now available, personal face-to-face meetings remain essential. Physical movement during work has been neglected in research and management: Physical movement not only influences cognitive performance, learning ability and individual creativity, it also affects the attitude to a task, work habits and the mood. It is a communication medium in and of itself. Triggered by the environment, it affects the characteristics of chance encounters, which in turn influences communication. This study is based on a single-case case study of a research team (n=27) of a multinational pharmaceutical company. It examines the communication patterns and the physical movement behaviour during communication of natural scientists before and after moving from a traditional cell space research and work environment into a modern multi-space building. This radically new work environment offers a wide range of open and closed workspaces as well as individual and communal work areas. The findings show that in an open multi-space work environment, the conversation lengths are immediately adjusted to the new environment, whereas the movement behaviour during conversation is adapted only after some time. Sitting during conversations has increased regarding the number of events whereas physical movement during conversations has decreased. In the multi-space work environment the lengths of communication events – distinguished by different behavioural patterns during communication – are timewise shorter than before the move. The duration of conversation while sitting has declined, it is now less than half as long as before the move. Previously they were by far the longest conversations. The impact on R&D productivity seems to be mixed. Negative aspects may be overcome by managing overarching events and concentration of specific equipment.

Keywords: work environment, multi-space, communication, creativity, innovation management, physical movement

“We give shape to our buildings, and they, in turn, shape us.”

(Winston Churchill in a 1943 speech to the House of Commons)

1. Introduction Thomas Bernhard (1971, S. 88), an Austrian author, wrote in his book Gehen (Walking): „The observation we make again and again is, that when we walk and thus our body gets in motion, then our thinking gets in motion as well […].” Already the ancient Greeks assumed a relationship between walking and thinking: Aristotle used to walk around with his group of students in the colonnades of Athens and hold his philosophical teachings.

The group was called Peripatetics, from the greek peripatein, to wander around.

Wandering around in order to think better – we can still find this behaviour in humans who have to make difficult decisions. The formal and informal meetings at Camp David between the U.S. Government and other States are one famous example. Other governments also have their lobbies (Wandelhallen) where decision makers can informally meet with lobbyists by moving around and discussing. The reason for walking around is not to improve one’s physical performance or to achieve a sporting goal: Physical movement seems to enable creative work. We know that poets like Goethe and Wordsworth created their best work by constantly walking up and down.

This paper shows the findings obtained from a case study in pharmaceutical industry. Beginning with a theoretical part, the influence of the working environment on physical movement behaviour during communication is discussed.

2. Theoretical background Knowledge has become more and more specialized. In the 1800s, Charles Darwin conducted research on a wide variety of topics, ranging from evolutionary theory to botany or geology. Nowadays, this is no longer possible. Although researchers are still interested in many topics, they can only focus on just a few topics. They are increasingly obliged to work with other researchers in interdisciplinary teams. While Charles Darwin or Gregor Mendel operated on their own and were very successful, today’s researchers are working in large

26

Claudia Erni Baumann and Roman Boutellier teams: the average number of authors of science and engineering papers has risen from 1.9 to 3.5 during the period 1960-2000 (Wuchty, Jones & Uzzi 2007). One of the most extreme examples of scientific collaboration is the paper reporting the initial sequence of the human genome, where more than a thousand authors were involved (International Human Genome Sequencing Consortium 2001; Understanding Science 2012).

For pharmaceutical industry this means that the entire research process, starting with the selection of new targets and continuing with the development and delivering of new compounds, needs intensive communication between the researchers, who are all specialists in their field. The pharmaceutical company we studied aimed to enhance communication by redesigning the work environment.

2.1 Creativity, Innovation and Productivity in R&D Research productivity is a key factor for R&D based companies. Although it is difficult to estimate the productivity returns in R&D due to imperfect output measurement (Griliches 1998), organisational knowledge creation seems to be a prerequisite for creativity and new innovative ideas (Amabile 1996b) and thus for productivity in R&D in research based companies (Pisano 2006).

Organisational creativity can be defined as the plethora of activities which leads to new ideas or new ways of solving problems (Styhre & Sundgren 2005). Creativity and innovations are in a means to an end relationship, creativity is an important prerequisite for innovation (Guldin 2005), which can be defined as the “successful implementation of creative ideas within an organization� (Amabile 1996a). The generation of a big number of creative ideas favours innovation (Alves et al. 2007). In order to be creative, domain specific expertise is needed along with creative thinking skills and motivation (Amabile 2008).

For organisational knowledge generation, both knowledge creation and knowledge sharing seem to play an important role: While knowledge creation provides the basis for continued value-creation and innovation (e.g.

Nonaka & Takeuchi 1995; de Pury 1994; Pavitt 1991), facilitating collaborative activities to enhance knowledge sharing (e.g. Allen & Henn 2007; Dyer & Singh 1998; Powell et al. 1996; Liebeskind et al. 1996) determine how efficiently the existing knowledge is utilized and new pieces of knowledge are combined. Knowledge sharing and collaboration within an organization spread the research results, lead to lower research expenses and allow the company to benefit from synergies (Kratzer, Gmunden & Lettl 2011; Howells, James & Malik 2003).

2.2 Communication promotes knowledge creation Although isolation and individual reflection are often stated as key factors for a creative achievement (Ochse 1990; Simonton 1988), communication and stimulating dialogues between researchers from different scientific disciplines, facilitate organisational creativity (Styhre & Sundgren 2005) and the creation of knowledge (Allan & Henn 2007). The iteration of professional discussion and deep individual reflection seems to be fundamental for creativity (Erni Baumann & Boutellier 2012).

So diversity of employees shall have a positive impact on creativity, they must share their diverse perspectives.

However, people tend to talk about common knowledge and ideas rather than unique individual knowledge (Strasser & Birchmeier 2003). Nevertheless, there is an obvious relationship between the integration of a researcher and the quality of his innovative ideas. BjĂśrk & Magnusson (2009) state that a certain number of relationships is needed in order for the proportion of useful new ideas to increase. An individual with more connections within the professional network has a higher proportion of high-quality ideas. However, on a group level only a limited increase of the number of connections is beneficial for the quality of the ideas: too many relationships are detrimental to the quality.

According to the sociologist Pierre Bourdieu, social capital is formed by accessible relationships (Bourdieu 1983). Social capital is intangible, characterizes the value of a network of reliable relationships (Coleman 1988) and affects the performance of an organization (Jansen 1999). The embeddedness into the social structure regulates the activities of people (Granovetter 1985). Direct and indirect social relationships provide opportunities for focused activities. In the 1970s Granovetter introduced the theory of strong and weak ties (1973): strong ties are lasting and reciprocal. Weak ties are less intense and not necessarily reciprocal, but are essential for gaining information and new knowledge because they combine different groups of people who have heterogeneous backgrounds. People with many weak ties (and thus many non-redundant relationships) play an important role in information and knowledge dissemination (Burt 1992).

27

Claudia Erni Baumann and Roman Boutellier In R&D, strong and close relationships between researchers are essential for knowledge transfer and work coordination. They build up trust among colleagues (Prusak 2001), increase work efficiency (Perry-Smith 2006) and allow for the exchange of complex knowledge (Hansen 1999; Nonaka & Konno 1998). Loose relationships enable the maintenance a large network. New ideas often emerge from discussions with people who have different backgrounds or work in a different work environment (Perry-Smith 2006).

2.3 Physical movement influences communication and knowledge creation Physical movement of human beings has many different meanings. For mechanical work, physical movement is the work content. The movement is the objective. On the other side of the scale, for creative work, physical movement is no immediate work content at all. In a subordinate sense however, physical movement helps people meet the demands of complex tasks (see Table 1). Regarding combinative and creative work – the work types this study is focused on – physical behavior has both personal and group impacts and affects communication.

Table 1: Types of work and the significance of physical movement (adapted from Luczak & Schlick 2007)

2.3.1 Personal impacts of physical movement Even the posture of a person has an impact on work behavior: Riskind & Gotay (1982) were able to show that the posture influences the staying power while managing challenging tasks. It has been demonstrated that the posture influences emotions and personal opinions (Wells & Petty 1980). A recent study explained this influence on a neuroendocrine level (Carney, Cuddy & Yap 2010): An expansive posture increases the testosterone level in the body, but decreases the cortisol level. This promotes courage, willpower and persistence.

Physical movement influences cognitive performance and learning ability: Moderate physical activity leads to a higher supply of oxygen and nutrients in the organism and an increased synthesis of neurotransmitters (Hollmann & Strüder 1996), which has a positive effect on the memory (Kubesch 2004). The neurogenesis (formation of neurons) is not only influenced by learning but also to a comparable degree by physical movement (Van Praag, Kempermann & Gage 1999). Neurogenesis is vital for learning and memory (Neves, Cook & Bliss 2008). Moderate physical movement enhances attention and concentration (Hollmann & Löllgen 2002; Dordel & Breithecker 2003). Well known studies like the Trios-Rivières-Study (Shephard 1996) or the SPARK-Study (Sallis 1999) show that a reduction of the number of hours of cognitive work in favour of physical activity has a positive or neutral impact on cognitive achievement in school children. From the perspective of individual creativity during work, semiautomatic activities like walking or driving a car are particularly helpful (Csikszentmihalyi 1997).

2.3.2 Group impacts of physical movement One’s posture has a far greater effect on one’s feeling of dominance and strength than one’s hierarchical position (Huang & Galinsky 2011). Several clinical studies show that a change in posture may change attitude

28

Claudia Erni Baumann and Roman Boutellier and mood (Döring-Seipel 1996). For example, people with an expanded posture are much more confident, optimistic and happier than people with a flexed posture. In this context, Watzlawick’s axiome “One cannot not communicate” (Watzlawick, Beavin & Jackson 2011) gets a deeper meaning and emphasizes the significance of physical behavior for communication.

2.3.3 Impacts on communication The creation of weak ties and the consolidation of strong ties are only possible when people talk to each other (see 2.2). The efficient way to do so is meeting face-to-face. The more communication events there are faceto-face, the more communication events there will be through other media (Allen & Henn 2007).

In addition to scheduled meetings, conversations take place between researchers whenever they meet: Chance encounters play an important role. Physical movement behavior during work influences the number of chance encounters. The use of the same infrastructure is the main reason for chance encounters with other employees. Physical dislocation, walking around during workflow and the need to pass by infrastructure being used by other researchers all make researchers cross each other’s path (Erni Baumann & Boutellier 2012).

2.4 Work environment as a setting The design of work environment is an opportunity to support work efficiency (Newsham 1997) not only for manual work but as well for knowledge workers. Not only is the individual productivity of a person affected by the work environment, but also the productivity of whole work groups and even organizations (Vischer 2006).

From the perspective of creativity, Amabile (1996a) emphasizes that the work environment affects the creativity of individuals and teams.

The built work environment affects the movement behavior by facilitating or inhibiting physical movement (Seiler 1984). It has an influence on encounters and communication between employees. For this reason, people communicate more often in a multi-space workplace than in a cellular environment and the mean duration of communication events decreases (Boutellier, Ullmann, Schreiber & Naef, 2008). Moreover, there is a strong correlation between physical distance of two employees and their frequency of communication (Allen 1984). According to Allan and Henn (2007), a thoughtful design of the layout of a work space enables chance encounters.

With all these relations and results, a basic model can be constructed (see Figure 1) and the following hypothesis seems to be reasonable: H1: The mean duration of communication events decreases in a multi-space environment.

H2: In multi-space environment, more conversations are held while sitting.

H3: A multi-space environment promotes movement during communication events.

H4: In a multi-space environment there are more researchers involved per communication event.

Figure 1: Basic research framework

3. Data and method For this study a grounded theory approach (Glaser & Strauss 1967) was chosen as a research methodology, based on an explorative case study. Case studies allow us to conduct research on a contemporary phenomenon within real-life contexts while considering multiple variables (Yin 2003).

29

Claudia Erni Baumann and Roman Boutellier The foundation of the study is a single-case case study of a research team of a global pharmaceutical company.

The field of pharmaceutical research is well qualified for doing research on creativity and communication: it is knowledge intensive and requires scientists and technology experts with diverse backgrounds to interact with one another, e.g. in our case chemists, biologists, physicians, and computer scientists.

In the case study, communication events and the behaviour of researchers in the offices and laboratories were observed before and after moving from a traditional 30- to 40-year-old cellular workspace for 1 or 2 people per room into a modern open plan multi-space environment.

The new workspace is located in one of the most modern research buildings of the company. The workspace consists of a laboratory and office space merged into one whole open plan office without any intermediate walls. It offers a wide range of open and closed workspaces as well as individual and communal work areas.

The laboratories are expected to be an area of exchange and cooperation because they are open and directly situated in the office area. The whole building comprises four floors, all with the same type of open-office environment. One of these floors was shared by 35 researchers from diverse disciplines.

Data collection of the study was conducted by observing the behaviour of a research team, which was earlier spread out over the large company site and was then moved into one of the four floors of the new building.

This approach allowed us to study the behaviour of the same employees in two different working environments. In the “old” working environment, the observations were conducted for 147 hours and in the “new” multi-space environment for 154 hours. During this time 983 communication events before the move and 2148 after the move were observed. The first observation in the new environment was held immediately following the relocation. The second observation was executed three months after the move. Since the focus of the study was on personal encounters between researchers, only face-to-face communication events were considered. The observed research team consisted of 1 Unit Head, 8 Lab Heads and 18 Associates (including 1 post-doc, 1 PhD student and 1 MA student).

4. Findings The following part outlines the physical movement behaviour of the researchers during communication, depending on the work environment.

4.1 Number of participants per face-to-face communication event Compared to the “old” enclosed environment (see Table 2), in the new multi space environment (three months after move) there are fewer people involved in communication events where all the participants exhibit all three types of behaviour – sitting, standing and moving (3.00 down from 3.17). Due to the workplace design it is almost no longer possible that at least one person is sitting, one is walking and one is moving around.

In the open multi-space environment there are more people involved in communication events where all are standing (2.24 up from 2.11) or all are moving around (2.14 up from 2.05). In the new environment fewer people participate in conversations during which at least someone is standing and at least someone is moving around (2.16 down from 2.26). In the new environment there are more people involved in conversations during which all are sitting (2.11 up from 2.04). Thus the number of persons involved in conversions has not changed much.

Table 2: Number of participants per face-to-face communication event (mean)

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Claudia Erni Baumann and Roman Boutellier

4.2 Behaviour during communication In the open multi-space environment the percentage of conversations during which at least one person is sitting has increased from 47.5% to 63.2% (see Table 3). In contrast, the proportion of communication events during which at least one person is moving around has declined from 26.9% to 16.7%. The percentage of conversations where at least one person is standing remains about equal (68.4% to 67.2%).

Table 3: Percentage of communication events during which at least one person is showing the corresponding behaviour

After analysing the movement behaviour during communication (see Figure 2) it can be seen that the percentage of the number of conversations during which all the participants are sitting (si) has increased significantly from 11.2% to 20.4% in the open multi-space environment. The percentage of conversations during which at least one person is sitting and at least one is standing (si/st) has increased as well (from 30.6% to 37.1%). The percentage of communication events during which all the people are standing (st) has decreased from 31.3% to 25.85%. The percentage of the events during which all the people are moving (mov) has decreased, from 15.4% to 7.0%. In total, 83.3% of all conversations in the new environment are events during which all participants are standing (st) or all are sitting (si) or all participants are standing or sitting (si/st) (compared to 73.1% before the move).

Figure 2: Relative distribution of movement behaviour during communication Shortly after dislocation the movement behaviour during communication was similar to the behaviour before the move. The behaviour changed only after some weeks.

4.3 Duration of communication events After moving to the open multi-space environment, the duration of conversations while sitting (si) dropped by more than half, from 5:46 to 2:45 minutes (see Figure 3 and Table 4 for an overview). On average, each communication event where one participant was seated was 3 minutes shorter. A similar decrease can be seen for the si/st/mov communication events, where the duration plunged from 2:46 to 0:02 minutes. Together with Figure 2 this means that the significance of si/st/mov conversations has dropped to zero (see Figure 4).

There is also a significant decrease for the conversations during which at least one person is sitting and at least one is moving (si/mov) (from 1:15 to 0:20 minutes). In the new working environment the communication events during which at least one person is sitting and one person is standing (si/st) have decreased from 2:06 to 1:48 minutes and the communication events during which all participants are standing (st) have slightly

31

Claudia Erni Baumann and Roman Boutellier increased from 2:12 to 2:28 minutes. In the new environment the conversations during which all people are moving (mov) has become much longer (from 1:23 to 2:45 minutes), while the percentage of the number of conversations halved (see Figure 2). Thus, total time spent with all participants moving remained constant (see Figure 4).

Interestingly, all types of movement behaviour show the same pattern: When weighting the corresponding mean duration of conversation according to the relative distribution of the movement behaviour, they are after three month again similar to the situation before the move (see Figure 4).

Table 4: Overview of key figures

The duration of the conversation events changed immediately after dislocation. One exception is si/mov: Researchers had to unpack the moving boxes and to arrange the material. For this reason employees talked while unpacking with colleagues sitting next to them.

Figure 3: Mean duration of communication events depending on movement behaviour

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Claudia Erni Baumann and Roman Boutellier

Figure 4: Mean duration of communication events weighted according to their relative distribution

5. Discussion When comparing the movement behaviour in the cell space with the behaviour in the open multi-space it can be stated that after the dislocation the duration of the different types of conversation changed immediately. In contrast, the movement behaviour during communication events only changed after a certain amount of time.

It seems that the environment influences the movement behaviour directly while the “communication policy� emerges after weeks only.

Compared to the cell space environment, in the open multi-space environment more people are involved in the communication events in which all participants have the same movement behaviour. An exception, however, are conversations during which one of the researchers is moving. That is to say that our hypothesis (H4) is only partially supported.

Hypothesis H3 is only partially supported by our data. In an open multi-space environment people prefer to sit while communicating and move less. However, the number of people which stand while communicating has remained about the same. And total time spent with all participants moving remains constant, too.

Furthermore, in the open multi-space environment the percentage of the communication events during which all or some participants are seated has increased. In fact, the percentage of the events during which all are sitting has nearly doubled. This fact supports our hypothesis H2. Communication events during which all are standing has remained important. This is probably because many conversational partners are now so close that they do not to have to stand up any more in order to communicate. This was not possible in the cell space environment.

Physical movement during communication has lost importance in the open multi-space environment. The routes in a big multi-space area are shorter and less given than in an environment with many corridors. Thus fewer conversations are held while walking. If a researcher goes to another researcher, he does not sit down (he has no way of doing so because there are no additional chairs). This is not so comfortable and does not tempt the researcher to stay and chat.

The mean duration of a communication event has decreased in the new environment. We have assumed this in advance (H1). Particularly, the duration of conversations while seated has declined: They are now less than half as long. Before, they were by far the longest conversations.

There is a tendency that all communication events are getting more similar. If the researchers are either all sitting or all standing or all moving or all standing and sitting, the conversations are about 2min long.

Otherwise they are less than half a minute long. Previously, the diversity of conversations was greater.

33

Claudia Erni Baumann and Roman Boutellier Because a lot of the other researchers can eavesdrop, there are fewer very long conversations than before. In the old environment various activities took place in a small space, it was possible to speak to one another even while pursuing different activities. In the new environment this is no longer possible.

6. Conclusion In a working environment in which the walkways are less predefined, there are fewer common paths, which lead to fewer conversations while moving. Our study, which examined a conventional cellular work environment with an open multi-space environment was able to show this.

Workplaces where other employees can eavesdrop result in shorter conversations. In particular, discussions while seated are shorter in a multi-space environment. The communication events while standing get a little longer, but they mostly occur away from the immediate workplace. This means that fewer "protection structures" in a work environment lead to a) more and shorter communication events and b) to more conversations during sitting or sitting and standing. The total time where all participants are on the move remains constant, but at a very low level. On the whole, one can say that the diversity of the communication events has gotten smaller and that movement is disappearing. From health point of view this means that that people move less during work.

What does this mean for creativity, and thus productivity in research? The impact seems to be mixed. On one hand, the work environment influences the communication patterns; on the other hand the physical movement behavior is affected. As we have seen in the theory part of this paper, the different ways of communication seem to play an important role for research activities. The open multi-space environment increases the weak ties, which in turn are crucial for new high-quality ideas, information exchange and knowledge dissemination. The goal to talk to a lot of other people has been achieved. However, too many contacts are detrimental to quality. The same is true for the group level: A certain level of connectivity is positive for the quality of ideas, but the quality decreases with a further increase of contacts. The fact that people tend to talk about common things rather than individual knowledge is supported by the environment, in which you can hear nearly every conversation. The open multi-space environment makes it possible to maintain close relationships and share complex knowledge. The immediate work is efficient. But there are fewer discussions with people who work in a different work environment and have totally different backgrounds. This is because researchers do not have to pass by other, different, research laboratories anymore and because there are almost no additional, team-overarching events, due to the assumption that the researchers are meeting anyway in the new environment. So, team-overarching events have to be managed as well.

Theory shows as well that the physical movement behavior has an impact on research performance.

Researchers move less during conversation in multi-space. Physical movement gives a special quality to communication events. If in the open multi-space environment people move significantly less, this has an impact on learning ability. In this study however, only the movement behavior during conversations was examined. In the new open multi-space environment researchers do always communicate, if not verbally, then through body language. One is always embedded in information flow. That makes it difficult to concentrate.

But for researchers, being able to think in self chosen solitude is important. However, the many face-to-face contacts promote communication across all media. Since many researchers are working in close proximity to one another, a low number of infrastructures are used by many and thus, because the researchers have to pass by the infrastructure used by others, more chance encounters take place. Thus the placement and concentration of specific equipment has to managed as well.

In summary, in order to benefit from the various advantages of a multi-space environment, the disadvantages of this form of organisation have to be managed consciously.

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Corporate Web 2.0 Systems Adoption in Russian Companies: Testing the UTAUT Validity Evgeny Blagov1 and Pavel Bogolyubov2 1 Graduate School of Management, Saint Petersburg University, Russian Federation 2 Lancaster University Management School, Lancaster, UK evgeniy.blagov@gmail.com p.bogolyubov1@lancaster.ac.uk

Abstract: The main obstacle of using corporate Web 2.0 systems as management tools is that these systems are usually not a result of the initiative of the employees of all the hierarchical levels existing in the organization, but an “upside-down” initiative of the senior management. Due to this reason, the activity of employees in using such systems can be less than expected due to psychological factors inclining the employees to resist the senior management’s innovative initiatives.

Consequently, a necessity arises to develop instruments allowing achieving the expected level of the employees' activity in accepting and using corporate Web 2.0 systems. To develop such instruments, it is important to figure out factors influencing the employees’ activity in accepting and using the corporate Web 2.0 systems and to develop models allowing predicting the influence of these factors on this employees' activity. One of the most promising models of such kind is the Unified Theory for Acceptance and Use of Technology (UTAUT) model that is summarizing views on the factors influencing the employees’ activity in accepting and using new technologies developed in a number of various management theories.

As for the moment, the UTAUT model is not being actively used in management practice, as currently the model is on the stage of testing its validity. One of the shortcomings of the empirical testing of the model’s validity by its authors is that it is tested on the samples belonging to a single national culture, namely that of the US. Most of the articles testing the validity of the UTAUT model in cross-cultural settings are also working with constrained samples: either samples of single organizations from countries other than of the Anglo-Saxon culture or the samples of similar organizations (e.g., universities) from a number of different countries. In this paper the validity of the UTAUT model is tested on a sample of 108 respondents facing the implementation of corporate Web 2.0 systems in three Russian organizations belonging to different industries. By means of including employees of different organizations into one sample, the influence of industry or organization specificity on the dependencies included in the model is decreased to a certain extent, thus allowing a deeper analyze of the national specificity influences. The Principal Component Analysis results show five statistically significant factors that are logically interpretable within the UTAUT model logic. This proves the validity of the UTAUT model in relation to the sample under scrutiny. A number of conclusions are made in the paper about the specificity of factors influencing the acceptance and use of corporate Web 2.0 systems in the organizations included in the sample. On the basis of this specificity, recommendations are given about development of instruments of stimulating the activity of acceptance and use of these systems in Russian companies. Finally, further directions of research development are suggested in the paper.

Keywords: UTAUT, technology acceptance, corporate Web 2.0 systems

1. Theoretical framework The Unified Theory of Acceptance and Use of Technology (UTAUT) model was developed in (Venkatesh et al.

2003). This model is based on comparative analysis of a number of different theories and models analyzing the factors influencing the user acceptance of information technologies.

The theories and models analyzed are the following: 

Theory of reasoned action;



Technology acceptance model;



Motivational model;



Theory of planned behavior;



Combined technology acceptance model and theory of planned behavior, “C-TAM-TPB”;



Model of PC utilization;



Innovation diffusion theory;



Social cognitive theory.

37

Evgeny Blagov and Pavel Bogolyubov An empirical comparative analysis of these models has been done with the help of a longitudinal field study of four organizations. The questionnaire has been designed containing the items from each of the tested theories and models. The respondents from each organization have been answering to the questionnaire at three points of time: the point right after the training program dedicated to the introduction of the new information technology, one month after the implementation of the new information technology, and three months after that. The use behavior of the respondents itself had been measured over the period of six months after the initial implementation of the new information technology.

This study showed the following results. Firstly, each of the models had at least one construct the influence of which on the use behavior had been statistically significant throughout all the three measurement points.

Secondly, several constructs from these had shown the statistically significant influence on the use behavior in more than one model. These constructs had been chosen to be included in the unified UTAUT model.

The chosen constructs include: 

Performance expectancy;



Effort expectancy;



Attitude toward using technology;



Social influence;



Facilitating conditions;



Computer self-efficacy;



Computer anxiety.

In addition to these constructs, the authors also included a number of moderator variables into the model, such as gender, age, computer experience and the voluntariness of use of the technology.

A number of hypotheses have been suggested about the influence of these constructs on the use behavior.

The hypotheses have the following formulations: Hl: The influence of performance expectancy on behavioral intention will be moderated by gender and age, such that the effect will be stronger for men and particularly for younger men.

H2: The influence of effort expectancy on behavioral intention will be moderated by gender, age, and experience, such that the effect will be stronger for women, particularly younger women, and particularly at early stages of experience.

H3: The influence of social influence on behavioral intention will be moderated by gender, age, voluntariness, and experience, such that the effect will be stronger for women, particularly older women, particularly in mandatory settings in the early stages of experience.

H4a: Facilitating conditions will not have a significant influence on behavioral intention.

H4b: The influence of facilitating conditions on use will be moderated by age and experience, such that the effect will be stronger for older workers, particularly with increasing experience.

H5a: Computer self-efficacy will not have a significant influence on behavioral intention.

H5b: Computer anxiety will not have a significant influence on behavioral intention.

H5c: Attitude toward using technology will not have a significant influence on behavioral intention.

H6: Behavioral intention will have a significant positive influence on use.

The resulting model is presented by the following figure: The validity of the UTAUT model was tested in [Venkatesh et al., 2003], firstly, on the same sample of the four organizations on which the theories and models unified by the UTAUT model had been tested. In addition to that, for cross-validation the model was tested on a different sample of 133 respondents from two organizations.

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Evgeny Blagov and Pavel Bogolyubov

Figure 1: The UTAUT model The following questionnaire was used for testing the UTAUT model validity constructs.

Performance expectancy 

I would find the system useful in my job.



Using the system enables me to accomplish tasks more quickly.



Using the system increases my productivity.



If I use the system, I will increase my chances of getting a raise.

Effort expectancy 

My interaction with the system would be clear and understandable.



It would be easy for me to become skillful at using the system.



I would find the system easy to use.



Learning to operate the system is easy for me.

Attitude toward using technology 

Using the system is a bad/good idea.



The system makes work more interesting.



Working with the system is fun.



I like working with the system.

Social influence 

People who influence my behavior think that I should use the system.



People who are important to me think that I should use the system.



The senior management of this business has been helpful in the use of the system.



In general, the organization has supported the use of the system.

Facilitating conditions 

I have the resources necessary to use the system.



I have the knowledge necessary to use the system.



The system is not compatible with other systems I use.



A specific person (or group) is available for assistance with system difficulties.

Self-efficacy 

I could complete a job or task using the system…

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Evgeny Blagov and Pavel Bogolyubov 

If there was no one around to tell me what to do as I go.



If I could call someone for help if I got stuck.



If I had a lot of time to complete the job for which the software was provided.



If I had just the built-in help facility for assistance.

Anxiety 

I feel apprehensive about using the system.



It scares me to think that I could lose a lot of information using the system by hitting the wrong key.



I hesitate to use the system for fear of making mistakes I cannot correct.



This system is somewhat intimidating to me.

Behavioral intention to use the system 

I intend to use the system in the next “n” months.



I predict I would use the system in the next “n” months.



I plan to use the system in the next “n” months.

The results of the validity testing on the initial sample showed that the UTAUT model can be a better predictor of 0.69% as compared to of the use behavior than each of the eight underlying models, with the adjusted these eight models’ highest of 0.53%. Even better predictive power was demonstrated by the UTAUT model in testing on the additional cross-validation sample, with the of 0.53.

The empirical validation of the UTAUT model in the original article (Venkatesh et al. 2003) shows the high predictive power of the model, but this validation was done only on the US companies sample, thus lacking the cross-cultural validity. Several other papers dedicated to the empirical validation of the UTAUT model (e.g., (Anderson, Scwager 2004; Li, Kishore 2006)) are testing the model on different samples, but nevertheless still belonging to the English-speaking countries.

An interesting example of testing the UTAUT model validity in culturally different settings is presented in (Oshlyansky, Cairns, Thimbleby 2007).

In this paper the validity of the model was tested on the sample consisting of representatives of nine different national cultures. Namely, the sample consisted of the university students from such countries as the Czech Republic, Greece, India, Malaysia, New Zealand, Saudi Arabia, South Africa, the United Kingdom and the United States. The total size of the sample was 1570 respondents. The original UTAUT questionnaire from (Venkatesh et al. 2003) has been slightly adjusted due to the peculiarities of the study. For example, the “behavioral intention to use the system” construct has been removed from the questionnaire, as the study was dedicated not to predict the use of the specific technology, but to test the cross-cultural validity of the model, while the “behavioral intention” is intended a predictor of the use of the specific technology. However, the preliminary tests had shown that these changes didn’t affect the validity of the questionnaire significantly.

The answers to the questionnaire are analyzed using the Principal Component Analysis (PCA). The factors has been treated as principal components if their eigenvalues were no less than 1. The loadings of no less than 0.3 were treated as having a statistically significant influence on the factor. The results of this analysis are suggested by the authors to prove the cross-cultural validity of the UTAUT model due to the following findings.

Firstly, the items of most of the UTAUT model constructs are demonstrating statistically significant loadings on a single “omnibus” factor. The authors explain it as the evidence of the fact that all the constructs of the model are measuring the same thing (namely, technology acceptance) in different cross-cultural settings.

Secondly, the variables measuring each of the individual constructs of the UTAUT model are grouping together on the same factors. Respectively, this is showing that the factors are measuring the same constructs across the samples of different cultures.

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Evgeny Blagov and Pavel Bogolyubov

2. Design of the study As is described above, the previous empirical tests of the UTAUT model have been using either the samples belonging to English-speaking cultures or the wide cross-cultural samples. Our study is testing the validity of the UTAUT model for the sample of respondents belonging to Russian culture. The respondents of the study belong to companies of different industries. It helps to minimize the influence of industry- and organizationspecific factors on the variables of the employees' acceptance and use of corporate Web 2.0 systems, thus allowing better concentrating on the influence of the factors specific for the national culture.

The sample of the study is including the respondents belonging to three organizations: the university students (namely, bachelor program students of the Graduate School of Management of the Saint Petersburg State University, hereinafter referred to as “GSOM SPbU”), software development company employees and employees of the banking outlet. The corporate Web 2.0 systems implemented in these organizations had been the BlackBoard system for the Graduate School of Management and the Microsoft SharePoint system for the software development company and the banking outlet.

The data had been collected by asking the respondents to answer to the online questionnaire.

The number of respondents to the questionnaire had been 108 persons, among them 31 GSOM SPbU bachelor student, 15 software development company employees and 62 banking outlet employees.

By gender profile, the sample consisted of 61 women (56.48%) and 47 men (43.52%).

The values of the moderator variable of age that were used in the study are “less than 20 years old”, “between 20 and 24”, “between 25 and 29”, “between 30 and 34”, “between 35 and 39”, “between 40 and 44”, “between 45 and 49”, “between 50 and 54”, “between 55 and 59”, “between 60 and 65” and “more than 65”.

By age, 23 respondents of the sample are younger than 20 years old (21.30% of the total sample), 34 respondents are between 20 and 24 (31.48%), 29 respondents are between 25 and 29 (26.85%), 13 respondents are between 30 and 34 (12.04%), 4 respondents are between 35 and 39 (3.70%), 5 respondents are between 40 and 44 (4.63%), and one respondent is of the age more than 65 (0.93%).

The values of the moderator variable of the experience in information technologies use that were used in the study are the “base level”, “average level”, “advanced level” and “expert level” By experience in information technologies use, 11 respondents (10.19%) reported to have the “base level”, 52 respondents (48.15%) reported to have the “average level”, 34 respondents (31.48%) reported to have the “advanced level”, and, finally, 11 respondents (10.19%) reported to have the “expert level”.

The questionnaire used was mostly the same as the original questionnaire of (Venkatesh et al. 2003), slightly reworded in accordance with the specific traits of the organizations (e.g., changing the word “job” to the word “study” for the GSOM SPbU students). Following (Oshlyansky, Cairns, Thimbleby 2007), the construct of “behavioral intention to use the system” has also been removed from the questionnaire, as the primary aim of the study was not to predict the use of a specific system, but to test the validity of the UTAUT model in a specific cultural setting. Continuing the model testing logic of (Oshlyansky, Cairns, Thimbleby 2007), the results are analyzed by the Principal Component Analysis with the help of the IBM SPSS Statistics 20.0 software. As in (Oshlyansky, Cairns, Thimbleby 2007), the factors with eigenvalues of 0.1 or more are treated as principal components, and the loadings of magnitude 0.3 or more are treated as having a statistically significant influence on the factor.

3. Results and discussion The results of the PCA after the Varimax rotation are presented in the table 1. The statistically significant loadings are marked with the sign “*”. Each separate item of the construct is representing the respective question of the UTAUT questionnaire.

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Evgeny Blagov and Pavel Bogolyubov

Rotated Component Matrixa Component 1

2

3

4

5

PE1

,853*

,293

,073

,013

,008

PE2

,890*

,150

,135

-,058

,019

PE3

,851*

,253

,068

-,154

-,013

PE4

,696*

,186

,277

-,051

,114

EE1

,424*

,575*

,098

-,132

,523*

EE2

,320*

,596*

,212

-,005

,463*

EE3

,263

,643*

,118

-,145

,611*

EE4

,330

,655*

,053

-,044

,516*

ATUT1

,801*

,334*

,089

-,079

,164

ATUT2

,728*

,074

,299

-,093

,354*

ATUT3

,650*

,263

,225

-,131

,552*

ATUT4

,756*

,236

,145

-,200

,337*

SI1

,478*

,450*

,417*

-,054

-,190

SI2

,092

,160

,696*

,015

,128

SI3

,316*

,552*

,322*

-,086

,161

SI4

-,036

,522*

,408*

-,147

,289

FC1

,151

,789*

,255

-,087

,123

FC2

,161

,813*

,140

-,122

,087

FC3

,236

,732*

,206

-,136

,057

FC4

,222

,744*

,156

,042

,123

SE1

,232

,775*

-,049

-,138

,006

SE2

,292

,531*

,455*

-,022

-,077

SE3

,093

,130

,821*

-,084

,030

SE4

,239

,223

,733*

-,070

,059

Anx1

-,329*

-,101

-,056

,758*

-,103

Anx2

,000

-,113

,025

,899*

-,028

Anx3

-,093

-,083

-,173

,855*

-,012

Anx4

-,642*

-,221

,148

,448*

-,131

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.

Table 1: Results of the PCA after the Varimax rotation Unlike the results of (Oshlyansky, Cairns, Thimbleby 2007), the results presented in the Table 1 do not show an “omnibus” factor with statistically significant loadings of all or nearly all costructs of the UTAUT model.

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Evgeny Blagov and Pavel Bogolyubov However, we treat these results as proving the validity of the UTAUT model as the factors shown by the Principal Component Analysis are logically interpretable within the UTAUT logic.

The Factor 1 has two constructs with all the items significantly loading on it: “performance expectancy” and “attitude toward using technology”. Moreover, the items of these constructs have the highest loadings among the items loading on this factor.

Consequently, this factor can be interpreted as, mostly, the combination if performance expectancy and attitude toward using technology.

Other items with high loadings on the first factor, namely first two items of the “effort expectancy” construct (““My interaction with the system would be clear and understandable” and “It would be easy for me to become skillful at using the system”), first and third items of the “social influence” construct (“People who influence my behavior think that I should use the system” and “The senior management of this business has been helpful in the use of the system”) and the first and the fourth items of the “anxiety” construct (“I feel apprehensive about using the system” and “The system is somewhat intimidating to me”) are also close by meaning to the combination of performance expectancy and attitude toward using technology. The interrelationship of these items allows interpreting the Factor 1 as the “subjective expectancy of use comfort”.

Items with statistically significant loadings on the Factor 2 are, first of all, all the items of the “effort expectancy” and “facilitating conditions” constructs.

Other items with statistically significant loadings on the second factor are the first two items of the “selfefficacy” construct (“I could complete a job or task using the system… 1) if there was no one around to tell me what to do as I go; 2) if I could call someone for help if I got stuck”), items from first to third of the “social influence” construct (“People who influence my behavior think that I should use the system”, “People who are important to me think that I should use the system” and “The senior management of this business has been helpful in the use of the system”) and the first item of the “attitude toward using technology” construct (“Using the system is a bad/good idea”).

The combination of effort expectancy, social influence and facilitating conditions is to some extent close to the “expectancy of comfort” notion of the factor 1. However, the items of “self-efficacy” and “attitude toward using technology” with significant loadings on this factor are closer not to the subjective comfort itself but to such factor influencing the subjective comfort as the subjectively perceived use efficiency. Thus, the Factor 2 can be approximately described as the “subjective expectancy of use efficiency”.

The Factor 3 is a mixture of “social influence” and “self-efficacy” constructs (namely, items of the “selfefficacy” construct describing the ability to “complete a job or task” with a help from social surrounding), thus making a factor relative to the Factor 1, but with more distinct social influence element. Thus, the Factor 3 can be approximately described as the “subjective expectancy of social comfort of use”.

The Factor 4 consists only of the “anxiety” construct items, but with positive sign loadings. We suppose that it can be interpreted in such a way that the employees with high anxiety toward using IT tend to invest more effort in using the IT, in this context, the corporate Web 2.0 systems. An interesting question for further inquiry seems to be the question of possible causes of this effect. We suggest two possible explanations. The first explanation is that computer anxiety can create an additional challenge for the employees in adopting and using the system. The second explanation is that the employees with high computer anxiety can demonstrate more effort in adopting and using the corporate Web 2.0 systems as a sign of loyalty to the innovative activities of the senior management.

Finally, the items with statistically significant loadings on the Factor 5 are all the items of the “effort expectancy” construct and the items from second to fourth of the “attitude toward using technology” construct (“The system makes work more interesting”, “Working with the system is fun”, “I like working with the system”).

However, all the loadings of the items of the “effort expectancy” construct have smaller loadings on Factor 5 than on the Factor 2 (although higher than on the Factor 1). Likewise, the loadings of the items of the “attitude

43

Evgeny Blagov and Pavel Bogolyubov toward using technology” construct on the Factor 5 are smaller than on the Factor 2. Thus, the Factor 5 can be interpreted as a factor close to the “subjective expectancy of use efficiency” (Factor 2), but of more individualcentered nature due to the absence of such ”social” factors as “social influence” and “facilitating conditions”.

4. Recommendations to practitioners The results of the Principal Component Analysis show that the main factors influencing the acceptance and use of corporate Web 2.0 systems for Russian companies are (at least, for this sample) the subjective expectancy of use comfort, subjective expectancy of use efficiency, subjective expectancy of social comfort of use and anxiety toward using the system (for the sample of the study, increasing the effort in acceptance and use of the corporate Web 2.0 systems).

Thus, it can be suggested that possible instruments of stimulating the employees’ activity in accepting and using corporate Web 2.0 systems in Russian companies should be oriented on balancing the employees’ subjective perception of personal efficiency in using these systems and the tolerance of the organizational social climate toward using the systems.

Several specific measures of each kind can be proposed.

As for the personal efficiency, the results of the Principal Components Analysis show that a very significant part of the subjectively perceived personal efficiency of the Russian business culture representatives is the perception of connection between personal efficiency and the efficiency of the organization. This allows making a recommendation that to increase the effort for adopting and using the corporate Web 2.0 systems in Russian companies, the reward policy for the employees using these systems must have a visible correlation with the results of the organization as a whole. For example, the remuneration of the employees using the corporate Web 2.0 systems could be designed to include a significant part of bonus payments correlated with the organization’s financial results.

As for the tolerance of the organizational social climate, possible measures that can be recommended should increase in employees the tolerance toward making mistakes in using the corporate Web 2.0 systems, thus lowering the possible social pressure on the employees that would be using these systems.

5. Further directions of research As was mentioned above, the loadings of the Factor 4 appear rather surprising, as the positive sign loadings of the “Anxiety” construct items are not consistent with the common sense about the influence of computer anxiety on eagerness to use the information technologies.

This result can be interpreted as a positive influence of the respondents’ computer anxiety on their effort in adopting and using the corporate Web 2.0 systems. We suggest two possible explanations for this result, namely, intrinsic motivation of meeting the challenge of using the system under conditions of computer anxiety, and social motivation of demonstrating loyalty to the innovative activities of the senior management.

So, an interesting and potentially fruitful direction of further research development is to test these two alternative suggestions.

In addition to this, it is obvious that testing the validity of the UTAUT model in a particular national context is only a first step in researching the influence of national culture on the acceptance and use of information technologies. The findings of this study should be further tested by specifically studying the implementation of particular corporate Web 2.0 systems in particular companies, probably by using longitudinal field studies methodologically close to those described in (Venkatesh et al. 2003).

6.

Conclusion

The results of testing the UTAUT model validity on the sample of organizations belonging to Russian culture prove the validity of the model in this context, because the factors unraveled by the Principal Component Analysis of the answers to the questionnaire are logically interpretable within the UTAUT logic.

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Evgeny Blagov and Pavel Bogolyubov On the basis of these factors several recommendations are given concerning the development of instruments of stimulating the activity of acceptance and use of corporate Web 2.0 systems in Russian companies. Namely, the recommendations consider sustaining the employees’ subjective perception of connection between personal efficiency and the efficiency of the organization (for example, by linking a significant part of the employees’ remuneration to the organization’s financial results) and developing the positive organizational social climate with a high level of tolerance to mistakes in using the corporate Web 2.0 systems.

Several suggestions are made about further research development directions in the area. Firstly, such research direction is suggested as a deep inquiry into the influence of computer anxiety on acceptance and use of corporate Web 2.0 systems in Russian companies. Secondly, we suggest longitudinal studies of implementation of particular corporate Web 2.0 systems in particular Russian companies.

As for the usefulness of the research for different types of audience, we suppose that the community of researchers of use and acceptance of corporate IT, particularly, corporate Web 2.0 systems, will methodologically gain from the research design of testing the sample of employees of different companies within one national culture. The companies (especially, Russian companies) will practically gain from the recommendations about stimulating the employees' acceptance and use of the corporate Web 2.0 systems.

References Anderson, J., Schwager, P. (2004) “SME Adoption of Wireless LAN Technology: Applying the UTAUT Model”, Proceedings of the 7th Conference of the Southern Association for Information Systems (SAIS), pp. 39–43.

Li, J. P., Kishore, R. (2006) “How Robust is the UTAUT Instrument? A Multigroup Invariance Analysis in the Context of Acceptance and Use of Online Community Weblog Systems”, Proceedings of the SIGMIS-CPR’06, pp. 183–189.

Oshlyansky L., Cairns P., and Thimbleby, H. (2007) “Validating the Unified Theory of Acceptance and Use of Technology st (UTAUT) tool cross-culturally”, Proceedings of the 21 BCS HCI Group Conference, Vol. 2, pp. 83–86.

Venkatesh, V., Morris, M.G., Davis, G. B., and Davis, F.F. (2003) “User Acceptance of Information Technology: Toward a Unified View”, MIS Quarterly, Vol. 27, No. 3, pp. 425–478.

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Innovation, Entrepreneurship and Sustainability: “This is an Idea!”

Cláudia Fernandes and Luís Rocha CATIM Technological Centre for the Metal Working Industry, Porto, Portugal claudia.fernandes@catim.pt lrocha@catim.pt

Abstract: Innovative and entrepreneurial behaviours are the basis for the creation of sustainable products and processes that preserve energy (and natural) resources. With this paper the authors argue and defend that adopting this principle of sustainability, where the response to actual needs in the present does not compromise the ability of future generations to meet their own needs, should be one the pillar in the educational systems (either formal or informal) and later on for industrial practices and manufacturing processes. The empirical part of this paper will be developed according to the case study’s approach methodology and grounded on “This is an idea!”, an activity encompassed in and out of school which is a hands-on project focused on experience, innovation and entrepreneurship for youngsters. The Technological Center has been running the project for 17 years and it has encompassed more than 9,500 youngsters between the ages of 10 and 17. The project’s main objective is to develop a positive vision of the industry, of employment opportunities and technical careers in the industrial sector, towards a sustainable and active citizenship. “This is an idea!”’s activities are designed to allow youngsters to: 1) Give new meanings and interpretations to reality; 2) Rationalise the impact of their learning in real settings; 3) Promote sustainable consumption and production awareness; 4) Develop new ideas promoting innovation and entrepreneurship; 5) Gain skills concerning divergent thought (e.g. creativity techniques) and viability evaluation; 6) Promote awareness for technical careers related to industry; 7) Promote awareness of industrial processes and its links to everyday life; 8) Promote and discuss the development of vocational identity. 3 outputs will be discussed and analysed: i) Ecowaters; ii) Hand-Write and iii) Citriwall. These outputs were thought up, questioned and developed by teams of youngsters according to the project principles. The pedagogical focus of the activities and the rationale for the products design is based not only on know-how (actions) and know-who (networking) but also on know-what (facts), know-why (science) and knowing how it works in real settings (industrial literacy), this is to say that besides the theoretical knowledge, the project gives emphasis to tacit knowledge and skills development on a wider scenario promoting sustainability behaviours anchored on innovation and entrepreneurship in the “new generation”.

Keywords: entrepreneurship; innovation; hands-on projects; sustainability; raise youth awareness; industry

1. Introduction Informal out-of-school education, namely hands-on projects, is a powerful starting point for the preparation of a creative workforce which is able to question and apply principles of innovation and sustainability to everyday life activities (products and processes). But, in order to facilitate sustainable innovation, all segments of society must be educated to understand economic and social connections (Autio, 2003; Seliger and Bilge, 2011; Marmot, 2010; Schaltegger et. al, 2012). A new awareness of the importance of innovations in technology, management, industry and everyday life is fundamental to global economic development, the preservation of life and natural resources along with the creation of social justice (Marmot, 2010). Innovation occurs when potentials are developed/applied and problems are solved.

According to the Sustainable Products Corporation (2012) sustainable products are characterised by providing environmental, social and economic benefits while protecting public health, welfare and environment through their full commercial cycle, at it might go from the extraction of raw materials, design, manufacturing or recycling, among others.

According to the theoretical background and technical expertise, the authors suggest the 3 P matrix analyses for sustainable products/processes: People, Product, and Planet. Each one of the vectors is closely related with the creation of social justice/fairness: People, the social vector, where the impact on lives, groups and society is questioned, aspects such has quality of live, quality of work and working conditions, education and training, entrepreneurship behaviours are looked upon; Product, the manufacturing vector, questions manufacturing and production processes and their impacts; and Planet, the environmental vector, where impacts on finite resources, recycling and re-use, and consumption patterns are looked upon.

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Cláudia Fernandes and Luís Rocha

Figure 1: 3 P matrix analyses – People, Product, and Planet

2. Method This paper is based on the case study methodology. It allows researchers to go to the field and study experiments in their natural setting and context. This methodology is particularly appropriate for “practical-based” problems where the actors’ experiences are important, and the phenomenon’s context is critical (Benbasat et al, 1987). Multiple sources of evidence were used, e.g. team reports, strategic documents, technical documentation produced by youngsters, analytical reports by the jury and technical staff, project outputs, press news. The paper will be based on qualitative data.

3. This is an idea!

“This is an idea!” (TIAI!) is an activity encompassed within a wider project - “Think Industry Technology” (TIT).

TIT is a hands-on, extra-curricular project, tailored for the country’s specifications (e.g. Portuguese industrial sectors) based on previously developed and validated intervention models. It encompasses youngsters with ages from 10 and 17 years old, and it has b e e n running in this technological centre since 1995 (Rocha, 1998) with more than 9,500 youngsters involved in it just in CATIM. The global project encompasses several different stakeholders such as: general citizens, parents, youngsters, the Technological Centres Network, Industrial companies, Universities, Polytechnics and Research Institutes, Industry and Professional bodies, Education and Training Providers, National and Local Government and Government Agencies. The project rationale was based on three problem dimensions: i) traditional image from the industry; ii) withdrawal of school children from industrial activities and careers; iii) training choices and market integration heavily influenced by commerce and services. The global aim is to develop a positive vision of the industry and employment opportunities and technical careers in the industrial sector toward an active and sustainable citizenship (see table 1).

Table 1: TIT main problem dimensions specific and global targets (source Fernandes and Rocha, 2001) Main Problem Dimensions Traditional the Industry

image

Specific Targets of

Withdrawal of school children from industrial activities and careers

• Develop a positive vision of the industry • To link industry with positive values and attractive careers • To make youngsters and industry closer (and vice-versa) • Evolve youngsters and industry in mutual approximation processes

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To develop a positive vision of the industry and of employment opportunities and technical careers in the industrial sector towards an active and sustainable citizenship

Cláudia Fernandes and Luís Rocha Training choices and market integration heavily influenced by commerce and services

• Make youngsters aware of industrial careers in short term • Motivate youngsters to carry on their studies in technological areas

The project has several different activities (see figure 2) that were designed so that youngsters discover alternative sustainable ways of learning, working and living in society – e.g. using Communities of practice (virtual or in-person), e-learning groups (Fernandes and Rocha, 2007; Fernandes and Rocha 2006 a, b; Rocha and Fernandes, 2006), practice teams, simulation games (Fernandes and Rocha, 2011), laboratory activities or field trips.

Figure 2: TIT segment activities On this paper the authors will focus on the activity segment simulation games with “This is an idea!” (Tiai!).

Tiai! is a simulation game designed to foster innovative and sustainable thoughts and to promote entrepreneurship and industrial property rights. It’s an industrial simulation game to be played in groups.

Each team has to come up with an idea for a new product/service/process. This product/service/process must have three criteria so that it can go forward: 

There shouldn’t be any similar product/service in the market;



It should be feasible and sustainable (economic and environmental);



It shall have selling potential.

The next step is the simulation of a constitution of an industrial enterprise. At this point it’s necessary to go by every industrial stage, starting from the birth of the “idea” until the product/service is placed on the market. The objective is to understand the product/service industrial cycle and to promote sustainable entrepreneurship and innovation among youngsters. The simulation game has four major phases: 

Team constitution – the groups should have four to six players;



Role definition - each player will be the chief/manager for a determined business area, with the following areas to distribute: CEO; Selling and Marketing; Innovation and Development; Finance; Production; Human Resources;



Idea operationalization;



Prototyping.

48

Cláudia Fernandes and Luís Rocha The game begins with a “brainstorming” session between all the managers which should take about 30 minutes. All the team members give ideas (no matter how silly they might appear) for the development of the new product/service/process. One idea is chosen based on the commercial potential and on the previous exposed criteria. The product to be developed and produced by the company is hereby defined. Each “manager” must think about several aspects (see figure 2) and the main conclusions are used to operationalize the idea and to fill in the final project form, so that the prototyping can begin!

Figure 3: Industrial cycle The authors will present and discuss the following examples – Ecowaters, Hand-write, Citrowall - that arose from the simulation game Tiai!. All the products presented were registered and the teams own the property rights of them.

3.1 Ecowaters Ecowaters was an idea developed by a group of four boys between 14 to 15 years old in the Portuguese Formal Teaching System. The team thought about everyday life tasks and got to one driver: “the need of some products that will be sustainable, ecological and profitable”. This was the pinpoint when the idea started to take shape. They figured out that when someone wants to take a warm shower, they switch on the hot water tap, then it’s necessary to wait for the hot water and a lot of “good” water is wasted, so they decided to solve this issue.The challenge was set: “To develop a mechanism that saves the cold water until the hot water comes to our shower”. Following these steps, Ecowaters was born, a simple mechanism which re-uses cheap existing parts which allows water to be saved and re-used.

Ecowaters consists of installing a temperature sensor and a valve that allows only hot water (temperature defined by the user) to flow out to the shower. Before this point, it is redirected for later use.

49

Cláudia Fernandes and Luís Rocha

Figure 4: Ecowaters prototype

3.2 Hand-Write Help-Write was an idea developed by a group of five students (4 girls and 1 boy) with ages from 15 to 16 years old in the Portuguese Formal Teaching System. The team focused on everyday life tasks: “some tasks seem very simple, but for some people, such as ones with different motion capabilities, they get very complicated”. This was the point when the idea started to take shape. In regular classes the team had a school colleague with a physical problem. He could not use a pen or a pencil as most of us do and “fine motor” movements are hard for him to perform due to a physical handicap. This was the problem situation they decided to solve.

So a question was set: “Why can’t we develop a mechanism that helps people pick a pen up in such a way that people with low fine motor skills can experience the pleasure of drawing or writing?”. Following these steps Help-Write was born, a simple, cheap, easy-to-handle mechanism that helps the user to hold a pen/pencil, and at the same time move the hands and have better movement control. Help-Write is an ergonomic support device that adapts to the hand where a pen can be settled. It contains a wristband so that the frustration of letting objects fall can be avoided (see figure 5).

Figure 5: Help-Write prototype The use of “Help-Write” can be generalised for various other situations, e.g. recovery from vascular diseases, hand exercise for older people, help people with temporary mobility difficulties to write. This idea was the winner of the 2007 national contest and it has been registered in the National Institute for Intellectual Property.

3.3 Citriwall Citriwall was an idea developed by a team of 3 boys with ages from 16 to 17 that were on the Portuguese Technical Teaching System. The idea arose due to the life experiences from the team members – a technical teaching system and personal hobbies such as product design and ceramics.

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Cláudia Fernandes and Luís Rocha

Figure 6: Citriwall prototype Citriwall was designed to be put on kitchen walls preforming three functions: squeezing oranges, making the area more pleasant, and contributing to water saving.

4. Discussion Tiai! was not designed to achieve “scientific literacy” but to promote “industrial literacy” although it is based on scientific and engineering principles. By industrial literacy we mean to promote knowledge on several aspects from the industry: industrial product/service life-cycle, advanced manufacturing technologies, sustainable products/processes, general theoretical and practical principles and implications, Industrial Property rights, the perception of industry, etc. But Tiai! activities are also designed to deal with specific objectives of developing innovation, creativity, sustainability and entrepreneurial spirit among youngsters.Analysing the simulation game, the idea generation process was very fruitful for every team: lots of ideas arose, but most of them already exist e.g. a microwave with a TV receiver, a chewing-gum disposal bucket, a pair of tennis shoes that grow with the feet. Only when youngsters started to think about their own everyday lives and experiences, ideas started to take shape and be operationalized. The conjunction of content knowledge, process skills knowledge and sustainable entrepreneurship awareness made possible the presented products – Ecowaters, Help-Write and Citriwall. Youngsters become aware that their knowledge is not confined by formal teaching and contents of a curriculum; their context and experiences are added value for what they can do in the present and in the future in several aspects of their lives (e.g. private, professional).

The authors suggest that sustainable innovations via entrepreneurism can be accessed by the 3 P matrix: People (Social vector), Product (Manufacturing vector) and Planet (Environmental vector). The analysis matrix was applied to the Tiai! products Ecowaters, Hand-write and Citriwall. Please see table 2.

Table 2: 3 P Matrix applied to Tiai! products (Ecowaters, Hand-write, Citriwall)

Ecowaters

Hand-write

Citriwall

People Social vector Entrepreneurship Incremental innovation Peer recognition Stakeholders recognition

Product Manufacturing vector Re-use of available resources (products, and subproducts) Incremental production

Planet Environmental vector Reduce waste water Re-use water Rational use of natural resources Re-use of components Environmental conscience

Entrepreneurship Incremental innovation Peer recognition Stakeholders recognition Social conscience Fairness for all

Re-use of available resources (products, and subproducts) Incremental production

Rational use of resources Re-use of components

People Social vector Entrepreneurship Radical innovation Peer recognition Stakeholders recognition

Product Manufacturing vector Design innovation Functionality New 3D prototyping technology Manufacturing conscience

Planet Environmental vector Rational use of resources Re-use of components in different ways (composite material)

51

Cláudia Fernandes and Luís Rocha We can clearly notice that prior to Tiai! Activities, youngsters have generic and imprecise images of the product cycle, industrial processes and predictions concerning sustainability of new (or renewed) products, while post-Tiai! Activities youngsters start to change their global perceptions on industry and industrial careers along with an increased awareness of sustainable entrepreneurial issues. The connection of their actions and possible consequences on people, product and planet is clearer. With Tiai! and its outputs (e.g. Helpwrite, Ecowaters, Citriwall) we can see that innovation, big breakthroughs, and entrepreneurship appear anywhere, with people of any age! Entrepreneurship/ innovative spirit and sustainable behaviours can be incited.

Intellectual creativity and “different ways” of seeing the same reality are important assets for the development of entrepreneurship capabilities.

5. Conclusions Industry, namely manufacturing, has huge potential for generating wealth, jobs, better quality of life and for promoting a fair and just society. This “new” industry must compete by adding value to the processes and products, and not just by reducing costs. These assets are made possible by the promotion of innovation and entrepreneurship with the help of trained and skilful people. Industry must attract and hold on to capable and qualified people going beyond demographic trends of aging and the unattractiveness of industry/manufacturing as a career. Solutions must encompass all areas, including formal and informal education, life-long learning, and promotion of healthier workplaces among many others. New reindustrialisation is required in most countries in order to face these other new or emerging challenges.

Entrepreneurship can be encouraged and promoted from young ages in a variety of forms, from out-of-school activities (e.g. the TIAI simulation game and other TIT activities), to the design of curricula, approaches to teaching, government policies and programs, sectorial associations’ intervention programs and campaigns, and many others. There are contexts that facilitate entrepreneurship such as environments that are open to new ideas where there is freedom to research and solve problems, and sometimes these assets are not present in most public and private schools. It’s also important to make youngsters aware of their capabilities and power to innovate and to be entrepreneurs contributing to a better and fairer society. Contexts which are open to entrepreneurship and innovation must also deal with failure; good ideas are not always big breakthroughs. On the other hand, there are also environments which inhibit entrepreneurship and innovation, e.g. places or schools with excessive rules/procedures and control, and not open to new ideas/activities. Young entrepreneurs (and others of all ages) need to have a keen eye to understand economic, social, and scientific realities and the capacity to understand evolutionary processes in the future. In other words they must have the capability to “see the big picture”.

Scientific data, common sense and intuition have told us that there is much to be done in the fields of innovation, sustainability and entrepreneurship to achieve economic growth along with a sustainable, prosperous and fair society. The Government, business people and researchers are aware and are taking action. But, programs like TIT and activities like TIAI! show that everybody has the power to act. Youngsters have an immense innovative and entrepreneur potential that must be encouraged and fostered so that an entrepreneurial and innovative culture is made possible aiming towards a fair society.

Acknowledgements Portuguese and European Founds (QREN – COMPETE – FEDER) grants finance Think Industry Project (01/SIAC/2008, project number 5248). This project is promoted by RECET.

References Autio, E. (1993)Technology transfer effects of new, technology-based companies: an empirical study, Helsinki University of Technology/Institute of Industrial Management, Helsinki.

Benbasat, I., Goldstein, D. and Mead, M. (1987) “The Case Study Research Strategy in Information Systems” MIS Quarterly, Vol. 11, No. 3, pp 396-386.

Fernandes, C. and Rocha, L (2006) The Conceptualization and Analyses of a Value Network: How to Create Value with Inter Organizational Communities of Practice? In José Cordeiro, Vitor Pedrosa, Bruno Encarnação and Joaquim Filipe (Eds), Proceedings on Society, e-Business, e-Government and e-Learning for the Second International Conference on Web Information Systems and Technologies, INSTICC – Institute for Systems and Technologies of Information, Control and Communication, Setúbal.

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Cláudia Fernandes and Luís Rocha Fernandes, C. and Rocha, L. (2006) Value Networks the Source of Collective Community Intelligence: One Case Study. In Piet Kommers, Pedro Isaías and Ambrosio Oikoetxea (Eds), Process of the International Association for Development of the Information Society – Web Based Communities 2006, IADIS, San Sebastian.

Fernandes, C. and Rocha, L. (2007). Pedagogy for collaborative learning: Technological and human issues in Proceedings of the IADIS International Conference on Web Based Communities 2007, IADIS, Salamanca.

Fernandes, C. and Rocha, L. (2011). Manufacturing Sustainability: Aligning youth mindsets. In Selinger, G, Khraisheh, M., Jawahir, I. (eds). Advances in Sustainable Manufcturing. New York, CIRP/Springer.

Rocha, L. (1998). Promover a Inovação e o Empreendorismo Junto dos Jovens Pense Indústria Inovação. In Motor de Innovación Ponencias y Comunicaciones Presentadas en el V Congreso Galego da Calidade, Xunta de Galicia, Santiago de Compostela.

Schaltegger, S., Laddeke–Freund, F., Hansen, E. (2012) “Business cases for sustainability: the role of business model innovation for corporate sustainability”, International Journal of Innovation and Sustainable Development , Vol. 6(2) 95-119.

Seliger, G., Reise, C., and Bilge, P. (2011). Curriculum design for sustainable engineering – Experiences from the international master program “Global production engineering”. In Selinger, G, Khraisheh, M., Jawahir, I. (eds).

Advances in Sustainable Manufcturing, CIRP/Springer, New York. Sustainable Products Corporation (2012).

What are sustainable products? [On-line] Sustainable Products Corporation, http://www.sustainableproducts.com/susproddef.html.

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Business Opportunities Associated with Changes in Ecosystem Services Giani Gradinaru Bucharest Academy of Economic Studies, Romania giani_gradinaru@ase.ro

Abstract. Biodiversity crisis is one of the many crises that started at the turn of the millennia. The strategy of action outlines a strong economic component, together with the recognition of market mechanisms as the most effective policies to protect biodiversity. In this context, biodiversity and ecosystem services are natural assets that play a key role in economic strategies to promote development and prosperity. With a view to identifying the main business opportunities that may be associated with the ecosystems services, our scientific approach and analysis has primarily focused in the first stage on the inter-connection between the economic mechanisms and the ecosystems services, thus aiming at substantiating the viability of existing relationship. For that purposes, we have analyzed the implementation methods and techniques of nature conservation policies. The concepts underlying the economic expression of the value of ecosystems services have thus (been) formed and developed. Developing market mechanisms for nature conservation purposes has become a significant trend growing stronger and faster each and every year. Although controversies and disputes still stir and leading to an obvious split between opponent supporters of conflicting opinions, both international organization and national governments acting either independently or in concert have initiated and implemented such mechanisms. The second part of our paper sets out the main business patterns that can be developed so as to fit into the triple referential requirements for a sustainable development (through the positive effects they create on three distinct dimensions): create profit (economic-wise), contribute to protection of bio-diversity (environment-wise) and helps out the equitable distribution of benefits (social-wise). Finally, points out that markets fail to quantify the value of most ecosystem services.

Existing price signals reflect at best, only a proportion of the total amount corresponding provision of food, water or fuel.

Keywords: ecosystem services, green innovation, entrepreneurship, business opportunities

1. Introduction Biodiversity crisis is one of the many crises that started at the turn of the millennia. Concrete form of expression is still disputed. The strategy of action outlines a strong economic component, together with the recognition of market mechanisms as the most effective policies to protect biodiversity. In this context, biodiversity and ecosystem services are natural assets that play a key role in economic strategies to promote development and prosperity. Developing and strengthening policies for transition to an economy based on efficient use of resources is the way forward.

To emphasize the co-viability specific to the connection economy-ecosystem services, scientific approach aimed on one hand how to implement policies for nature conservation and on the other hand, the concepts underlying the economic expression of ecosystem services’ value.

Environmental policy can be implemented by using tools such as: 

Legislation: This type of political instruments is a priority option to ensure sustainable use of natural resources, reducing pollution and the frequency of accidents affecting natural resources; to implement urgent measures to form the basis for applying all other implementation tools;



Market-based instruments: such instruments include taxes, subsidies, tradable permits, fees, etc.., using the mechanism of their action to change economic incentives and, consequently, the behavior of private actors when they decide to use resources.



Communication and information: the mechanism of these instruments including behavioral change through involvement, requiring respect for the well-being of others in a voluntary context, based on awareness of the individual action’s consequences on different plans and assuming activities as: understanding common interests, the availability of operational information, transfer of knowledge (for example, extended services) and the existence of attractive interactive information and communication.

Connection economy-ecosystem services is intended to create a system in which contributions of ecosystems to human well-being find an economic expression of value, becoming subject to market negotiations. This expression is justified on several grounds: 

Basis for decisions;

54

Giani Gradinaru 

Relationship between biodiversity and the poor;



Respecting economic principles;



Aligning incentives with the distribution of biodiversity benefits and ecosystem services;



Building a more efficient economy.

2. Basis for decisions Expression of the economic value of ecosystem services helps as basis for decisions by: 

Comparison of costs: Deciding factors with access to information on the value of ecosystem services are likely to be more effective and motivate regarding their actions and choice options. Identification and measurement of this value began to feed the policy-making process and turn into market signals. Further, saving opportunities can be identified through planning. For example, evaluation can help to compare services. Thus, water purification can be performed by ecosystems or treatment facilities. Knowing the costs of both options, we can make an economically fundamental choice. The same approach is also applicable for flood control and carbon storage.



Comparison of benefits: evaluation of ecosystem service also allows comparison between the benefits of nature conservation with the benefits of using those areas for other purposes (agriculture, urban development, tourism, mining, etc.), thereby helping to establish priorities in many situations.



Development of decision support tools: Expression of the economic value in the case of of ecosystem services contribute to building decision support tools for landowners, investors and other users of natural resources. Instruments may take various forms, such as: payments for ecosystem services, subsidy reform, pollution taxes, fees and charges for access to resources in national parks.



Policy impact assessment: The Framework Directive for Waters and the marine legislation which provides the establishment of Marine Conservation Zones in the UK will be evaluated based on knowledge of ecosystem services value.



Establishment of damages to be compensated in the case of ecosystems’ damage.

3. Relationship between biodiversity and the poor The relationship between biodiversity and the poor has direct economic implications. Biodiversity is important for all world population, but it is essential for the rural poor who depend directly on natural ecosystems regarding the food supply, building shelters, obtaining income, availability of fuel, medicine and quality of life.

Dependence of the ecosystem services in the case of the rural poor highlights the social impact of biodiversity loss and can be expressed by calculating the "GDP of the poor." In Brazil, the contribution of agriculture, forestry and fisheries to the GDP increased from 6% to 17% by considering the goods and services that are provided by the forest, but unrecorded in national accounts (Torras, 2000). The poor are more vulnerable because their access to other products and services is impossible or very expensive in relation to their opportunities to get income.

TEEB (2008) has highlighted the link between the persistent poverty and biodiversity and ecosystem services loss, demonstrating that this link compromise the fulfillment of some performance targets, proposed by the MDG (Millennium Development Goals) project, as the eradication of poverty and hunger, women's status in society, infant mortality, maternal health and economic development. This raises issues such as equity, property rights and distribution of the resulting impact from the degradation of nature.

4. Respecting economic principles Another important argument to emphasize the co-viability of the connection economy-ecosystem services is that this ensures compliance with a basic economic principle of environmental protection, namely: the "polluter pays" principle (payment made by the polluter is reflecting the value of natural resources in the case of private and public decision making process and aligning incentives with the primary interests of society). Its interpretation, regarding the use of resources, is that "beneficiary-pays”, formulated by TEEB (2008) as the “full cost recovery" principle (to transfer the costs of providing goods and services, including environmental costs, to the user or beneficiary; consumers pay the full cost of what they consume).

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Giani Gradinaru Ensuring compliance with this principle is achieved through legislative and fiscal measures that transform the economic cost of biodiversity and ecosystem services damages into visible signs for those responsible for their degradation, namely into incentives to change their actions cause. Thus, development of policies to allow users of resources dealing with all costs of such use is a key priority for policy makers.

These principles must be addressed by understanding them within the socio-economic context of each community. Otherwise, problems may occur. For example, higher prices for access to essential services like water for social groups who cannot afford to pay these prices. However, disadvantaged categories can be supported by granting payment or by concessions. This alternative is more effective than the low-cost (incomplete) service delivery for all categories of consumers. In fact, the situation would maintain a "lose-lose" framework, as it creates incentives to over-exploitation of resources without generating sufficient funds to be invested in conservation or reconstruction.

If designed properly, the management of natural capital takes into account the distribution of costs and benefits for all ecosystem services and stimulation of "win-win" situations, in which the welfare of poor is improved in terms of avoiding or reducing loss of biodiversity. Evaluation of the different strategies potential benefits can be used for identifying these opportunities.

5. Aligning incentives with the distribution of biodiversity benefits and ecosystem services Biodiversity is unevenly distributed, with a number of areas where it is much higher. To highlight them, two approaches are most frequently used: biodiversity hotspots and ranking countries according to the number of species from different categories.

Myers (1988) proposed the concept of biodiversity hot spots to support decisions regarding the localization of protected areas. Delimitation of biodiversity hot spots is based on two criteria: 

Number of endemic species and



The level of threat expressed by habitat loss.

By applying these criteria were defined 25 global hot spots, as the representation of figure 1.

1. Tropical Andes, 2. Central America, 3. Caribbean, 4. Atlantic Forests of Brazil, 5. Ecuador Chico / Western Darien, 6. Brazilian Cerrado, 7. Central Chile, 8. California Floristic District, 9. Madagascar, 10. Eastern Arch and Coastal Forests of Tanzania / Kenya, 11. Western Africa Forrests, 12. Cape Floristic District, 13. Juicy Karoo, 14.

Mediteranean Area, 15. Caucasus, 16. Sundland, 17. Wallacea, 18. Filipins, 19. Indo-Burmese, 20. Central and Suthern China, 21. Western Ghats and Sri Lanka, 22. South West Australia, 23. New Caledonia, 24. New Zeeland, 25. Polinezia/Micronezia.

Source: Myers, N. (1988) Threatened biotas: "Hot Spots" in Tropical Forests, The Environmentalist, 8, pp.1-20.

Figure 1: Biodiversity hot spots World Conservation Union (IUCN) developed a ranking of countries according to the number of species of three categories: mammals, birds and reptiles. Countries that are on the top ten from the perspective

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Giani Gradinaru of three categories are presented in figure 2. Countries such as Colombia, Brazil, China, India, Mexico, Malaysia are present in the top ten for several categories.

Diminishing biodiversity dependent ecosystem services are not yet correlated with the distribution of biodiversity, as local ecosystems generates benefits more widely - national and even international (e.g. carbon sequestration, providing medicines, food security). These benefits depend on local knowledge and management and in some cases on economic development opportunities. However, the populations of countries that host high biodiversity ecosystems do not get a receipt for the ecosystem services to which they contribute. Therefore, economically, their exploitation becomes more attractive than their protection.

Pasari

Mamifere 515

Indonezia

428

Malaiezia

1200

India

1200

311

Uganda Tanzania

310 0

100

200

300

1250

Bolivia

350

India

1275

Venezuela

359

Columbia

1447

Ecuador

361

Peru

1519

Indonezia

394

China

1622

Brazilia

409

R.D. Congo

1701

Peru

449

Mexic Brazilia

1721

Columbia

China

400

500

600

1195 0

200

400

600

800

1000

1200

1400

1600

1800

2000

Reptile 717

Mexic

686

Australia 600

Indonezia 383

India

383

Columbia

345

Ecuador 297

Peru

294

Malaiezia

282

Tailanda Papua Noua Guinee

282 0

100

200

300

400

500

600

700

800

Source: IUCN Figure 2: Top ten countries regarding the number of mammals, birds and reptiles species The policy should address this unequal distribution and the global benefits that biodiversity produces.

Distribution problem can and must be addressed nationally and internationally. In this regard, there are a number of certain political instruments that may help to solve problems of equity. These include PES, which rewards providers of benefits, until recently considered free. For example, utility companies have to pay for watershed protection.

PES applies to services such as water supply, carbon sequestration, soil protection and biodiversity conservation and can be used for local or international transactions. European Union (EU) spent over 2 billion / year to support PES schemes, represented here by agro-environment schemes and forestry, environment, incentives for low-impact land uses on biodiversity that ensure soil conservation (CE, 2003). The most promising international PES project is REDD+.

PES schemes must be carefully designed to achieve high rates of income and to avoid side effects of improper distribution. Conditions to be fulfilled in this respect are: defining property rights, adequate training for enhancing change, preparing to change, and eliminate power imbalances between local and external users.

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6. Building a more efficient economy Faced with the threat of climate change, governments have initiated a series of actions to promote progress towards a "low carbon" economy that minimizes the greenhouse gas emissions. It is necessary that this concept be developed relative to other resources. The more efficient economy is an economy that: 

Provide the right signals to represent the value of nature, from providing food, raw materials, access to clean water, to recreation, inspiration and sense of cultural and spiritual identity;



Ensure the best use for biodiversity, ecosystems and resources without compromising their sustainability;



Is supported by the society that respects the value of its natural capital.

In case of any other assets, the loss is not tolerated without asking what we risk to happen with this loss and why. As we ask these questions and identify answers in relation to biodiversity, we realize that the situation is not consistent with our expectations because the nature is lost and the loss rate is very high.

In the case of every buying decision is difficult to go through the whole chain of questions and answers (causes and effects) that transmit the consequences of your decision at a certain population level, but also in terms of lifestyle and values. In these circumstances, it becomes obvious the need for policies to transform the value judgments into market signals, into prices.

The more efficient economy from the perspective of natural resources use is a solution not only for nature conservation. Issues such as poverty and food security, which transcend borders, political regimes and levels of development, will be benefic "side effects”.

7. Analysis of business opportunities associated with changes in ecosystem services Development of market mechanisms for nature conservation is a trend that is increasingly stronger individualized within recent years. Although there are still many controversial issues that have already given rise to an obvious bias, international organizations and national governments have initiated and implemented in cooperation or independently such mechanisms. Consequently, they created the conditions for convergence between private interests and social interests of nature conservation, so there are opportunities for ongoing business development which leads, among other things, the positive effects on biodiversity.

Jonkers and collaborators (2010) consider that such business is a triple referential for sustainable development, through positive effects on three dimensions: creates profit (economics); helps protect biodiversity (environment) and helps fair distribution of benefits (social). Business models that can develop are grouped into the following categories: 

Carbon: compensation to maintain the carbon regulation services. This is one of the most popular markets through emission credits trading schemes. The voluntary emission credits markets are emerging too;



Water: Payments for watershed management to conserve water quality and volume. They are motivated by the treatment services (water orifice size) and hydropower potential ("green" energy);



Biodiversity: payments for conservation of natural habitats and ecosystems health. Compensation is the most common form of payment. EU and U.S. law require certain types of ecosystems loss compensation, as a result of economic activities, in order to avoid net loss of biodiversity (biodiversity credits or habitats bank);



Certified forest products: lumber and products;



Ecotourism: access fees in parks and payments for specific services (accommodation, transport, guides etc.);



Genetic resources / bio-prospecting: made by pharmaceutical companies.

Bishop (2009), completes this list with the following market segments, sectors and approaches: organic agriculture, sustainable fishing and aquaculture; sportive hunting and fishing and bio-mimicry (bionic).

Business developed in this area includes a combination of the previous mentioned categories. For example, maintaining forest can generate emission credits, tradable water rights, compensation (credits) for biodiversity and ecotourism revenues (the so-called package of payments). Another form, sufficiently developed, refers to

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Giani Gradinaru products certified as organic food, in which case the conserving ecosystems costs being included in price.

Business opportunities associated with changes in ecosystem services occur by considering new paradigms promoted by the concept of ecosystems management.

To create a business based on ecosystem services, their provision must be paid from public funds or by private buyers. Factors on which depend creating business opportunities can be grouped into three categories: corporate management, legislative framework and government mediation.

8. Evaluation of market limitations in the case of ecosystem services Markets fail to highlight the value of most ecosystem services. Existing price signals reflect at best, only a proportion of the total amount corresponding provision of food, water or fuel. Even in this case, prices may be distorted or to produce benefits without a trading market value. Value of other ecosystem services is not reflected, an exception being services that support tourism.

Ghazoul and collaborators (2009) considers the use of market mechanisms and, in particular, the PES limited by the following problem: inclusivity and poverty, high transaction costs, combining services, social pressure and flexibility of decisions.

Inclusivity and poverty - an important constrain for PES is that they are available to land owners that can provide quantifiable services and may exceed the transaction costs of participation in the program. Thus, the program excludes those who have no land or who have small areas. For example, in Ecuador, the PROFAFOR program operates only with owners holding at least 50 hectares. If the same criteria would apply in Kodagu region from India, almost all owners would be excluded. For those without land, the application of the required conservation regime of PES means the loss of seasonal employment opportunity.

Transaction costs are important for ecosystem services that may be provided independently and can be measured for many landowners. Negotiating with each of the owners increases cost, being the main restriction in the case of RUPES program implementation.

Combining services limits PES adoption due to the fact that majority of those entering the program are looking for a single service, or a limited number of services. By promotion, it is possible that other services be ignored or undermined.

Social pressure - the success of schemes involving the community depends on institutional structures that allow negotiation and communication between the stakeholders. This becomes very important when there are no clear-cut differences between correct and incorrect solutions and where the stakeholders are different in terms of power and values we respect. Conflicts and community organizations corruption is significant barrier to the use of PES. However, there is ample evidence that such situations can be overcome. For example, Kodagu Model Forest Trust is a partnership of several local organizations aimed at maintaining environmental quality and landscape of the region of Kodagu. The CAMPFIRE program in Zimbabwe, Chimboco community institutions from Bolivia, protected areas institutions established by the Uganda Wildlife Authority are other similar examples.

Decision flexibility is problematic given that landowners are bound by contractual obligations to carry out certain activities only because they cannot respond to any changes taking place in the market. The problem can be reduced and avoided by evaluating the delivery of ecosystem in the entire landscape.

The existence of these restrictions finds its explanation into poor correspondence between economic and social assumptions, considered to the proposal and development of market mechanisms for nature conservation. Thus, the reformulation of the "polluter-pays" principle under transformation into a positive externalities provider is not politically neutral. Conceptual change has significant implications, which are rarely discussed in the literature (Van Hecken and Bastiaensen, 2010).

Viewed from a broader perspective, the concept of externality is not without controversy. From the epistemological point of view, it defines both the problem and solution (Vatn, 2005) and does not take account the political influences, "offering an argument for giving the illusion that biological diversity can be saved without fundamental changes in current distribution of public power."

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Giani Gradinaru Other controversial issues are how it is defined an externality, the need to address negative externalities or positive externalities and direct and indirect consequences of these decisions.

An externality exists only if a third party is affected, which means a change with economic effect. Thus, the farmer may be polluted or environmentally protective, depending on how you perceive his business effects on ecosystems. Complex relationships between ecosystem functions, their dependence on context and limited knowledge of the interactions makes the externality, and its positive or negative evaluation, a local perception topic. Here is another argument for increasing information and awareness efforts of the local population, to ensure an accurate perception of externalities.

The choice between positive and negative externalities is another important dilemma. In the context of land use types, you can define both positive and negative externalities. However, their nature is not subject to technical evaluation. For example, a farm is exclusively producing agriculture products, and its owner decides to rebuild fencing with a hedge. Farmers must be rewarded for positive environmental contribution? Or will refer to the social limits of property rights, involving moral and social duty to respect the minimum requirements of environmental protection in farm management. If it is decided that the second case is true, the farmer will pay fees for non-compliance, which offset the negative externalities. When including the first version, i.e. that the investment made to rebuild containment leads to positive externalities, the farmer will benefit from incentives (tax breaks, direct payments). From this perspective, PES can be interpreted as "bribes" given by the company for providing ecosystem services. To increase the efficiency of PES, it is important to prioritize the most degraded areas, which can lead to "polluter pay" situations, contradicting the economic principles of environmental protection. Secondary effect may be that farmers deliberately destroy their land for the benefit of priority to participate in PES programs.

Based on purely economic reasoning, Wittman (1984) shows that spillovers are symmetric; that may be considered negative or positive, being removed by using instruments specific to each type. The existence of administrative costs (such as trading, negotiation) determines the need for a minimum negative standard, as "administrative costs must be less, to punish an inefficient farmer, which is much less than effective acting."

Implicit assumption is that most will comply with minimum standards. The reality in many developing countries, however, contradicts this assumption (Van Hecken and Bastiaensen, 2010).

Another problem is fairness. Thus, the question is whether it is justified or to what point it makes sense to ask users of ecosystem services to pay for services that were free and not used in any way contribute to the degradation of those services. In other words, access to water and clean air is a basic human right? Using positive externalities reward can lead to solutions at a different level, than the one the environmental problem determinants are acting. PES is seeking for financial sources to those representing the demand for ecosystem services, starting from those who benefit the most. To meet the requirement of equity, funds should be sought in determining the level of degradation of ecosystem services. Thus, the issue returns to determine the nature externality: positive or negative.

The implementation of market mechanisms for biodiversity protection has important implications for the legitimacy of actions. The key issue is the social limits of ownership. Thus, the appropriate characterization of externalities is not so much an object or a technical task, as a moral and political problem, based on a value judgment (Salzman, 2005). Also, differentiation of the evaluation criteria is a subjective process, even if many aspects are accepted as scientific facts, or examples of good sense.

Despite issues that weaken the theoretical background of market mechanisms as feasible tools to protect biodiversity and ecosystem services, such initiatives still have many followers and ambitious plans for their implementation.

Attention paid to market mechanisms for nature conservation has helped to raise political support (GomezBaggethun and collaborators, 2010) and the emergence of markets for ecosystem services. However, many uncertainties remain about side effects of this mechanisms generalization, which may manifest as changes in conservation motivation and in generalization of certain visions on human-environment relationship.

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9. Conclusions Public and private decisions affecting biodiversity seldom fail to take into account the benefits that manifest at regional or global level (e.g. protection of water resources). Also, they may omit the local public benefits (for example, the commercial exploitation of timber), even when the local living conditions are affected. Decisions are made mainly by taking into account short-term gains and not by taking into account the possibility of providing long term benefits. This systematic undervaluation of ecosystem services and the inability to highlight the economic value are the main causes of contemporary biodiversity crisis.

In these circumstances, it becomes very important to provide opportunity for public policy formulation and implementation, to highlight the main types of benefits and avoid their undervaluation. Policies should create well-functioning markets for ecosystem services, where their value is incorporated into price signals. At the same time, institutions and regulations may be established, together with secured funding.

The transition from the existing situation to desired one, pursued by these public policies may be seen as a difficult process, in which the main problems are related to the replacement cost benefits, for those who exploit ecosystems in the current situation, to the delayed manifestation of policy’s results, to both - business profile and way of life - change.

Overcome the problems depend on many factors, but change must occur at all levels of decision. This includes international collaboration for implementation. Experience of international agreements – such as the Framework Convention on Biological Diversity Conservation, IPCC - show that international cooperation efforts can favorably influence the political priorities and social attitudes. Inter-governmental science-politics Platform on Biodiversity and Ecosystem Services (IPBES) is a project which aims to create a similar framework to protect biodiversity.

Limits and shortcomings of market mechanisms to protect biodiversity and ecosystem services are used by the opponents of these mechanisms. One of these, the Friends of the Earth NGO, at a conference in Nagoya (2010) believes that "we cannot and should not rely on market mechanisms to meet the burden of government power. Commoditization and privatization of nature and biodiversity are false solutions. Biodiversity is not for sale. Existing financial incentives work against biodiversity in place to support it and often violate the rights of local communities� (Rojas, 2010).

Other issues considered problematic are synthesized by Wunder (2005), as represented by the possibility of financing to buyers of ecosystem services and capital formation, the confidence in PES system.

Thus, as a buyer you should have the possibility to fund ongoing payments. Then, while the demand remains restricted, extension services on offer is unrealistic. From the perspective of the supplier, any community may decide at a meeting of local authority to choose from ecosystem services in place to support to provide all services specific to ecosystems it manages. Except for the carbon sequestration services, that have a global impact, the other ecosystem services requires buyers or intermediaries initiative to ask suppliers to ensure a favorable maintain of ecosystems.

Creating a climate of trust, establish rules ans rewards can be a difficult process that requires time and the existence of trusted intermediaries. However, success is not guaranteed. Decades of paternalistic approach to rural development have created expectations that are difficult to overcome, even if all parties are taking benefits.

Acknowledgement This work was supported by CNCSIS-UEFISCDI, project number PN II-RU code TE_336/2010, agreement no.

45/03.08.2010.

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Giani Gradinaru Fitzsimmons, A.K. (1999), Ecosystem management: An illusion? PercReports, vol.17, nr.5, pp.3-5.

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Van Hecken, G., Bastiaensen, J. (2010), Payments for ecosystem services: justified or not? A political view, Environmental Science and Policy, nr.12, pp.785-792.

Vatn, A. (2005), Rationality, institutions and environmental policy, Ecological Economics, nr.55(2), pp.203–217.

Wittman, D. (1984), Liability for harmor restitution for benefit?, Journal of Legal Studies, nr.13, pp.57–80.

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EIP@AUC: A Case Study of a University-Centred Entrepreneurship Eco-System in Egypt Sherif Kamel and Ayman Ismail American University in Cairo (AUC), School of Business, Cairo, Egypt skamel@aucegypt.edu aymanism@aucegypt.edu

Abstract: The Entrepreneurship and Innovation Program (EIP) at the American University in Cairo (AUC) School of Business provides a best practice case study of how a university can contribute to building an entrepreneurial eco-system in an emerging economy. EIP was established in 2010 with a dual mission. First, to spread awareness and ideas of entrepreneurship and innovation to a broader audience by educating youth inside and outside the university about entrepreneurship and innovation; second, to identify, mentor, incubate, connect, and support those who possess the talents and desire to become entrepreneurs, facilitating their success in launching start-up ventures. In this paper, we provide a framework for how EIP@AUC contributed to building the eco-system in six key areas: entrepreneurs, ideas, networks, mentors, funding, and start-ups. This framework guides the activities, programs and performance evaluation of EIP. In each of these areas, EIP implemented a number of programs and partnerships with the objective of raising awareness, facilitating team formation, creating new innovative business models through ideation workshops and business plan competition, facilitating the creation of start-ups ventures through start-up weekends, building their business plans and connecting them with potential mentors, funders, team members and customers. We also discuss the partnership model that EIP emphasized in working closely with other actors. The case study also identifies a number of best practices and lessons-learned in university-centred entrepreneurship programs, and provides real-life experiences.

Keywords: Entrepreneurship, University, AUC, Eco-system, Incubator, Egypt

1. Introduction and background 1.1 Literature review of entrepreneurship education The general consensus of the importance of entrepreneurs in advancing a country’s economy (ABD 2009; El Dahshan, Tolba & Badreldin 2010; Hattab 2010; Wilson 2008) has in turn highlighted the role of universities in fostering and promoting an ecosystem for innovation and entrepreneurship (Wilson 2008). The first known university to offer entrepreneurship programming was Harvard Business School, who began offering courses on entrepreneurship in 1948 (Wilson 2008). Yet, “it was only in the last two decades of the twentieth century that any considerable attention was paid by academia to the role of higher education in the creation of graduate entrepreneurs” (Kirby, 2004). As evidence of this recent trend, the United Kingdom enlisted entrepreneurial development as a strategic goal for British universities in the year 2000 (UK 2000). Similar programs in other parts of Europe began emerging over the past decade, with such universities as Universidad Autonoma De Madrid in Spain, Delft University of Technology in the Netherlands, and GEA College of Entrepreneurship in Slovenia adopting entrepreneurship curriculum (NIRAS 2008) (with some minor exceptions to universities that began earlier (Wilson 2008)).

The variation in the definition of entrepreneurship plays an important role in shaping the programs offered by different universities. In the United States entrepreneurship commonly refers to innovation-driven and growth-oriented ventures or companies (Wilson, 2008). With that, universities in the U.S. have a critical role in connecting academics and students with real life business by developing networks with entrepreneurs, businessmen, venture capitalists, and angel investors (Wilson 2008).

Contrasting this, in Europe entrepreneurship is usually a synonym for small and medium enterprises (SMEs) in which most programs concentrate on teaching functional management skills for small business owners. The link between the university and the outside private business sector is quite minimal with a tendency towards encouraging students to secure future jobs rather than become entrepreneurs (Wilson 2008). Nonetheless, universities in Germany tend to take a more pro-entrepreneurship approach at which an internal structure of professors, departments, and other support services focusing on entrepreneurship exist (Hofer, et al., 2010).

Additionally, “entrepreneurship centers and technology transfer units” provide consultation and networks to future entrepreneurs (Hofer et al. 2010). Similarly, France favours the interaction between universities and

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Sherif Kamel and Ayman Ismail companies in fostering the entrepreneurial mindset of the students with a law on innovation and research released in July 1999 (Schmitt 2003).

One of the possible ways universities can support and promote entrepreneurship and innovation is through the creation and hosting of business incubators and accelerators. Business incubators provide a variety of services including managerial assistance, counselling, and networking (Schmitt 2003). Tangible support in terms of equipment and office spaces can also be provided. University-based incubators aim to assist promising entrepreneurs to use resources like university research labs and seminars (Bathula, Karia & Abbott 2011). The goal of these incubators varies between “[(a)] facilitating the start-up of new companies, increasing their survival rate and growth and, more generally, by training entrepreneurs, and (b) stimulating firms involved in emerging technologies or the commercialisation (or transfer) of research done in universities, research institutions and firms” (Bergek & Norrman 2008).

1.2 Entrepreneurship and innovation education in Egypt According to the 2010 Egypt Entrepreneurship Report for the Global Entrepreneurship Monitor (Hattab), the Total Entrepreneurial Activity rate (TEA) which measures the percentage of the population between the age of 18 and 64 years old who are either actively trying to start a business or already owning and managing a business was 7% in 2010. With such TEA level, Egypt ranked 37th among 59 countries that had their TEA measured in 2010. It is important to note that the majority of the young entrepreneurs chose to pursue entrepreneurship because they do not have better employment opportunities (Hattab 2010).

Despite the small percentage of entrepreneurial activity, the Egyptian government has established several support programs offering training, financing opportunities, and technical assistance to encourage entrepreneurship (Hattab 2010). In terms of rules and regulations that ease the process of doing business, Egypt was considered among the top global reformers for the simplification of administrative work in 2007 (OECD 2009). Egypt’s reforms are further highlighted by the creation of one-stop-shops allowing the start-up of a business to become an easier and more straightforward process (IBRD 2012). The government is also supporting entrepreneurship through financial opportunities, such as banks’ creation of departments to address particular SME’s needs (e.g. Banque du Caire, Banque Misr, and Bank of Alexandria (AFDB, 2009)).

Furthermore, the Social Fund for Development (SFD) and Industrial Modernization Center (IMC) created support programs for SMEs (AFDB 2009).

In addition to the government efforts, non-governmental organizations and educational institutions are also providing support to entrepreneurship. El Dahshan, Tolba, and Badreldin (2010) identified some of the most active organizations in Egypt that support entrepreneurship, including both governmental and nongovernmental programs: the Information Technology Industry Development Agency (ITIDA), the SME Development Unit at the Ministry of Finance, the Middle East Council for Small Business and Entrepreneurship, Nahdet El Mahrousa, Ashoka, Entrepreneurs Business Forum (EBF), Endeavor, Alashanek ya Baladi (AYB-SD), the Egyptian Junior Business Association (EJB), the Women Entrepreneurship and Leadership (WEL) Program at AUC, the Center for Entrepreneurship at Cairo University, and the European Training foundation (ETF). These programs vary in their scope and activities, and results on their effects are still too early to measure.

As for entrepreneurship and education in Egypt as a whole it is considered weak. Hattab notes that school and university students generally lack skills and knowledge that would allow them to start a business (2010).

Nonetheless, some experts claim that vocational training offered to young Egyptians allows some of them to start a business (Hattab 2010). It is important to note that the interest in entrepreneurial education increased after the law of promoting entrepreneurs that was passed by the government in 2004 (Masri, Jemni, AlGhassani & Badawi 2010).

2. Case study In the rest of this paper, we seek to demonstrate how an institution of higher education in Egypt has been able to promote an entrepreneurship ecosystem. The Entrepreneurship and Innovation Program (EIP), as it is called, is held at the American University in Cairo (AUC) (EIP@AUC). Over the two years since its founding, the program has demonstrated success in creating a pipeline of young entrepreneurs who are in the process of starting their start-ups.

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Sherif Kamel and Ayman Ismail Due to the program still being in its early stages, we were limited in our ability to gather long-term data and evidence related to the overall results of the program. Thus, findings are substantially anecdotal and based on direct experience. The case study was developed from the experiences and knowledge of the authors, who have been instrumental in the design and implementation of EIP, and also incorporated the feedback of others who have been intricately involved.

Here, we highlight the program mission, structure, and overall design, and describe why these facets were chosen as part of EIP. In the next section, we describe the vision for future development of EIP. We conclude with lessons learned. The goal of this case study is to highlight a model of entrepreneurship education and offer a suggested framework that can be applied in other regions and centers.

2.1 Entrepreneurship and Innovation Program overview th

EIP@AUC was launched on October 26 , 2010 by the School of Business in an attempt to realize its mission: “to create an environment that fosters the development of principled and innovative business leaders and entrepreneurs who can make a difference.” In collaboration with different stakeholders within AUC and partners within the community, the program aims to educate, train and inspire students in this intricacies of entrepreneurship through a combination of seminars, workshops, networking events, mentorship, business boot camps, and business plan competitions (Hafez 2012). EIP seeks to assist entrepreneurs in generating business ideas and connecting the most viable start-ups to incubators, venture capital, angel investors, and mentors.

At the early stages of building the EIP ecosystem, several discussions and meetings were held with different stakeholders—such as faculty, students, alumni, and business leaders—all with a common entrepreneurial passion. These discussions showed the need for non-academic programs and activities to increase the entrepreneurial awareness and create a pipeline of entrepreneurs. In response to the discussions, the school established the Entrepreneurship and Innovation Program Council and the Experts in Residence group, who acted as advisory bodies for the genesis of EIP, as well as the AUC Mentor100 network. In addition, the school supported the launch of the AUC Alumni Entrepreneurship Interest Chapter. EIP was founded with the aspiration of becoming the center of the region’s entrepreneurial ecosystem, helping to accelerate the growth of hundreds of entrepreneurial companies.

In addition to EIP’s current framework, AUC is working on the development of a university-based incubator.

Coined the AUC Venture Lab, it will act as the hub for all EIP activities, with a target on improving the Egyptian economy.

The key objectives of EIP, its programs, and the AUC Venture Lab are: 

Encouraging employment and job creation



Investing in people and innovation



Focusing on the development of high-growth small and medium-size enterprises (SMEs)



Empowering and engaging youth and building their capacity



Engaging the private sector in community development (CSR)

2.2 EIP@AUC: A framework for action EIP@AUC takes a comprehensive, eco-system approach in designing its action framework, focusing on six key areas: entrepreneurs, ideas, networks, mentors, funding, and start-up ventures (Figure 1). In doing so, the program take a partnership approach to implement its activities.

The initial focus area of the framework, entrepreneurs, begins with raising awareness on entrepreneurship among the participants (students and graduates), allowing them to enhance their understanding and familiarity with the concepts. This stage exposes entrepreneurs to the venture process and the eco-system, and also acts as a catalyst for start-up team formation.

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Figure 1: Six focus areas for EIP The second area, ideas, revolves around generating attractive ideas, conceptualizing business opportunities, and developing business plans. Attractive ideas are those that respond to the Egyptian market needs.

Leadership panels, partnerships with incubators, and summer camps are the major activities of this stage.

Creating networks is the third area of EIP’s framework. Through the collaboration of 28 universities and institutions across Egypt and several other business schools around the world and through the involvement of influential political and social figures from different sectors, participants are exposed to real life examples of entrepreneurial experiences. Meetings and discussions are carried out between like-minded entrepreneurs and industry experts and local leaders.

The mentors’ area revolves around coaching and mentoring potential entrepreneurs through the development of their business plans and launch of their start-up. Mentors also sometimes provide internships in start-ups.

The mentoring process is accomplished through collaboration with the AUC Mentors100 network, as well as faculty advice, workshops, and training programs.

The following area involves capturing funding. Through EIP, entrepreneurs are connected to venture capitalists, angel investors, and potential investment partners, and/or are offered financial awards through start-up competitions.

Lastly, in an attempt to connect start-up ventures to the market, some entrepreneurs are admitted to business incubators while others are assisted in promoting their ideas to the market. This is done by either connecting start-ups to incubators/accelerators, or by supporting incubated start-ups in partner organization and providing visibility and access to start-ups.

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2.3 Evolving EIP: a university-based incubator In seeking to expand EIP beyond its current framework, AUC is in the process of creating a university-based incubator/accelerator, the AUC Venture Lab. The venture lab will offer new entrepreneurs several services assisting their start-ups, helping increase their survival rates and secure access to funding from angel investors, venture capital, or other sources. The main aim of the AUC Venture Lab is to transform an entrepreneurial idea into an actual fundable business.

The AUC Venture Lab will deploy four main strategies. First, it will seek to offer acceleration and incubation services to entrepreneurs at the early start-up phase. Second, to assist in developing excelling entrepreneurs, the AUC Venture Lab will offer an intensive educational program that highlights entrepreneurship, selfempowerment, and innovation. The Venture Lab will also engage the EIP Mentors100 network to mentor entrepreneurs. Towards the end of the program, incubated start-ups will be assisted in securing funding through angel investors, VCs, and other financial partners.

To assess the success of the AUC Venture Lab, AUC has developed a number of key performance indicators (KPIs). The main indicator of success is the number of start-ups that the AUC Venture Lab creates. Others include the number of entrepreneurs trained through the AUC Entrepreneurs Development Program (EDP); the number of start-up ventures incubated and supported by the AUC Venture Lab services; and the number of start-ups able to access funding (and the amount of funding) as a result of AUC incubation. In addition, mentorships that link entrepreneurs with successful business executives and entrepreneurs is a further indication of success. Finally, the Venture Lab will measure long-lasting partnerships developed between startups, business, government, or educational institutions.

3. Conclusions and lessons learned Our experience in establishing and managing the EIP@AUC program has taught us a number of lessons applicable to educational entrepreneurship programs. Here, we identify four key lessons learned.

First, we have found a high level of importance in using a partnership model collaborating with other players in the eco-system. For example, EIP partners with the two leading venture capital funds and a newly established angel investor network to connect them to start-ups that they may be interested in funding. EIP also works with a number of non-profit organizations providing entrepreneurship training to youth across Egypt and helps them with their activities. EIP created a customized educational program, the Entrepreneurs Development Program (EDP) to train all entrepreneurs hosted by a leading high-tech incubator in Cairo. EIP jointly organized numerous activities to spread entrepreneurial awareness. Such a partnership model helps AUC, its students, and its ventures to gain synergies with others in the field. The number of actors in the entrepreneurship ecosystem in Egypt is still limited, and creating partnerships with the most active helps EIP and the other organization expand their reach, make the best use of our resources, and grow our network.

Such a model also strengthens the eco-system and the other players.

Second, we see that it is critical to build on the assets and strengths of AUC as a university in designing the program and the incubator. This includes utilizing existing services across faculties within the university, such as facilities, labs and equipment, and centers; focusing on areas where there is interaction between the incubated start-ups and the students and faculty; and where the start-ups could benefit from being incubated at AUC. For example, the first two start-ups to be incubated at AUC Venture Lab were created by an AUC professor and an AUC alumnus; both are based on innovations in science and engineering in the areas of biotechnology and solar energy. In each case, the start-up is working with AUC students to improve their business plan, implement marketing research, conduct additional technical research, and connect with AUC network of funders and mentors. Through this integration with the university, these start-ups benefit tremendously, and also contribute to the university and its students. This relationship makes a university-based incubator distinctive from any off-campus incubator.

The third lesson learned is to use an experimental/gradual approach in growing the scope of EIP activities.

During the first year of the program, our initial focus was on creating awareness within campus on entrepreneurship, among faculty, students and alumni. During the second year, we expanded to create partnerships with key actors in the eco-system, and expand the scope and number of our activities. During the third and current year, we are working on building the university-based incubator. Our aspiration for the next

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Sherif Kamel and Ayman Ismail year is to create a funding vehicle to fund start-ups incubated at the AUC Venture Lab. This gradual approach provided us with the ability to experiment and learn, to build a stronger network with key players, and to invest our resources wisely.

Finally, we have seen that the creation of local stakeholders for the EIP@AUC program helps build a solid support base and lay a foundation for long-term sustainability. Individuals and institutions who feel they have a stake in the program—whether they are from within or outside the university—tend to have greater interest and care in the program. Many become further engaged in the program, often becoming cheerleaders who help seek the program’s success. For example, we have worked closely with one of the largest global high-tech companies in planning and executing our business plan competitions. Through last year’s competition, they selected a winning team to represent Egypt in their “global challenge” in Silicon Valley, where innovationbased start-ups from different countries compete. They are keen to see our competition continue to provide strong global competitors. Similarly, local venture capital funds are eager to see a strong pipeline of start-up companies that feeds into their investments, and are keep to see EIP activities continue to build the awareness and the base for such a pipeline. These stakeholders become strong long-term supporters to the program.

References AFDB. (2009) Egypt Private Sector Country Profile, African Development Bank, Tunis, Tunisia.

Bathula, H., Karia, M. and Abbott, M. (2011) The Role of University-Based Incubators in Emerging Economies, Working Paper no. 22, [Online] Available from: http://www.crie.org.nz/research-papers/WP%2023Teaching%20Business%20Ethics%20Hanoku%202.doc [Accessed 2 September 2012].

Bergek, A. and Norrman, C. (2008) “Incubator best practice: A framework”, Technovation, Vol. 28, No. 1-2, pp 20-28.

EIP. (2010) Entrepreneurship and Innovation Program – EIP, American University in Cairo, Cairo.

El Dahshan, M., Tolba, A. and Badreldin, T. (2010) Enabling Entrepreneurship in Egypt, Towards a sustainable dynamic model, Entrepreneurship Business Forum, Alexandria, Egypt.

Hafez, G. About EIP. [Online] Available from: http://www.aucegypt.edu/Business/eip/Pages/AboutEIP.aspx [accessed 10th September 2012].

Hattab, H. (2010) Egypt Entrepreneurship Report 2010, Global Entrepreneurship Monitor.

Hofer, A.R., Potter, J., Fayolle, A., Gulbrandsen, M., Hannon, P., Harding, R., et al. (2010) From Strategy to Practice in University Entrepreneurship Support: Strengthening Entrepreneurship and Local Economic Development in Eastern Germany: Youth, Entrepreneurship and Innovation, OECD, Paris, France.

IBRD. (2012) Doing Business in a More Transparent World, The International Bank for Reconstruction and Development, The World Bank, Washington, D.C. Kamel, S. (2011) Entrepreneurial Uprising, American University in Cairo, Cairo.

Kirby, D. (2004) “Entrepreneurship education: can business schools meet the challenge”, Education + Training, Vol. 46, No. 8/9, pp 510-519.

Masri, M., Jemni, M., Al-Ghassani, A. and Badawi, A.A. (2010) Entrepreneurship Education in the Arab States, UNESCO, Beirut.

NIRAS. (2008) Survey of Entrepreneurship Education in Higher Education in Europe, NIRAS Consultants.

OECD. (2009) Overcoming Barriers to Administrative Simplification Strategies: Guidance for Policy Makers, Organization for Economic Cooperation and Development, Paris, France.

Schmitt, C. (2003) “Entrepreneurship and University: Reflections on the role of the University Incubators”, Paper read at 12th International Conference on Management of Technology, Belfort, France.

UK Universities (2000) A Forward Look Highlights of Our Corporate Plan 2001 – 2004, [online], Available from: http://www.universitiesuk.ac.uk/Publications/Documents/CorpPlan2.pdf [accessed 10th September 2012].

Wilson, K. (2008) Entrepreneurship Education in Europe, European Foundation for Entrepreneurship Research, Paris, France.

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Entrepreneurship Education: Shifting the Landscape through Embedding Practitioner Experience Lester Lloyd-Reason Centre for Enterprise Development and Research (CEDAR), Anglia Ruskin University, Cambridge, UK Lester.Lloyd-Reason@anglia.ac.uk Abstract: The QAA Framework for Higher Education Qualifications (England) in General Business and Management states that ‘Preparation for business should be taken to mean the development of a range of specific business knowledge and skills, together with the improved self-awareness and personal development appropriate to graduate careers in business with the potential for management positions and to employability in general. This includes the encouragement of positive and critical attitudes towards change and enterprise, so as to reflect the dynamism and vibrancy of the business environment. In a report recently produced by the National Council for Graduate Entrepreneurship (NCGE), the National Endowment for Science, Technology and the Arts (NESTA) and the Council for Industry and Higher Education (CIHE) concluded that ‘Entrepreneurship education is currently taught primarily through modules in business school courses and extra-curricular activities. HEIs need to enhance the perception and relevance of entrepreneurship education, so students and staff recognise the value of its combination of innovation, creativity, collaboration and risk-taking skills to a wide range of disciplines’. This paper focuses on a ground breaking programme specifically designed to address these criticisms of the way in which enterprise and entrepreneurship is taught in universities. There are a huge number of programmes on offer across within European Higher Education with the words ‘enterprise’ and ‘entrepreneurship’ in the title, but what makes the BA (Hons) Enterprise and Entrepreneurial Management unique is the close involvement of entrepreneurs right from the outset, including course design, module content and delivery. This is achieved through an ‘entrepreneur in residence’ network, with Walter Herriot, Managing Director of St John’s Innovation Centre, Cambridge, one of the world’s leading incubation centres, as Director. This enables leading entrepreneurs to be embedded in fabric of the programme through playing a very active role in the continued development of the curriculum, content, and delivery of the pathway.

Additionally, each student is allocated an entrepreneur as mentor for the duration of the three year programme. This paper will firstly explore the key issues raised by the policy community and others calling into question the appropriateness of the way in which enterprise and entrepreneurship is taught. It will then look at the way in which universities are responding to these comments. The paper concludes with a case study of an academic programme developed and delivered jointly by academics and practitioners.

Keywords: Entrepreneurship, entrepreneurship education, practitioner experience

1. The Context Over the last ten years, there has been an increasing level of academic and policy interest in the role of higher education institutions as agents of economic and social development, through not only their research and teaching activities but also their engagement with individuals and businesses in the wider local and regional economy. For example, a recent report from the Council for Industry and Higher Education, the National Council for Graduate Entrepreneurship and NESTA in the United Kingdom notes that ‘HEIs have increasingly become more involved in regional economic and social development (through closer business, industry and third sector collaborations …) and activities such as the commercialisation of intellectual property’(NESTA, 2008, p. 10).

Across a range of developed market economies, there have been a number of policy statements which have outlined ways in which the outreach or ‘third leg’ activities of higher educations institutions can be enhanced and supported. In the United Kingdom, for example, the Innovation White Paper (DIUS, 2008a), the Enterprise Strategy (BERR, 2008) and the Employer Engagement Reforms (DIUS, 2008b) all outline different scenarios for higher education institutions supporting the development of the capabilities and skills of individuals and businesses to survive and thrive. This policy narrative has manifested itself in programmes of support and funding stream including the Higher Education Reach Out into the Business and Community Fund, the Science and Enterprise Challenge Fund and the Higher Education Innovation Fund. As a result, HEIs have introduced a range of activities and initiatives to support students and staff in engaging with their community and viceversa. Incubation spaces, technology transfer offices, business planning competitions and business development programmes are now common across the HEI landscape.

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Lester Lloyd-Reason One key element of focus within such activities has been the development of enterprising students and graduates through enterprise education. Evidence from economies such as the United States highlights the potential contribution of enterprising students to competitiveness and productivity, particularly through facilitating organisational change and business start-up. Hannon et al. (2004) report on statistics from the United States that demonstrates that business start-ups by graduates accounts for between 6 and 8 per cent of national GDP. In addition, there is evidence of mis-match between the supply of graduates and the skills required by employers. Research undertaken by CIHE demonstrates a gap between perceived importance and levels of satisfaction in terms of commercial awareness and communication skills. Archer and Davison (2008, p.

8) note that: It appears that while many graduates hold satisfactory qualifications, they are lacking in the key ‘soft’ skills and qualities that employers increasingly need in a more customer focused world.

There has been a relatively recent proliferation of enterprise education offerings in higher education institutions in economies such as the UK, as a way of providing students with an awareness of the abilities, behaviours and skills required to compete within different employability contexts (Hartshorn and Sear, 2005).

In parallel to such activity, the academic literature on enterprise education in higher education has mushroomed. Given the relatively newness of activity, there are a number of studies which have focused on mapping the extent and nature of enterprise education offerings. Recent surveys by EFER (2004) and NCGE (2007) highlight that: 

Levels of student engagement vary across different contexts and whilst there is evidence of growth, current levels are approximately 10 to 20 per cent of students in an institution



The majority of growth in enterprise education activity has occurred over the last five years. The research

by EFER identified 69 centres of Entrepreneurship across Europe

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The majority of enterprise education is provided through business schools, with limited examples of other departments and faculties proactively engaging with such activity



There are a variety of entrepreneurship-related activities and services, such as business plan writing competitions, mentoring and coaching programmes, student placements, incubation and managed workspace and advisory and information services



Classroom based lectures tend to be the predominate teaching method, although there is recognition of the need for experiential learning in practice



Extra curricular entrepreneurship education provision tends to be underpinned by using public sector funding, introducing a degree of reliance on external stakeholders for the continuation of activity.

These studies have also identified that higher education institutions have adopted different approaches or models to the delivery of such enterprise education activity. These approaches can be classified into two key groupings: focused and dispersed (Gibb, 2005). In the former, a specific centre or unit (e.g. a Centre for Enterprise) is provided with the responsibility for the co-ordination and delivery of enterprise education activity across the University. With the dispersed model, activity is embedded within specific departments and faculties. These approaches are associated with different challenges and opportunities. For example, a focused approach may encounter difficulties in developing ownership of specific enterprise education activity within specific departments or faculties and different reward structures for staff in central units may create tensions with other members of staff.

Other challenges which may influence the delivery of enterprise education activity in higher education institutions include: 

A constantly changing policy environment which supports innovation, as opposed to the continual delivery of successful activity



A reliance on funding from public sector sources which may hinder longer-term planning and delivery

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The coupling of enterprise with business start-up which may hinder embedding of enterprise education in other departments and faculties

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A lack of evidence as to the effectiveness of different approaches and activities to supporting enterprise education

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Lester Lloyd-Reason As noted above, there has been a focus on traditional teaching and learning pedagogies, such as lectures and case studies, which may hinder engagement with ‘opportunities for live learning in which entrepreneurial practice and experience may be introduced’ (NESTA, 2008, p. 11). Indeed, there is a lack of insights as to how external practitioners, such as entrepreneurs and enterprising people from different contexts can be embedded within the development and delivery of enterprise education offerings.

2. The state of play within the Higher Education sector The European Commission Green Paper On Entrepreneurship (2008) states that within university entrepreneurship training should not only be for MBA students it should also be available for students in other fields, However, with a few notable exceptions this has not happened within the Higher Education (H.I.) sector.

Indeed even within Business schools the whole enterprise agenda has been undervalued resulting in an uneven offering across the sector where in the main enterprise as a subject remains on the periphery offered either as an option elective or at best bolted on to the pervading corporate model of education to create a degree programme that has enterprise/entrepreneurship the title, but with little change in the content and none in teaching methodology.

There has in business schools been an attempt to define the subject area for example is teaching for enterprise or about entrepreneurship. These words are often seen as synonymous, however entrepreneurship is in essence about starting a new venture. Enterprise is the whole concept of how students need to think in a completely different way to face the challenge of work in the 21st century.

Not everyone will want to start a business, but all students need to be enterprising both for success in the work place and to add value to society. Therefore business schools need to change the way they both structure and deliver enterprise education. They have not thus far taught enterprise skills except where they are seen as relevant to understanding new venture creation, thus making it appear that this “special few” who are entrepreneurial have or need such a capability. Indeed most of such entrepreneurial programmes are formulaic in structure and traditionalist in methodology, which only serves to underpin the view that entrepreneurs are different to the rest of mainstream business. This has been and still is a very dangerous weakness in the understanding shown by Business Schools about the enterprise agenda and it’s importance to their collective futures.

There has then to be a major cultural change in the way Business Schools operate if they are to face these changes that are coming. Acceptance that there needs to be a move to a model of integrated learning with more student management of the process and a wide and more innovative use of technology is essential.

Business schools in the UK have to move rapidly from an educational orthodoxy based on separate disciplines being taught in silos and managing the learning process by and arcane approach to teaching and learning that is reliant on didactic teaching approach and the production of ever more obtuse work books to an educational methodology that embraces the concept of enterprise and integrated business skills thus placing them at the centre of the curriculum and not on the periphery.

Further there has to be a much deeper understanding that such activities as creativity, problem solving, understanding innovation, risk management and culture change coupled with decision making and confidence building which in turn leads to self reliance, open minded respect for evidence and a willingness to take on responsibility, are the absolute core issues of the enterprise concept.

In order to achieve this change Business schools need to interact more with the entrepreneurial world by bringing successful enterprising people into the development and delivery process. This is something again which many Business schools have not embraced due to a culture of academic insulation that if not changed will render them increasingly non competitive.

3.

Embedding Practitioner Experience: A case Study – BA (Hons) in Enterprise and Entrepreneurial Management

3.1 Background to the course The objective behind the development of this course was to address many of the issues identified above through establishing a benchmark programme in the area of enterprise and entrepreneurial management. It

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Lester Lloyd-Reason provides the students with conceptual and theoretical insights into enterprise, innovation and entrepreneurial management, as well as the practical abilities and skills to apply this understanding within a range of different business, community and organisational contexts.

It has been developed by the Centre for Enterprise Development and Research (CEDAR) within the Ashcroft International Business School (AIBS), Anglia Ruskin University, Cambridge, UK. CEDAR has a well established reputation for its work in the area of enterprise and entrepreneurial management within the region and at a national and international level. CEDAR recently acted as expert consultant to the 44-country OECD-APEC study titled ’Removing Barriers to SME Access to International Markets’ which made policy recommendations to the 44 governments included in the study, the European Commission and the World Trade Organisation (WTO).

With regard to curriculum design, CEDAR worked in close conjunction with Walter Herriot, who as Managing Director, built St. John’s Innovation Centre, Cambridge into a world leader in Business Incubation. The joint development team of academics and entrepreneurs allows the course to bring together theory and practice in a coherent academic programme of academic study.

The extensive academic and entrepreneurial networks of the development team allowed practitioners to be involved from the outset. An ‘entrepreneur in residence’ network was established, with Walter Herriot as Director, to ensure that leading entrepreneurs were closely embedded in the fabric of the course from the start, playing a very active role in the continued development of the curriculum, content, and delivery of the academic programme. In this way the course aims to blend theory and practice to provide graduates of the programme with the skills, attitudes and aptitude required if they are to thrive in a highly complex, fast changing business environment.

The ‘entrepreneurs in residence’ network The ‘entrepreneur in residence’ network represents a central pillar underpinning the course. The entrepreneurs play a central role and their activities can be summarised as follows: 

Provide advice to the development team with regard to the design of the overall course



Work in collaboration to with academic staff to develop the individual modules.



Contribute to the delivery of the pathway though an agreed mix of guest sessions, advice on appropriate module content, observing student presentations and assisting in the assessment process.



Agree to be allocated to an individual student and act as mentor to that student until the time of graduation.



Act as advocates for the programme within the regional business community.



Encourage entrepreneurial firms to provide placement opportunities for the students through the Learning in Residence module.



Provide experiential learning opportunities for the students within their own enterprises.

It is important to stress that the aim in developing the ‘entrepreneur in residence’ network is to embed enterprise and the experiences of entrepreneurs within the academic programme and as such the above list is indicative rather than prescriptive. The key however is the intention to build a sustainable set of relationships capable of embedding the world of enterprise and entrepreneurial management into the course.

A key role of the entrepreneur is one of mentoring the students. In addition to the Personal Tutor appointed under the University Personal Tutoring system, each student on the course will be allocated a member of the ‘entrepreneur in residence’ network who will act as their personal mentor for the duration of the academic programme. The Personal Tutor and the entrepreneur will then work closely together to support the ongoing learning needs of the student. This creates a very strong link between the Personal Tutor system and the ‘entrepreneur in residence’ network whist at the same time providing the student with a very powerful learning support structure. This will have particular value in supporting the student during the ‘Learning in Residence’ placement period.

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Lester Lloyd-Reason Before briefly describing the academic programme, below is a brief profile of some of the entrepreneurs involved in the course.

Walter Herriot Director of the Entrepreneur in Residence Network Managing Director, St. John’s Innovation Centre Walter Herriot built St John’s Innovation Centre into one of the most successful business incubators in the world. Regarded as one of the founders of the Cambridge Phenomenon, Walter is Chair of the Cambridge Chamber of Commerce, Chairs both the EEDA Enterprise Hubs in the East of England and Enterprise East and is a member of the steering committee of the Greater Cambridge Partnership. A former Cambridge Evening News "Businessman of the Year", in 1999 Walter was awarded an OBE for services to enterprise.

Billy Boyle Co-founder / Director Owlstone Ltd

Billy Boyle is co-founder and director of Owlstone which develops and commercialises MEMS chemical sensors for industrial and military use. Founded in 2004, Owlstone currently employs 30 people, has raised $10M in the USA and has won a $3.7M contract from the US Department of Defence. Billy is first and co-author on numerous conference and journal papers, has presented at a number of prestigious international conferences and is co-inventor of 19 patents.

Ludo Chapman Managing Director Grant Instruments Ltd

Ludo Chapman is Managing Director of Grant Instruments Limited, a 53 year old company specialising in the design and manufacture of scientific and data logging equipment. Ludo joined Grant after many years running a successful software training company, which he grew into a £1m turnover business with clients such as British Gas, Pearl Assurance and Addenbrokes Hospital. Ludo is an active member of the CBI, working on the CBI small business council.

Charles Cotton Director UK-based Library House, Cambridge Enterprise and Wigadoo

Charles Cotton has been at the forefront of successive waves of technology innovation – computing, broadband communications, information services, digital mapping and location based services, and Web 2.0.

He is a director of UK-based Library House, Cambridge Enterprise and Wigadoo, a director of US-based Solarflare Communications, Feeva Technology and Terabitz. He is a Supervisory Board member of Tele Atlas, the Euronext Amsterdam listed supplier of digital maps, and active investor in, and adviser to, venture capital firms and is a business angel.

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Lester Lloyd-Reason Iain Cruickshank Managing Director

Ian Cruickshank for many years managed multi-million pound building and construction projects, while building a property portfolio with a current value of £4M. In the early 1990’s he established elecheck, an electrical safety testing company which now employs 80 staff with a further 50-60 contract/consultancy staff.

With a turnover of £5M the firm services the requirements of over 2,500 organisations. In addition, Ian has invested over £500k in AIM listed companies and start-ups and still holds a considerable shareholding in a variety of businesses in excess of £1M in value.

Julie Horne Business leader, consultant and coach

Julie Horne is an experienced business leader, consultant, and coach with broad experience in a variety of business and public sectors. In 1989 she founded Oakland Innovation Ltd to provide information and consulting services to support service and product innovation in science and technology based companies and universities. This business was successfully sold in 2006 and Julie now provides business consulting and coaching to senior executives in the corporate, SME and public sectors. Typical assignments include business mentoring; leadership and management development; and organisational development.

Bev Hurley Chief Executive YTKO

Bev Hurley’s career spans inner city regeneration in London, a corporate career with a global north American mining company, and the growing of three successful companies, in healthcare packaging, the creative industries, and her own management consultancy. She was appointed Chief Executive of YTKO in 1999, an economic development and business consultancy which has helped hundreds of businesses to start, raise funding, and get to market. Bev is on the board of EEDA, a Member of the East of England Science and Industry Council and the SME Advisory Committee of the Industry and Parliament Trust Amy Mokady Entrepreneur

Amy Mokady is a serial entrepreneur who has held senior sales, marketing and business development roles in start-ups and multinational companies. She was a co-founder and marketing director of STNC Ltd., which was acquired by Microsoft in 1999. Following roles working at the forefront of the mobile industry at Microsoft, QUALCOMM and Hutchison 3G, more recent start-ups include Pogo Mobile Solutions, Light Blue Optics and Mo.Jo. Amy is also a Director and mentor of several early-stage technology start-ups, a Director of the Greater Cambridge Partnership, and a Board Member of the Cambridge Angels.

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Lester Lloyd-Reason Micah John Styles Managing Director CLR Global Group

Micah is founder and Managing Director of the CLR Global Group, a visionary Group of specialist international recruitment consultancy companies, which has been operating on a truly global scale since 2001. A ‘Born Global’ entrepreneurial business, the CLR Global Group have operations in Qatar, China, Brazil and Mauritius.

Prior to founding the CLR Global Group Micah worked in senior finance positions in Media companies in the UK and South Africa and currently directs his commercial endeavours and oversees his worldwide interests from his home in the South of France.

Steve Westcott Founding Director Melbourn Scientific

Steve Westcott is founding director of Melbourn Scientific, a company that provides analytical chemistry and formulation support to the global Pharmaceutical, Biotech, Healthcare and Biopharmaceutical Industries.

Having previously held senior positions at GSK (formerly Glaxo) in Ware, Steve is a Fellow of Royal Society of Chemistry. Established in 1999, Melbourn Scientific has grown year on year and under Steve’s direction is now clearly established as one of the premier labs for Pharmaceutical Analysis in Europe. In 2006 the firm moved into 20,000sq ft of space and now has a staff of around 60 employees.

4. The academic programme With regard to the coverage of key academic areas for the subject, the majority of existing enterprise and entrepreneurship degree programmes are either highly practical in nature or ‘knowledge’ based. This course takes the approach of marrying these two together through developing an enterprising skills set alongside the practical application of those skills. Schools and Colleges increasingly report that ‘enterprise clubs’, ‘run your own business’ schemes and other programmes tend to capture the attention of those students alienated from more traditional subjects and who are likely to drift away from education. Having been persuaded to stay within the education system, upon entering University these students again typically encounter traditional functional subjects such as finance, HRM. For many students this is perfectly appropriate, but for the type of student likely to be attracted to the proposed pathway this is insufficient, their interest is again lost and they tend either to drift out of the educational system or to badly underperform due to lack of interest or motivation.

This course, through a highly innovative and radical approach to curriculum design and delivery aims to capture the passion and imagination of this neglected group of students. At the outset, the students are introduced to the concept of enterprise through two innovative modules ‘Foundations of Enterprise’ which provides an understanding of enterprise as a discipline and ‘Enterprise in Action’ which allows for the initial development of core enterprising abilities and skills.

The ‘Enterprise in Action’ module, as the name suggests, is a very practical, hands on module. To this end, the development team worked in partnership with Virgin Money to provide the students with an opportunity to work on a real business opportunity. Virgin Money had for some time been exploring the potential market for Pet Insurance. Virgin Money provided the students with their market intelligence and provided a dedicated liaison person and the students were required to prepare an outline business plan for the market potential and the best route to market. This plan was then presented t the senior management at Virgin Money in their boardroom at the conclusion of the module.

In the second semester the students are placed within an entrepreneurial business, not on a traditional student placement where low level tasks are often undertaken, but to provide exposure to the trading realities facing the entrepreneurial enterpriser and to offer opportunities for personal skills development through such

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Lester Lloyd-Reason mechanisms as mentoring and shadowing. This is the first stage in the students’ outside journey and is called ‘Learning in Residence’.

The ‘Learning in Residence’ module plays a central role in the teaching and learning strategy of the course. This is not a standard student placement opportunity, but rather represents the first stage on the students’ external journey. The aims of this module are to: Provide exposure to the trading realities and challenges facing the entrepreneurial business; Provide insights into managing in a complex environment; Offer opportunity for personal skills development through informal mentoring and shadowing; Create opportunities for problem solving, creative thinking, the development of networks and strategic awareness.

Keith Hermann, Deputy Director of the National Council for Education and Entrepreneurship, has described the ‘Leaning in Residence’ module as ‘a fabulous invention and although there are numerous schemes which encourage work-based learning for students via placements, the design of this element of the programme is fundamental to its success.’

Consistent with the highly innovative nature of this course, an innovative approach is taken to the learning and teaching methods used to achieve the learning outcomes. Teaching will be undertaken in blocks often away from the University within entrepreneurial businesses and other locations. For example, Paul Bourne, Artistic Director of Menagerie Theatre Company, Managing Director of Ensemble Training and Visiting Fellow in Management Training at the Centre for International Business, AIBS will take the students to a theatre to take part in the creative process of developing a piece of theatre from scratch.

Within a wider context, the course address a number of policy and practice agendas at a regional, national and international level, not least the emphasis of Governments to embed enterprise in education institutions and prepare students for a highly dynamic and uncertain labour market (Davies Review, 2002; Leitch Review, 2006).

As part of the programme, 2 students worked with MEDO and UK Trade and Investment S Africa as part of a 5week programme to promote entrepreneurship to young South Africans. The paper presentation will expand on the impact of this work and the joint lessons we can learn both in S Africa and more generally from this experience.

5. Some thoughts in conclusion This paper has identified a number of policy initiatives aimed at promoting the development of skills and capabilities required by graduates if they are to survive and thrive within the modern fast paced, highly competitive entrepreneurial environment. Evidence of the contribution made by enterprising students to competitiveness and production, particularly through facilitating organisational change and business start-up has been cited. However, the key issue underpinning this paper is that higher education institutions have demonstrated relatively few offerings able to provide students with an awareness of the abilities, behaviours and skills required to compete within different employability contexts.

In recent years there has been growing interest in the area of enterprise education, resulting in a huge increase in the academic literature in the area. This body of work appears to suggest that within HEIs there largely remains a focus on traditional teaching methods and learning pedagogies such as lectures and case studies. In the paper we note that there is a lack of insights as to how practitioners can be embedded within the development and delivery of enterprise education offerings.

The case study presented here is one of many examples of good practice to be found within the Higher Education. Such programmes, however, that embed practitioners into the teaching of enterprise and entrepreneurship appear to be the exception rather than the rule. This paper contends that there are significant weaknesses in the way Business Schools in general approach the teaching of enterprise and entrepreneurship.

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Lester Lloyd-Reason We would argue that Business Schools need to move from a model of educational orthodoxy to a more integrated based approach which interacts in a much more meaningful way with the entrepreneurial world.

One of the ways this can be achieved is by bringing successful enterprising people into the development and delivery process. The case study above provides an example of how this can be done efficiently and effectively.

References Archer, W. and Davison, J. (2008) Graduate Employability: What Do Employers Think and Want? Council for Industry and Higher Education, London.

Department of Business, Enterprise and Regulatory Reform (2008) Enterprise: Unlocking the UK Talent, The Stationery Office, London.

Department for Innovation, Universities and Skills (2008a) Innovation Nation, The Stationery Office, London.

Department for Innovation, Universities and Skills (2008b) Higher Education at Work: High Skills: High Value, Department for Innovation, Universities and Skills, London.

Department for Innovation, Universities and Skills (2006) UK Skills: Prosperity for all in the global economy – world class skills, London.

Gibb, A.A. (2005) Towards the Entrepreneurial University, Policy Paper No. 3, NCGE, Birmingham.

Hannon, P. (2004) Making the Journey from Student to Entrepreneur: A Review of Existing Research into Graduate Entrepreneurship. Final Report for the National Council for Graduate Entrepreneurship, Institute of Small Business Affairs Consortium, Birmingham.

Hannon, P. (2007) Enterprise for All? The Fragility of Enterprise Provision across England HEIs, Journal of Small Business and Enterprise Development, 14, 2, pp. 183-210.

Hartshorn, C. and Sear, L. (2005) Employability and Enterprise: Evidence from the North East, Urban Studies, 42, 2, pp. 271-283.

Leaning and Skills Development Agency (2002) The Howard Davies review of Enterprise and the Economy in Education, London.

NESTA (2008) Developing Entrepreneurial Graduates: Putting Entrepreneurship at the Centre of Higher Education, NESTA, National Council for Graduate Entrepreneurship and Council for Industry and Higher Education, London.

National Council for Graduate Entrepreneurship (2007) Enterprise and Entrepreneurship in Higher Education, National Council for Graduate Entrepreneurship, Birmingham.

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Innovation and Cooperation in Emerging Economies: Two Sides of the Same Coin?

Anne-Laure Mention1, Serdal Temel2 and Marko Torkkeli3 1 Centre de recherche public Henri Tudor, Luxembourg, Grand Duchy of Luxembourg 2 Ege University Science and Technology Centre, Turkey 3 Lappeenranta University of Technology, Kouvola Unit, Finland Anne-laure.mention@tudor.lu Serdal.temel@ege.edu.tr Marko.torkkeli@lut.fi

Abstract: This study aims to investigate the effects of openness on the performance of the innovation process in a leading transition economy. More specifically, it explores the role of cooperation on innovation propensity, measured as the introduction of goods or services. It further delineates the effects of cooperation with partners located in specific geographical areas on the performance of the innovation process and it investigates the effect of each cooperation partner on the innovation outcome. The analysis encompasses the various types of innovation, thus embracing product, process, marketing and organisational innovations. The empirical setting for this research is Turkey, which is a leading developing economy and has experienced significant growth in the past few years. The dataset consists of more than 5000 observations, from manufacturing and service sector firms, and covers the years 2006 to 2008. It is slightly similar, in many respects, to the Community Innovation Survey, which is the harmonized instrument for measuring and monitoring innovation efforts across Europe. The findings reveal that doing R&D either continuously or occasionally affects the probability to introduce novelties. Conducting simultaneously marketing, organisational and process innovations also increases the likelihood to innovate. Further disentangling the cooperation partners and their effects on innovation propensity unveils that process, marketing and organisational innovations are determinants of product and service innovation, thus confirming that the various innovation types are intertwined and mutually supporting each other. From a geographical perspective, cooperating with customers/clients and with government bodies and public research institutes from the same country plays a dominant role in determining the innovation outcome. Cooperating with consultants and private labs on the other hand seems to negatively affect innovation performance. The role of foreign cooperation remains ambiguous as results were not statistically significant. This study further uncovers insightful features of the innovation process in a country that has been hitherto largely overlooked in innovation studies.

Keywords: open innovation, performance, cooperation, emerging and transition economies

1. Introduction The Schumpeterian mode (Schumpeter, 1942) of the individual entrepreneur, which considers separately the 3 stages of invention (i.e. research leading to the generation of new ideas), innovation that consists of the development of these new ideas into marketable products and finally, the diffusion process across the market, has been superseded by new models highlighting the interactive nature of the innovation process. According to those models, multiple players are collaborating so as to turn an idea into a potentially successful product or service. Along these lines, innovations have been acknowledged to result from interactions between individuals, teams, groups located both and outside the boundaries of the firm, as already strongly emphasized in the third generation of innovation model (Rothwell, 1992).

Despite the growing awareness of these open, networked and interactive features of the innovation process, there is hitherto little empirical evidence on the impact of opening up the innovation process on performance, either considered in economic terms or adopting a broader conceptualization of performance so as to encompass financial and non financial criteria, is another critical area of interest for innovation management.

Lichtenthaler (2011) further claims that quantitative research dealing with the measurement of the effects of openness nature of the innovation process on performance has only begun to emerge. This observation resonates with the findings of Dahlander and Gann (2010), whose recent systematic literature review indicates that large-scale quantitative studies remain scarce, with some notable exceptions such as Laursen and Salter (2006) and Van de Vrande et al. (2009). Most of the studies have hitherto concentrated on developed economies (e.g. Tether, 2005) and neglected transition and developing economies.

This empirical study precisely aims to investigate the effects of openness on the innovation process and on its performance in a leading transition economy. More specifically, it first investigates how cooperation affects

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Anne-Laure Mention, Serdal Temel and Marko Torkkeli innovation propensity, measured as the introduction of novelties, either goods or services. Then, it further delineates the influence of the geographical location of the cooperating partner, as well as the type of partner on the innovative performance. Finally, it considers how cooperating affects the degree of novelty of the innovation introduced.

2. Theoretical background Literature on the rationales for cooperation in innovation activities abounds and usually distinguishes interfirm cooperation, intra-firm cooperation and cooperation with science partners. Inter-firm cooperation has been demonstrated to support firms in their achievement of three complementary goals. First, it contributes to the creation of a critical mass of resources that allow firms to handle more complex and more demanding ventures. This critical mass of resources may be a consequence of a combination of similar resource bases, through resource pooling or may be derived from the bundling of unique repositories of skills, expertise and knowledge of individual firms. Second, it enables firms to rely on counterpart’s resources and achieve higher levels of agility and flexibility in the distribution of tasks both within and across different yet common projects.

Finally, through their partners’ networks, firms can indirectly extend their own pool of potential resources and partners.

The benefits of co-operation have been extensively studied and summarized by Ahuja (2000): endure environmental shocks, improve economic performance and likelihood of survival, gain access to complementary resources, learn new skills, absorb technology, have control over relation with other companies, keep abreast with competitors and improve efficiency. Moreover, access to technology bases through inter-firm co-operation or alliance has been demonstrated to help companies to redefine and reposition themselves in the market in terms of technology (Stuart et al., 1996). Co-operation for innovation is also often motivated by the willingness to gain access to new or foreign markets and to share the risks and costs associated with R&D activities.

Critical factors for successful co-operation agreements have been identified in strategic alliance literature and include trust, communication, matching of resources, organizational structures and processes (George and Farris, 1999). Besides the adequacy of this matching, the ability of firms to keep and maintain the skills balance is another key success factor (Hanna et al., 2001). The potential of firms to generate innovations is dependent on the prior accumulation of knowledge they have absorbed (Fiol, 1996), in line with the concept of “absorptive capacity” introduced by Cohen and Levinthal (1989). Inter-firm cooperation also embraces coopetition (Brandenburger and Nalebuff, 1996), which refers to the simultaneous practices of cooperation and competition practices. Besides the pooling of resources and the quest for synergistic effects (Das and Teng, 2000; Huang et al., 2009), co-opetition may also occur in the context of standard setting or when firms aim at jointly achieving a dominant design, which in turn fosters other innovations.

Cooperation with universities, research centres and the like has also been extensively studied, leading to mixed conclusions. On the one hand, they have been identified as critical partners for the development of more radical or new-to-the-market innovations (Becker and Dietz, 2004; Kaufmann and Tödling, 2001). Some scholars have also concluded that cooperating with science partners positively influence the so-called intermediary outputs of the innovation process, such as patents (e.g. Miotti and Sachwald, 2003). On the other hand, some have argued that the knowledge developed by these partners is less likely to be applicable in the short term, and that they are frequently slow to react (Tether, 2002) and may not meet the needs of some industries, such as services industries (e.g. Tether, 2008). Despite the growing body of literature on “open innovation” (Chesbrough, 2003), and the effects of opening up the innovation process on innovative and economic performance, large-scale studies concentrating on qualifying and quantifying the impact of the openness nature of the innovation process remain scarce.

This observation is further exacerbated when emerging economies are considered. Nevertheless, most prior studies focusing on manufacturing industries in developed economies tend to support a positive effect of cooperation on innovation performance, though to various forms and extents according to the type of partner or the cooperation intensity (e.g. Monjon and Waelbroeck, 2003; Tether, 2005; Tether and Tajar, 2008), our expectations naturally follow the same lines and we adopt an “a priori positive bias” of the effect of opening up the innovation process. The lack of prior empirical evidence in this specific country setting has provided grounds for this exploratory study on the effects of openness on innovation performance in a leading emerging

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Anne-Laure Mention, Serdal Temel and Marko Torkkeli economy. The availability of a large-scale and reliable dataset has guided part of this research and has supported the progressive development of more fine-grained research propositions.

3. Data and method The empirical work is based on the Community Innovation Survey (CIS). The CIS is conducted by the Turkish Statistical Institute (TSI). The CIS is the only available data source from the TSI that collects data in terms of the size of enterprises surveyed at country level and which is comprehensive in terms of the range of questionnaire items (e.g. innovation expenditures such as training expenditures or acquisition of external knowledge, importance of information sources and co-operation for innovation activities, factors hampering innovations and protection methods – patents but also trademarks, copyrights, design patterns and secrecy – for innovations). The data covers all manufacturing sectors including small and large enterprises and the sampling excluded firms which have fewer than 10 employees over the period 2006–2008. The survey has been conducted at enterprises’ place by using face to face meeting and questions were answered by top level managers.

In the survey, cooperation is defined as the “active participation with other enterprises or non-commercial institutions on innovation activities”. Both partners do not need to gain a commercial benefit. The definition excludes pure contracting out of work where there is no active co-operation.” Cooperation partners include firms belonging to the same group; suppliers of equipment, materials, components or software; customers or clients; competitors; universities and higher education institutions; consultants, commercial labs or private R&D institutes and finally, government bodies or public research institutes. Partners for innovation activities may be located inside the country or reside beyond boundaries, namely in other European countries, United States, China or India, and all other countries.

Cooperation is first modelled as an aggregated variable taking the value of 1 if the firm cooperates, with any partner, located in any of the listed geographical areas. Then, we further delineate the type of cooperation partner in order to explore its impact on the propensity to innovate (measured as the introduction of new product, either goods or services) and then on the degree of novelty of the innovation. We also investigate the role of the location of the partner in order to unveil if and to what extent this influences the outcome of the innovation of the innovation process. All dependent variables related to cooperation (COOP_Type of partner and COOP_geographical region) are binary, with values equalling when one when the firm does cooperate with this type of partner or with any type of partner located in this geographical area, respectively. We also include other variables, such as size (expressed in natural log), the ownership to a group and the fact that the firm declares conducting in-house R&D activities on a permanent or on an occasional basis. Since literature has emphasized that the different forms of innovation are frequently intertwined, occur simultaneously, while supporting different strategic goals, we also include dummy variables related to the introduction of process, marketing and organisational innovations. Across all multivariate analyses, innovation is modelled as a dependent variable and equals one when the firm declares having introduced a new product (i.e. good or service). Logistic regression analysis is applied as it is often used to investigate the relationship between discrete responses and a set of explanatory variables (e.g. Agresti, 1990; Collett 1991; Cox and Snell, 1989; Hosmer and Lemeshow, 2000; Stokes et al., 2000).

A total of 5863 companies responded to the survey. The average firm size has 247 employees, whereas the median size is 49 and standard deviation is 1073. Overall, 16% of firms are part of an enterprise group.

According to the respondents, the main markets for their products and services was the local/regional market (56% of respondents), followed by national market (50%), and then to a lesser extent European countries (roughly 30%) and all other countries (27%). The descriptive statistics indicate that slightly more than 8% of firms do cooperate to develop novelties, and that the main cooperation partner is located in the country (7.8%), followed by European partners (4%), US partners (1%), Chinese and Indian partners (less than 1%) and the rest of the world (1.1%), whatever type of partner is considered.

4. Results and discussion The first regression, which uses the variable COOP as an aggregate variable, clearly indicates that cooperation has a positive and significant influence on the propensity to develop and commercialise novelties. The value of the odds ratio confirms that cooperating strongly affects the probability to innovate, giving firms which set up cooperation agreements an advantage of almost 2.5 over firms which opt for a closed innovation process.

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Anne-Laure Mention, Serdal Temel and Marko Torkkeli Results also indicate that doing intramural R&D, either on a continuous or on an occasional basis significantly and positively impacts innovation performance. Comparing the odds ratios, firms that do R&D on a permanent basis are much more likely to innovate than firms which conduct R&D on an occasional basis. This is perfectly consistent with the extant literature on absorptive capacity (Cohen and Levinthal, 1989) and the need to maintain internal R&D capabilities in order to integrate external knowledge into the internal innovation process. Interestingly, firms that declared having introduced both process and organisational innovations are more likely to innovate than firms which do not succeed with or get involved in these innovation types. This finding supports the view that the different innovation types are closely linked and may be mutually supporting each other. Marketing organisation is also evidenced to be positively associated to product innovation, as the result is statistically significant at the 5% level. Despite being statistically non significant, size seems to negatively affect innovation propensity. This finding may seem contradictory with prior evidence supporting that larger firms are usually more likely to innovate.

Table 1: Role of cooperation on innovation propensity DEP=INNO

parameter estimate

standard error

Intercept

-2.5247

Group

-0.0780

lnsize

Khi2

Pr> khi2

0.1353

348.3294

<.0001

0.1210

0.4162

0.5188

0.925

-0.0121

0.0322

0.1415

0.7068

0.988

RDCONT

2.5474

0.1632

243.7552

<.0001

12.774

RDOCC

1.7629

0.1406

157.1237

<.0001

5.829

Process

1.9385

0.0952

414.5920

<.0001

6.949

MKTG

0.3268

0.1124

8.4493

0.0037

1.387

ORGA

1.1664

0.1047

124.1970

<.0001

3.211

COOP

0.8951

0.1551

33.3193

<.0001

2.448

Percent Concordant

odds

87.5

As a second stage, the cooperation variable was disaggregated and we considered cooperation with each type of partner separately. These results replicate the pattern regarding the positive and significant influence of conducting R&D activities either on a continuous or on an occasional basis. Similar ranges for the odds ratios also confirm the magnitude of this influence. Likewise, conducting in parallel process, marketing and organisational innovations positively impact the propensity to develop novelties. Process innovation clearly emerges as an enabler considering the value of the odds ratio. When focusing on the type of partner for cooperation activities, conclusions can be drawn only for customers or clients and for universities and higher education institutions as results are statistically significant only for these 2 types of partners. Cooperating with customers seems to give a clear competitive advantage when it comes to introducing product or service innovation and confirms prior research conducted in developed economies (e.g. Monjon and Waelbroeck, 2003; Tether, 2005).On the other hand, cooperation with the science base is demonstrated to negatively and substantively (considering that the odd ratio is much lower than 1) influence the propensity to introduce novelties. This result suggests that cooperating with universities, whether they are located in the country or abroad actually deteriorates the innovation performance of the firm. As such, it is certainly challenging, and deserves further investigation in the context of the national innovation system as well as international academic cooperation.

Adopting another angle to investigate the effects of cooperation, we merged the different partners according to their geographical origin. The results regarding intramural R&D again hold, as well as the mutually reinforcing effects of the different innovation types (i.e. marketing, organisational and process). Statistically significant results are obtained exclusively for cooperation within the country, which is evidenced to positively influence the propensity to innovate. Further delineating the cooperation with the different types of partners located in Turkey, positive and significant effects could be demonstrated for customers/clients and government bodies/public research institutes, with odds ratios of 3.235 and 2.168 respectively. Negative and significant effect of cooperating with universities has been found, with odds ratio value of 0.536, suggesting a strong disadvantage of cooperating with this kind of partner for innovation activities.

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Anne-Laure Mention, Serdal Temel and Marko Torkkeli Table 2: Role of partner type on innovation propensity DEP=INNO

parameter estimate

standard error

Khi2

Pr> khi2

Intercept

-2.5482

0.1361

350.7409

<.0001

Group

-0.0651

0.1219

0.2854

0.5932

0.937

lnsize

-0.0073

0.0323

0.0522

0.8193

0.993

RDCONT

2.5948

0.1645

248.7145

<.0001

13.393

RDOCC

1.7608

0.1409

156.0553

<.0001

5.817

Process

1.9723

0.0955

426.7989

<.0001

7.187

MKTG

0.3156

0.1131

7.7933

0.0052

1.371

ORGA

1.1564

0.1052

120.7364

<.0001

3.179

GROUP _ANY

0.4313

0.3020

2.0400

0.1532

1.539

odds

SUPPLI _ANY 0.0245

0.2900

0.0072

0.9326

1.025

CUST_ANY

0.9878

0.3485

8.0337

0.0046

2.685

COMP_ANY

0.5143

0.3608

2.0312

0.1541

1.672

CONS _ANY

-0.4939

0.3243

2.3196

0.1277

0.610

UNI_ANY

-0.6231

0.3775

2.7241

0.0998

0.536

GOV_ANY

0.6491

0.4076

2.5366

0.1112

1.914

Percent Concordant

86.5

Table 3: Role of geographical location of partners on innovation propensity DEP=INNO

Parameter estimate

standard error

Khi2

Pr> khi2

Intercept

-2.5118

0.1359

341.6912

<.0001

Group

-0.0889

0.1217

0.5333

0.4652

0.915

lnsize

-0.0145

0.0323

0.2003

0.6544

0.986

RDCONT

2.5460

0.1637

241.8085

<.0001

12.756

RDOCC

1.7659

0.1409

157.1381

<.0001

5.847

Process

1.9345

0.0953

411.7264

<.0001

6.921

MKTG

0.3129

0.1130

7.6701

0.0056

1.367

ORGA

1.1641

0.1049

123.1001

<.0001

3.203

COOP_EU

0.4595

0.3186

2.0802

0.1492

1.583

COOP_US

-0.0235

0.5285

0.0020

0.9645

0.977

COOP_COUNT

0.7732

0.1822

18.0203

<.0001

2.167

odds

COOP_REST

0.7795

0.5311

2.1538

0.1422

2.180

COOP_CHI

-0.3147

0.6880

0.2093

0.6473

0.730

Percent Concordant

87.8

A further step included tests on whether cooperation, whatever the partner under consideration and its geographical location, had an impact on the degree of the novelty of the innovation. Namely, we tested whether cooperation affected the propensity to introduce new-to-the-market versus new-to-the firm innovations, as literature tends to suggest, although empirical evidence is scarce and usually ambiguous on this topic (e.g. Mention, 2011; Monjon and Waelbroeck, 2003). Results did not show any significant relationship between any type of cooperation (either horizontal or vertical cooperation forms) or the location of the partner and the degree of novelty, thus deserving further investigation.

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Anne-Laure Mention, Serdal Temel and Marko Torkkeli

5. Conclusions, limitations and further research This exploratory empirical study uncovers insightful features of the innovation process in a country that has been hitherto largely overlooked in innovation studies. More precisely, it first uncovers the effects of cooperation on innovation propensity. The role of customers and universities, irrespectively of their location, has been evidenced and the effects of cooperating with domestic customers/clients, government bodies and the so-called parallel knowledge infrastructure (i.e. consultants and the like) have been unveiled.

This study focuses on a single country setting, which challenges the generalisability of the results.

Nevertheless, given the lack of empirical research focusing on this emerging economy and more generally on developing countries, it provides some insights on the drivers for cooperation as well as on its effects on innovation performance. Another limitation resides in the fact that the dataset used is cross sectional and thus does not allow capturing the time lag effects of cooperation on innovation performance, despite the fact that the data related to cooperation covers the entire period 2006-2008 while information on introduced novelties relates to 2008. Merging several waves of surveys would enable to overcome this limitation and would strengthen the analysis of the process dynamics.

Furthermore, the data is subject-oriented and is based on the declaration of the respondent. This of course may induce some subjectivity, according to the involvement of the respondent in the innovation process, as well as his/her level of awareness of the success of this process. This bias is nevertheless typical of such largescale surveys and this source of data most likely remains the most reliable when it comes to measuring and monitoring innovation efforts across countries. Collecting data on innovations per se would be an area for further development, along the lines of prior projects such as Sfinno (Pentikainen et al., 2002) although this is a time-consuming and resource-intensive activity.

Avenues for further research include explaining some of the challenging results, especially when it comes to foreign cooperation when explored in an aggregated way. As Europe is by far the largest trade partner for the country, it would be relevant for policy makers and business leaders alike to understand the impact of developing synergies in innovation activities. Considering the critical role of innovation for economic growth, further understanding how cooperation affects performance so as to design effective and efficient innovation systems, at all levels – national, regional and local, with all related mechanisms and incentives should be of the utmost priority and may require the development of dedicated surveys in order to better capture the peculiarities of the innovation process and its openness nature in emerging economies.

References Agresti, A. (1990) Categorical Data Analysis, New York: John Wiley & Sons, Inc. Ahuja, G. (2000) “The duality of Collaboration: Inducements and Opportunities in the Formation of Inter-firm Linkages”, Strategic Management Journal, Vol. 21, pp.317-343.

Becker, W. and Dietz, J. (2004) “R&D cooperation and innovation activities of firms - Evidence for the German manufacturing industry”, Research Policy, Vol. 33, N°2, pp. 209-223.

Brandenburger, A.M. and Nalebuff B.J. (1996) Co-opetition. New York: Doubleday.

Cohen, W. and Levinthal, D. (1989) “Innovation and learning: the two faces of R&D”, Economic Journal, Vol. 99, N°397, pp.

569-596.

Collett, D. (1991) Modelling Binary Data, London: Chapman and Hall.

Cox, D.R, Snell, E.J. (1989) The Analysis of Binary Data, Second Edition, London: Chapman and Hall.

Dahlander, L. and Gann, D. M. (2010) “How open is innovation?” Research Policy, Vol. 39, N°6, pp. 699-709.

Das, T.K. and Teng, B.S. (2000) “A resource-based theory of strategic alliances”, Journal of Management, Vol. 26, N°1, pp.

31-61.

Fiol, C.M. (1996). “Squeezing harder doesn’t always work: continuing the search for consistency in innovation research”, Academy of Management Review, Vol. 21, N°4, pp. 1012-1021.

George, V.P. and Farris. G. (1999) “Performance of Alliances: Formative Stages and Changing Organizational and Environmental Influences”, R&D Management, Vol. 29, N°.4, pp. 379–89.

Hanna, V. and Walsh, K. (2008) “Inter-firm cooperation among Small Manufacturing Firms”, International Small Business Journal, Vol. 26, N°.3, pp. 299-321.

Hosmer, D.W, Jr. and Lemeshow, S. (2000) Applied Logistic Regression, Second Edition, New York: John Wiley & Sons, Inc. Huang, Y. A., Chung, H. J., and Lin, C. (2009) “R&D sourcing strategies: Determinants and consequences”, Technovation, Vol. 29, N° 3, pp. 155-169.

Kaufmann, A., and Tödtling, F. (2001) “Science-industry interaction in the process of innovation: The importance of boundary-crossing between systems”, Research Policy, Vol. 30, N°5, pp. 791-804.

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Anne-Laure Mention, Serdal Temel and Marko Torkkeli Laursen, K. and Salter, A. (2006) “Open for innovation: The role of openness in explaining innovation performance among U.K. manufacturing firms”, Strategic Management Journal, Vol. 27, N°2, pp.131-150.

Lichtenthaler, U. (2011) “Open innovation: Past research, current debates, and future directions”, Academy of Management Perspectives, Vol. 25, N°1, pp. 75-93.

Mention, A.-L. (2011) “Co-operation and co-opetition as open innovation practices in the service sector: which influence on innovation novelty?”, Technovation, Vol.31, N°1, pp. 44-53.

Miotti, L. and Sachwald, F. (2003) “Co-operative R&D: Why and with whom? An integrated framework of analysis”, Research Policy, Vol. 32, N°8, pp. 1481-1499.

Monjon, S. and Waelbroeck, P. (2003) “Assessing spillovers from universities to firms: Evidence from French firm-level data”, International Journal of Industrial Organization, Vol. 21, N°9, pp. 1255-1270.

Pentikäinen, T., Palmberg, C., Hyvönen, J., and Saarinen, J. (2002) “Capturing innovation and recent technological change in Finland through micro data elaborating on the object approach”, Unpublished Mimeo, VTT Technology Studies.

Rothwell, R. (1992) “Successful industrial innovation: critical factors for the 1990s”, R&D Management, Vol. 22, N°3, pp.221–239.

Schumpeter, J. A. (1942). Capitalism, Socialism and Democracy. London: Unwin.

Stokes, M.E., Davis, C.S., and Koch, G.G. (2000) Categorical Data Analysis Using the SAS System, Second Edition, Cary, NC: SAS Institute Inc. Tether, B. S. (2005) “Do services innovate (Differently)? Insights from the European innobarometer survey”, Industry and Innovation, Vol. 12, N°2, pp. 153-184.

Tether, B. S., and Tajar, A. (2008) “Beyond industry-university links: Sourcing knowledge for innovation from consultants, private research organisations and the public science-base”, Research Policy, Vol. 37, N°6-7, pp. 1079-1095.

Van de Vrande, V., de Jong, J. P. J., Vanhaverbeke, W., and de Rochemont, M. (2009) “Open innovation in SMEs: Trends, motives and management challenges”, Technovation, Vol. 29, N°6-7, pp. 423-437.

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Integrating Information and Knowledge Created in Distributed Product Development Jonas Rundquist School of business and engineering, Halmstad University, Sweden joru@hh.se

Abstract: Research has indicated that small and medium sized firms (SMEs) play an important role for the growth of economy. However, in order to be able to compete at an international level, most SMEs are bound to work in alliances in order to gather enough knowledge and resources for product and technology development or to be able to penetrate a larger market. Alliances can be formed with different types of actors (i.e. suppliers, costumers, agents, universities, consultancies) and in the alliance information and knowledge is gathered and created. Information is defined by Kogut & Zander as “knowledge which can be transmitted without loss of integrity” which includes facts, axiomatic propositions and symbols. This knowledge can be categorized as the domain-specific, procedural knowledge or general knowledge. In the present study a case approach is used to investigate how different types of information and knowledge generated in a distributed product development is integrated to the firm. What methods are used and some conclusions on what methods are more successful for each type of information/knowledge. Results indicate a very high representation of formal information sharing (server or documents) even if there is a high degree of belief (understanding) among the respondents that personal meetings and continuous information sharing would be better if they had a system for this.

Therefore the conclusions should lead to systems that address the above problems.

Keywords: distributed product development; knowledge integration; medium sized firms

1. Introduction Research has indicated that small and medium sized firms (SMEs) play an important role for innovation and the growth of the economy (e.g. Ács and Audretsch, 2005). However, in order to compete on a global market, most SMEs are bound to work in alliances (distributed organizations) to gather enough knowledge to conduct complex tasks such as NPD (e.g. Grant and Baden-Fuller, 2004). To maximize the effects of knowledge developed the issue of integrating knowledge achieved in NPD projects is important.

There is a growing stream of literature investigating knowledge integration and its importance for new product development (NPD) performance. (e.g. Murray and Chao, 2005; Verona, 1999). This literature focus on knowledge integration either as a unit or as a process typically including a number of phases (e.g. acquisition, sharing, using). Few studies consider the type of external knowledge sourced from outside the organization.

Knowledge integration has been studied as codified knowledge or information with a focus on IT tools to support knowledge integration (e.g. Chang and Li, 2007). In this study knowledge is considered as including both codified (information) and tacit knowledge. Some studies have looked beyond the IT tools and found that knowledge integration needs collaboration. Otherwise it might just be knowledge transfer (Subramaniam, 2006). This study explores the degree of involvement between the source firm and the recipient firm and specifically whether the type of knowledge affects the need of involvement between the firms.

The contribution of the study is a framework combining three types of knowledge (domain-specific, procedural, and general) with the degree of involvement between individuals (impersonal interaction, personal interaction and collaboration). Integrative effectiveness is investigated in relation to degree of involvement from individuals in the knowledge integration.

2. Distributed product development According to the Aberdeen Group’s Global Product Design Benchmark Report (Brown, 2005), today’s products are increasingly brought to market by cross-enterprise teams that span multiple geographic borders. This is often called distributed product development. Distributed product development is defined by the Product and Development Management Association (PDMA) as the separation and optimization of activities performed during a single product development process (i.e., product ideation, development and launch) across multiple geographic locations (Kahn et al Eds., 2005). These locations may be within a single corporate entity, within subsidiaries or involve the use of third parties.

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Jonas Rundquist According to PDMAâ&#x20AC;&#x2122;s definition all the cases of the study involve third parties. When small and medium sized firms gather resources by using distributed NPD the main reason is to find knowledge and resources that could not be gathered within the organization.

Alliances (involving the use of third parties) can be formed with different types of actors (i.e. suppliers, customers, agents, universities, consultancies), and in these alliances knowledge is gathered and created.

Inter-firm alliances require at least two partners, though a growing number of co-operations involve more than two partners. The NPD projects of this study are all conducted in an alliance context according to above.

This means that the projects have been joint efforts with potential profits mutually and shared. Each partner is definitely able to take autonomous decisions as they are equally strong and participate in the alliance only because they have an interest in it.

3. Theoretical framework In this section important terms around knowledge integration effectiveness will be defined and two propositions developed. Knowledge integration effectiveness will be examined according to codification and personalization and classified in to three levels of involvement. The connection between knowledge integration effectiveness and level of involvement will then be examined in combination with type of knowledge, moving from the most projects specific to the most general knowledge.

3.1 A measure of integrative effectiveness If integrative effectiveness is defined as how effectively organizational members can acquire, convert and apply knowledge sent by other members of the collaboration, these three dimensions will shape the measure of integrative effectiveness. Knowledge is sent between individuals with a media or method. Effectiveness depends on the individualsâ&#x20AC;&#x2122; capability to send and acquire knowledge, and on the effectiveness of the media or method used in a specific situation. Further, integrative effectiveness is an assessment of the value that the integrated knowledge provides to the organization. In order to provide value it must be converted and applied as well.

Even if the focus is on the media or method used to transmit the knowledge, the nature of the method affects the individualsâ&#x20AC;&#x2122; capability to convert and apply knowledge. In order to measure integrative effectiveness, integrated knowledge is identified in different projects in the three case firms. In the study knowledge integration processes have been identified, and the extent of acquisition and conversion of the knowledge is rated. Some examples are presented with the results.

3.2 Integrative effectiveness and the level of involvement The acquisition of technological knowledge does not translate automatically into strong competitive market positions or high performance (McGrath et al., 1995). It is the integration that helps organizations to develop shared learning and accumulate knowledge over time (e.g. Teece et al., 1997). Integration enables the firm to internalize the knowledge gained from its distributed work. In order to reach effective processes for product development, it is important to share knowledge between functions. In a distributed context that will mean sharing knowledge between organizationally and geographically divided units. This means that the individuals may have their position at different departments, but also in different organizations (e.g. Moenaert and Souder, 1990).

To achieve knowledge integration [1] personal and [2] impersonal interaction should take place (Kahn, 1996).

Personal interaction could be participation in meetings or phone conversations, while impersonal interaction could be exchanging of e-mails or reports. A third method for integration is [3] direct collaboration (Kahn, 1996). Personal and impersonal interactions, as well as collaboration, are important for the integration of knowledge. This puts focus on how involved the individuals are; a degree of closeness.

According to Grant (1996) integrative effectiveness is a function of common knowledge among organizational members, frequency and variability of common activities, and a supportive structure (e.g. a modular structure). This suggests that the most efficient integration of knowledge should be with co-located individuals who share the same physical room. They are more likely to develop a common language of discourse and frequently interact with each other. In distributed product development it is more likely to find lower degrees

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Jonas Rundquist of involvement as occasional physical meetings, but even more likely to communicate via phone or e-mail.

These are examples of different degrees of involvement and lead to proposition 1 Proposition 1: Knowledge integration effectiveness will increase if methods of knowledge integration with a higher degree of involvement between individuals are used.

3.3 Type of knowledge as a moderating factor Many efforts have been made to describe and categorize knowledge from different traditions and perspectives (e.g. Polanyi, 1983; Wiig, 1995; Edvinsson and Sullivan, 1996). An often recurring distinction is between general knowledge and specific knowledge (e.g. Grant, 1996; Zack, 1998). Specific knowledge is context-specific (e.g. knowledge about a technology or a market) while general knowledge is applicable in different contexts and often publicly available. For example is demographic statistical data and data from public patent data-bases general knowledge. Edvinsson and Sullivan (1996) discuss the distinction between product knowledge and procedural knowledge, where product knowledge is codified and revealed if the product is sold. Meanwhile procedural knowledge is knowledge of business processes. Zack (1998) adds to the concept of procedural knowledge by showing that procedural knowledge can be both codified (e.g. a description on how to bake cookies in a bakery), or not codified (e.g. the professional feeling of the baker). General knowledge is, according to Zack (1998) not meaningful to codify as it is public and changes continuously.

In this study the categories from Ullman (2010) are used as they merge the two above above lagics into three categories. The first category [1], domain-specific knowledge, is knowledge of ‘…the form or function of an individual object or class of objects’ (Ullman, 2010:50). This means that domain-specific knowledge includes knowledge acquired as the result of previous or on-going product development projects (Court, 1997; Ramesh and Tiwana, 1999). Domain-specific knowledge can be of technological nature, but also include other areas of knowledge directly connected to the result of the project (Lynn and Akgun, 2000).

A second category of knowledge is [2] procedural knowledge. This is the know-how of the NPD process (Kyriakopoulus and de Ruyters, 2004) or the collaborating process (Emden et al, 2006). Procedural knowledge refers to ‘[t]he knowledge of what to do next’ (Ullman, 2010:50) in the entire NPD process that typically consists of different stages. Procedural knowledge supports the process of gaining new knowledge and new results in future projects. Procedural knowledge addresses both firm-internal and external aspects of NPD activities.

A third category is [3] general knowledge. This can be knowledge about market, technology or societal situations (peripheral in the present NPD process) that could be useful in future product development projects. Such general knowledge is thus applicable across both organisational procedures and specific technological domains (Ullman, 2010).

Ramesh and Tiwana (1999) elaborated that domain-specific knowledge can be integrated with less involving methods. Following the earlier reasoning of Zack (1998), procedural knowledge can be codified and integrated with less involving methods, but also be of a non-codifiable nature. In this case more involving methods would be needed for efficient integration. General knowledge is, according to Zack (1998), not meaningful to codify and would thereby need a higher degree of involvement to be efficiently integrated. Therefore the following proposition is made.

Proposition 2: P1 is stronger for general knowledge than for procedural knowledge, and weakest for domain-specific knowledge.

4. Method If the limits of a phenomenon to be studied are not apparent at the beginning of investigation, the best option to validate the research will be a case study (Benbasat et al., 1987). The same is valid when control and/or experimental manipulation are not possible to use, due to the complexity of context and/or lack of knowledge about independent and dependent variables (Yin, 2003). Knowledge integration in a distributed organization is a very complex phenomenon that needs to be studied in its context. In the present project a case study approach is used to investigate how different types of knowledge, generated in a distributed product development project, are integrated in the individual firm.

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Jonas Rundquist The firms are medium sized (between 227-357 employees) and situated in the manufacturing sector (see table 1 for description). All three firms also have an extensive R&D operation in-house, which is important for the study.

Table 1: A short summary of the firms in the case study. Figures from 2010 * Firm bought by a multinational company in 2008.

The three firms in the study have been present in different research projects since 2001. This is important as it gives easy access to the firms, employees as well as documents. The researchers also have good knowledge about operations due to the long-time cooperation. In this specific study however the collection of empirical material adds 15 unstructured interviews with employees in the three firms.

All the respondents are deeply involved in product development in an alliance context. The respondents in the firms were R&D managers, HR managers, Production managers and project managers/members of on-going product development project in alliance context. The interviews were conducted during autumn 2010 and were used for finding operational examples of knowledge integration and to assess effectiveness in knowledge integration using the model from table 2.

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Jonas Rundquist

Table 2: Examples of operationalization of the dimensions studied in the cases For within-case analysis the model in table 2 was used. The categorization had the purpose to find patterns in the knowledge integration patterns of the firm. These patterns include strategic statements regarding, for example, which methods and practices were suggested from a managerial level, but also how the knowledge integration work was actually conducted. In the cross-case analysis general conclusions of effectiveness in the knowledge integration work was drawn.

5. Results The interviews with management and project members in the three firms indicated that there is a high awareness about the concepts of the study as well as an understanding of the phenomena and the terms used in the study. Discussions around terminology and knowledge integration in general created good construct validity. That is that the terms of the framework are understood and interpreted in a similar way by all respondents and by the interviewer.

5.1 Effects from degree of involvement at knowledge integration All three firms in the study have today the major emphasis on impersonal methods for achieving knowledge integration. A common pattern is that the projects start with a meeting between R&D managers in the alliance, discussing collective goal and mutual understanding. However, this meeting culture is not spread down to the project members, who rarely meet. During the project e-mail and exchange of reports are the dominating methods for knowledge sharing, while the managers meet again two or three times at the end of the projects.

Firm A has as a policy that all project members shall meet in the beginning of a project. They also used this policy earlier, but R&D manager explained that longer geographical distances have made it more difficult today. New suppliers in China have made travel costs extensive, while new communications technology has made it easier to motivate fewer physical meetings. However, in this case, the longer geographical distance also leads to a longer cultural distance, which would rather motivate more physical meetings to avoid misunderstandings. The R&D manager of the firm pointed out that manufacturability of the products developed in collaboration has decreased as knowledge about the partnersâ&#x20AC;&#x2122; plants decreased with distance.

Firm B is the one with the most involving level of collaboration. The obvious explanation is that the partners in the alliance are geographically closer. The managers meet the partners in the beginning of the project, during the project, and after the project. Management also claims that project members are encouraged to meet partners according to their own need. Project members confirmed that there is a lot of discussion with the partner firms regarding project methodology and other types of procedural knowledge.

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Jonas Rundquist Firm C has been under economical pressure for a few years. Today, even though there is an awareness of the importance of involving methods of collaboration, there is no money to apply it completely. Economic pressure has led to a lower organizational self-esteem which makes it hard for project members to communicate. Management shows in the quality handbook how communication shall be handled with impersonal methods, but do not motivate project members to share knowledge types that is not described in the handbook.

In firm A the larger distance and more less involving methods of knowledge exchange has decreased the knowledge integration. In firm B a high level of individual involvement supports a high level of knowledge integration effectiveness. In firm C the focus on impersonal knowledge exchange has led to lower knowledge integration effectiveness. The three cases support proposition 1, stating that knowledge integration will be more efficient when more involving methods are used.

5.2 Integration of knowledge with different specificity All three firms have a focus on integration of domain-specific knowledge. In product development projects this means that there are specific routines for how to convert and apply technological knowledge about the product or the key technologies in the product itself. That is for example the function of the product, how to efficiently produce the product, and deeper knowledge of the key technologies used in the product. Two of the firms have some integration of procedural knowledge as post project evaluation (PPE) applied in the continuous improvement of their project management model. However, it was more difficult than expected to find examples of integration of general knowledge.

Firm A has a well-developed system for integrating domain-specific knowledge. The basic idea of EDI (Electronic Data Interchange) has been to avoid redundant recording work and thus to ensure a seamless data exchange. They do not refer to a quality standard, but have a strong culture and structure to support knowledge sharing of domain-specific knowledge. For example, a project management platform presents a checklist for how meetings, reports, and technical protocols shall be stored and shared. The domain-specific knowledge fits well into the structure of the platform. The platform is also used for geographically closer partners, and has led to a stronger emphasis on sharing correct documents.

Firm B, with an alliance in a close distance and mainly focus on collaboration, seems to have a good integration of as well domain-specific as procedural knowledge. The procedural knowledge is in this case not only developed as PPE, but also in informal intra-firm meetings during the project aiming to improve collaboration processes. Even though Firm B has a much less formalized monitoring system for projects, they seem to have a greater mutual understanding and shared vision than the other firms.

Firm C has a very strong focus on integration of domain-specific knowledge. In accordance with the findings from Firm A there are routines for gathering and sharing technological specifications and reports. Two years ago the Firm C had no integration of procedural knowledge, but during the study they have increased their interest in post project evaluation and learnt to carry out PPE workshops through knowledge spill over from Firm A. A first workshop was carried out in the fall of 2007. The tools and processes for PPE have been integrated during several intra-firm meetings where both firms have developed knowledge on PPE. â&#x20AC;&#x153;These meetings have been valuable as a catalysist for increased project effectiveness, especially regarding the monitoring of resource useâ&#x20AC;?, according to the CEO of firm C. Firm A has a working system for impersonal knowledge sharing, but also need personal methods in order to integrate procedural knowledge. Firm B with collaborative methods integrate also procedural knowledge and even general knowledge. Firm C has increased their effectiveness in integrating procedural knowledge by introducing more involving methods. Material regarding general knowledge is scarcer than regarding domainspecific and procedural knowledge. The three cases support proposition 2, stating that methods involving individuals from the same or different firms closer, affect knowledge integration effectiveness between these individuals more the less specific knowledge is in focus.

6. Conclusions The cases resented in the empirical study have supported the two propositions that 1) more involving methods for knowledge integration increases knowledge integration effectiveness, and that 2) This is more obvious the

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Jonas Rundquist less specific knowledge in object for integration. In figure 2 the knowledge integration effectiveness is analysed and indicated in the framework. The term “High” refers to high knowledge integration effectiveness, meaning that knowledge of this type can be efficiently acquired, converted and applied with the specified degree of involvement.

Figure 2: Results from the study summarized.

7. Discussion The first finding is that high involvement increases knowledge integration effectiveness. This finding support findings from other recent research. For example Newell et al (2004) investigated collaboration and concluded that “strong social capital” is important for knowledge integration. Social capital could be gained by closer collaboration and is a concept close to trust. This is also supported by Enberg et al (2006) who stresses the importance of learning processes over time and interation between project members adapted to the context of a specific project.

Akgün et al (2005) investigated the effects of using a transactive memory system (TMS) in a distributed project development project. TMS is an example of how software can be used for both personal and impersonal interaction. In their quantitative study they concluded that this type of software supported knowledge integration. Software is normally connected with lower degrees of involvement and information processing, but in order to get to a higher level of involvement in distributed projects, especially long distance, TMS software could be a tool to communicate knowledge.

With a focus on domain-specific knowledge, Vachon and Klassen (2006) concluded that collaboration increased knowledge integration in a supply chain. The domain-specific knowledge in the study is practices on a green supply chain. The study shows indications that the integration of the domain-specific knowledge on environmental technology as well as the procedural knowledge on effectiveness in a supply chain is supported by collaboration.

Knowledge generated in a product development project has two different values. First it generates hopefully a product that can be commercialized on a market and generate profit. Second it adds to the firm’s collective knowledge base and can be used in future NPD projects. In order to win maximum effect from investments made in distributed product development, the firm needs to integrate knowledge generated. Knowledge that is not integrated in the firm’s collective knowledge capital is not made useful in future product development projects. The decision to invest in knowledge integration is a strategic decision. To do like Firm A and not invest in structures for integrating knowledge means that the firm in the future depend on the alliance in order to access the same knowledge. It also means that the firm is not able to communicate around the knowledge or to develop further knowledge in the same field. Firm C get the same disadvantages. However, Firm C chose not to invest in cultures for integrating knowledge.

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7.1 Contributions and outlook The study has contributed to the field of knowledge integration showing the importance of collaboration for effectiveness. Many previous studies focusing on IT as a knowledge enabler have not taken the collaborative aspect under consideration. Previous studies (e.g. Subramaniam, 2006) have shown the importance of collaboration to achieve an effective integration between cross-national MNCs. The present study show the importance of collaboration also when medium sized firms working both locally and cross-nationally are involved. It also shows the importance of working both with strategy and firm culture to achieve efficient knowledge integration. Resources invested in a collaborative culture may be seen as a cost in the short run, but can create considerable advantages in the longer run.

A second contribution is the tested categorization of knowledge as domain-specific, procedural and general knowledge. Results have indicated that collaboration is differently important depending on what type of knowledge shall be integrated. Domain-specific knowledge seams to need less involving integration methods, while general knowledge needs more involving methods of knowledge integration to be efficient.

A third contribution is the methodological approach implementing the framework with practitioners in three firms. This showed that the categorization had a practical relevance, as it is understandable and easy to operationalize in the organization. The long-time work with the firms has contributed to a deeper understanding for the researcher, but also with a transfer and practical support for the firms.

7.2 Managerial implications This article provides some guidance for project members and managers involved in distributed product development projects. It is important to note that managing knowledge in alliances is an important problem and that the main challenge is primarily related to degree of involvement. Firms in alliances need to better understand that not only the results of the project, but also the procedural knowledge of handling the cooperation between firms in an alliance are important to integrate. This integration can be nurtured both with culture (motivation or informality) as structures (methods or organization charts).

The terminology for categorizing type of knowledge and involvement level may be useful to practitioners describing a set of idealized types and examples, as well as correlation between the two sets of categories.

Increased awareness of the terminology along with the correlations may assist managers to appropriately initiate actions to nurture structures and culture for knowledge integration.

More generally, managers have the ability to enhance knowledge integration effectiveness through deploying their human capital, turning "knowledge into action" (Pfeffer and Sutton, 1999). Managers should allocate their resources carefully because it can show that an investment in collaboration can increase the involvement considerably, creating profits in the longer perspective. Increased collaboration we can assume leads to better knowledge integration, which in turn could lead to better use of the knowledge created in the project.

References Ács, Z. and Audretsch, D. (Eds.). (2005) Handbook of entrepreneurship research : an interdisciplinary survey and introduction, Kluwer Academic, Boston, Mass.

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Optimal Quality Decisions for Elderly Service Integrators in Elderly Service Supply Chain Yuan Shi1, ZhiyongZhang1, Jun Zhao1 and Riza Sunindijo1 1 School of Economics and Commerce, South China University of Technology, University town, Panyu, Guangzhou, China 2 Faculty of Built Environment, The University of New South Wales, Sydney, Australia blessingsun@gmail.com zhyzhang@scut.edu.cn jasonzhaobest@gmail.com r.sunindijo@unsw.edu.au Abstract: Elderly service supply chain (ESSC) is providing a brand new management and operation mode for current and potential elderly care service industry. Considering the elderly service integrator (ESI) as the core participant in ESSC, we aim to analyze how the ESI make the optimal service quality decisions in the case of given service quality from elderly service providers, and how to get optimal service quality decision-making through the game between different ESIs when they are competing with each other. Specifically, the impact of market scale and learning effects on ESIsâ&#x20AC;&#x2122; service quality choices are considered. This study provides an important theoretical basis for the development of ESSC and how to guarantee optimal elderly service quality decisions in the elderly care service industry.

Keywords: service quality; elderly service supply chain; elderly service integrator; elderly care service industry

1. Introduction At present, aging problem has become increasingly serious and complex over the world, especially in some developing countries. Existing elderly care service modes mainly include family-based care, institution-based care and community-based care, which belong to traditional loose mode from the perspective of service supply chain (Wang et al, 2004). Among them, community-based care model is currently predominant, under which the elderly people live in familiar household and community, allowing them to take an advantage of various common service facilities and resources in the community. Presently, this is the most popular choice, where up to 95% Chinese people opt for it. (Hou 2010 and Hou 2011). For example, in Liwan District, GuangZhou, South China, 210 000 elderly over 60 years old are mainly depending on this mode of service care among 830 thousand citizens. Unfortunately, communities are not specialized organizations in providing elderly care services and have many other governmental affairs to handle as well. As a result, most communities are facing difficulties in maintaining its acceptable level of elderly care service with an affordable operation cost. Moreover, among independent elderly service providers with asymmetric information, the entire elderly service processes are decentralized, making it difficult to guarantee the quality of services.

To improve this situation, the elderly service supply chain (ESSC) brings a brand new development direction for the operation management in elderly care service industry. ESSC can be defined as a type of functional chain structure, which is oriented around the requirements of the elderly. Through controlling and managing the service flow, information flow and capital flow in the process of service request, service integration and service supply, the ESSC aims to coordinate various service providers, service integrators as well as the elderly(Shi et al, 2011). In the ESSC, the elderly service providers (ESPs) will include the elderly apartments, sports therapy and rehabilitation centers, hospitals, homemaking service companies, recreation centers, the elderly universities and so on. The elderly service integrator (ESI) is the core enterprise in the ESSC which will integrate various elderly services and then provide them to the elderly depending on their needs. This innovative ESSC operation and management framework shows its advantage in the current complicated and decentralized elderly care service industry. They could help coordinate various services and resources in community-based elderly care service mode, and encourage others to join in. Moreover, the ESI, performed as the third-party will help relieve the pressure of the community or government and to guarantee the quality of services.

The satisfaction of customers is always a main evaluation criterion for service quality. Specifically, the service quality in an ESSC depends on the service quality of ESIs and ESPs, who directly or indirectly affect the elderlyâ&#x20AC;&#x2122; satisfaction with the entire service supply chain (SSC). Therefore, with various upstream ESPs and numerous downstream elderly, the losses of ESIs may be caused by their own failure in services, such as high additional cost in services compensation and reputation reducing etc., or indirectly brought by ESPsâ&#x20AC;&#x2122; failure in services,

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Yuan Shi, Zhiyong Zhang, Jun Zhao et al such as complaints to ESIs for dissatisfaction with service of elderly apartments, or for dissatisfaction with medical facilities, etc. In ESSC framework, service quality also has strong influence on the total cost and performance of entire service supply chain.

This study aims to analyze the relationship between service quality and cost control to obtain optimum service quality decisions for ESIs under different potential market scales. Considering the elderly service integrator (ESI) as the core participant in ESSC, this study will focus on analyzing how the ESI optimize service quality decisions when ESPs’ service quality is given. On this basis, this study endeavors to obtain optimal service quality decisions under duopoly games between different ESIs when they are competing with each other. This study will also discuss about the impact of market scale and learning effects on the choices of ESIs’ service quality decisions.

2. Literature review This study is essentially concerned with the quality decision-making management in SSC, which originates from the manufacturing supply chain. There is plenty of literature about quality decision-making problems in manufacturing supply chain with quantitative or qualitative methods. Stanley et al (2000) discussed the suppliers’ quality guarantee activities and buyers’ quality evaluation activities under the risk neutral environment, and pointed out the change in contract terms has little effect on quality costs and product quality in the supply chain. Lim et al (2001) studied on the game problem of quality control with asymmetric information, and pointed out that the price discounts and commitment on the quality for the end users can effectively prevent suppliers’ opportunistic behaviors. Hong et al (2007) explained that most suppliers are always committed to the quality rather than continuous improvement through improved multitask clientagent model.

Comparatively, research on problems in the service quality of decision-making in SSC also has been widely discussed since it is one of the core issues in SSC management, and is included in some burgeoning service industries, such as the tourism service industry. Seth et al. (2006) discussed the importance of quality in the service supply chain, and proposed conceptual model of service quality measure based on Gap analysis. Yang et al. (2009) investigated the optimal decision of service quality in the tourism industry for package holiday among theme parks and tour operators. Liu et al. (2010) studied a game model for quality decision coordination between service providers and service integrators in a two level service supply chain, and discussed the effect of parameters on the quality coordination level in SSC. Cho et al. (2012) developed a framework of SSC performance measurement. Their emphasis was on performance measures dealing with SSC processes such as demand management, customer relationship management, service performance and so on.

All the research above has provided a comprehensive framework for service supply chain quality management.

More recently, the increasing concern on aging problem has also aroused much interest in related research on problems about elderly care service. One pioneer work in this area is by Lai et al. (2009), who stated that community occupational therapy services for the elderly in Hong Kong and indicated future development directions. Stolt et al. (2011) presented a service quality comparison between public and private residential elderly care providers in Sweden. Béland et al. (2011) provided an international review of integrated systems of caring the frail elderly, and analyzed how elderly care can be coordinated effectively across different types of services, and how all the service provider organizations can be coordinated to ensure continuity care for frail elderly. This research also indicated the importance and urgency of caring ESSC in community-based care mode. Kuo et al. (2012) used fuzzy set theory and the TOPSIS method in multiple criteria decision making to rank the severity of the failure modes, which is helpful to improve outpatient service process for the elderly.

In summary, previous research in elderly service mainly focuses on qualitative analysis of the current situation and problems, the evaluation of elderly services modes or the development of new service models. Much of their work has shown the feasibility and requirements in carrying ESSC and the importance of high- quality decisions in the management of elderly care service. Our study will initially discuss the optimal quality decisions problems between ESIs and ESPs in the innovated ESSC mode in the elderly care service industry.

3. Model descriptions In this paper, a two-level ESSC model involved with upstream ESPs and downstream ESI is studied. Considering different requirements from various elderly, the ESI will cooperate with different ESPs and then integrates

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Yuan Shi, Zhiyong Zhang, Jun Zhao et al various service resources to satisfy the elderly. Finally, the ESPs will directly provide required services to the elderly, such as accommodation service, medical nursing, and entertainment services.

Service quality is measured by the satisfaction of the elderly. The satisfaction for the ESI is denoted as u ∈ [u ,1] , which signifies the percentage of the number of the elderly who are satisfied with the services of ESI. Usually, the dissatisfaction comes from exaggerated or false advertisements, poor accommodation services or lagged medical facilities. The threshold of service satisfaction defined in a specific elderly service market is u > 0 . And the satisfaction for ESPs is denoted as vi ∈ [v,1] , i = 1, 2, …, n , which signifies the percentage of the elderly who are satisfied with the services provided by the ESPs, where v is the threshold of satisfactions . The levels of satisfaction directly or indirectly depend on the services provided by all ESPs involved, thus causing greater complexity to the study of the problem. In order to simplify the research, a weighted service quality satisfaction V is assumed to denote the overall satisfactions from all the ESPs involved: V =

n

∑θ v ,

j= i= 1

j i

j = 1, 2, …, n . θ j denotes the weight given by the elderly to different ESPs’ service

quality in the overall service quality satisfaction. Specifically, the 100% satisfaction in this paper means the nearly 100% satisfaction. As summarized in Table 1, four situations exist for different satisfactions of the elderly in ESSC. Table 1: The probability of four situations in ESSC For ESIs For ESPs

Satisfied with ESIs

Dissatisfied with ESIs

Satisfied with ESPs

uV

(1-u )V

Dissatisfied with ESPs

u (1-V )

(1-u )(1-V )

Considering the dissatisfactions, the unit expected loss caused by the failure of ESIs and ESPs can be summarized as: (1) L(u ) = (1 − u )Vc1 + u (1 − V )c2 + (1 − u )(1 − V )c3 Where c1 , c2 and c3 are the losses of ESIs in different situations separately. The above losses include the cost of dealing with the complaints from the elderly, negative effect of bad reputation, losing potential customers and so on. In this study, only the losses caused by ESI will be discussed since the losses caused by the ESPs could not be managed by the ESI through decision-making. When the satisfaction about ESI is 100%, L(1)= (1 − V )c2 , the unit expected loss caused by the failure of ESIs is represented as, (2) L '(u ) = L(u ) − L(1) = (1 − u )Vc1 − (1 − u )(1 − V )c2 + (1 − u )(1 − V )c3 It is further assumed that c3 > c1 + c2 , which means the loss has an incremental effect : ∆C = c3 − (c1 + c2 ) . For example, the ESI may purposely provide inferior apartments which located in suburbs for the elderly to reduce cost. As a result, the elderly can not enjoy a comfortable and convenient living condition in terms of daily needs and transportation. The elderly would be more discontent if they find out that the health care services of the ESP is also inferior than their expectations. Multifold poor services will exacerbate the negative impression of the elderly, and the elderly may think that the entire elderly service is unsatisfied, which may bring serious losses than the summation of individual dissatisfactions in the services.

Also, it is assumed that the elderly care service investment cost is a monotone increasing convex function of service quality u with a quadratic form λu 2 (λ > 0) , where λ is denoted as the coefficient related to service providers. This quadratic form cost function is quite common in previous studies (Tsay A et al. (2000), Sethi S et al. (2005)). These investment costs include the costs for staff, establishing elderly care service information system and advertisings. The demand in a certain elderly service market is assumed to be positively correlated with the satisfaction of the elderly: D(u ) =(α + β V ) + u , where α denotes potential market scale, β denotes the marginal impact of the market demand on the ESPs’ service quality. Then the total cost of the ESI can be represented as, = TC (u ) D(u ) L '(u ) + λ u 2 (3) In conclusion, the objective function of the ESI can be represented as, (4) Min TC (u ) = (λ − K )u 2 + (1 − α − β V ) Ku + K (α + β V ) Where K = Vc1 + (1 − V（ ) c3 − c2）= c1 + (1 − V )∆c .

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4. Optimum service quality decisions for ESIs Given overall service quality of the ESPs, the service quality decisions of the ESI under different market scales will be analyzed in this sector. Two market scales are denoted as massive market scale ( α + β V > 1 ) and small market scale ( α + β V < 1 ). Generally, the scale of potential market mainly dependeds on the ESI’s service diversity and integrated degree. For example, an ESI who can successfully provide and integrate the lodging, medical treatment and entertainments services will attract more elderly and gain a massive potential market share.

4.1 Optimum service quality decisions under massive market scale First, we will discuss the optimum service quality decisions under massive market scale ( α + β V > 1 ).

Theorem 1

when α + β V > 1 : i) if c1 ≤ c ，the optimum service quality decision of ESI will be u ；ii)

if c1 ∈ (c, c) , the optimum service quality decision of ESI will be u ∗ = and −

c =

c1 ≠ λ − (1 − V )∆c ,the

optimum

service

quality

(α + β V − 1)[c1 + (1 − V )∆c] ；iii) if c1 ≥ c 2[λ − c1 − (1 − V )∆c]

strategy

of

ESI

will

be

100%,

where

2uλ 2λ − (1 − V )∆c . )∆c and c − (1 − V= α + β V − 1 + 2u α + βV + 1

Theorem 1 provides the optimum decision strategies for the ESI under massive market scale: When the loss caused by low satisfactions is not high enough, the ESI will choose low service quality to reduce the operation cost; while the loss caused by low satisfactions is high enough, the ESI will endeavor to improve the service quality to a high level; When the loss caused by low satisfaction between a certain intervals, an optimum service level u ∗ exists to minimize the cost of ESI .

4.2 Optimum service quality decisions under small market scale In this section, we will discuss the other situation when the potential market scale is small ( α + β V < 1 ).

Generally, a small market scale mainly targets a specific group of elderly, for example, the disability elderly, or some high-class elderly service community like the Sanya Haitang Bay international health community in Hainan.

Theorem 2

when α + β V < 1 : i) If c1 < c∗ and c1 ≠ λ − (1 − V )∆c , the optimum service quality of ESI decision

will be u ; ii) the optimum service quality strategy of ESI will be 100% when c1 > c∗ ; iii) when c1 = c∗ , both quality decisions are the same, where = c∗

λ (1 + u ) − (1 − V )∆c . α + βV + u

Theorem 2 indicates that under the condition of small potential market scale, the ESIs only have two choices: choosing low service quality when the loss caused by dissatisfaction is not high, otherwise choosing the high service quality when the loss caused by dissatisfaction is high. The loss caused by dissatisfaction is determined by c∗ .

4.3 Optimum service quality decisions between competing ESIs In practice, existing ESIs in the same elderly service market usually compete with each other. This section aims to analyze optimal service quality decision-making through the dynamic game between competing ESIs. For simplicity, we will only consider the competition situation between two ESIs i and j . Here, the service demand is denoted as Di (u ) = (α + β V ) + ui − δ u j , where δ ∈ [0,1] denotes the effect of one ESI’s service quality on the other ESI’s service demand. When one ESI’s service quality is superior to the other ESI, they will attract more elderly and bring more market demand, which will indirectly have negative effects on the demand of the other ESI. Apparently, higher δ denotes more serious effects between the competitions.

Considering ESSC is a brand new management mode for the aging market, different ESIs could also learn from and imitate each other to optimize service quality and reduce the service costs. Then the cost of ESI providing

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Yuan Shi, Zhiyong Zhang, Jun Zhao et al

the elderly service with satisfaction u can be denoted as

λ ui 2 (0 ≤ µ ≤ 1，λ > 0) , where µ is the 1+ µ

improvement degree of ESI i after learning from ESI j .

Hence, the total cost of ESI could be represented as = TCi (ui ) Di (ui ) K (ui ) +

λ ui 2 . Correspondingly, the 1+ µ

objective function of the ESI i can be represented as,

λ

(5) − K i )ui 2 + (1 − α − β V + δ u j ) K i ui + (α + β V − δ u j ) K i MinTCi (u= ( i) 1+ µ Thus under competing ESIs, (α + β V − δ u j − 1)[ci1 + (1 − V )∆ci ] (6) ui∗ = λ − Ki ) 2( 1+ µ Moreover, it can be concluded that, Corollary 3 ∂u ∗ 1) when α + β V > 1 + δ u , then i > 0 , which means the optimum service quality of ESI will improve with the ∂µ increase of learning degree µ under massive market scale. Since under prosperous aging market, the competition between ESIs became more serious and they can learn from each other quickly to enhance higher level service quality. ∂ui∗ 2) when α + β V < 1 + δ u , then < 0 , which means the optimum service quality of ESI will decrease with ∂µ the increase of the learning degree µ under small demand scale. When the aging markets focus on providing elderly service care for some special elderly group, the overall demand is not very large and cannot attract more elderly. At this situation, the investment on learning each other will increase the cost and hinder the improvement of service quality.

5. Numerical studies This section aims to demonstrate the above analysis on the service quality decisions through numerical experiments. Under massive market scale, it is assumed that λ = 500 ， α= β= 1 ， V = 0.5 ， ∆c =300 ，

λ = 500 ， δ = 0.1 ， u = 0.5 ， u j = 0.5 . Based on the conclusions in Theorem 1 , it is obtained 0.5c1 + 75 ， c = 250 ， c = 183.33 ; And the relationships between service qualities and loss under −2c1 + 700 different markets scale can be summarized in Figure 1 . u∗ =

Figure 1: Relationship between service qualities and costs by losses

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Yuan Shi, Zhiyong Zhang, Jun Zhao et al As shown in Fig 1, the optimum service quality decision of the ESI will increase with the increase of the cost under massive market scale. When c1 < c = 183.33 , the service quality of the ESI will below the threshold

250 , u = 0.5 in the market, so the ESI will chose u as the optimum service quality decision; and when c1 > c = the service quality of ESI is already up to 100%; and when the it between the interval (183.33, 250), there exist an optimum quality service u ∗ to minimize the cost of the ESI. Under small market scale，and if α = 0.3 ， β = 1 ，based on the conclusions in Theorem 2, it is obtained

u∗ =

−0.1c1 − 30 and c∗ = 426.92 . As shown in Figure 1, the optimum service quality decision of the ESI will −c1 + 350

decrease with the increase of the cost under small market scale. When c1 < c∗ = 426.92 , the service quality of ESI is already up to 100%, and the ESI will choose the current economic decision- the 100% service quality; when c1 > c∗ = 426.92 , ESI will choose the optimum service quality 100% to hedge the high cost.

Next, the service quality decision-making problems between competing ESIs will be studied based on Corollary 112.5µ + 112.5 , it is obvious that the 3 under the assumption of c1 = 100 . Under massive market scale, ui∗ = −500 µ + 500 optimum service quality will increase with the learning degree µ as shown in Figure 2.

Figure 2: Effect of learning effects on service quality under massive market scale Under small market scale, the relationship between learning effects and service quality are summarized as in Figure 3, with the learning effects µ1 = 0.2 , µ 2 = 0.5 and µ3 = 0.8 . Corresponding, when µ1 = 0.2 , then

c ' = 350 , c ' = 370.83 ; when

µ2 = 0.5 , then c ' = 250 , c ' = 266.67 ； when µ3 = 0.8 , c ' = 183.33 ,

c ' = 197.22 . It is shown that the optimum service quality of ESI will increase with the improvement of learning degree µ , and decrease with the increase of cost.

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Yuan Shi, Zhiyong Zhang, Jun Zhao et al

Figure 3: Effect of learning effects on service quality under small market scale

6. In Conclusion This study has discussed optimum quality decisions problems of ESIs in the innovated ESSC mode in the elderly care service industry, which initially extended previous quality management problem into multi-stage problems among the ESPs and ESIs. First, the proposed models are developed to analyze the relationship between the costs and service qualities under different market scales, which could provide guidelines for ESI’s optimum service quality decisions. Then the problems of optimum service quality decision-making between competing ESIs are analyzed, and the effects of learning degree and market scales on service quality are also concluded. Therefore, this research has not only provided scientific decisions for ESIs in their service quality management, but also helped the government supervise the ESIs to guarantee that the elderly care service quality is at a decent level. Thus, this study provides an important theoretical basis for the development of ESSC and how to guarantee the service quality in the elderly care service industry. Considering fluctuating market demand and risk in service quality management, an extension from this study will discuss the risk prevention problems between ESIs and ESPs among elderly service supply chain.

Acknowledgements The authors are most grateful to government officers and elderly service providers in Liwan district at Guangzhou in Mainland China for their cooperation and assistance during our investigation and survey for this research. We also would like to acknowledge the financial support of National Social Science Foundation of China (12BGL052), National Natural Science Foundation of China (71101055), and Fundamental Research Funds for the Central universities, SCUT, (No.2011ZM0079), Educational Commission of Guangdong Province (wym11011) and the Guangdong Natural Science Foundation (S2011040002521).

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Yoo S., Hong R. and Kim O. (2009) “Service Level Management of Non stationary Supply Chain Using Direct Neural Network Controller”, Expert Systems with Applications, Volume 36, No. 2, pp 3574-3586.

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Social Technologies for Increasing Entrepreneurship in Public Administration Organizations Aelita Skaržauskienė Faculty of Social Informatics, Mykolas Romeris University, Vilnius, Lithuania aelita@mruni.eu

Abstract: Today`s organizations are increasingly finding themselves in a world characterized by globalization, turbulence and complexity, paralleled with an exponential advancement in information technology (IT). These conditions require flexibility, collaboration, innovation and the courage to embrace uncertainty and ambiguity. Such extreme challenges require radical solutions and the transformation of organization development. Improving efficiency and effectiveness in the knowledge-intensive society demands sophisticated technologies – learning from and solving problems with other people in organisations using new technologies. Social technologies (ST) are a powerful tool for holding organizations accountable for their social impact. Information technology has experienced many cycles of innovation, producing always more complex and integrated set of technologies to respond directly to societal needs. The paper presents new management practices using social technologies in public administration organizations for addressing complexity, uncertainty and changes. Drawing on qualitative and quantitative evidence the paper is seeking to improve our understanding of the role of social technologies and to give guidance on how to handle the relationship between technologies and entrepreneurship in public administration organizations.

Keywords: social technologies, knowledge management, innovation, entrepreneurship

1. Introduction Social technologies have the potential to provide individuals with significant economic and non-economic benefits. As people multiply their abilities to organize themselves through social technologies, there is a possibility to effect positive change in communities and governments, also help communities collaborate in non-political ways, such as organising disaster aid. Social technologies, for example, were an important enabler of the 2011 Arab Spring (Bughin, et al., 2011, Divol et al, 2012). ST can be disruptive to existing power structures (corporate and governmental). Despite the rapid adoption of social technologies, far more growth lies ahead. Today, more than 80 percent of the world`s online population is interacting with social networks on a regular basis, but 65 percent of the world population – 4,6 billion people – still lack internet access (Chui et al., 2012). It’s a fact that organizations have started to appreciate the potential of social technologies just in the recent years. Tools like Facebook, Twitter, and LinkedIn appeared with personal use, but recent surveys have demonstrated that inside an organization users employ social technologies to improve their job not just for personal matters (Forrester Research, 2009). Today organizations are very complex environments.

Information technology has experienced many cycles of innovation, producing always more complex and integrated set of technologies to respond directly to society needs (Koplowitz, 2010). In spite of this, the huge quantity of documents produced daily can create innumerable silos of information. As a consequence, knowledge capture and sharing can be too difficult and ineffective (Alberghini et al., 2010). New technologies could contribute to developing an environment conducive to building and nurturing relationships among organization members and increasing entrepreneurship. Further, managers could facilitate the creation of organizational capabilities using technologies such as the ability to locate and share knowledge rapidly and respond to changes. Knowledge held by employees and the network of relationships help dynamically to solve problems and create new knowledge.

The paper presents new management practices using ST in public administration organizations to address complexity, uncertainty and changes. Drawing on quantitative evidence the paper is seeking to improve our understanding of the role of social technologies and give guidance on how to handle the relationship between technologies and entrepreneurship in public administration organizations.

2. Defining social technologies The term "social technology" was first used by A. W. Small and Ch. R. Henderson at the University of Chicago around the end of the 19th century (Wikipedia, 2012). Small (1898) defined “social technology” as being the use of knowledge of the facts and laws of social life to bring about rational social aims. Henderson (1895) used the term "social art" for methods by which improvements to society are and may be introduced; social scientists are the ones who make predictions and social art is what gives directions. According to Li and Bernoff

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Aelita Skaržauskienė (2011) "social technology" is a term that has had two meanings historically: as a term related to “social engineering”, it emerged in the 19th century (Schotter, 1981; Sugden, 1989; North and Wallis, 1994; Nelson, 2008; Pelikan, 2003, Leichteris, 2011) and as a description of “social software”, it appeared in the early 21st century (Sproull and Faraj, 1997; Johannessen et al., 2001; Andersen, 2011; Duarte, 2011; Leibetseder, 2011; Chui et al, 2012; Derksen et al, 2012). McKinsey Global institute (2012) defines social technologies as digital technologies used by people to interact socially and together to create, enhance, and exchange content. Social technologies distinguish themselves through the following three characteristics (Chui et al., 2012): 

They are enabled by information technology;



They provide distributed rights to create, add, and/or modify content and communications;



They enable distributed access to consume content and communications.

In modern understanding of social technology, it was referred to any technology application for various purposes, especially to support a decision making process, so in the sense of technology “social technologies’’ are instantly recognized via some kind of media. Koo et al. (2011) present five media types of the new generation: “telephone is representing a traditional medium; video conferencing, email, and instant messenger representing computer-mediated technologies; and blog and social networks representing new social media”. Communication technologies such as telephone, voice mail, e-mail, videoconferencing, and instant messaging help members of virtual teams or groups stay in touch with one another and share information. All these types of media or technologies can be described in terms of three dimensions (Johannessen et al., 2001): 

• Richness: the ability to convey verbal and nonverbal cues, and facilitate shared meaning in a timely manner;



• Interactivity: the extent to which rapid feedback is allowed;



•Social presence: the degree to which virtual team members feel close to one another.

Surveys conducted by analysts such as Forrester Research (2012) demonstrate that social technologies continue to grow in popularity inside the society; adoption of wiki in particular is in the leading position, followed by social networks. Nowadays, when people think about social technologies, they often refer to Web applications like Facebook or LinkedIn, even though family, friends, classmates, or network of work colleagues remain the most common social networks (SN). This misconception has even a scientific base. Social technologies include a wide range of applications that can be used by consumers, private or public sector organizations, or as an interaction tool between those subjects. They include many of the technologies that are classified as ‘’social media’’, ‘’Web 2.0’’, and ‘’collaboration tools’’. Social gaming, social art, crowdsourcing, discussion forums could also be defined as social technologies. However, after the fundamental exploitation in this area, the current function of social technology is to serve social purposes.

Although the term “social communication technologies” is most commonly used to refer to new social media, a redefinition of this concept based on the original definition is needed. Nowadays the concept of “social technology” has several aspects which destabilize the dominant image of technology. It emphasizes the social sciences and humanities as society shapers, reconsiders the strength of “soft technologies” and restores focus on human actors in sociotechnological assemblages without making them their sovereign masters (Derksen, 2012). That means social technology is increasingly salient as an object of study for the social sciences: sociality is more and more something that people create technically. The instrumental, technoscientific approach to social life is not the exclusive province of social scientists anymore, but by the same token, it demands all the more attention as an object of study (Mayer, 2009). Social technologies are defined as any technologies used for social purposes or with a social basis, including social hardware (traditional communication media), social software (computer mediated media), and social media (social networking tools) (Helmer et al., 1966; Alberghini, et al., 2010).

3. Social technologies for increasing entrepreneurship The growth of the Web in reach and capability and as a medium for interaction set the stage for the explosive growth of social technologies. Social technologies unleash creative forces among users and enable new relationships and group Dynamics (Chui et al., 2012). Social technologies are becoming the preferred method of communication of new generations and communication styles are evolving into a more collaborative approach (Alberghini, et al., 2010). In more and more hyperactive world, people could feel immediate benefits

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Aelita Skaržauskienė in connecting with the right peers, getting answers to questions and finding information. “The real power of technologies stems from the innate appeal of interacting socially and the pleasure and intellectual stimulation that people derive from sharing what they know, expressing opinions, and learning what other know and think” (Chui et al, 2012). As has been seen in early use of social technologies, when these ways of interacting are applied to commercial and professional activities (e.g. developing and selling products, working together to solve a business problem), the resulting value creation is impressive (Bughin et al., 2011).

Modern organizations face new challenges: a growing swarm of unconventional rivals, crumbling entry barriers, a rapid transition from the “knowledge economy” to the “creative economy,” intensifying competition for talent and a profusion of new stakeholder demands (Divol, et al., 2012). To tackle these challenges, organizations will need to become far more adaptable, innovative, inspiring and accountable than they are right now. This will require a fundamental re-tooling of traditional management practices.

Management strategies need to shift from command and control to sense and respond (Rao, 2005). The Millennials, also known as the Millennial Generation (Generation Y), are people born between 1980 and 2000.

They are now entering the workplace and have habits and communication forms different from the older generation workforce. According to Forrester analysts De Gennaro and Fenwick, there are key trends that will make the inclusion of social technology a necessity in the societal life. These trends are the physical distance between teams and the entrance of Millennials into the workforce (De Gennaro, 2010).

These new employees bring very different understanding of entrepreneurship, different needs, experiences and expectations to the job and often meet a seasoned workforce that has very different work styles (Schooley, 2009). Anyway, what Millennials want to support in their work – flexible work schedules, social media tools, or a collaborative environment – are the work features that other employees can benefit from, too (Schooley, 2008). New technologies allow people to ask questions, share ideas and discover people skills regardless of the hierarchy. These tools help to break down organizational and cultural barriers such as time differences (Koplowitz and Owens, 2010). Freed from the limitations of the physical world, people are able to use social technologies to connect across geographies and time zones and multiply their influence beyond the number of people they could otherwise reach. These new opportunities enable new forms of entrepreneurship. In social networks all members are able to contribute to content building, which is distributed freely and instantaneously, so from leader-centered approach in management we move to distributed leadership, from top-down management to bottom –up management. Social interaction is a powerful way to efficiently organize knowledge, culture, economics and political power. While the typical corporation is based on a center-to-end architecture, in which decision-making authority is heavily concentrated at the top, the Web is built on an end-to-end architecture, where power is highly distributed (Divol, 2012). Within the new competitive situation, a critical issue facing entrepreneurs, is how to manage an unpredictable and unstable future. Since the future is basically unpredictable and uncertain, evoking images, rather than established facts, organizations must rely on creative initiatives from the employees to be able to create the desired future (Johannessen, 2001). Software developers have continued to develop tools for creating new interaction possibilities (Jue et al., 2009). Gamefication, the use of features of games to enhance online engagement, is another way how social technologies can encourage increased collaboration. Therefore, increasing entrepreneurship in the knowledge-intensive society demand sophisticated technologies – learning from and solving problems, creating and building business ideas with other people (Cross et al., 2001).

Today`s public administration organizations change the focus from the ineffective bureaucratic models onto more flexible communities of professional workers such as online communities, virtual self-managing teams, networked organizations, etc. Social technologies enable social behaviours to take place online, endowing the interactions with the scale, speed, and disruptive economics of the Internet (Chui et al., 2012). Over the last decade, the Internet has had a profound impact on entrepreneurship. It has spawned a slew of new management models and has helped make operating models vastly more efficient. Social media/networking and the collection of tools they have spawned have moved solidly into the strategy toolbox for public administration organizations. Many strategies taken to increase entrepreneurship with social technologies by private-sector companies also apply to the public sector. However, the operating models and mission of public administration organizations are distinct from those of business enterprises. Therefore, we have identified some social technological concepts that are mandatory for every public administration organization today, see Table 1 (Zupan, Kase, 2007; Klososky, 2011; Chui et al., 2012; Divol, 2012):

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Table 1: Social technologies increase entrepreneurship in public administration organizations Collection of information and insights

Organizational Voice

Gather information Build Rivers of Information Crowdsource recourses and solutions Analyse data Fundraise Create and expand volunteer network Retain support Educate the public Engage supporters Improve collaboration and communication Distribute leadership Participate in collective decision making process Create self-managing networked teams Rapid organizing Adapt gamefication Increase e-learning Match talents to roles Conversation with constituents, mindshare

Online Reputation Management (ORM)

Form online reputation, all comments become searchable

Marketing

Use crowdsourcing Increase creativity

Mobilizing structures

Mission execution Organization management

Learning and training

4. Research results The paper follows a quantitative research approach. The total sample consists of 122 respondents. The sample was at random selected in Lithuanian Public sector organizations such as Ministries and Departments. The two stage procedure, recommended by Bartlett, Kotrlik and Chadwick (2001) was employed to determine a sample size of every subsample. Firstly, sample size of 100 was determined using sample size table and having in mind that the population size is over 10000 and data is continuous. Secondly, having collected 100 responses, the worst variances were identified in every subsample. Finally, the size of every subsample was calculated using formula recommended by Bartlett, Kotrlik and Chadwick (2001). Mainly public heads of departments and managers were surveyed using a web-based questionnaire. Data was analyzed using statistical software package SPSS. The questionnaire ends with demographic questions. The return rate of the survey was 55% and can be treated as good.

It is interesting to note that all the participants answered positively (yes or no option) the question “Do you believe that technologies are applicable to all types of organizations, regardless of the field they operate?”

75% of the respondents reported using some form of social technology in their organization. Of these more than 60% indicated benefits from social technologies. The heaviest users of technologies are the users between the age 25 - 35.

Online reputation management is the most common organization application in public administration organization (see Figure 1), while marketing remains the most popular application in business according to Chui et al. (2012). More than half of the respondents admit that they use social technologies to strengthen their organizational voice (56%) and for collecting information and insights (69%).

The respondents reported benefits from the use of social technologies for various purposes: first of all, reducing communication costs (80%), increased speed to access knowledge (68%), decreasing travel costs (64%), increasing employees’ satisfaction (34%). The analysis of the most important obstacles to organization in order to adapt to new technologies shows that the most commonly mentioned are bureaucracy, investment deficit, infrastructure shortage, etc. (see Figure 2.)

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organizational voice marketing online reputation management organization management mission execution mobilizing structures collecting information and insights 0

10

20

30

40

50

60

70

80

50

60

Figure 1: The use of social technologies across functions employees restriction towards technologies strategic vision deficit specialized human resources deficit public sector infrustructures shortage investment deficit regarding technologies bureaucracy 0

10

20

30

40

Figure 2: The most important obstacles preventing application of new technologies

5. Limitations The references used for this survey are not an exhaustive list within the topic area. Relevant sources of information may also exist in other domains of scientific inquiry. Because of the chosen research approach, the research results may lack generalizability. The sample of this research was limited only to national level; therefore there is no possibility to compare results across different countries.

6. Discussion and conclusions: The Potential and Risks of Social Technologies Business enterprises that apply social tools have reported measurable business benefits (McCinsey, 2012). Our research results show growing interest of public administration organizations in social technologies and increase of entrepreneurship in these organizations by interaction of the staff and outside partners, citizens and society. Public administration organizations are usually companies with high number of employees and incorporation of social tools can be used to facilitate collaboration and co-creation, reduce the time spent in unnecessary in-person meetings, help share internal knowledge and best practices. Organizations can also use ST to hire new employees and integrate contractors or experts into networked teams. From almost any location employees could initiate projects, form teams and complete their tasks. The conducted research indicated that the main obstacles to apply technologies are bureaucracy, investment deficit, infrastructure shortage for public administration.

New technologies allow people to connect at a different scale and create a unified, powerful voice – as social groups or entire societies – that can have significant impact on the ways in which dialogues are shaped and policy is made (Chui et al., 2011). Social networking capabilities are providing vital information in a way that is adaptive and user-driven. However, all these technologies have limitations that can easily lead to

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Aelita Skaržauskienė misinterpretation. They cannot provide the same richness as face-to-face interaction. Because of delays in transmission and the lack of social and nonverbal cues, communication technologies can interfere with open communication, knowledge sharing, and the ability of teams to identify and resolve misunderstandings. Online collaboration, in its current state, is not a very good substitute for face-to-face interactions that are critical to create innovations, improve organizational climate, foster human relationship, motivate and inspire.

Furthermore, the older generation tends to be sceptical about social technologies, so it is important to implement something very useful for all society members and that should become a habit and a necessity at work and private life. For this reason, it is necessary to monitor the user engagement and to educate the community for using social technologies (Allberghini et al., 2010).

The use of social technologies can also carry risks. One risk is the possibility of abuse, such as excessive employee time spent ‘’chatting’’ about non-work-related topics on internal or external social networks or using social media to attack fellow employees or management. Enterprises have taken different approaches to handling this risk, from forbidding non-work-related conversations or censoring critical opinions to welcoming the critiques and engaging in public conversation with the critics. Other risks involve breaches of customer privacy. Similarly, there is a great need for information security, but an organization’s need to maintain data security can limit the ways in which social technologies can be applied. In addition, in many nations, censorship and restrictions on Internet use stand in the way of value creation by organizations that hope to enable citizens to interact with them and that wish to harvest deep insights from social data (Klososky, 2011; Chui et al., 2012; Divol, 2012).

With social technology, more and more users are becoming a part of the global conversation, creating their own content rather than just consuming it. However, the quality of user-generated content varies dramatically – from excellent works of journalism to spam and even abuse (Bauerlein, 2008). Some critics have argued that the short-form content available through social technologies is making people less able to digest large and complex amounts of information. The opposing view is that even our existing means of content selection do not always assure quality, that the diversity of opinions is healthy and increase creativity and critical thinking (Carr, 2010).

Our final discussion about the potential and risks of “social technologies” will be the occasion to address through theoretical and conceptual reflections and empirically-oriented contributions the following questions: How technologies are changing society`s life? Which social technologies are especially prominent in contemporary culture, and how can we study these?

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Divol, R., Edelmann, D., Sarrazin, H. (2012) “Demystifying social media”, April, Marketing & Sales Practice Duarte, A. T. (2011) “Privacy and Health System Solution Case”, Conference proceedings Social Technologies '11: ICT for Social transformations, 17-18 November, 2011, Vilnius-Net. Forrester Research (2009) “Global IT Market Outlook: 2009”. Cambridge: Forrester Research, Inc. De Gennaro T. (2010) “Social Technologies Will Penetrate IT Management Tools”, Cambridge: Forrester Research, Inc. Helmer, O. et al. (1966) Social Technology. New York, NY: Basic Books Henderson, C. R. (1895) “Review”. Journal of Political Economy, Vol. 3 (2), pp. 236-238.

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Aelita Skaržauskienė Johannessen, J.A., Olaise, J., Olsen, B. (2001) “Aspects of innovation theory based on knowledge-management”, International Journal of Information Management, Vol. 19, Iss. 2, pp. 121-139.

Jue A.L, Marr, J.A., Kassatokis, M.E. (2009) Social media at work: How networking tools propel organizational performance, John Willey&Sons, NJ, Hoboken Klososky, S. (2011) “Social Media: Four Ways to Make Social Technologies Relevant to Your Business”, TechNet MAgazin, access online 16 Sep. 2012, url: http://technet.microsoft.com/en-us/magazine/hh219267.aspx Koo, Ch. et al. (2011) “Examination of how social aspects moderate the relationship between task characteristics and usage of social communication technologies (SCTs) in organizations”, International Journal of Information Management, Vol. 31, p. 445-459.

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Mayer, K. (2009) “Who produces social technologies?” access online 16 Sep. 2012, url: http://socialtechnology.wordpress.com/2009/10/23/who-produces-social-technologies/ McKinsey Global Survey (2012) McKinsey Global Survey results, access online 16 Sep. 2012, url: http://www.mckinseyquarterly.com/Business_Technology/BT_Strategy/Minding_your_ digital_business_McKinsey_Global_Survey_results_2975 Nelson, R. R. (2008) “Factors affecting the power of technological paradigms”, Industrial and Corporate Change, Vol. 17, Number 3, p. 485–497.

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Brain Drain as Brain Gain in Southeast Europe: Challenges Ahead Mirjana Stankovic1, Biljana Angelova2, Verica Janeska2 and Bratislav Stankovic3 1 Ministry of Education and Science, Skopje, Republic of Macedonia 2 Institute of Economics, Skopje, Republic of Macedonia 3 University St. Paul the Apostle, Ohrid, Republic of Macedonia mirjana.stankovic@fulbrightmail.org angelova@ek-inst.ukim.edu.mk verica@ek-inst.ukim.edu.mk bratislav.stankovic@fulbrightmail.org

Abstract: The majority of highly educated Southeast Europeans leave their countries in search of a better life. Scientists and researchers are attracted by career opportunities, salaries and better overall conditions abroad. Over the past decade, the number of researchers has seriously declined. Many Southeast European (SEE) countries experience high emigration rates of their skilled professionals. What is typical of brain drain emigrants from SEE is that they usually sever their ties with their country of origin and generally do not send any remittances or interact in substantial ways with the home country.

The main goal of this paper is to propose a model for intellectual mobilization of the SEE highly skilled Diaspora by envisioning the creation of a brain circulation network that will foster a regular set of interactions, collaborations, joint grant proposals, joint research projects, co-authorships, visitor exchange, joint ventures and alike, between the highly educated Diaspora and their counterparts in the countries of origin. This will provide expatriates with the opportunity to transfer their expertise and skills to the country of origin, without necessarily returning home permanently. In this way, the countries of origin, i.e. SEE countries, will have access to the knowledge and expertise of the expatriates, and to the knowledge networks that they form in the host countries.

Keywords: human capital, brain drain, technology transfer, innovation, economic growth

1. Theories of brain drain in the context of small developing countries The term â&#x20AC;&#x153;brain drainâ&#x20AC;? refers to the international transfer of human capital, i.e. migration of high-skilled labour force from developing to developed countries. For instance, until 2000, twenty million high-skilled immigrants lived within the OECD, an increase by seventy per cent within ten years, compared to only thirty per cent increase for unskilled immigrants in the same period.

The reasons behind brain drain are twofold: on one hand, the globalization generates agglomeration of human capital in places where it is already in abundance; on the other hand, host countries gradually impose conditions to filter high-skilled immigrants through selection policies (World Bank, 2008). Two concepts prevail in the theoretical discussion about the impact of high-skilled migration on the economic development. The first concept refers to brain drain as a phenomenon that negatively impacts the sending countryâ&#x20AC;&#x2122;s human capital accumulation and fiscal revenue (Bhagwati and Hamada, 1974). The proponents of this view accentuate the need for implementation of restrictive public policies targeted at restricting high-skilled labour mobility.

The second concept focuses on the nature of high-skilled Diaspora which acts as a powerful force in promoting economic development through a variety of instruments, such as remittances, trade, FDI and knowledge transfer. An example in this regard would be the rapid development of high-tech companies in India and China as a result of their Silicon Valley Diaspora (Saxenian, 2002). Migration, under certain circumstances, can lead to human capital accumulation and influence the net increase of the educational level of the sending country (Beine et al., 2001, 2008). Only handful of studies, which examine the impact of high-skilled migration on the economic development, engage in analysing empirical data pertaining to high human capital emigration rates in small developing countries, such as Macedonia (Docquier and Marfouk, 2004; Beine et al., 2001, 2008; Gibson and McKenzie, 2010). Previous research does not clarify whether it is common for high-skilled immigrants, coming from countries that face high brain drain rates, to engage in knowledge transfer, trade and FDI, or the experience of the Chinese and Indian information and communication technologies (ICT) companies is an exception to the rule. These studies provide no empirical data about the brain drain effect on the fiscal system, nor do they measure the size of the benefits for the migrants themselves in the process of emigration (Gibson and McKenzie, 2010).

Docquier and Marfouk (2004) try to create statistical matrix for assessment of the emigration rates by educational level (primary, secondary and tertiary) for all countries in the world. Their estimates on the

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Mirjana Stankovic, Biljana Angelova, Verica Janeska et al emigrants who had completed tertiary educational level might be taken as a measure of brain drain. However, one of the caveats associated with this measure is the fact that it can be too wide for developed countries where highly educated account for one third of the total working population. Thus, this measure is more appropriate for developing countries where the share of high-skilled population accounts for only about five per cent of the total labour force. Due to impossibility for adequate data collection, the South-South migration is not taken into account. This could lead to underestimation of the migration rates in some developing countries that are important migration destination for other developing countries. Docquier and Marfouk’s (2006) definition of immigrants as foreign-born workers does not consider the fact if education was gained in the home or in the host country. This can lead to overestimation of brain drain and create a false picture of the variations of this phenomenon across the analyzed countries (Rosenzweig, 2005). In order to overcome this, Beine et al. (2006) use the age at which immigrants enter the host country as an indicator of where the education was acquired. Their results lead to minute corrections in the ranking of countries according to brain drain intensity, and indicate a strong correlation between corrected and uncorrected results. The research of Docquier and Marfouk (2006) indicates that the size of the country and the emigration rate are inversely correlated, i.e. the average highly skilled emigration rates are seven times higher in small in comparison to the ones in large countries. The highest emigration rates have been observed in middle-income countries, where people have both the motive and the financial means to emigrate.

Number of studies show that the knowledge is unevenly distributed in clusters, which results in stratification and differentiation of centre and periphery, where underdeveloped peripheral countries (i.e., SEE countries) and regions become impoverished in terms of human capital, and as a result do not achieve high incomes at the expense of developed central regions, which in turn benefit from disproportionately increased revenues.

As a consequence, the North-South development gap increases constantly. Less developed regions have a shortage of high-skilled staff that would enable higher capital profitability. Capital circumvents these regions, and thus the average productivity remains low. This in turn encourages more talented people to leave, perpetuating the brain drain phenomenon in a vicious circle. This phenomenon is called the “Mezzogiorno effect”, named by the region of Southern Italy where it is ubiquitous. In the context of SEE countries’ high rates of highly skilled emigration and in the context of formulating sound brain circulation public policies, several questions resonate: What is the starting point of the “Mezzogiorno effect”, and whether SEE countries, through implementation of targeted public policies, can affect their qualification as a periphery or centre?

Whether SEE countries should undertake public policies aimed at generating indigenous human capital by subsidizing education and scientific research? Or should they undertake public policies aimed at attracting and importing of human capital that has already been created abroad, and funded by another country (Lucas, 1990).

Brain drain for one country equals brain gain for another. High brain drain rate negatively impacts the sending country in several aspects. First, it might lead to increased global level inequality (Bhagwati and Hamada, 1974), creating substantial losses in the economy of the home country. It might also generate deficit in certain professions, making certain professional profiles emigrate in disproportionately large numbers. This might be exacerbated by different types of governmental public policy measures aimed at prevention of brain drain, such as disincentivizing professional programs for acquisition of easily mobile skills, e.g. nurses (Poutvaara, 2004). These public policy measures are presumably focused on creating professionals who will be unable to leave the country easily (e.g., lawyers). However, in the long run this might lead to hyperinflation of lawyers, leaving the problem with the deficit professions unsolved.

The degree of possibility to emigrate affects the decision as to whether people will invest in acquiring tertiary education diploma. If a certain type of education is an immigration card, this will act as an additional stimulus for investment in human capital. Nonetheless, if one is uncertain about emigration prospects at the time when deciding about entering tertiary studies, then, one might decide not to invest in acquiring new skills and competences. In the short term, this can be seen as a benefit for the sending country in terms of not losing additional human resources (Mountford, 1997; Beine et al., 2001). In this respect, countries combining relatively low levels of human capital and low rates of highly skilled emigration evidence net profit. However, most developing countries record huge losses in human capital in the form of brain drain. Only a handful of large developing countries showed insignificant benefits in terms of balancing low human capital levels and low high-skilled emigration rates (Beine et al., 2008).

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2. Potential benefits of brain drain 2.1 Remittances There are two motives behind remittances: altruism and exchange (Rapoport and Docquier, 2006). Altruism is usually directed at immediate family members, whereas remittances motivated by exchange, most often, represent compensation for services done on behalf of immigrants by someone in their native country. Such transfers are intrinsic to temporary migration, signalling the willingness of immigrants to return home. It is unclear whether high-skilled migrants transfer more funds than uneducated ones. The former can transfer larger amounts in order to repay for funds invested in their education. On the other hand, they often emigrate with their family severing their ties with the native country. In this respect, Faini (2006) found that at aggregate level brain drain migration generates less income from remittances.

2.2 Return migration and brain circulation These phenomena are rare among high-educated persons who left their country, unless the return is not preceded by considerable growth of the national economy. For instance, less than one-fifth of Taiwanese and South Koreans with doctorate in engineering who completed their studies at US universities in the seventies have returned to their home countries. After two decades of rapid growth of Taiwan and South Korea, the share of students returning upon graduation increased to two-thirds. The same trend has been observed with Chinese and Indian students who graduate in the USA and return home (OECD, 2002), suggesting that the return of highly qualified persons is a consequence rather than the cause of economic growth (Commander et al., 2004).

2.3 Diaspora externalities There is significant number of social studies stressing the potential of Diaspora externalities. Mobility of highqualified migrants might contribute towards reducing transaction and other types of information costs, and thus facilitate trade, FDI and technology transfer between the host and the home country (Rauch and Casella, 2003; Kugler and Rapoport, 2006; Arora and Gambardella, 2005).

Human capital formation and accumulation have been challenge to most of the developing countries in terms of achieving economic growth. Human capital is inevitably linked to issues of innovation, successful technology transfer and economic growth. The most persistent challenge in this respect has been the phenomenon of high rates of brain drain, i.e. scientists leaving their native countries in search for better life. In SEE countries this problem has been pervasive and ubiquitous for years. This paper tries to build on the existing human capital and innovation literature and to come up with creative solution to the problem by proposing a brain circulation model.

2.4 Brain drain trends in the SEE countries The dissolution of the past communist regimes, weak economic structure, low level of production, low performance results of the educational system, high level of public debt, high unemployment level, low SMEs’ contribution to innovation and lack of motivation, commitment and trust had enormous impact on human capital development in the SEE countries. Two contemporaneous processes have been taking place, one associated with “external” brain drain, i.e. experts leaving the country for better professional fulfilment abroad, and the other associated with “internal” brain drain, i.e. specialists leaving their professions for better paid jobs in the private and/or informal sector of the economy (UNESCO, 2005). The educational and scientific systems of the SEE countries share low level of investments in research and development (R&D) undertaken by the private sector, the academia and the public authorities (Figures 1-4). This is a result of several intertwined structural problems, such as budgetary constrains imposed by restrictive monetary and fiscal policies, deindustrialization, high transaction costs of societal transition, external accounts imbalances, low national investment and savings rates, and limited FDI inflows (UNESCO, 2005). In contrast, developed countries, such as South Korea and Germany, invest substantially more in R&D (2-2.5 per cent of GDP, Figure 1). Developed countries’ private sector is the key innovation catalyst, and holds the highest percentage of the total GERD, i.e. gross expenditure in R&D (Figure 4). In contrast, SEE countries’ academia and public authorities have substantially bigger investments in R&D when compared to the private sector investments (Figures 2 and 3).

Even though most of these countries have undertaken strategies and action plans geared towards higher

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Mirjana Stankovic, Biljana Angelova, Verica Janeska et al tertiary enrolment rates, this has not resulted in substantial decrease in brain drain rates. On the contrary, brain drain rates have been increasing relentlessly, Macedonia being the leader in the SEE region with respect to this (Figures 5 and 6, Table 1). Croatia and Bosnia and Herzegovina (BiH) follow suit. Interestingly, Albania and Serbia have much lower brain drain rates that stay relatively stable over time and fluctuate around the world average. Bulgaria and Romania, as members of the European Union, also experience relatively low brain drain rates, in comparison to the â&#x20AC;&#x153;brain drain leaderâ&#x20AC;? in the region, i.e. Macedonia.

Figure 1: Gross expenditure on R&D (GERD), percentage of GDP. UNESCOstat 2011.

Figure 2: GERD performed by the academia, percentage. UNESCOstat 2011.

Figure 3: GERD performed by public authorities, percentage. UNESCOstat 2011.

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Figure 4: GERD performed by the private sector, percentage. UNESCOstat 2011.

Figure 5: Emigration rate by education level, SEE countries. World Bank 2011.

Figure 6: Emigration rate by educational level 1995â&#x20AC;&#x201C;2005, selected SEE countries. OECD,Docquier, 2011.

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Mirjana Stankovic, Biljana Angelova, Verica Janeska et al Table 1: Measuring international skilled migration, estimates controlling for age of entry, Beine et al., 2006.

Country Albania Bosnia & Herzegovina Macedonia Croatia Bulgaria Turkey Serbia and Montenegro Romania

Brain drain 0+ 1990 2000 17,4% 14,3% 23,9% 29,1% 24,1% 4,0% 6,8% 8,3% 5,8% 13,7% 9,1% 11,9%

Brain drain 12+ 1990 2000 17,3% 14,1% 23,2% 26,9% 22,1% 3,9% 6,6% 7,7% 5,4% 13,3% 8,7% 11,4%

Brain drain 18+ 1990 2000 17,1% 13,9% 22,9% 25,9% 20,7% 3,8% 6,5% 7,4% 5,2% 12,9% 8,2% 10,8%

Brain drain 22+ 1990 2000 16,1% 13,2% 21,9% 24,1% 18,9% 3,7% 6,2% 6,9% 4,9% 12,3% 7,7% 10,2%

Macedonia is a typical example of a small, landlocked developing country facing high rates of brain drain. Over the past two decades, remittances have experienced constant growth (e.g., in 2003 they amounted to only $US 174 million, while in 2010 they amounted to $US 414 million). Nevertheless, if other categories of inflows are taken into account it becomes clear that remittances do not play major role in total inflows, i.e. their share is only 5% compared to the exports’ share of 62%. For instance, in 2008 net FDI inflows reached $US 0.6 billion, net ODA (official development assistance) was $US 0.2 billion, total international reserves were $US 2.1 billion, and exports of goods and services reached $US 5 billion.

More important is the fact that the analyzed data pertaining to remittances does not reveal the educational level of the senders of remittances. Taking into account the fact that Macedonia is a multiethnic society, as well as the long and intense immigration tradition of Macedonian Albanians, it would be interesting if one performs the brain drain analysis on such a micro level, in order to determine which segment of the Macedonian immigration population constitutes the Macedonian brain drain, and whether and to what extent the highly educated Diaspora invests back in the home country. Partial data on the extent of the Macedonian brain drain can be obtained from the World Bank KAM (Knowledge Assessment Methodology) database. This data has been obtained through a survey which measures the perception of the respondents about the extent of the brain drain in the country. In this respect, Macedonia is ranked on the bottom of the list, being a country with one of the highest brain drain rates. The Table 3 data gives a partial overview of the scope and structure of the Macedonian brain drain. In the year 2000 the emigration rate of tertiary educated labour force reached 29.1%. Even more interesting is the research of Schiff and Sjoblom, which makes an assessment of the international high-educated immigration from 1975 to 2000, based on the research of Docquier and Marfouk (2004). This database contains data on the structure of the Macedonian emigration classified by education level, in 1995 and 2000. Figure 5 shows that the highest percentage of the Macedonian emigration accounts for highly educated immigrants. If this is analyzed together with the fact that remittances have a minute share of total inflows in the Macedonian GDP, it becomes evident that from 1995 onwards high–skilled individuals leave the country with their families, while severing their ties with their home country and not investing back at all. In a period of only five years, from 1995 to 2000, the tertiary emigration rate has nearly doubled from 14.3% to 27.3% (Figure 5). Unfortunately, reliable empirical evidence about the extent, chronology and intensity of the brain drain in Macedonia does not exist. One can only arrive to certain assumptions, but not to scientifically valid conclusions. Likewise, the data from Table 2 is analytically limited due to the difficulty of measuring the exact amount of inward remittance flows as a result of the existence of informal channels of sending money. Moreover, the analysis of the data does not provide information on the impact (positive as a brain gain/negative as a brain drain) of temporary or permanent migration of human capital.

Table 2: Inward and outward remittance flows, Macedonia. World Bank, 2011.

US $ million Inward remittance flows Worker’s remittances Employees’ compensation Migrants’ transfers Outward remittance flows Workers’ remittances Employees’ compensation Migrants’ transfers

2003 174 146 28 / 16 15 1 /

2004 213 161 52 / 16 15 1 /

2005 227 169 57 / 16 14 2 /

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2006 267 198 69 / 18 16 2 /

2007 345 239 106 / 25 22 3 /

2008 407 266 140 / 33 28 5 /

2009 401 260 121 / 26 22 4 /

2010 414 / / / / / / /

Mirjana Stankovic, Biljana Angelova, Verica Janeska et al

Figure 7: Migrant remittance inflows - Workers’ remittances, compensation of employees, migrant transfers, credit (US$ million), 1996 - 2011, Macedonia. World Bank, 2011.

Table 3: Migration flows 2010, Macedonia. World Bank, 2011 Emigration, 2010 ■ Stock of emigrants: 447.1 thousands ■ Stock of emigrants as a percentage of total population: 21.9 % Skilled emigration, 2000 ■ Rate of emigration of tertiary educated population: 29.1 % ■ Emigration of doctors: 91 or 2.0% of doctors educated in the country Immigration, 2010 ■ Stock of immigrants: 129.7 thousands ■ Stock of immigrants as a percentage of total population: 6.3 %t ■ Females as percentage of immigrants: 58.3 % ■ Refugees as percentage of immigrants: 1.0 % Intellectual Mobilization of the SEE Highly Skilled Diaspora: A Model According to the OECD Investment Reform Index 2010 (OECD, 2010), the SEE countries in a period of four years, from 2006 to 2010, achieved certain level of progress in the area of human capital development by enacting and implementing national strategies and actions plans pertaining to the concept of lifelong learning. Although formal mechanisms for stakeholder consultations in this area exist, in reality communication among the government institutions, the academia and the private sector is fragmented and ad hoc. Despite the positive reforms in the field of lifelong learning, the SEE countries’ governments face number of challenges due to a deficit in certain types of occupations. This in turn generates a gap between the supply and the demand of certain skills. High brain drain rates create distortions in the high-skilled population labor market. The private sector often emphasizes the fact that there is a lack of a workforce which has practical and technical skills. Additionally, having no coherent, holistic and strategic public policy approach sustains the vicious brain drain cycle in these countries. For instance, the National Program for the Development of Education in the Republic of Macedonia 2005 - 2015 is not aligned with other national strategies, such as the ones for investment and for innovation. This is a consequence of the fragmented cooperation between government institutions responsible for creation of public policies in the field of human capital development. One possible public policy instrument in this regard would be implementation of a holistic, inclusive approach to education, science, technological development and innovation. Creating and sustaining substantial, and not only formalistic, institutional ties is essential in this regard. Highly educated and skillful workforce contributes to the development of innovative capacities of the firms and of the society as a whole. For example, the number of students in tertiary education in Macedonia in a period of 3 years (2006 – 2009) recorded an increase of 35% (UNESCO, 2011). The increase in the number of students, as an indicator, represents the input in the educational system. The number of graduates is a measure of the output of the educational system, which may indirectly indicate the efficiency of the educational system in generating human capital. If once more, the example of Macedonia is taken, the statistics pertaining to the output of the

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Mirjana Stankovic, Biljana Angelova, Verica Janeska et al educational system is quite different from the one that displays the input. The former is more relevant for analysis of the relationship between the educational system and the human capital formation and accumulation. Figure 8 indicates that the number of graduates is relatively low or decreases in all sectors, apart from social sciences, where it records rapid growth. These figures should be analyzed simultaneously with the data on brain drain in Macedonia. The increased number of social sciences graduates, the increased volume of brain drain, and the lack of technical high-skilled workforce lead to the possible conclusion that a large number of technical studies graduates leave the country whenever they have an opportunity to do so.

Figure 8: Tertiary graduates in different sectors, percentage, Macedonia. UNESCOstat, 2011.

As already pointed out, high rates of brain drain represent the net transfer of human capital, in the form of educational costs, from low-income to high-income countries (UNCTAD, 2007; World Bank, 2006a). Brain drain rates in certain small developing countries amounted to over 60% (World Bank, 2008). Emigration of the highly educated workforce strata that directly contribute to production, e.g. engineers, might result in reduced innovation and technology transfer rates in the domestic economy (Kapur & McHale, 2005). The emigration rates of scientists, engineers and doctors are, in general, higher than the emigration rates of the labor force that has non-technical university education (e.g. lawyers). For example, the emigration rate of individuals with tertiary education in India is 4%, however the emigration rate of individuals graduating from the prestigious Indian Institutes of Technology was in the range of 20 to 30% in the 80s and 90s (Docquier & Marfouk, 2004).

When local conditions and opportunities are limited, certain levels of emigration rate can be positive for the sending country, due to the possible positive effect of technology transfer from the Diaspora. However, certain preconditions need to be fulfilled in order for positive externalities of brain drain to occur. If the sending country represents relatively small economic market, and such is the case of all the SEE countries, it is very likely that the brain drain will cause significantly adverse labor market changes that will affect all sectors of the local economy. The likelihood that a young man who earned his doctorate in the USA will remain there after completing doctoral studies decreases with the increase in the average per capita income in the home country.

However, this is not the sole factor affecting the decision to return. This decision is influenced by other factors such as quality of living conditions, density of research networks and size of the host country Diaspora. Factors that could positively affect the decision to return to the home country are family proximity, cultural familiarity and the desire to participate in the technological progress of the home country.

Due to the high brain drain rates, the SEE governments should formulate public policies aimed towards encouraging the so-called brain circulation. The brain drain is a complex issue that occurs as a result of a variety of mutually overlapping factors, out of which the most important is the level of economic development of the home country. For instance, the economic development of the country is the main reason for the return of South Korean high-skilled immigrants to their home country. However, the lack of opportunities for economic development is not the only obstacle to the return migration. The 2005 study of the Albanian Institute for International Studies, Tirana, pointed out the fact that the young educated Albanians do not return to their home country due to the inappropriate business practices of the employers in terms of recruitment and selection, nepotism and lack of transparency in the public administration and in the academia (OECD, 2010). â&#x20AC;&#x153;Piloting Solutions for Alleviating Brain Drain in South East Europeâ&#x20AC;? financed by UNESCO and Hewlett-Packard is one of the pioneering brain circulation projects in the SEE. This project was designed to

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Mirjana Stankovic, Biljana Angelova, Verica Janeska et al support research and reduce brain drain by creating opportunities for advancement of young Southeastern scientists in their home countries. Universities from the SEE countries received assistance in the form of grid technologies and start-up capital for financing scientific cooperation and exchange with their counterparts in the Diaspora. Since all SEE countries share similar socio – economic conditions, the regional approach to brain circulation will be an effective public policy instrument. Therefore, it would have been beneficial if the activities of the above mentioned project became sustainable in the long run. Another effective public policy in this regard would be the creation of Diaspora knowledge networks (e.g. the Colombian Red Caldas). We perceive the highly skilled Diaspora as an opportunity which takes a different approach to the brain drain because it perceives the brain drain not as a loss, but a potential gain to the home country. We see the highly skilled SEE expatriates as a pool of potentially useful human capital for the countries of origin. The challenge lies in mobilizing these brains in order to involve them in promoting the economic growth of the region, i.e., in building a sustainable brain circulation network. SEE countries can benefit from other countries’ successful experiences, e.g. India, where the partnerships between the private sector and the academia, twinning project with technology institutes from the USA and the technology transfer led by the Silicon Valley Diaspora have greatly influenced the rise of Bangalore as one of the world’s IT centers. Universities, together with the public authorities should motivate talented lecturers and students to spend short periods of research and study abroad. Also, the institution of exchange programs is an excellent means of encouragement of highly skilled Diaspora scientists to come back in their home country and give lecture series or engage in collaborative projects with their counterparts. The SEE countries’ governments should play a key role in the process of brain circulation by adopting a regional approach to this issue. This is even more important in the light of the new R&D program of the European Union, Horizon 2020, which advocates scientific collaboration and formation of research and development consortia, not only between the academic institutions, but also between the academia and the private sector. All of these endeavors need to rely on long term strategies to promote economic growth and democracy in all of the SEE countries, thus leaving no way to nepotism and corruption, two of the main culprits for the long socio-economic status quo of the SEE countries (Quaked, 2002). Horvat (2004) rightly points out that the main preconditions for brain circulation to occur can be found in the “well developed scientific infrastructure, higher investments in the science sector, and the stability of a consolidated democratic government that assures human rights and academic freedoms”.

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ICBS Intellectual Capital Benchmarking System: A Practical Methodology for Successful Strategy Formulation in the Knowledge Economy José M. Viedma Marti1 and Maria do Rosário Cabrita2 1 Department of Business Administration, Polytechnic University of Catalonia, Barcelona, Spain 2 UNIDEMI, Department of Mechanical and Industrial Engineering, Faculty of Science and Technology, FCT, Universidade Nova de Lisboa, Portugal jose.m.viedma@upc.edu rosariocabrita@gmail.com Abstract: The advent of the knowledge economy fundamentally changes the way to create wealth. According to new theoretical foundations (Resource Based View, Dynamic Capabilities and Knowledge Based View) key strategic knowledge or Intellectual Capital has become the fundamental driver of wealth creation. A revision of the literature concludes that business excellence has always been due to good strategy formulation and superior strategy implementation. In order to

achieve business excellence in the knowledge economy context substantial efforts have been made to improve the process of strategy implementation and some of them have produced relevant frameworks and methodologies, such as Balanced Scorecard and InCaS (Intellectual Capital Statement. Made in Europe).

Nevertheless, fewer efforts have been made in the process of strategy formulation and, in practice, the SWOT analysis still is the most well known existing framework. However, in a world where customer preferences are volatile and the identity of customers and the technologies for serving them are changing, a market-focused strategy may not provide the stability and constancy of direction needed as a foundation for long term strategy. When the external environment is in a state of flux, the firm itself, in terms of its bundle of resources and capabilities, may be a much more stable basis on which to define its identity. Hence, a definition of the firm in terms of what it is capable of doing may offer a more durable basis for strategy than a definition based upon the needs the business seeks to satisfy. Consequently, the SWOT analysis methodology can’t cope with the new external environment requirements and a kind of improved or extended SWOT analysis is needed.

ICBS (Intellectual Capital Benchmarking System) is the output of a practical research on extended or improved SWOT analysis, a framework that knowledge economy requires for successful strategy formulation. ICBS is a new management method that allows companies to perform a competitiveness strategy check-up of their business models. For that purpose, ICBS benchmarks their core innovation and operations intellectual capital against the world class competitors in their sector.

Keywords: strategic management, core competencies, core capabilities, intellectual capital, extended swot analysis

1. Introduction We live in a time of great opportunities where creativity and innovation has led to competences and technologies that have allowed many great advances in almost every aspect of our lives. The opportunities arise in a new economic landscape where change and uncertainty is constant, and the firm’s focus should be on identifying and exploring these opportunities. Organisations facing uncertain, changing, or ambiguous market conditions need to be able to learn and make effective use of intellectual capital factors.

The main features of this new economy involve major systemic changes: new forms of competition between global competitors; temporary rather than continuous competitive advantages; vertiginous pace of change; and ever-shorter life-cycles for products and services (Hitt et al., 2002). Those trends are changing the competitive structure of markets in such a way that the effectiveness of traditional sources of advantage is blurred. A new paradigm emerged in which knowledge, itself, became a critical factor of production (Adams and Oleksak, 2010), specifically, knowledge related to identifying and exploiting new ways to establish sustainable competitive advantages. In response, new models of business are emerging where the value chain have their hard nucleus in the creation, dissemination, application and leverage of intellectual resources.

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José M. Viedma Marti and Maria do Rosário Cabrita Structural changes transform the traditional business frameworks into insufficient and incomplete tools for developing a strategy. Traditional frameworks such as the BCG matrix, the Porter’s Five Forces and the SWOT analysis have had a lasting influence on strategic management and have been especially valuable for managers to develop and implement long-term strategy for organizations so as to build and sustain competitive advantage. However, those frameworks are becoming insufficient because they do not take into account the dynamics of global markets. As most of models were developed in an era of stable markets, they also lack the perspective of intangibles.

To be able to create value within this new economic landscape, we need to rethink our established notions regarding value creation process and strategy formulation - in short we need to change our recipes for success.

The value creation process is now based on the ability of firms to generate and exploit new forms of knowledge, and the most important contribution management needs to make is similarly to increase the productivity of knowledge work and the knowledge worker (Drucker, 1999). It is imperative for firms to focus on strategic management processes concerned with creating long-term value from intellectual capital.

One of the main challenges for the knowledge economy is how to use SWOT analysis efficiently and effectively in a context of permanent changes. Extended SWOT analysis is seen as a framework for formulating strategies at business level in an efficient and effective way to achieve success in the new context in which the main features are: (i) the importance of knowledge as the main source of sustainable competitive advantage; and (ii) the world-wide hyper-competition. The challenge is to move SWOT analysis away from the generalities of “strengths”, “weaknesses”, “opportunities”, and “threats” to more concrete factors and characteristics appropriate to the new reality. A specific methodology and information system framework – Intellectual Capital Benchmarking System (ICBS)–, focused on the value chain activities of both the operations and innovation processes, is developed.

Deploying scarce resources to create superior value when dealing with the innovation process is a very different task from that involved when dealing with the operations process. To create value the two processes require particular resources and different core knowledge. For this reason, the ICBS has a specific methodology and information system framework for each of the processes (Viedma and Cabrita, 2012). The first is the Innovation Intellectual Capital Benchmarking System (IICBS) which is mainly focused on the value chain activities of the innovation process. The second is the Operations Intellectual Capital Benchmarking System (OICBS) which refers to the value chain activities of the operations process.

This paper explores the theoretical foundations behind the process of strategy formulation in the context of knowledge economy. It starts by addressing the value creation process as a function of intangibles. Drawing on the activity-based view and the resource-based view, we discuss the theories and concepts that support the application of the Extended SWOT analysis as a framework designed to accomplish the dynamics of the knowledge economy. The concepts of business intelligence and strategic competitive benchmarking are also discussed as key components of the ICBS model. It is concluded that: (i) in order to achieve entrepreneurial excellence the process of strategy formulation is the key one, because it is closely related with effectiveness; (ii) among different intellectual capital methodologies and tools, ICBS is the only relevant for successful strategy formulation, for gaining and sustaining competitive advantages.

2. Theoretical foundation In the context of global economy, entrepreneurial excellence is related to the ability to achieve and sustain competitive advantages by building long-term value from intellectual capital identified as a set of intangibles with potential to create value. Business excellence depends on soundly formulated strategy (business formula) and effectively implemented strategy (business recipe) based on core competencies, core capabilities and intellectual capital, as illustrated in Figure 1.

In order to create value, the ingredients (resources, competencies and capabilities) in the business formula must be transformed into products and/or services that deliver business recipe.

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Figure 1: Entrepreneurial excellence in the knowledge economy.

This set of intangibles or intellectual capital creates value when its components are combined and put into action and degrades when they remain unused (Roos, 2005). These value drivers are bundled together, and the interactions between them are varied, complex and dynamic making difficult to demonstrate the cause and effects relationships and its linkage to value outcomes. This perspective goes beyond the traditional value chain to other more complex ways of creating value mainly based on intangibles.

2.1 Value creation as a function of intangibles Value creation process is always linked to the capacity to build sustainable competitive advantages. In order to achieve sustainable success, which is the primary goal of strategic management, companies should build up a competitive advantage vis-a-vis its rival companies. Competitive advantage comes from the company’s ability to create value for its customers and to capture part of this value in form of profits. At the micro level, discussions seeking to explain sustainable competitive advantages have focused on the industrial organization theory (Porter, 1985), the resource-based view (Wernerfelt, 1984), dynamic capabilities (Teece et al. 1997), core competencies (Prahalad and Hamel, 1990), and knowledge-based view (Sveiby, 2001).

Value creation process in the context of knowledge economy is directly linked to the intelligence, the speed, and the agility that comes from a host of latent intangibles which represent a reservoir of potential talent and innovation that provides a source of competitive advantage. This suggests that the value generated is a function of the way in which resources are managed. This means that having a resource is not enough to create value. In order to create or leverage value, the resources have to be deployed effectively and efficiently.

Sveiby (2001) argues that the key to value creation lies with the effectiveness of knowledge transfers and conversions. Carlucci et al., (2004) state that the generated value is the result of an organization’s ability to manage its business process and the effectiveness and efficiency of performing organizational processes are based on organizational competencies. Knowledge assets interact with each other to create competencies and capabilities, and it is often these interactions that provide a competitive advantage because they make these assets difficult for competitor to replicate (Barney, 1991; Teece et al., 1997; Marr, 2005). Value is then created through complex dynamic exchanges between tangibles (goods and money) and intangibles (cognition processes, intelligence and emotions) where individuals, groups or organisations engage in a value network by converting what they know, both individually and collectively, into tangible and intangible value.

2.2 Formulating business strategies The purpose of strategy is to ensure the achievement of competitive advantage by defining the direction and scope of an organization.

Strategy formulation process mainly deals with effectiveness, or choosing the right things to do. Drucker (1977) adverts that the pertinent question is not how to do things right but how to find the right things to do, and then concentrate resources and efforts on them. Formulating the right questions demands that organizations understand which resources, capabilities and competencies they need in order to gain and sustain the competitive advantage. At the same time, to be successful or to be excellent, organizations need to know what their competitive advantage is.

Making good decisions are based on strategies well formulated. The crux of strategy formulation is to define a strategy that makes the best use of the organization’s resources, competencies and capabilities.

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2.3 Resources, competencies and capabilities Resources are inputs into the production process and they can be tangible or intangible assets (Itami, 1987) that a firm controls and can use to conceive of or implement strategies (Barney and Hesterly, 2006). The resource-based view (RBV) of the firm argues that sustainable competitive advantage requires unique and inimitable resources (Barney, 1991). Intangible resources can include skills, human assets, information and organizational assets, and relational and reputational assets. These all represent what a firm has. Another class of intangible resource is capabilities or competences that represent what a firm does (Hill et al., 2007).

Capabilities may be understood as the way resources, talents and processes are combined and used (Teece et al., 1997). Prahalad and Hamel (1990) defined competencies as the collective learning that gives firms the ability to deploy their resources productively. Competencies are the means by which a firm deploys resources in a characteristic manner in order to compete (Haanes, 2000). Thus, professional competencies integrate professional skills and knowledge, and organizational competencies include a firm’s knowledge, routines, and culture. Prahalad and Hamel (1990), have distinguished particular competencies, which they call “core competencies”, as being fundamental to the firm’s performance and strategy. “Core competencies”, according to these authors, are those that make a disproportionate contribution to ultimate customer value, or to the efficiency with which that value is delivered. Core competencies thus provide a basis for entering new markets (Prahalad and Hamel, 1990:81). The authors put the cumulative development of specific competencies at the centre of the agenda of corporate strategy because “the real sources of advantage are to be found in management’s ability to consolidate corporate-wide technologies and production skills into competencies that empower individual businesses to adapt quickly to changing opportunities”. Hence, the sustainable competitive advantage of firms resides not in their products, but in their core competencies. Furthermore, those core competencies feed into more than one product, which, in turn, feed into more than one business unit.

Teece et al. (1997) defined dynamic capability as a firm’s ability to integrate, build, and reconfigure competence. It is the heterogeneity of skills and capabilities available from its resources that gives each firm its uniqueness (Penrose, 1959).

In describing how organizations create and leverage competitive advantage, the literature focuses on what the firm has, but not less important is what the firm does with what it has. Collis and Montgomery (2008, p. 142) note that “the RBV inextricably links a company’s internal capabilities (what it does well) and its external environment (what the market demands and what competitors offer). In strategy management, two relevant perspectives still coexist in understanding how firms deploy scarce resources to create superior value (Haanes, 2000). These two perspectives are the resource-based view and the activity-based view (Porter, 1985, 1996).

The two are complementary. The resource-based view focuses on what the firm has, whereas the activitybased view focuses on what the firm does.

Figure 2: The basis of competitive advantage: complementary perspectives Resource-based view The focus of resource-based view is on the relationship between firm resources and firm performance.

Following the seminal work of Penrose (1959), the resource-based view of the firm proposes that firms consist of bundles of productive resources and that different firms possess different bundles of these resources in competitive environments. Distinct types of resources including tangible assets, intangible assets and skills have been identified as underlying the distinctive or core competences of a firm (Prahalad and Hamel, 1990).

These core competences can only achieve sustainable competitive advantage when underlying resources are valuable, rare, cannot be imitated, and have no substitutes (Barney, 1991).

In accordance with Grant (1998), a key common ingredient in all business success stories is the presence of a soundly formulated and effectively implemented strategy. Grant (1998) has stated that the starting point for the formulation of strategy must be some statement of the firm’s identity and purpose. This generally takes

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José M. Viedma Marti and Maria do Rosário Cabrita the form of a mission statement that answers the question: ‘What is our business?’. Traditionally, firms have defined their business in terms of the market they serve by asking: ‘Who are our customers?’ and ‘Which of their needs are we seeking to serve?’ Nevertheless, in a volatile world in which the identity of customers, their preferences, and the technologies for serving them are all changing, a market-focused strategy might not provide the stability and constancy of direction required as a foundation for long-term strategy. When the external environment is in state of flux, the firm itself, in terms of its bundle of resources and capabilities, might be a much more stable basis upon which to define a sense of identity. Hence, a definition of the firm in terms of what it is capable of doing might offer a more durable strategic basis than a definition based upon the needs which the business seeks to satisfy (Quinn, 1992).

The above discussion points to the fundamental role of resources, capabilities and competencies in strategy formulation for entrepreneurial success in an environment of rapid change in technology and in the needs of customers and industry. Figure 3 summarizes the above discussion on resources, capabilities and core competencies.

Figure 3: Resources and capabilities of a firm The activity-based view The activity-based view has mainly been concerned with seeing firms as value chains that create value by transforming a set of inputs into more refined output (Porter 1985, 1996). Nevertheless, to be more specific, we need to consider how value is created in the internal business process value chain. The business process value chain can be divided into major processes: (i) the innovation process; and (ii) the operation process.

The innovation process is made up of product design and product development, whereas the operations process is made up of manufacturing, marketing, and post-sale service. Figure 4 illustrates the business process value chain.

Source: Adapted from Kaplan and Norton (1996) Figure 4: Business process value chain The traditional perspective has focused on the operations process. According to the short-term view, value creation begins with the receipt of an order from an existing customer for an existing product or service, and

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José M. Viedma Marti and Maria do Rosário Cabrita ends with the delivery of the product to the customer (Kaplan and Norton, 1996). In this case, value is created through operations core competencies.

However, viewed from the perspective of the innovation process, value creation is a long-term process which, for many companies, is a more powerful driver of future financial performance than the short-term operations process. This view requires an organisation to create entirely new products and services that will meet the emerging needs of current and future customers. For many companies, their ability to manage successfully a multi-year product-development process, or to develop a capability to reach entirely new categories of customers, can be more critical for future economic success than managing existing operations efficiently, consistently, and responsively. Value is thus created through innovation core capabilities. Specifically, innovation value chain is about to translate competencies into new processes, products and services, and, where necessary, develop new competencies.

Then, building core competencies is not done in a vacuum, but is done in the business process value chain in which resources are deployed in a characteristic manner in order to compete. The resource-based view and the activity-based view are therefore complementary. Taken together, they explain the process of creating value and securing a sustainable competitive advantage

3. Building the intellectual capital benchmarking system (ICBS) As previously noted, in our times the RBV and the ABV are the fundamental cornerstones that determine company competitiveness. The RBV stresses that, in turbulent times sustainable competitive advantages are mainly due to the intangible resources of a company or, more specifically, to core competencies (which are, in practice, equivalent to core knowledge). However, resources per se do not create value, and because the RBV focuses only on what the firm has, this view does not, in isolation, adequately explain how to deploy scarce resources to create superior value. In this sense, the ABV is a necessary complementary perspective which focuses on what the firm does, and takes into account that value creation results from the activities to which the resources are applied. If core knowledge is the key strategic asset, improving existing core knowledge and building new core knowledge are fundamental tasks. Building and improving core knowledge require organizational learning capabilities, including the appropriate learning structures and information systems.

World-wide industry hyper-competition has ensured that, in order to remain competitive, organizations need not only to protect their interests but also to expand their interests. They need to out-innovate their competitors. For doing this, business intelligence and strategic competitive benchmarking have become essential learning tools. That valuable knowledge can be obtained only from: (i) a business intelligent process that gathers, processes, interprets and communicates the economic, social, technical and political information needed in the decision-making process; and (ii) a strategic benchmarking process that provides a systematic and frequent comparison with the world-class processes and core competencies of competitors in the same business segments. Organisations are now competing on the basis of core knowledge and core competencies.

Opportunities and threats come mainly from competitors who offer the best in the same industry segment.

3.1 Business intelligence and strategic competitive benchmarking Competitive intelligence helps organization to identify threats in the external environments capable of impacting negatively on the future of the company, and identify new opportunities for the organization, leading to innovation and ultimately benefiting the competitive status of the organization. The objective of competitive benchmarking is to identify specific information about the competitor’s products, processes and business results and then make comparisons with those of the own organisation. Competitive benchmarking is also useful in positioning the organisation’s products, services and processes relative to the marketplace.

When we move from competitive benchmarking, to strategic competitive benchmarking (Watson, 1993) we mainly focus on core activities, core competences and specially core knowledge. This suggests that the SWOT analysis should move away from the generalities of “strengths”, “weaknesses”, “opportunities”, and “threats” to more concrete factors and characteristics appropriate to the new reality.

3.2 The Extended SWOT Analysis Fahy and Smithee (1999) agree the RBV of the firm helps to overcome some of the frequently cited problems of the SWOT framework. Amit and Schoemaker (1993:35) state that “the resource-based perspective

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José M. Viedma Marti and Maria do Rosário Cabrita complements the industry analysis framework”. Roos (2005) presents a theoretical approach that seeks to integrate the competitive forces and the resource-based paradigms of competitive advantage. Strategic development process based on the competitive forces paradigm starts by looking at the relative position of a firm in a specific industry, i.e. we first consider the firm’s environment, and then we try to assess what strategy is the one that maximize the firm’s performance. By contrast, the RBV can be seen as an “inside-out” process of strategy formulation. We start by looking at what resources the firm possesses, and then we assess their potential for value generation and end up by defining a strategy. In short, the RBV of the firm provides a conceptually grounded framework for assessing strengths and weaknesses and enables strengths or weaknesses to be examined in terms of the criteria for establishing sustainable competitive advantage.

Further to the discussion above, the SWOT analysis framework moves from A to B as shown in Figure 5. In effect, there is a change from simple SWOT analysis to an extended SWOT analysis.

Figure 5: Evolution of SWOT analysis The Extended SWOT analysis gives us the main factors to consider when seeking strategies that leading to entrepreneurial excellence. The main factors of the extended SWOT analysis also determine the information system required to measure and manage those factors. In other words, the main factors produce the Intellectual Capital Benchmarking System (ICBS), an intellectual capital strategic management information system framework developed by Viedma (2004). Nevertheless, as previously noted, strategy formulation in dynamic environments, even those mainly based on core capabilities, has different features when dealing with the innovation process than when dealing with the operations process. Core capabilities can be very different in the two processes.

The innovation process points to new products and services through the innovation value chain in which innovation capabilities are basic and fundamental. Core capabilities represent a potential and, therefore, cannot contribute to competitiveness unless they are successfully translated into new processes, products and services. This is the role of innovation management. The Innovation Intellectual Capital Benchmarking System (IICBS) has a specific system for the innovation process. The operations process, which produces ordinary products and services through the systematic and repetitive operations value chain, also requires core competencies and core capabilities to be competitive. However, these competencies and capabilities will probably be of a different nature from the ones mentioned above in the discussion of the innovation process.

ICBS also has a specific process for the operations value – the Operations Intellectual Capital Benchmarking System (OICBS). Figure 6 illustrates the business process broken down into two constituent parts, and the specific methodologies and information systems that correspond to each of the constituent parts.

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Customer need

INNOVATION

Design

OPERATIONS

Develop

Make

Market

Customer

Service

identified

need satisfied

Core activities

Core activities

Core competencies

Core competencies

Innovation core knowledge

Operations core knowledge

IICBS

OICBS

Innovation Intellectual Capital Benchmarking System

Operations Intellectual Capital Benchmarking System

Figure 6: Business process value chain In summary, the general model of the ICBS can be divided into two partial models. The first, the IICBS, refers to innovation core activities and core knowledge, whereas the second, the OICBS, refers to operations core activities and core knowledge.

The two models have a similar structure and they work in a similar way, but there is a fundamental difference.

The IICBS model refers to the core activities and core knowledge of the different projects that make up the innovation process. In contrast, the OICBS model refers to the core activities and core knowledge of the different business units that make up the operations process.

This paper describes only the IICBS. However, the structure and function of the OICBS can be easily deduced because the systems are very similar and work in an analogous fashion.

4. (IICBS) innovation intellectual capital benchmarking system general framework Using the metaphor of a tree, we can consider the company that performs innovation activities as a new tree in which the visible part (that is to say, the trunk, the branches, and the fruits) corresponds to the tangible assets of the innovative company (see Figure 7). The invisible part of the tree (the roots of the tree below ground) corresponds to the intangible assets of the innovative company. The two parts – tangible and intangible – are inseparable. The roots of the tree send the sap through the trunk and the branches to the fruits. In a similar way, knowledge and its aggregates – competencies, capabilities, and intellectual capital – make up that flows from the roots to the new processes, and thus to the new products and services.

Figure 7: Innovation tree and innovation infrastructure In addition, the company has at its disposal a common intangible innovation infrastructure that is shared by all the project units. This infrastructure corresponds to the fertile soil in which all the company trees are planted.

This fertile soil nourishes the roots (core knowledge) of each individual innovation company tree. The assessment process is carried out in a two-fold fashion as depicted in the flowchart of Figure 8. On one side, we take as reference benchmarks the innovative project objectives and goals (Company A); on the other side, we take as a reference benchmark the equivalent innovative project of the best world competitor (Company

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José M. Viedma Marti and Maria do Rosário Cabrita B). The flowchart shows that, within each company innovation tree (project unit), an analysis can be made, successively, on the fruits (new products and services), the branches (new processes), and the roots (new core competencies and professional core competencies). In addition, the overall soil fertility (innovation infrastructure) can be analysed. In analysing each particular tree (i.e. each individual project unit), we use the innovation value chain as an analysis tool. We argue that it is a useful approach because it helps to identify the interrelationships between innovative products and innovation capabilities. If products with a closer fit to firm competencies tend to be more successful, in turn, the effect that new product projects have on the firm’s competencies is a crucial issue to be observed in the trajectory of firm’s renewal and development. All of the above mentioned analyses have the ultimate purpose of discovering, in each of the flowchart steps or phrases, the new core knowledge and new core technologies that are the prime reason for sustainable competitive advantages.

Company A Project 1 Objectives

New Products and Services

New Processes

New core capabilities

New professional Core capabilities

Innovation Infrastructure

Customer emerging needs

Company B

Benchmarking GAP

Benchmarking GAP

Benchmarking GAP

Benchmarking GAP

Benchmarking GAP

Benchmarking GAP

Project (h) Objectives

New Products and Services (h)

New Processes (h)

New core Capabilities (h)

New professional Core capabilities (h)

Innovation Infrastructure

(h) = Homologous

Figure 8: Innovation Intellectual Capital Benchmarking System In the same way, the methodology makes it possible to compare each specific tree (project unit) with the homologous tree of the best of the competition, thus facilitating the benchmarking of fruits (new products and services), branches (new processes), roots (new core competencies and professional core competencies), and soil fertility (innovation structure).

4.1 Implications for Managers Senior managers effectively integrate the ICBS into the overall business strategy in a similar way they integrate other strategy-focused models. Nevertheless, in the particular case of the ICBS two new functions have to be performed: business intelligence and competitive benchmarking.

The main benefits from using ICBS are the following: 

Learning from one’s betters to surpass one’s own competitive position.



Identifying the specific competitiveness factors that are relevant I a given business activity.



Through the ICBS factors framework, enabling the identification, auditing and benchmarking of the core competencies or core knowledge that are the main sources of long term sustainable competitive advantages.



When using ICBS in an orderly systematic and repetitive way we obtain competencies statements that complete financial balance sheets and lead companies to leverage core knowledge.

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José M. Viedma Marti and Maria do Rosário Cabrita 

Selecting in a systematic and organised way the necessary information for evaluating relevant factors, core knowledge, core competencies and key intellectual capital.



Identifying the key areas in which in-depth benchmarking can be carried out in the future.



Promoting organizational learning through assessment teams, benchmarking teams, and strategic teams



Introducing a common language for company managers when dealing with intellectual capital



Facilitating the work of the benchmarking and competitive intelligence team.

5. Conclusion In the knowledge economy, soundly formulated and effectively implemented strategies are still the main drivers of company success, and SWOT analysis still remains the most common approach for analysing business strategy. However, in the new context, classical SWOT analysis does not provide suitable guidance for building an effective strategic management information system. An extended SWOT analysis which takes into consideration the two main streams of modern strategic thought - the resource-based view and the activitybased view - is a more reliable foundation. ICBS draws inspiration from the extended SWOT analysis and builds a strategic management information system in which core knowledge is the key issue.

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Barney, J.B. and Hesterly, W.S. (2006). Strategic Management and Competitive Advantage: Concepts and Cases. Upper Saddle River, NJ: Pearson Education.

Carlucci, D., Marr, B. and Schiuma, G. (2004). The knowledge value chain: How intellectual capital impacts on business performance. International Journal of Technology Management, 27, 6/7, 575-90.

Collis, D.J. and Montgomery, C.A. (2008). Competing on resources. Harvard Business Review, 86, 7/8, pp. 140-50.

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Drucker, P.F. (1999). Management challenges for the 21st century. Oxford: Elsevier Butterworth-Heinemann.

Fahy, J. and Smithee, A. (1999). Strategic marketing and the resource based view of the firm. Academy of Marketing Science Review, 10, 1-19.

Grant, R.M. (1998). Contemporary strategy analysis. Oxford: Blackwell Publishers Ltd. Haanes, K. (2000). Linking Intangible Resources and Competition. European Management Journal, 18, 1, 52-62.

Hill, W.L., Jones, G.R., Galvin, P. and Haidar, A. (2007). Strategic Management: An Integrated Approach. Sydney: John Wiley and Sons.

Hitt, M.A., Ireland, R.D., Camp, S.M. and Sexton, D.L. (2002). Strategic entrepreneurship: Integrating entrepreneurial and strategic management perspectives. In M.A. Hitt, R.D. Ireland, M.S. Camp, and D.L. Sexton (Eds.), Strategic entrepreneurship: Creating a new mindset. UK: Blackwell Publishers Ltd. Itami, H. (1987). Mobilizing Invisible Assets. Cambridge, MA: Harvard University Press.

Kaplan, R.S. and Norton, D.P. (1996). Using the balanced scorecard as a strategic management system. Harvard Business Review, 74, 1, 75-85.

Marr, B. (2005). Perspectives on intellectual capital – multidisciplinary insights into management, measurement, and reporting. Oxford: Butterworth-Heinemann.

Penrose, E.T. (1959). The theory of the growth of the firm. New York, NY: Oxford University Press.

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Porter, M.E. (1985). Competitive Advantage. New York: Free Press.

Prahalad, C.K. and Hamel, G. (1990). The core competence of the corporation. Harvard Business Review, May-June, 79-91.

Quinn, J. B. (1992). Intelligent Enterprise. New York: The Free Press.

Roos, G. (2005). Intellectual capital and strategy: A primer for today’s manager. Handbook of Business Strategy, 123-32.

Sveiby, K.E. (2001). A knowledge-based theory of the firm to guide strategy formulation. Journal of Intellectual Capital, 2, 4, 344-58.

Teece, D.J., Pisano, G. and Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18, 7, 509-33.

Viedma, J.M. (2004). Strategic knowledge benchmarking system (SKBS): A knowledge-based strategic management information system for firms. Journal of Knowledge Management, 8, 6, 31-49.

Viedma, J.M. and Cabrita, M.R. (2012). Entrepreneurial excellence in the knowledge economy.Intellectual Capital Benchmarking System. London: Palgrave Macmillan (forthcoming).

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Arabic Track

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Application Study of Management Knowledge Cities to Improve Tourism Planning in Egypt Lead Assistant Professor Hanan Hosny Soliman Elassar Faculty of Tourism and Hotels, Alexandria University, Egypt hanan_elassar@yahoo.com

Abstract: The conditions and the current situation influenced by the Arab region, at different levels and at the national and local, regional and global levels, requiring comprehensive consideration of the current form of the planning system at the national level as a whole, and its relationship to various government systems and other systems, the private sector and investment, and systems of society civil contemporary. In addition to the above relationship systems and regional and global frameworks, and through a clearer vision of the concepts currently under way in dealing with the development of tourist cities.

The reconsideration process , dictated by a number of substantive considerations, organizational and procedural, present and future. Which must be carefully considered with priority and the relative weight of each by its relationship to the nature of the prevailing tourism planning and its effectiveness. Especially, within the new situation of the various organs of the urban planning official.

This taking into account the importance of studying the current developmental experience for each individual state, in the light of past experience, and the present conditions that include ages and reconstruction projects at various levels and sectors of the overall development. This situation will naturally affect significantly on how to deal with future situations. And thus determine general trends when foreseeing the future prospects for this. It trends that will represent, therefore, the content of strategies and visions of the various levels and sectors of development in all Arab countries

Keywords: Community Knowledge Cities, urban planning, knowledge management

‫دراسة تطبيقات إدارة مدن المعرفة لتطوير الھيكل التخطيطي السياحي فى مص‬ ‫حنان حسنى سليمان العصار‬ -‫أستاذ مساعد التخطيط السياحي‬ .‫كلية السياحة والفنادق – جامعة اإلسكندرية‬ Hanan_elassar@yahoo.com ... ‫مقدمة‬ ،‫ على مختلف المستويات المحلية واإلقليمية والعالمية‬،‫إن الظروف واألوضاع الراھنة التي تمر وتـتأثر بھا المنطقة العربية‬ ‫ونظم المجتمع تستوجب إعادة النظر بصورة شاملة في الشكل الحالي لما يسمى بالنظام التخطيطي‬، ‫على المستوى الوطني ككل‬ ‫ وذلك عن طريق رؤية أوضح للمفاھيم المطروحة‬، ‫ باإلضافة إلى عالقة ما سبق بالنظم واألطر اإلقليمية والعالمية‬.‫المدني المعاصر‬ ‫ وأصبحت إدارة المعرفة وتطبيقاتھا من سمات مجتمعات المعرفة في المنظمات اإلدارية‬. ‫حاليا فى التعامل مع تطوير المدن سياحيا‬ ‫ إال أن ھناك‬، ‫في العديد من دول العالم من األمور التى أدت لتطوير الواقع التخطيطى وساعدت على إحداث طفرات تنموية شاملة‬ ‫ حيث تواجھھا العديد من التحديات والمعوقات التي تؤثر على فاعلية االستفادة من تلك التطبيقات‬،‫قصوراً معرفيا ً في المدن العربية‬ ‫ لذا يثار جوھر المشكلة البحثية ھنا أال وھو ما متطلبات تطبيق إدارة‬. ‫الھامة والتى يمكن أن تؤدى لنقالت تنموية تحتاجھا تلك الدول‬ ‫ وتحدد‬.‫ وكيف ستؤثر تلك المتغيرات على رؤية المستقبل‬.‫مدن المعرفة ؟ وما مدى توافر ھذه المتطلبات في المدن العربية ومصر‬ ‫التوجھات العامة عند استشراف آفاق ھذا المستقبل والتى تمثل مضمون اإلستراتيجيات والرؤى الخاصة بمختلف مستويات وقطاعات‬ .‫التـنمية بكل دولة عربية‬ . ‫ إدارة مدن المعرفة – تفعيل التخطيط السياحى‬:‫الكلمات الدالة‬ :‫المقدمة العلمية‬ 1- ‫اإلشكالية واألھمية البحثية‬: ‫ وربطھ ا بالرؤي ة التخطيطي ة الس ياحية‬، ‫تعتمد ھذه الدراسة على توظيف اَليات إدارة مدن المعرفة‬ ‫ وتنب ع أھمي ة البح ث م ن حداث ة مف اھيم إدارة م دن المعرف ة وت أتي‬.‫ ممارس ة وفع ال‬، ‫المعاص رة فك را ومنھج ا‬ ‫لحاج ة إل ى االس تفادة م ن تطبيقاتھ ا ف ي الم دن العربي ة م نأھمي ة تناول ه كموض وع معاص ر م ن جان ب وا‬ ‫ ونظ را ألن ه ال يوج د إط ار واض ح أو منھجي ة موح دة للتص ميم والتنفي ذ للتطبي ق األمث ل‬،‫ جان ب آخ ر‬،

131

‫‪Hanan Elassar‬‬

‫فتحدي د الخص ائص ال تي تمي يز إدارة م دن المعرف ة الناجح ة عل ى ارض الواق ع أص بح أب رز الوس ائل‬ ‫‪ Amidon, 2003, p 67)) .‬ح و التطبي ق الفع ال لھ ذه المنھجي ة ف ى مص رال تي تقودن ا إل ى أول الط ريق ن‬ ‫وندرة الدراسات العربية التي تناولت إدارة المعرفة ف ي التخط يط بوج ه ع ام ‪ ،‬والتخط يط الس ياحى بوج ه خ اص ‪ ،‬تس اھم ف ي اإلث راء‬ ‫المعرفي في ھذا المجال ‪ ،‬كما قد تك ون مقدم ة لدراس ات أخ رى ف ي حق ل التخط يط الس ياحى ‪ .‬ل ذا ترتك ز الدراس ة عل ى محاول ه إللق اء‬ ‫الضوء على تلك التطبيقات وتحليلھا واإلشارة ألمثلية تطبيق تل ك المنھجي ة كھ ا ِد لن ا نح و وض ع رؤي ة للمس تقبل الس ياحي ل بعض الم دن‬ ‫السياحية لدينا وسنطبق تلك االمكانية فى مدينة اإلسكندرية كإقليم سياحى وثقافى مميز ‪.‬‬ ‫‪ - 2‬أھداف البحث ‪ :‬تنطلق األھداف العلمية والعملية للدراسة الراھنة من عدة جوانب ھي ‪:‬‬ ‫ تفعيل اًليات التعامل مع الفكر التخطيطى من خالل إدراك قيمة تطبيقات إدارة مدن المعرفة‪.‬‬‫ تحديد وضع و متطلبات تطبيق إدارة مدن المعرفة عربيا ومحليا )مصر( ‪.‬‬‫‪ -3‬فروض البحث ‪ :‬تنطلق الدراسة من فرضين أساسيين مفادھما‪:‬‬ ‫ تحديد اًليات إدارة مدن المعرفة تعد نواة لتطور الرؤية التخطيطية السياحية‪.‬‬‫ تعانى التنمية المعرفية وتطبيقاتھا من قصور واضح فى المنطقة العربية‪.‬‬‫‪ -4‬منھجية البحث ‪ :‬يعتمد البحث على المنھج الوصفي فى دراسة نظرية ألسس إدارة مدن المعرف ة والتحليل ى لتحدي د انعكاس اته‬ ‫على الرؤى التخطيطية للقطاع السياحى‪ .‬ومدى اإلستفادة منھا بمدينة االسكندرية ‪.‬‬ ‫‪ -5‬حدود الدراسة‪ :‬اقتصر البحث على دراسة إدارة مدن المعرفة كمنھج للتطوير وليس كأسلوب يتم تحليله لذا لم يتم تناوله اال فى إط ار‬ ‫تطبيقاته التى تطور م ن الرؤي ة التخطيطي ة للقط اع الس ياحى وإتخ ذت االس كندرية كمث ال ألح د الم دن المص رية الرئيس ية س ياحيا ‪ -‬دون‬ ‫التوغل فى الواقع التخطيطى لھا ‪ -‬لتواجد مكتبة ومناطق ثقافية تمثل نقطة البداية لتالقى القيمة واإلبداع ‪.‬‬ ‫‪ -6‬االطار العام للبحث‪:‬‬ ‫المبحث االول ‪ :‬إدارة مدن المعرفة لدعم ھيكل التخطيط السياحي فى مصر‪.‬‬ ‫المبحث الثانى‪ :‬تطبيقات إدارة مدن المعرفة عربيا ومحليا لتطوير التخطيط السياحى ‪.‬‬

‫المبحث األول ‪ :‬إدارة مدن المعرفة لدعم ھيكل التخطيط السياحى فى مصر‪:‬‬ ‫اوال ‪ :‬مفھوم إدارة مدن المعرفة كتطبيق تخطيطي ‪:‬‬

‫إن إدارة مدن المعرفة تتضمن مجموعة من األنشطة التي تركز على كسب المعرفة التنظيمية داخليا ً وخارجيا وتؤثر فى تطوير‬ ‫المدن كنواة لتطوير الدولة كك ًل‪ ،‬و تعرف إدارة مدن المعرفة بانھا‪ " :‬مصطلح يرتبط بمراحل ايجاد ‪ ،‬ونشر ‪ ،‬واستخدام المعرفة‬ ‫إلدارة فعالة "‪ .‬ومن ھذا لتعريف نربط بين إدارة المعرفة كوسيلة لتحقيق تخطيط فعال ‪،‬و التطبيق الفعلى للمعرفة من أجل تحقيق‬ ‫أھداف الدولة ‪ ،‬وھذه األنشطة يجري تنفيذھا من خالل التكامل بين التكنولوجيا واالستراتيجيات التنظيمية المدعومة بالمعرفة الحالية ‪،‬‬ ‫وإنتاج معرفة جديدة من خالل تبنى فكر تخطيطى مدرك للموارد المعرفية كأصول للتنمية ‪ .‬والعنصر الحرج في إدارة مدن المعرفة‬ ‫ھو تحقيق الدعم للنظم المعرفية من أجل اكتساب المعرفة واستخدامھا في التطوير )‪ .( Gottshalk, 2002 - p84‬فإدارة مدن‬ ‫المعرفة تتعلق بالقضايا المحورية ذات العالقة بالتوغل التخطيطي مستعينا بالقدرات المعرفية المتاحة ‪ ،‬وقدرات وإمكانات الدولة في‬ ‫مواجھة التغيرات البيئية المتزايدة بصورة غير منتظمة‪ .‬وإدارة مدن المعرفة بھذا المفھوم تتضمن العمليات التخطيطية التي تسعى‬ ‫إلى تحقيق التداؤبية من خالل اإلمكانات الخالقة واالبتكارية للعنصر البشري ‪ ،‬فھى تسعى لتحقيق المثالية إلدارة األصول الثقافية‬ ‫لدى الدولة سواء أكانت تطبيقات أو منتجات لھا ملموسة أو ضمنية )‪ ، ( Daniels. And Bryson,2002, pp 45-48‬فھي‬ ‫إطار عام يشكل مظلة للفكر التخطيطى المقترح‪.‬‬ ‫‪ -1‬إدارة مدن المعرفة كقيمة سياحية ‪:‬‬ ‫فى ظل اقتصاد عالمى تعتمد بنيته االنتاجية على المعرفة‪ ،‬تصبح المدن ومنھج إدراتھا عامل ُمحفز للتنمية االقتصادية‬ ‫وبالتالى ُموجه للتنمية السياحية وداعم لھا‪ ،‬فالمدن تملك القدرة على السيطرة والتكيف مع الظروف المتغيرة لألسواق والتقنيات‬ ‫والثقافات‪ ،‬و تملك طاقة أعلى حتى لو كانت قدرتھا أقل من الحكومات للنھوض من أجل دعم التطور‪ -‬وبالتالى تستطيع المدن‬ ‫امتالك القدرة على تحقيق توغل فعلى للمشروعات السياحية كنسيج للمجتمع كبديل لفرضھا عليه ‪ -‬النھا قادرة على إرساء مكان‬ ‫اكثر كفاءة ألداء األعمال وخلق ظروف جاذبة لموارد جديدة من القوة والمكانة للمدينة‪ ،‬والتنافس فيما بينھا كمصدر لالبتكار ‪ ،‬لذا‬

‫‪132‬‬

‫‪Hanan Elassar‬‬

‫إدراكنا لذلك فى العالم العربى ھو نقطه التحول فى االندماج فى تلك الكيانات إن لم نستطيع أن نكن إحداھا‪ ،‬ومدن المعرفة تتنافس‬ ‫فى أربعة مجاالت ترتبط مباشرة بطبيعة القطاع السياحى ھى)‪: (Carrillo , 2009-pp 135- 140‬‬ ‫أ‪ -‬جودة الثقافة المحلية المرتبطة بفكرة االصالة كقيمة تدعم من االبداع ‪ ،‬وفى نفس الوقت تطور من أداء العمل السياحى‪ ،‬وھو‬ ‫مجال نستطيع ان ننافس من خالله المتالكنا فى مصر ‪-‬والعالم العربى‪ -‬ثقافة محلية مميزة ومتفردة ‪،‬ولذا تكامل تلك الثقافة بتطبيقنا‬ ‫لمنھج إدارة مدن المعرفة سيحقق الجودة لتلك الثقافة ويوفر فكرة األصالة لتلك القيم‪.‬‬ ‫ب‪ -‬حجم وكثافة سوق العمل وجودته وھو إدراك لقيمة العمالة المؤھلة وھو بعد معرفى و سياحى ھام‪.‬‬ ‫ج‪ -‬وجود مرافق وأماكن جذب محلية لھا قيمة عالية‪ ،‬مقترنة بطبيعة التطور المعرفى للدولة كالمكتبات ومراكز االبحاث‬ ‫والمناطق االثرية ذات الطبيعة العلمية التعليمية وھى مناطق ذات بعدين معرفى وسياحى‪...‬غيرھا‪.‬‬ ‫د‪ -‬إدارة المعرفة كمنھج للرؤية التخطيطية للقطاع ات التنموي ة وم ن ض منھا القط اع الس ياحى تھ دف إل ى اح داث طف رة معرفي ة‬ ‫ذات مردود اقتصادى واجتماعى ينعكس ايجابيا على ترسيخ العمل السياحى المحقق لتنمية شاملة‪.‬‬ ‫‪ - -2‬تطبيقات إدارة مدن المعرفة لدعم العمل التخطيطى ‪:‬‬ ‫إن تطبيق المعرفة يسمح بعمليات التعلم الفردي الجماعي الجديدة‪ ،‬والتي تؤدي إلى ابتكار معرفة جديدة ولذا يطلق على‬ ‫عمليات إدارة المعرفة بالحلقة المغلقة‪ .‬وقد استخدمت عدة أساليب لتطبيق المعرفة منھا ‪ :‬الفرق متعددة الخبرات الداخلية –‬ ‫مبادرات العمل – مقترحات الخبير الداخلي – اعتماد مقاييس للسيطرة على المعرفة – التدريب الفرقي من قبل خبراء (‬ ‫)‪،Wiig,Karl, 2003, p 11‬إن المعرفة يجب أن توظف في حل المشكالت التي تواجھھا ‪ ،‬إضافة إلى أن تطبيق المعرفة‬ ‫يجب أن يستھدف تحقيق األھداف واألغراض الواسعة التي تحقق لھا النمو والتكيف‪ .‬وھذا يقود بالضرورة إلى ترابط استراتيجية‬ ‫إدارة المعرفة مع استراتيجية الدولة ككل ‪.‬إن تطبيق المعرفة ھو غاية إدارة المعرفة فالحصول عليھا وخزنھا والمشاركة فيھا أمور‬ ‫ال تعد كافية‪ ،‬واألھم ھو تحويل ھذه المعرفة إلى التنفيذ‪ ،‬فالمعرفة التي ال تنعكس في التنفيذ تعد مجرد تكلفة‪ ،‬وأن نجاح إدارة‬ ‫المعرفة يتوقف على حجم المعرفة المنفذة قياسا ً لما ھو متوافر فالفجوة بين ما تعرفه وما تنفذه يعد أحد أھم معايير التقييم في ھذا‬ ‫المجال‪.‬‬ ‫ولذا تصبح المعرفة أحد مكونات التنمية الشاملة‪ ،‬و أصبح نمو الخدمات اكثر قيمة من السلع ‪ ،‬فتدعيم الموارد المعرفية يزيد‬ ‫القدرة التنافسية فى ارساء فكر التواصل والتوازن سياحيا َ ‪ .‬و تتضمن أبرز تطبيقات إدارة مدن المعرفة والتى تطور الفكر‬ ‫التخطيطى )كاريللو‪ ،2011 ،‬ص ص ‪: (42-38‬‬ ‫أ‪ -‬اإلرادة السياسية والمجتمعية أمر ال غنى عنه ‪ :‬حتمية تواجد إلحاح مجتمعي وإيمان بضرورة التغيير وتلك السمة تتواجد اآلن‬ ‫بشكل واضح في مصر‪ -‬و المنطقة العربية كنتاج مباشر للثورات السياسية ‪ -‬مما يترتب عليه إمكانية توجيه تلك التحوالت‬ ‫نحو الرغبة لتحسين وضع المدن فى مصر ‪.‬‬ ‫ب‪ -‬الرؤية اإلستراتيجية وخطة التنمية ‪ :‬لنجاح تطبيق نموذج مدن المعرفة يجب االسترشاد برؤية إستراتيجية واضحة تضم‬ ‫شمولية المعرفة وعمقھا )عالء ‪ ،2005 ،‬ص ‪. ( 68‬‬ ‫ج‪ -‬ضرورة الدعم المالي واالستثمارات المستمرة ‪ :‬يعتبر الدعم المالي من الشروط الجوھرية لتحقيق نجاح تنفيذ األھداف‬ ‫اإلستراتيجية ‪ ،‬فمن خالل التسويق الفعال يمكن للمدينة جذب االستثمارات الخارجية المطلوبة للتمويل ‪.‬‬ ‫د‪ -‬حتمية تأسيس وكاالت لتعزيز تنمية األقاليم القائمة على المعرفة ‪ :‬تتمثل في مؤسسات تقنية – كالقرية الذكية‪ ،‬مكتبة االسكندرية‬ ‫فى مصر ‪ -‬ومراكز ومعاھد بحثية وجامعات وھى مؤسسات تشارك في تصميم وتنفيذ المشاريع ذات الصلة وإجراء بحوث‬ ‫وتعزيز التعاون وتبادل المعرفة ‪.‬‬ ‫ه‪ -‬أھمية عالمية المدينة وتعددية األعراق بھا ‪ :‬الن ھذا المناخ يحفز تالقى األفكار وتنقيحھا ويشجع على تدفق المعرفة ‪.‬‬ ‫و‪ -‬أھمية موقع المدينة على شبكة المعلومات الدولية ‪ :‬يعد تطوير موقع فعال للمدينة على شبكة االنترنت وجودته دليال على‬ ‫أبداعية المدينة وجاذبيتھا ‪.‬‬ ‫ز‪ -‬أھمية إنشاء محركات ابتكارية حضرية ‪ :‬ھو النظام الذى يدعم إنشاء وتوليد وتحفيز االبتكار فى المدينة وھو نظام يتضمن‬ ‫األفراد والعالقات والقيم والعمليات واألدوات والبنية التحتية التكنولوجية والمادية والمالية ومن أبرز محركات االبتكار ؛‬ ‫المكتبة والبورصة والجامعات والمتاحف ‪....‬وغيرھا وھى مقومات نمتلكھا فى مصر ‪.‬‬ ‫ح‪ -‬ضمان حقوق مواطني مجتمع المعرفة ‪ :‬وتتضمن توافر حقوق للمواطنين فى؛ حق الوصول إلى المعلومة‪ ،‬حق توافر المعلومة‬ ‫‪،‬حق التعليم والتدريب ‪،‬حق المشاركة‪.‬‬ ‫‪ -3‬تحليل إدارة مدن المعرفة وارتباطه بالرؤية التخطيطية السياحية ‪:‬‬ ‫ان التطبيقات التى اشرنا اليھا تمثل فكرة التواصل المعرفى وھذه الفكرة فى ذاتھا اقرب ما تكون للفكر السياحى الذى يعتمد على‬ ‫فكرة التوازن والتواصل ‪ ،‬والذى كان فى بدايته دون رؤية واضحة أو خطط محددة‪ ،‬ثم تطور ليصبح تواصل ممنھج من خالل رؤية‬ ‫سياحية لدولة يقابلھا احتياج مستمر لسائح ‪ ،‬وكما حدث فى تطور فكر السياحة وقواعد االتصال المرتبطة به نتيجة التطور من المجتمع‬ ‫الصناعى لمجتمع المعلومات انتقل االمر لمجتمع المعرفة الذى حقق اتصال اكثر فاعلية مما اثر بشكل مباشر على السياحة ورؤيتھا‬

‫‪133‬‬

‫‪Hanan Elassar‬‬

‫التخطيطية‪ .‬فتحول االمر فى عصر المعرفة من حدود مكان وزمان إلى رغبة وقدرة‪ ،‬فيواجه احتياج السائح قدرة المجتمع على‬ ‫استيعاب وتحقيق تلك االحتياجات ‪ ،‬وأصبح دور المخطط السياحى فى اطار ھذا الفكر رابط جوھرى فى تحقيق انسجام بين الرغبة‬ ‫الموجودة او ال ُمخلقة – نتيجة جھد التسويق السياحى – والقدرة المحتملة من استغالل موارد سياحية بشكل أمثل يجعلھا تواجه تلك‬ ‫الرغبة وتشبعھا ‪.‬ولذا يصبح فكر مدينة المعرفة كما يوضح الشكل )‪ (1‬فى ذاته نقطة للتحول للقدرة التخطيطية ليصبح المخطط قادر‬ ‫على التواصل عبر نظام متكامل من شبكة المدن التى تغطى أنحاء العالم لوضع فكر خالق يتعدى حدود معرفته ليشمل قدرات عصر‬ ‫المعرفة كمنظومة متكاملة )‪. ( Friedman,1998,p27‬‬ ‫شكل )‪( 1‬محاور مدينة المعرفة وعالقتھا بالرؤية التخطيطية السياحية المقترحة‬

‫مدينة‬ ‫ل فة‬

‫االقتصاد المعرفى ‪:‬‬ ‫ ﺗﺣﻘﻳق ﻧﻣو اﻗﺗﺻﺎدى ﻳﺗوﻏﻝ ﻓﻰ‬‫اﻟﻣﺟﺗﻣﻊ ﺑرؤى ﺗﺧطﻳطﻳﺔ ﺷﺎﻣﻠﺔ‪.‬‬

‫ اﻟﺣﺎﺟﺔ ﻟدﻋم اﻟﻘطﺎﻋﺎت اﻟﻣﻌرﻓﻳﺔ‬‫واﻟﺗﻛﻧوﻟوﺟﻳﺔ ﻣﻣﺎ ُﻳﻔﻌﻝ ﻣن‬ ‫ﺗﻧظﻳم اﻟﻌﻣﻝ اﻟﺳﻳﺎﺣﻰ‬

‫‪ -‬ﺗوﻓﻳر ﻋﻣﺎﻟﺔ ﻓﻌﺎﻟﺔ ﻟﻠﻘطﺎﻋﺎت‬

‫اﻻﻗﺗﺻﺎدﻳﺔ واﻧﻌﻛﺎس ذﻟك ﻋﻠﻰ‬

‫اﻟﻘطﺎع اﻟﺳﻳﺎﺣﻰ‪.‬‬

‫اﻟﻣراﻛز اﻟﺣﺿﺎرﻳﺔ واﻟﻘوى‬ ‫اﻟﺑﺷرﻳﺔ‪:‬‬ ‫‪ -‬رؤﻳﺔ ﺗﺧطﻳطﻳﺔ ﻟﻠﻘطﺎع‬

‫اﻻﺑداع ‪:‬‬ ‫ رؤﻳﺔ ﺗﺧطﻳطﻳﺔ ﻣﺗﻛﺎﻣﻠﺔ ﻟﻔﻛر ٌﺧﻼق ﻣﺑدع‪.‬‬‫‪ -‬ﻗﻳﻣﺔ ﻓﻌﻠﻳﻪ ﻟﻼﻫﺗﻣﺎم ﺑﺎﻟﺑﺣث اﻟﻌﻠﻣﻰ ‪.‬‬

‫ ﻣراﻛز اﻻﺑﺣﺎث واﻟﻣراﻛز اﻟﺛﻘﺎﻓﻳﺔ واﻟﻣﻛﺗﺑﺎت‬‫ اﻟﻧﻣو اﻟدﻳﻣوﺟراﻓﻰ اﻟﻣرﺗﺑط ﺑﻣﺟﺗﻣﻊ واﻋﻰ‬‫ﻗﺎدر ﻋﻠﻰ اﺳﺗﻳﻌﺎب اﻟﺗطور ‪.‬‬

‫اﻟﺳﻳﺎﺣﻰ ﻻرﺗﺑﺎطﻪ اﻟﻣﺑﺎﺷر‬ ‫ﺑﺗطوﻳر اﻟﻣﻧﺎطق اﻻﺛرﻳﺔ وﻓق‬

‫ﻣﻧﻬﺞ أﻗطﺎب اﻟﻧﻣو‪.‬‬

‫ إدراك اﺣﺗﻳﺎﺟﺎت اﻟﻣدن وﻗدرﺗﻬﺎ‬‫اﻻﺳﺗﻳﻌﺎﺑﻳﺔ ﻋﻣراﻧﻳﺎ وﺳﻳﺎﺣﻳﺎ‬

‫‪ -‬اﻟﻌﻣﺎﻟﺔ اﻟﻣؤﻫﻠﺔ اﻟﻣﺣﻠﻳﺔ ‪.‬‬

‫‪ -1‬المصدر ‪ :‬أ‪-‬الباحثة ‪.‬‬ ‫نستخلص مما تقدم أن تطبيقات إدارة المعرفة تنعكس على أداء العمل التخطيطى فى تحسين عملية اتخاذ القرارو مس توى االس تجابة‬ ‫للسائح واحتياجاته و مستوى كفاءة األفراد والعمليات وتحسين اإلبداع والمنتج السياحى‪.‬‬

‫ثانيا ‪ :‬أبرز اًليات إدارة المعرفة لتطوير الھيكل التخطيطى للقطاع السياحى فى مصر‪:‬‬ ‫‪ -1‬معوقات الرؤية التخطيطية الحالية فى مصر ‪:‬‬ ‫تمثل مشكلة غياب التخطيط العلمي للمستقرات البشرية في الوطن العربي بصفة عامة ومصر تحديدا ‪ ،‬من أھم المش كالت‬ ‫الخاصة باألبعاد التخطيطية لإلدارة الحضرية‪ ،‬فقد نمت أغل ب المس تقرات الكب رى ف ي ظ ل غي اب م دروس للمؤش رات االجتماعي ة‬ ‫واالقتصادية وحتى الطبيعي ة المتوقع ة للم دن و ينبغ ي للمخط ط أن ي درك أن للتحض ر الزائ د أض راراً ومش اكل ع دة ت زداد خط ورة‬ ‫عندما يفقد التخطيط جوھره وھذا بحد ذاته يعبر ع ن تك اليف مض افة إل ى المجتم ع )ع اطف ‪ ،1989،‬ص ‪ .(295‬وھن اك معوق ات‬ ‫رئيسية تعرقل تنفيذ إدارة المعرفة بشكل فاعل فى العمل التخطيطى فى مصر )‪ ( Amin, 1999,pp. 365-78‬يتمثل أبرزھ ا‬ ‫فى‪:‬‬ ‫أ‪ -‬غياب تصور واضح لمفھوم إدارة المعرفة وممارساتھا‪ -‬وھو ما نحاول معالجته بتل ك الدراس ة ‪ -‬و تض ارب مص ادر الحص ول عل ى‬ ‫البيانات والمعلومات و تفسير المشكالت بصورة شخصية ‪ ،‬والعمل الفردي بعيداً عن مشاركة اآلخرين ‪.‬‬ ‫ب‪ -‬تراجع دور القيادة التربوية في تبني ثقافة تنظيمية ترفع من قيمة المعرفة ومن قيمة المشاركة فيھا ‪ -‬بل وقيمة اإلبداع في تط وير‬ ‫المعرفة مع سيطرة الثقافة التي تكبح التشارك في المعرفة‪ ،‬لعدم دعم القيادة العليا إلدارة المعرفة‪.‬‬ ‫ج‪ -‬اإلدراك غير الكافي لمفھوم ودور إدارة المعرفة ومحتواھ ا وفوائ دھا‪ ،‬واإلفتق ار إل ى الت دريب الفع ال ل تعلم كيفي ة اس تخدام وتنفي ذ‬ ‫نظام إدارة المعرفة‪ ،‬وعدم فھم مب ادرة إدارة المعرف ة بش كل ص حيح بس بب اإلتص ال غي ر الفع ال وغي ر الكف ؤ ‪ ،‬و ع دم تخص يص‬ ‫الموارد البشرية والمادية الكافية لنجاحھا)‪.( Sveiby & Lioyd -2001‬‬ ‫د‪ -‬التغير المطلوب في الثقافة قد يكون بطيئا‪ ،‬واإلستثمار في الوسائل الضرورية لتطبيق إدارة المعرفة قد يكون ضعيفا‪.‬‬ ‫ه‪ -‬إدارة المعرفة ھي خلية لحلول عالية المستوى قد ال تدركھا دول العالم النامى لقصور نظرتھا التنموية ‪.‬‬ ‫و‪ -‬على الرغم من إحتياج الدول العربي ة لتطبيق ات اإلدارة المعرفي ة لتقلي ل الفج وة التكنولوجي ة الت ى تع انى منھ ا ‪ ،‬إال أنھ ا تتب ع أس اليب‬ ‫إدارية تقليدية خاصة فى مجال التخطيط السياحى وتتسم بالتطور المعرفى الشكلى بعيدا ً عن المضمون ‪.‬‬

‫‪134‬‬

‫‪Hanan Elassar‬‬

‫‪ -2‬الھيكل التخطيطى المقترح وفق تطبيق بعض اَليات إدارة مدن المعرفة بمصر‪:‬‬ ‫يُظھر تحليل األوضاع التخطيطية فى مصر ثالث مناھج رئيسية تحدد االقاليم التخطيطية وھى) أكاديمية البحث العلمى‪،‬‬ ‫القاھرة‪ ،1998،‬ص‪ : (69‬المنھج األول؛ ويتمثل فى االعتماد على الشبكة اإلدارية القومية التقليدية كمحاور مكانية تخطيطية‪،‬‬ ‫ويقصد بھذه الشبكة تلك االقسام اإلدارية التى تقسم الدولة إلى محافظات‪.‬المنھج الثانى؛حيث يتم وضع أقاليم تخطيطية فى حالة عدم‬ ‫مناسبة االقاليم اإلدارية ألھداف التنمية اإلقليمية ‪ ،‬وتتكون االقاليم التخطيطية من عدد من االقاليم اإلدارية‪.‬المنھج الثالث؛ ويتمثل فى‬ ‫عملية إنشاء وحدات إدارية جديدة لتتناسب مع االھداف التخطيطية اإلقليمية وتمثل أقاليم إقتصادية) صناعية – سياحية ‪.(..-‬وتمثل‬ ‫متطلبات التخطيط الفعال وفق األساس المقترح فيما يلى )نور برھان ‪ ،1988 ،‬ص‪:(66‬‬ ‫‪ ‬وجود دعم سياسي وإداري لدعم فكر إدارة مدن المعرفة و توغله الفعلى داخل المنظومة التخطيطية‪.‬‬ ‫‪ ‬وجود رؤية إستراتيجية واضحة تحدد مواطن القوة والتميز و الجوانب التي تحتاج إلى تنمية عاجلة وآجلة‪.‬‬ ‫‪ ‬سن القوانين والتشريعات الداعمة والمشجعة لدعم الشراكة المعرفية وتطبيقاتھا المختلفة ‪.‬‬ ‫‪‬أن يدعم المجتمع بصورة فاعلة مفھومإدارة مدن المعرفة ممثلة فىربط األفراد والھيئات والقطاع الحكومي والقطاع الخاص‪.‬‬ ‫‪ ‬توفير الموارد لتطوير ثقافة األفراد فى مجال الشراكة المعرفية ودعم الوعى السياحى بالقيم التراثية والثقافية ‪.‬‬ ‫إن نماذج التنمية التقليدية أصبحت غير مجدية مما أظھر الحاجة الى بزوغ أفكار ورؤى جديدة ‪ ،‬وانعكاس تلك الرؤى سياحيا‬ ‫تبرز أھمية إنجاح تطبيقات إدارة مدن المعرفة وھو بلورة حقيقية للتطور السياحى الذى يھتم بالمجتمع وعناصر الجذب والسائح‬ ‫كحلقات مكتملة إلنجاح الفكر التخطيطى للتنمية السياحية المتواصلة ‪ ،‬ويرمز المنھج المعرفى المقترح لثالث عمليات أساسية‬ ‫مترابطة ھى انعكاس لثورات اقتصادية معاصرة لالقطاب التقنية الممثلة فى ؛الثورة التقنية و االقتصاد المعرفى و ظھور نمط جديد‬ ‫من أنماط االنتاج االقتصادى واإلدارة اال وھو االقتصاد المعرفى والقائم على توليد مستمر للمعارف كل ذلك يتجمع برؤية‬ ‫تخطيطية واحدة فى داخل منطقة ھى مدينة المعرفة او القطب التقنى)السلمي‪ ،1998 ،‬ص ص ‪.( 19 -18‬‬ ‫وتطبيق إدارة المعرفة على الفكر السياحي تبرز فى اعتبارھا رأس المال الفكرى المدعم لالمكانات الشخصية والتنظيمية ف ى‬ ‫إطار التنمية السياحية لتحقق التأثير االيجابي في نتائج الميزة التنافس ية‪ ،‬وب ذلك نحق ق مكان ة س ياحية ممي زة ت رتبط بتالق ى ؛ المي زة‬ ‫التنافس ية الحض ارية الت ى تملكھ ا مص ر م ن مقوم ات وعناص ر ج ذب متف ردة ‪ ،‬م ع المي زة التنافس ية االبداعي ة الت ى يخلقھ ا التط ور‬ ‫والتمكين والمعرفة لخلق تف رد ف ى المن تج الس ياحى المق دم يض من االس تمرار والمنافس ة العالمي ة الت ى يحققھ ا الم زج ب ين الحض ارة‬ ‫واالبداع ‪ ( McDermott and O’Dell, 2001, pp76-79) .‬ويمثل جوھر اإلدارة المعرفية مساريين ھما‪:‬‬ ‫ األول‪ :‬مسار المعلومات؛ ينظر عبره إلدارة المعرفة ك إدارة المعلوم ات وتُع د المعرف ة لمعلوم ات تج ري معالجتھ ا ب نظم مس ار‬‫محدد االفق ‪ ،‬يقصر اإلدارة على قيمة المعلومة دون ربطھا بفكر ومنھج استخدامھا لذا نعتبر ھذه المرحلة التمھيدي ة إلدارة المعرف ة‬ ‫حيث يؤثر فى تطوير اَليات العمل التخطيطى دون المساس بمنھجيته‬ ‫ الثاني‪ :‬مسار التطوير؛ ويعتمد على أن المعرفة تعبر عن اَلية للعمليات و المھ ارات الديناميكي ة المعق دة والمتغي رة ‪،‬وھ و المس ار‬‫االق رب لم نھج الدراس ة حي ث يس تخدم المعرف ة كاَلي ة لتط وير أداء العم ل كك ل ‪ ،‬وھن ا يب رز قيم ة إدارة المعرف ة ف ى تط وير العم ل‬ ‫التخطيطى السياحى‪.‬‬ ‫إن منھج التخطيط يعتمد على التفكير اإلبداعي والديناميكي ‪ ،‬وخاصة اذا ما أدركنا الطبيعة المتغي رة للق وى الفاعل ة ف ي البيئ ة‬ ‫التي يعمل فى إطارھا العمل السياحى‪ .‬وھذا يؤكد حقيقة ان تبني التخطيط السياحى مب ادىء اإلدارة لم دن المعرف ة كمنھجي ة عم ل ال‬ ‫يعني بالضرورة اتباع اسلوب محدد للتصرف ولكن يقتضي تطبيقھا بدرجة عالية من المرونة والقدرة على التكيف ‪،‬حتى تس تطيع‬ ‫االستجابة لمقتضياته والرد عليه ‪.‬‬ ‫و نظرية إدارة المعرفة توضح التحول الكبير لمجتمعنا االقتصادي ‪ ،‬من مجتمع يتص ف بإيج اد الث روة م ن خ الل إنت اج الس لع‬ ‫والخدمات – وم ن ض منھا المن تج الس ياحى ‪ ، -‬إل ى مجتم ع يتص ف بإيج اد الث روة م ن خ الل التح ول لقيم ة وق وة الفك ر لالف راد ف ى‬ ‫المجتم ع وتص بح ثقاف ة المجتم ع وھويت ه ‪ -‬الص ورة الس ياحية‪ -‬ھ ى مرك ز خَل ق القيم ة ‪ .‬ف إدارك الم وارد وتحويلھ ا إل ى رأس مال‬ ‫استراتيجي فكري ذو قيم ة تعتب ر ج وھر الفك ر التخطيط ى للقط اع الس ياحى ال ذى يحت اج دائم ا لفك ر مب دع ف ى التعام ل م ع الم وارد‬ ‫المتف ردة لتحقي ق االص الة للمن تج المق دم للس ائح ‪ ،‬وھن اك مح وريين وراء ھ ذه العملي ة لإلنتف اع م ن رأس الم ال الفك رى وھم ا‬ ‫)‪ (Dieleman, Dijst, & Spit. , 1999, pp. 605–621‬؛‬ ‫المحور األول ‪ :‬إن التكنولوجيا تلعب دورا واسعا فى تفعيل العمل التخطيطي سواء كعملية فى ذاتھا أو كوسيلة للتنمية‪.‬‬ ‫المحور الثانى ‪:‬طرق معالجة االفراد للمعلومات وتصورھم للواقع مختلفة لذا رؤيتھم ستتباين وفق طبيعة االھتمام والھدف‬ ‫واألليات المستخدمة التى كلما تطورت زادت فعالية النتائج المحققة‪ -‬الھدف من الدراسة – تفعيل اًليات التعامل مع الفكر‬ ‫التخطيطى من خالل إدراك قيمة تطبيقات إدارة مدن المعرفة‪.‬‬ ‫وتكامل المنھج السابق مع أس تراتيجية أقط اب النم و كم نھج تخطيط ى أمث ل لتحقي ق التنمي ة الس ياحية الفعال ة ف ى مص ر بحي ث‬ ‫تتحول المدن إلى أقطاب نمو ‪ ،‬فھ ى تعتم د عل ى تنمي ة المنطق ة أوال وف ق التص ور الس ابق للتفكي ر االب داعى وال ديناميكى‪ ،‬ث م تق وم‬

‫‪135‬‬

‫‪Hanan Elassar‬‬

‫بنش ر التنمي ة ع ن طري ق قي ادة التط وير لالنش طة كم ا ھ و الح ال بالنس بة لمدين ة اإلس كندرية داخ ل اإلقل يم كنقط ة االنطالق ة لالقل يم‬ ‫‪،‬ويعتبر مفھوم أقطاب النمو أحد أھم األطر النظرية التي حاولت تفسير التباين في التنمي ة اإلقليمي ة ويرك ز أن التط ور ال يح دث ف ي‬ ‫جميع المناطق في نفس الوقت‪ ،‬ولكن يظھر على شكل أقطاب نم و‪ -‬كم دن المعرف ة – وھ ى من اطق كبي رة تعم ل كمراك ز للنم و مم ا‬ ‫يجعلھا نقاط إشعاع للتحديث ولتلك المنھجية بعدين رئيسيين يتكامال معا ‪ ،‬ويتمثل بعدي تلك المنھجية فى) عل ي‪ ، 2001 ،‬ص ‪(45‬‬ ‫؛‬ ‫أوال ‪ :‬البع د الم ادى ‪:‬وھ و ال ذى يعتم د عل ى المك ان والبيئ ة المحيط ة وعل ى العناص ر المبني ة وھ ى جميعھ ا تمث ل مقوم ات البيئ ة‬ ‫الحضارية الطبيعية للمكان ‪.‬‬ ‫ثانيا ‪ :‬البعد الثقافى الحضارى والتقنى ‪:‬المدينة المصرية ناتج لمجموع ة م ن التف اعالت المادي ة والثقافي ة والحض ارية داخ ل مس احة‬ ‫جغرافية معينة لھا محددات بيئية خاصة أنتجت تجمعات عمرانية ومدن ذات صفات حضرية وطابع مميز‪.‬‬ ‫وتمثل أبرز االنج ازات الحادث ة لتحوي ل مص ر لقط ب تقن ى ؛ مدين ة مب ارك للبح ث العلم ى والتطبيق ات التقني ة الت ى ت م انش ائھا‬ ‫‪ ، 1993‬وتب ع ذل ك ع ام ‪ 1995‬وض ع مخط ط للب دء ف ى أرب ع اودي ة للتقني ة ف ى ك ل م ن س يناء ومدين ة الس ادس م ن اكت وبر وقن ا‬ ‫وسوھاج ‪ ،‬وتم وضع وتبنى مشروع للقطب التقنى فى الساحل الشمإلى بواسطة محافظة االسكندرية ووزارة التعل يم الع إلى والبح ث‬ ‫العلمى والصندوق االجتماعى للتنمية والقرية الذكية فى الھرم التى انشأت عام ‪ 2000‬يركز فيھ ا عل ى االنش طة التقنية‪،‬وتع د مص ر‬ ‫قطب ثقافى حيث تملك فى معظم اقاليمھا امتزاج للحضارة والمعرفة ) عبد الجليل ‪ ،1992 ،‬ص ص ‪.( 46 – 45‬‬

‫المبحث الثانى‪ :‬تطبيقات إدارة مدن المعرفة عربيا ومحليا لتطوير التخطيط السياحى ‪:‬‬ ‫اوال ‪ :‬إدارة المعرفة في المدن العربية الوضع الحالي و متطلبات التطبيق‪:‬‬ ‫لك ي نتع رف عل ى متطلب ات تطبي ق إدارة المعرف ة ف ي الم دن العربي ة‪،‬فان علين ا أن نتع رف عل ى واق ع المعرف ة ف ي ھ ذه‬ ‫المدن)البرنامج االنمائى لألمم المتحدة‪:( .2003، ،‬‬

‫‪ -1‬وضع المعرفة في المدن العربية ‪:‬‬ ‫أشار تقرير التنمية البشرية العربية لعام ‪ 2003‬إلي تقي يم وض ع المعرف ة ف ي الع الم العربي‪،‬حي ث ذك ر " إن المعرف ة ش كلية ف ي‬ ‫الدول العربية ‪،‬وتوجد عقبات مجتمعية تحول دون قي ام مجتم ع المعرف ة‪.‬و دوام االتجاھ ات الراھن ة نح و تھم يش دور المعرف ة ف ي‬ ‫المجتمعات العربية ‪ .‬وربط التقرير بين وضع المعرفة ووضع البحث العلمي " ھناك عالقة متبادلة بين تراكم المعرفة وبين مس توى‬ ‫البحث العلمي‪ ،‬إذ كلما تقدم مستوي البحث العلمي‪ ،‬ارتادت المعرفة اإلنس انية آفاق ا غي ر مس بوقة فيس جل الع الم العرب ى إخفاق ا أخ ر‬ ‫يض اف إل ي سلس لة اإلخفاق ات الت ي يع انون منھ ا ف ي الوق ت ال راھن ‪ ،‬إذ يتس م واق ع العل م والتقني ة ف ي الع الم العرب ي بالمحدودي ة "‬ ‫‪.‬ويشير التقرير االقتصادي العربي الموحد لعام ‪ 2003‬إلي أن الدول العربي ة تحت ل المرتب ة األخي رة ب ين المجموع ات الس كانية ف ي‬ ‫العالم علي صعيد إالنفاق علي البحث العلمي وعدد براءات االختراع وحقوق التصنيع "‪.‬كما يشير التقري ر إل ي أن ه عل ي ال رغم م ن‬ ‫زي ادة ع دد مس تخدمي االنترن ت ف ي ال دول العربي ة ‪ ،‬إال أن النس بة مازال ت ض عيفة ) ح والي ‪ (% 1.29‬ويتض ح ش دة التف اوت‬ ‫المعلوماتى بين الدول العربية‪ ،‬حت ى تل ك الت ي تتس اوى ف ي مس توى التنمي ة البش رية‪ ،‬وھن اك عوائ ق تعم ل عل ي توس يع ھ ذه الفج وة‬ ‫الرقمية داخل كل دولة عربية أھمھا عامل اللغة والتوغل الحقيقى بعيدا عن الشكل ‪.‬‬ ‫‪ -2‬مدي توافر متطلبات تطبيق إدارة المعرفة في المدن العربية‪:‬‬ ‫إن تطبيق إدارة المعرفة لتطوير الھيكل التخطيطى يتطلب توافر مجموعة من العناصر التي سوف نتعرف علي م دي توافرھ ا‬ ‫في المدن العربية‪ ،‬وذلك علي الوجه اآلتي)‪:( Graham and Healey, 1999, pp 109-111‬‬ ‫أ‪ -‬مدى إمكانية الحصول علي المعلومات والشفافية ‪:‬تتسم الممارسات في معظم المدن العربية بع دم الش فافية‪ .‬و ل يس ھن اك تب ادل‬ ‫فعلي للمعلومات بين مناطق الدولة ‪.‬وعلي الرغم من أن قوانين اإلدارة والحكم والسلطات المحلية في الدول العربية تمنح المواطنين‬ ‫حق حضور اجتماعات المجالس المحلية إال أن ھذا ال يطبق بالفعل‪ ،‬كما أن العالنية التي تنص عليھا الق وانين غالب ا م ا ي تم تفس يرھا‬ ‫بأنھا مقصورة علي حضور الصحفيين أو وس ائل اإلع الم لالجتماع ات ‪.‬كم ا تع اني المج الس المحلي ة م ن مش كلة تك رار المعلوم ات‬ ‫المتوافرة ل ديھا أو تناقض ھا‪ .‬وي ذكر تقري ر التنمي ة البش رية العربي ة)البرن امج االنم ائى لألم م المتح دة‪ ( .2003، ،‬ف ي إط ار تبري ره‬ ‫لوض ع مجتم ع المعرف ة ف ي ال دول العربي ة أن الس لطة السياس ية بھ ا تعم ل عل ي ت دعيم ال نمط المعرف ي ال ذي ينس جم م ع توجھاتھ ا‬ ‫وأھدافھا‪،‬وھي بالتالي تحارب األنماط المعرفية التي تتعارض مع التوجيھات العامة التي تتبناھا مما يفقد االمر قيمته الفعلية ويجعله‬ ‫إطار شكلى وليس منھج حقيقى ‪.‬فالوصول إلي مجتمع المعرفة يرتبط أساسا بإطالق حرية الرأي والتعبير وض مانھا ب الحكم الص الح‬ ‫الذي يتجسد بالمشاركة الشعبية الفاعلة والقادرة علي التأثير علي مسار القرارات الحكومية التي تم س الم واطنين ع ن طري ق حتمي ة‬ ‫توافر الشفافية و الديمقراطية والحرية والمشاركة السياسية ‪.‬‬

‫‪136‬‬

‫‪Hanan Elassar‬‬

‫ب‪ -‬عدم وجود ھياكل تنظيمي ة وإداري ة واقعي ة ‪ :‬تفتق د معظ م الم دن العربي ة وج ود ھياك ل تنظيمي ة تعك س الواق ع ف ي ھ ذه الم دن ‪.‬‬ ‫فھناك قصور واضح في بنية الھياك ل التنظيمي ة وك ذا الل وائح المنظم ة لألعم ال المنوط ة بالمج الس المحلي ة والت ي منھ ا ع دم تحدي د‬ ‫الصالحيات والمسئوليات بصورة واضحة تمنع التداخل واالزدواجيةوتواجه الدول العربية مشكلة التضخم الوظيفي ‪.‬وإلي جان ب م ا‬ ‫سبق ‪ ،‬فإن المدن في معظم الدول العربية تفتقر إلي وضوح االختصاصات والتنسيق بين المجالس المحلية وبعضھا ال بعض أو بينھ ا‬ ‫وبين الحكومة المركزية‪ .‬كما أن التعاون بين ھذه المجالس في تبادل المعلومات يعتبر ضعيفا ‪ .‬ويرجع ذلك إلي فق دان الثق ة المتب ادل‬ ‫والذي يؤدي بدوره إلي عدم القدرة علي تكوين شبكات من العالقات ما بين المنظمات‪ .‬ومن ناحية ثانية‪،‬فإن ما يتسم به القط اع الع ام‬ ‫من بيروقراطية وھيراركية يؤدي إلي صعوبة تبادل المعلومات والمساھمة في انتقالھا ) ‪( Urbecon ,2002.,p 65‬‬ ‫ج‪ -‬الثقافة التنظيمية ‪:‬من أھم سمات الثقافة التنظيمية في معظم الدول العربية ارتباط اإلدارة بالسلطة السياسية‪،‬والو الءات التقليدي ة‬ ‫ومحدودية المشاركة في صنع القرارات ‪ ،‬والمقاومة ألي تغيير في النظم واللوائح ‪ ،‬والنظرة المتعالي ة لطال ب الخدم ة ‪ .‬و المج الس‬ ‫المحلية والبلدية في العالم العربي ترتبط بالسلطة أكث ر م ن ارتباطھ ا ب المواطن المتعام ل معھ ا ‪ ،‬وق د أدى ذل ك إل ى اھتم ام المج الس‬ ‫المحلية بتلبية رغبات السلطة التنفيذية وتجاھل احتياجات المجتمع إال بالقدر الذى يتناس ب م ع فلس فة وأھ داف النظ ام ‪.‬كم ا أدي إل ي‬ ‫وج ود فج وة ب ين ھ ذه المج الس والم واطن‪.‬و تنط وي الثقاف ة التنظيمي ة ف ي معظ م – إن ل م يك ن ك ل – الم دن العربي ة عل ى س رية‬ ‫المعلومات مما يفقدھا قيمتھا ووزنھا فى التطوير‪.‬‬ ‫د‪ -‬سيادة نمط المدير في مقابل غياب نمط القائد ‪ :‬إن تبن ي تطبيق ات إدارة م دن المعرف ة يعتم د عل ي نم ط القي ادة اإلداري ة الت ي ت وفر‬ ‫المناخ المناسب لتفعيلھا‪ .‬و المالحظ علي القيادات اإلدارية العربية اعتمادھا علي اإلدارة بالس لطة وانش غالھا باألنش طة واإلج راءات‬ ‫كأھداف وغايات في ذاتھا‪ ،‬وليس باعتبارھا آليات ووسائل لتحقيق األھداف‪.‬‬ ‫‪ -3‬تكنولوجيا المعلومات وتطبيقاتھا ‪:‬‬ ‫علي الرغم من دخول تكنولوجيا المعلومات وانتشار استخدامھا في المدن العربية ‪ ،‬إال أن التطبيقات الحالية لھذه التكنولوجيا‬ ‫ال تتناسب مع االحتياجات الفعلية لتطوير ھياكل التخطيط فيھا ‪ .‬وبشكل عام فإن مستوى االستفادة من الطاقة الحالية منخفضا جدا‬ ‫بالمقارنة باإلمكانيات المتاحة‪.‬وعلى الرغم من أن تكنولوجيا نظم المعلومات أحد العناصر المكونة لنظام إدارة المعرفة ‪ ،‬فإن المدن‬ ‫العربية تعاني من نقص واضح في اإلمكانيات المادية والبشرية والتكنولوجية المطبقة فعليا ‪ ،‬فضال عن ضعف الحوافز المادية‬ ‫وعدم توافر التدريب المناسب‪ .‬ومن أھم األسباب التي تؤدي إلي ھذا الوضع غياب الرؤية الشمولية لھدف الوصول إلي مجتمع‬ ‫المعلوماتية والطرق المؤدية له كالمدينة اإللكترونية )‪.(Sveiby, 1996, pp 21-25‬‬

‫ثانيا ‪ :‬تطبيق إدارة المعرفة في التخطيط السياحى محليا )مدينة االسكندرية( ‪:‬‬ ‫إقليم االسكندرية أحد أبرز االقاليم السياحية فى شمال مصر ‪ ،‬وعاص مته مدين ة االس كندرية وھ ي المدين ة األكب ر ب ه‪ .‬و تبل غ‬ ‫مساحة المحافظة ‪ 2879‬كيلومتر مربع ‪.‬‬ ‫‪ -1‬مدى توافر متطلبات تطبيق إدارة المعرفة بالمدينة ‪:‬‬ ‫إن ذلك يستلزم تحليل ما يلي‪:‬‬ ‫أ‪ -‬الھيكل التنظيمى‪:‬من خالل دراسة الھيكل التنظيمى لمدينة االسكندرية ‪ ،‬يتبين أنه يتسم بما يلى ‪:‬‬ ‫‪ ‬التخصص وتقسيم العمل‪، :‬حيث توجد ھيئات عامة تتبع المحافظ‪.‬كالمديريات الخدمية‪.‬كما يالحظ على ھ ذا التنظ يم التركي ز عل ى‬ ‫الخدمات األساسية التي تھم المواطن‪ ,‬خاصة في مجاالت السياحة و الصحة‪ ,‬والتعليم‪ ..‬الخ‪.‬‬ ‫‪ ‬الجمع بين التنظيمين الجغرافي والوظيفي‪ :‬الھيكل التنظيمي لمدينة االسكندرية يجمع ما بين التنظيمين الجغراف ي )تقس يم المدين ة‬ ‫إلى أحياء( والوظيفي )المديريات الخدمي ة(‪.‬و يش مل عناص ر التنفي ذ المتمثل ة ف ي الم ديريات والتقس يمات اإلداري ة المس ئولة ع ن‬ ‫تنفيذ أھداف التنظيم والمدينة مباشرة ‪،‬والعناصر المعاونة المسئولة عن مساندة األنشطة الرئيسية‪.‬‬ ‫‪ ‬االرتباط بالنظام السياس ي‪ :‬إن التنظ يم اإلداري للمدين ة ي رتبط بالحكوم ة المركزي ة‪ .‬فالھيك ل التنظيم ي للمدين ة‪ ،‬يوض ح أن ھن اك‬ ‫عالقات تربط المحافظة )المحافظ – المجلس الشعبي المحلى للمحافظة – رؤساء األحياء( بالحكومة المركزية‪.‬‬ ‫ب‪ -‬النمط القيادي‪ :‬أن ھناك فصالً بين الوظيفتين التقريرية والتنفيذية للمدينة‪.‬فالوظيفة التقريرية يضطلع بھا المجلس الشعبي المحلى‬ ‫للمحافظ ة‪.‬أم ا الوظيف ة التنفيذي ة فيض طلع بھ ا المجل س التنفي ذي للمحافظ ة‪.‬ويختل ف ھ ذان المجلس ان م ن حي ث تكوينھم ا‬ ‫واختصاصاتھما‪.‬ولذا يتبين انه ليست ھناك جھة لھا سلطة واضحة في توفير المعلومات‪.‬‬ ‫ج‪ -‬الثقافة التنظيمية‪ :‬سمات الثقافة التنظيمية بين العاملين في مدينة االسكندرية تميل إلى المركزية وع دم التف ويض‪ .‬ويترت ب عل ى‬ ‫ذلك الميل إلى تركيز المعلومات لدى القيادة‪.‬‬ ‫د‪ -‬أب رز خ دمات المدين ة م ن البني ة التحتي ة لبن اء المجتم ع المعرف ى ‪:‬تت وافر بالمدين ة مجموع ة مقوم ات رئيس ية تتمث ل ف ى ؛ البواي ة‬ ‫االلكترونية لمحافظة االسكندرية ‪،‬تطبيقات الحكوم ة االلكتروني ة خ دميا‪ ،‬مراك ز ت دريب تكنولوجي ا المعلوم ات والمراك ز البحثي ة ‪،‬‬ ‫مكتبة االسكندرية كمنارة إبداع وعنصر جذب سياحى يجعل من المعرف ة أح د عناص ر الج ذب المكمل ة للنش اط الس ياحى ف ى مص ر‬ ‫كأحدى تطبيقات مدن المعرفة‪.‬‬

‫‪137‬‬

‫‪Hanan Elassar‬‬

‫ه‪ -‬تكنولوجيا المعلومات‪ :‬تم إنشاء وزارة االتصاالت وتكنولوجيا المعلوم ات ع ام ‪ 1999‬بھ دف تمھي د الطري ق إلقام ة مجتم ع مص ري‬ ‫معلوماتي قادر علي التجاوب م ع ث ورة تكنولوجي ا المعلوم ات ‪ .‬وإذا كان ت تل ك ھ ي سياس ة الحكوم ة نح و التح ول إل ى مجتم ع المعرف ة‬ ‫وتطبيق مشروع الحكومة اإللكترونية على مس توى الجمھوري ة‪ ،‬ف ال ش ك أن مدين ة االس كندرية باعتبارھ ا العاص مة الثاني ة بمص ر ق د‬ ‫حظيت باھتمام كبير من جانب الحكومة‪ ،‬حيث كانت من أولى المدن الت ي طبق ت فيھ ا جمي ع مراح ل إقام ة الحكوم ة اإللكتروني ة‪ ،‬حي ث‬ ‫بذلت المحافظة ومؤسساتھا المختلفة جھودا لتحقيق التنمية واالرتقاء بمستوى الخدمات المقدمة إلى السكان واالرتقاء بمستوى معيش تھم‪،‬‬ ‫وتوافر البيئة المناسبة للعمل واإلنتاج)‪.(Taylor, P.J, p98‬‬ ‫ولكن ال تزال المدينة تحتاج الى امتالك ھيكل تنظيمي مرنا وأفقيا‪ ،‬وليس رأسيا ھرمياً‪ ،‬وأن تكون ھناك قيادة واعية ومھتمة‬ ‫بتطبيق إدارة المعرفة ومشجعة لتبادل المعلومات بين العاملين‪ ،‬مع إتاحتھا للمواطنين‪.‬كما يجب أن تكون الثقافة التنظيمية مواتية‬ ‫لتطبيق إدارة المعرفة ) ‪ .( Devol, R.& Kothin J.,2001‬لذا فإن المتطلبات ال تتوافر بالدرجة الكافية بمدينة االسكندرية‬ ‫‪.‬فالھياكل التنظيمية بھا ھياكل ھرمية‪ ،‬ونمط القيادة والثقافة التنظيمية تتسم بالمركزية وعدم إتاحة المعلومات للجميع بما ال يتفق مع‬ ‫تطبيق إدارة المعرفة‪ .‬كما أن تكنولوجيا المعلومات تعترضھا العديد من المشاكل مثل األمية واإلمكانيات المادية المحدودة‪.‬‬ ‫‪ -2‬النظام التخطيطى السياحى لمدينة اإلسكندرية) تحليل الفجوة( ‪.:‬‬ ‫جوھر المزج المقترح بين تطبيقات إدارة مدينة المعرفة وتطوير نھ ج التخط يط للمدين ة يمث ل التفاع ل والم زج ب ين المعرف ة‬ ‫ومقوماتھا‪ ،‬والسياحة ومواردھا ‪ ،‬ليمثال معا ميزة تنافسية لمدينة االسكندرية نحقق بھ ا التنمي ة الس ياحبة المبتغ اة ونص ل م ن خاللھ ا‬ ‫لتقليل الفجوة التكنولوجية بين مصر والعالم ‪.‬فإيجاد نظام تخطيطى لتحقيق ھذا المزج بالمدينة يراعى أھمية تواجد اإلرادة السياسية‪،‬‬ ‫والرؤية اإلستراتيجية العمرانية المنبثقة من المستوى القومى‪ ،‬التي تعطي النظام مضمونه المجتمعي‪ ،‬وتواجد جھ از تخطيط ي ق وي‬ ‫وعصري‪ ،‬ومنظومة تشريعات وقوانين تخطيطية وعمراني ة متكامل ة تراع ى الم وارد الس ياحية ومتطلب ات الس وق الس ياحى ‪،‬و م ن‬ ‫أھم طرق تحديد المعلومات بدقة‪ ،‬طبيعة مس ئوليات الجھ از التخطيط ي‪ ،‬ف ي الحاض ر كوض ع ق ائم‪ ،‬وم ا يج ب أن تك ون علي ه‪ ،‬ف ي‬ ‫المستقبل لتحديد الفجوة ‪ .‬وتوفير أسس إدارة مدن المعرفة والتى تساعد المخطط على رؤية سياحية أوض ح لتقل ل م ن تل ك الفج وة ‪،‬‬ ‫ومن أبرز تلك األسس التى يجدر اتباعھا ؛ األول ؛ المدرسة المعلوماتية التى تعود بجذورھا إلى أنظم ة المعلوم ات الحاس وبية ذات‬ ‫التقنية العالية خاصة تطبيقات الذكاء الصناعي و الثاني ؛المدرسة السلوكية وھو اتجاه تكثيف الجھود والقدرات الذاتية والموضوعية‬ ‫نحو استثمار الموارد البشرية المتاحة‪ ،‬بمعنى أدق استثمار الموارد الفكرية والتقنية والتنظيمية التى تس تطيع اإلدارة تش كيلھا كفري ق‬ ‫عمل موجود أو افتراضي يجمع من أجل حل المشكالت أو تنفيذ مشروعات أو التخطيط لتغييرات استراتيجية ‪.‬‬ ‫‪ -3‬رؤية مقترحة لمنظومة التخطيط السياحى باالسكندرية وفق المنھج المعرفى ‪:‬‬ ‫مفھوم التطوير التخطيطى المقترح لمدينة االسكندرية وفق تطبيق ات إدارة م دن المعرف ة الت ى ت م تناولھ ا بالدراس ة ‪ ،‬يميي ز‬ ‫ثالثة اتجاھات فكرية في تحديد محاوره كما يلى ) الكبيسى ‪ ،2005 ،‬ص ‪ ) (83‬العدواني واَخرون ‪ ،‬ص ‪: (11‬‬ ‫األول‪ :‬مدخل تكيفي‪ ،‬لكونه ينظر إلى التطوير التخطيط ى بوص فه ظ اھرة ي راد منھ ا تحقي ق التكي ف المناس ب للعم ل التخطيط ى م ع‬ ‫بيئته السياحية‪ ،‬وذلك إما من خالل تطوير الفكر‪ ،‬أو تطوير طرق إنجاز المھام‪ ،‬أو تطويرھما معا ً‪.‬‬ ‫الثاني‪ :‬مدخل معرفي وسلوكي في آن واحد ‪ ،‬يركز على المدخلين‪ ،‬استخدام المعرفة‪ ،‬وتقنيات العل وم الس لوكية‪ ،‬للم زج ب ين رغب ات‬ ‫اإلفراد في النمو والتطور‪ ،‬وبين أھداف المنظمة التخطيطية وغاياتھا ‪.‬‬ ‫الثالث‪ :‬مدخل شمولي‪ ،‬يمزج المدخلين السابقيين ‪ ،‬ويضيف إليھما البعد االستراتيجي للتطوير من خالل دعم دوره في تحسين فاعلية‬ ‫أداء اإلدارة العليا‪ ،‬خاصة المتعلق ة بتط وير الفك ر والم نھج التخطيط ى ‪ ،‬ب دءاً م ن الق يم وم رورا بالمعتق دات واالتجاھ ات‪ ،‬وانتھ اءاً‬ ‫بالتطبيق ات التخطيطي ة للتط وير الس ياحى‪ .‬ونتواف ق م ع االتج اه الثال ث الم دعوم بالمعرف ة كظ اھرة تنظيمي ة مخط ط لھ ا تھ دف إل ى‬ ‫توظيف المعرفة بغض النظر عن طبيعتھا الضمنية في العمل التخطيطى المرتبط بالمعلوم ة كأس اس وكنتيج ة والمنبث ق م ن معرف ة‬ ‫استراتيجية ‪ ،‬بما يجعله على نحو ال تنحصر منافعه في مجال تحقيق أفضل نواحي التكيف مع البيئة السياحية فقط‪ ،‬وإنما تمتد لتشمل‬ ‫النواحي التي تقود إلى تميز الدولة سياحيا ‪ ،‬و دواعي ھذا التطوير يعتمد على المفھ وم اإلجرائ ي ال ذى يش مل كاف ة ن واحي المنظم ة‬ ‫التخطيطية والسياحيةو تمتد كما يبدو من الشكل )‪ (2‬لتصبح ذات تأثيرات غير مباش رة م ن خ الل عوام ل البيئ ة المختلف ة ليت يح لھ ا‬ ‫فرص التكيف مع التغييرات المعرفية في البيئة مع إمكانية التفوق على المنافسين ‪ ،‬وقيادة السوق ‪.‬‬ ‫الشكل)‪ (2‬المنظمة السياحية التخطيطة المتكيفة مع تطبيقات إدارة مدن المعرفة‬

‫‪138‬‬

‫‪Hanan Elassar‬‬

‫المعرفة اإلستراتيجية‬ ‫تطبيقات إدارة مدن‬ ‫المعرفة‬

‫عوامل اقتصادية‬

‫عوامل اجتماعية‬

‫عوامل سياسية‬

‫عوامل سياحية‬

‫عوامل‬ ‫تكنولوجية‬

‫المنظمة في‬ ‫طور التطوير‬

‫تطبيقات إدارة مدن المعرفة لالقاليم السياحية‬

‫المنظمة التخطيطة‬ ‫ال ا ة‬ ‫المصدر‪ :‬أ‪ -‬العدواني ‪ ،‬عبد الستار واخرون ‪ (2006)،‬ص ‪14‬‬ ‫ب‪ -‬الباحثة‪.‬‬ ‫النتائج والتوصيات ‪:‬‬ ‫لقد تبين من خالل التحليل السابق نتائج متطلبات لتطبيق إدارة المعرفة لتصبح نواة لتطوير الھيكل التخطيطى السياحى ‪:‬‬ ‫‪ -1‬إن إدارة مدن المعرفة ھي أحد الميادين الحديثة نسبيا‪ ،‬وھي من الحقول التي لم تنضج بصورتھا المتكاملة بعد‪ ،‬وھي ال تزال‬ ‫في مرحلة االكتشاف الذاتي‪ ،‬والغرض األساسي لھذه اإلدارة ھو إدارة أنشطة وجھود المعرفة وتنظيمھا وتوجيھھا والرقابة‬ ‫عليھا لتحقيق األھداف‪.‬‬ ‫‪ -2‬توجد عالقة وثيقة بين إدارة مدن المعرفة واإلبداع التخطيطى ‪ ،‬فالمعرفة كقوة أساسية محركة لالقتصاد‪ ،‬إلى جانب التغيير‬ ‫والعولمة وتحدياتھا‪ ،‬ولدت الحاجة إلى اإلبداع لترجمة المعرفة إلى )سلع‪ ،‬خدمات‪ ،‬عمليات( جديدة أو مطورة‪ ،‬تحقق للدولة‬ ‫ميزة تنافسية‪ .‬كما أن القدرات المعرفية مكنت المنظمات التخطيطية من إبداع منتجات جديدة بسرعة وكلفة منخفضة‪ ،‬فضالً‬ ‫عن االرتقاء بمستويات الجودة للمنتج الجديد‪ ،‬وأثرھا في صياغة استراتيجيات المنافسة‪ ،‬وبما يعزز إبداعية الدولة ونجاحھا‬ ‫التنافسي‪.‬‬ ‫‪ -3‬التغيير متشابك يصعب التنبؤ باتجاھاته لذا يجدر توقعه ودعم الوسائل – تطبيقات إدارة مدن المعرفة – القادرة على التنبؤ به‬ ‫والتعامل معه‬ ‫‪ -4‬التطور المعرفى والتكنولوجى سريع مما يفرض على المنظمات التخطيطة‪ -‬السياحية بصفة خاصة‪ -‬تحقيقا ً لنواحي التكيف‬ ‫معه تطوير تطبيقاتھا المختلفة ‪ ،‬بدءاً بالرؤى والمناھج وانتھاءاً بمختلف التطبيقات الھادفة لتحقيق األھداف‪.‬‬ ‫‪ -5‬إن تأثيرات المعرفة ال تقف حدودھا عند التأثير المباشر إلسھامات المفكرين في مجال تطور العمل التخطيطى لقطاع محدد‪،‬‬ ‫وإنماترتبط بكافة نواحى الفكر التنموى لذا فالسعي نحو توظيف تطبيقات المعرفة من خالل التطوير بوصفه المدخل الذي‬ ‫البد من تحقيقه‪ ،‬وصوال للحالة التي تجعل المنظمات متكيفة مع التغيرات الحاصلة في البيئة‪ ،‬وبذلك تتحقق أھداف التطوير‬ ‫المتواصل ‪.‬‬ ‫‪ -6‬فيما يتعلق بالمعوقات التي تواجه تطبيق ادارة المعرفة أظھرت النتائج أن من أبرز المعوقات ھو عدم وجود ادراك كاف‬ ‫لمفھوم ودور ادارة المعرفة‪ ،‬وعدم وجود الموارد المناسبة لتطبيق نظام ادارة المعرفة‪ ،‬واإلفتقار إلى التدريب المتعلق بإدارة‬ ‫المعرفة وعدم الدعم الكافي من اإلدارة العليا لعمليات ادارة المعرفة‪.‬‬ ‫وتنحصر أبرز توصيات الدراسة فيما يلى ‪:‬‬ ‫‪ -1‬يجب أن تكون الثقافة التنظيمية مواتية لتطبيق إدارة المعرفة‪.،‬وكشف البحث أن ھذه المتطلبات ال تتوافر بالدرجة الكافية في‬ ‫المدن العربية بشكل عام ومصر بصفة خاصة‪.‬‬ ‫‪ -2‬يجب التأكيد على أھمية التحول من المركزية وتعدد المستويات التنظيمية في النمط الھرمي للتخطيط السياحى إلى‬ ‫الالمركزية وتعدد مراكز اتخاذ القرار وتقليص المستويات الرأسية‪ ،‬و توفير شبكة خدمات إرتكازية لإلقليم مفيدة إقتصاديا‬ ‫وتؤدي دورھا المغذي لألنشطة السياحية المختلفة‪ ،‬ليس على حساب إقتصاد اإلقليم وإنما من أجله‪ ،‬و في سبيل تطويره إلى‬ ‫أحسن مستوى إقتصادي وإجتماعي وعمرانى و سياحى ‪.‬‬ ‫‪ -3‬يجب ان تتوازى المحافظة على الموروث الثقافى والعمراني وإعادة تطويرھما وتأصيلھما وفقا للنظم والعالقات اإلقتصادية‬ ‫واإلجتماعية الجديدة مع التطور التكنولوجى المطلوب‪ ،‬ودعم مفھوم األصالة السياحية التي ينشدھا السكان في اإلقليم لتؤدي‬ ‫دورھا في ضمان الحفاظ على ھوية االقليم المميزة‪.‬‬

‫‪139‬‬

‫‪Hanan Elassar‬‬

‫‪-4‬‬

‫‪-5‬‬ ‫‪-6‬‬ ‫‪-7‬‬ ‫‪-8‬‬

‫ضرورة العمل على تحويل المعرفة الكامنة في أذھان العاملين إلى معرفة صريحة وذلك من خالل تبادل المعرفة بين‬ ‫العاملين بوسائل متعددة‪ .‬والسعي إلى إيجاد بيئة عمل يسودھا الثقة واالحترام المتبادل والسلوك األخالقي والعالقات التفاعلية‬ ‫الفعالة بين المستويات االدارية المختلفة مع ضرورة تخصيص وحدة مستقلة متخصصة بتطوير أنشطة ادارة المعرفة وتعمل‬ ‫على متابعة تطبيق عمليات ادارة المعرفة في المؤسسات السياحية‪.‬‬ ‫السعي الى تطوير مكتبة مھنية من أجل كسب المعرفة وتشجيع العاملين على تحديث المعرفة وتطويرھا‪.‬‬ ‫السعي الى تطوير وسائل اإلتصال االلكترونية وتطوير برامج اإلنترنت كوسيلة الكتساب المعرفة وتبادلھا‪.‬‬ ‫تقدم الجھات المانحة الدعم المادي للمؤسسات األھلية من أجل أن تعمل على توفير كل المستلزمات التي تضمن تطبيق ادارة‬ ‫المعرفة بفاعلية وكفاءة مثل‪ :‬تنمية الطاقة البشرية‪ ،‬وتوفير األجھزة االلكترونية‪ ،‬وتطوير المكتبات ‪....‬وغير ذلك ‪.‬‬ ‫الحاجة الى تأصيل مقومات وتطبيقات منھج إدارة المعرفة في مجتمع أصبحت فيه المعرفة رأس المال األغلى ثمنا‪ً،‬‬ ‫واألكثر سلطة لمن يمتلكه ويوظفه في ترسيخ اقتصاده‪ ،‬وإدارة موارده‪ ،‬وتطوير اًليات تنميته ‪ ،‬والتى تكن أكثر احتياجا فى‬ ‫الدول العربية وبصفة خاصة مصر ‪.‬‬

‫المراجع ‪:‬‬ ‫‪ -1‬اكاديمية البحث العلمى‪ ،(1998) ،‬المالمح العريضة للمدن المصرية ‪ ،2000‬التقرير النھائى‪ ،‬أكاديمية البحث العلمى‪ ،‬القاھرة‪.‬‬ ‫‪ -2‬السلمي ‪،‬علي ‪ ،(1998)،‬اإلدارة بالمعرفة ‪ ،‬دار قباء للطباعة والنشر‪ ،‬القاھرة ‪.‬‬ ‫‪ -3‬الش مري‪ ،‬أحم د ‪ .‬ال دوري ‪،‬م‪ : (2004) .‬ادارة المعرف ة ودورھ ا ف ي تعزي ز عملي ة اتخ اذ الق رار اإلس تراتيجي‪ .‬م ؤتمر جامع ة‬ ‫الزيتونة األردنية‪ ،‬عمان‪ ،‬األردن‪.‬‬ ‫‪ -4‬البرنامج االنمائى لألمم المتحدة)‪ ،(2003‬تقرير التنمية البشرية العربية لعام‪ ،2003‬البرنامج المتكامل ‪.‬‬ ‫‪ -5‬برھان ‪،‬محمد نور ‪ ، (1988 ) ،‬تكنولوجيا المعلومات واإلدارة العامة في الدول العربية ‪ ،‬المجلة العربية لإلدارة ‪ ،‬المجلد الث اني‬ ‫عشر ‪ ،‬العدد األول ‪.‬‬ ‫‪ -6‬صبري‪ ،‬ھـ ‪، ( 2004 ) .‬العرب والمعرفة والمستقبل ‪ .‬مؤتمر جامعة الزيتونة األردنية‪ ،‬عمان‪ ،‬األردن‬ ‫‪ -7‬عبد الجليل‪ ،‬راشد محمد ‪ ،(1992) ،‬سياسات إدارة الموارد البشرية وتطبيقاتھ ا والمس تقبل المتوق ع لھ ا ف ي البيئ ة المص رية ‪:‬‬ ‫دراسة تحليلية تطبيقية استرشادية ‪ ،‬مجلة البحوث التجارية ‪ ،‬السنة الرابعة عشر ‪ ،‬العدد األول يناير ‪.‬‬ ‫‪ -8‬عطي ة ‪ ،‬خال د ‪ ، ( 2005) .‬أس س إدارة المعرف ة ‪ .‬الملتق ى العرب ي األول ح ول األس اليب الحديث ة إلدارة لمكتب ات ومراك ز‬ ‫المعلومات بالجودة الشاملة ‪ .‬اإلسكندرية– جمھورية مصر العربية‪.‬‬ ‫‪ -9‬عالء ‪،‬أحمد ‪،(2005) ،‬القيادة المتميزة ‪ :‬صياغة استراتيجيات للتغير ‪ ،‬مجموعة النيل العربية ‪ ،‬القاھرة‪.‬‬ ‫‪ -10‬علي‪ ،‬نبيل‪ ،(2001)،‬الثقافة العربية وعصر المعلومات‪ ،‬الطبعة األولى‪ ،‬سلسلة عالم المعرفة‪ ،‬مطابع الوطن‪ ،‬الكويت‪.‬‬ ‫‪-11‬غيث‪ ،‬محمد عاطف‪ -‬محمد ‪،‬علي محمد‪ ،( 1989)،‬دراسات في التنمية والتخطيط االجتماعي‪ ،‬دارالمعرفة‪ ،‬اإلسكندرية‪.‬‬ ‫‪ -12‬الكبيسي ‪،‬صالح الدين ‪ ، (2005) ،‬إدارة المعرفة ‪ ،‬المنظمة العربية للتنمية اإلدارية‪ ،‬القاھرة ‪.‬‬ ‫‪ -13‬كاريللو ‪ ،‬فرانشيسكو خافيير ‪ ، (2011)،‬مدن المعرفة الم داخل والخب رات وال رؤى‪،‬ترجم ة خال د عل ى يوس ف‪،‬عالم المعرف ة‪،‬‬ ‫الكويت‪.‬‬ ‫‪ -14‬مركز معلومات ودعم اتخاذ القرار بمجلس الوزراء ‪ ،‬تقرير حول استخدام االنترنت ‪،‬المركز‪.2005،‬‬ ‫‪15-Amidon, D.M. (2003): "The Innovation Superhighway" Butterworth‐Heinemann ‬‬ ‫‪16-Amin, A. (1999) an Institutionalize Perspective on Regional Economic Development, International Journal of Urban & Regional ‬‬ ‫‪Research 23. ‬‬ ‫‪17-Carrillo, F. (2009) Knowledge Cities: Approaches, Experiences and Perspectives. Butterworth Heinemann, London. ‬‬ ‫‪18-Dieleman, F. M., Dijst, M. & Spit, T. (1999) Planning The Compact City: The Ramstad Holland Experience, European Planning ‬‬ ‫‪Studies. ‬‬ ‫‪19-Daniels, P. W. And Bryson, J. R. (2002): "Manufacturing Services And Servicing Manufacturing: Knowledge‐Based Cities And ‬‬ ‫‪Changing Forms Of Production", Urban Studies, Vol. 39, No 5. ‬‬ ‫‪20-Gottshalk Peter, (2002) in Barnes, Stuart (ed.,) Knowledge Management Systems : Theory & Practice, London : Thomson ‬‬ ‫‪Learning. ‬‬ ‫‪21-Graham, S. & Healey, P. (1999) ‘Relational Concepts In Time And Space: Issues For Planning Theory And Practice’, European ‬‬ ‫‪Planning Studies, Vol. 7, No. 5. ‬‬ ‫‪22-Kothin, J. and Devol, R. (2001). Knowledge‐Value Cities in the Digital Age. Milken Institute, Santa Monica, California. ‬‬ ‫‪23-McDermott & O’Dell, (2001) “Overcoming Cultural Barriers to Sharing Knowledge “. The Journal of Knowledge Management, ‬‬ ‫‪January. ‬‬ ‫‪24-Sveiby, Karl. What is Knowledge Management, 1996 and updated 2001. ‬‬ ‫‪25-Taylor, P.J. (2005) "Leading World Cities: Empirical Evaluations Of Urban Nodes In Multiple Networks" Urban Studies, Vol. 42, ‬‬ ‫‪No. 9, August ‬‬ ‫‪26-.Urbecon (2002). Creating and Sustaining a Knowledge City. SGS, Economics and Planning Pty. Ltd., August 2002, Queensland, ‬‬ ‫‪Australia. ‬‬

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Hanan Elassar

27-United Nations development program,(2001), Human development Report, Today’s Technology Transformation – Cresting the Network Age. 28-Wiig,Karl,( 2003) ,Knowledge Management Foundations ,Arlington: Schema Press.

Website links ‫( دور المعرفة اإلستراتيجية في تحديد خيارات التطوير‬2006)،‫ زياد‬،‫عالء والنجيفي‬، ‫عبد الستار والجبوري‬، ‫ العدواني‬-29 content/uploads/2011/04/46.doc‐ http://www.eco.asu.edu.jo/ecofaculty/wp‐ last accessed3/12/ 2012 ‫التنظيمي‬

30- Dubai Knowledge Village, http://www.kv.ae/ last accessed 8/09/2012 Manizales (Colombia) Knowledge City, http://www.infimanizales.gov.co/ , last accessed 3/10/2012

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PhD Research Papers

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144

The Influence of the Organizational Culture on Academic Entrepreneur’s Knowledge Sharing Behavior: Case Study at Private University Colleges in Malaysia Hafiza Adenan, Dang Merduwati Hashim, Adnan Jamaludin and Haziah Sa’ari Faculty of Information Management, MARA University of Technology, Puncak Perdana campus, 40150 Shah Alam, Malaysia hafizaadenan@ymail.com merdu61@yahoo.com azie.crystal@gmail.com

Abstract: One of the methods to encourage the private university colleges’ academicians to achieve academic entrepreneur capability is through research activities. The research activities enable the private university colleges’ academicians to commercialize their research discovery and become innovative academic entrepreneurs in future. Several scholars argue that the direct involvement of academic entrepreneur into industrially relevant activities would solve some imperfections in the transmission of knowledge and motivate researchers to undertake projects with greater economic and social relevance (Gibbons et al., 1994; Ezkowitz 2004). On the other hand, some scholars (Farsi and Talebi, 2009) are skeptical about the ability of academics to manage commercial activities, while still abiding by the rules and missions of academia and the scientific community. In line with this, it is important for the private university colleges in Malaysia to have a appropriate culture that encourages academicians to share their research idea with others. The willingness to share their research idea shows that the academicians have intention and initiative to collaborate with others, next, commercializes their findings and later become innovative academic entrepreneurs in the future. The commercialization of their research findings helps the private university colleges to obtain profit. Therefore, the objective of the study is to investigate the influence of organizational culture on the academic entrepreneurs sharing research idea behavior. The qualitative approach and multiple case study method were used to fulfill the research’s objective. The theory of planned behavior by Ajzen (1991) was used to determine academic entrepreneurs sharing research idea behavior. The findings showed that the organizational culture has influence academic entrepreneurs’ attitude, subjective norm, perceived behavioral control and intention to share their research idea with others that leads to development of innovative academic entrepreneurship.

Keywords: Academic entrepreneur, sociability, solidarity, attitude, subjective norm, perceived behavioral control, intention

1. Introduction In the knowledge-based economy, universities are encountering changes as their missions and functions are changed because of emerging new expectations, new needs, competing markets for innovative knowledge and technology production and the assimilation of information technology into the university environment. The dynamics and conduct of university researches has correspondingly become more sensitive to industry collaboration opportunities, commercial exploitation, and is increasingly inter disciplinary. In Malaysia, in line with globalization changes in Higher Education Institution (HEI), the role of private university colleges have been scrutinized and challenged by the society (Mohayidin, et.al., 2007). To face the challenges, the private university colleges’ academicians should undertake research as part of their job function to produce and share the latest development, insights and expertise with society which will serve as motivation for learning. Hence, research is the road to discovery with a proven worldwide acceptance that research contributes positively to society economically. In addition, as a profit oriented organization, one ways that can be done to gain profit is through commercialization of academic entrepreneurs’ research findings. However, academicians at private university colleges faced the challenges in terms of producing outstanding research making the university proud of them and teaching quality becomes major hurdles (Arokiasamy et.al., 2009). Although, the private university colleges’ academicians are facing several challenges in their career development in the terms of producing research, they should not neglect their responsibility as knowledge provider to society. To succeed in research activities and later producing innovative academic entrepreneur, it is important that the private university colleges’ organization facilitate appropriate culture. The appropriate culture motivates academic entrepreneurs to share their research idea that leads to collaboration in commercialize their findings.

2. A review of academic entrepreneur In this research, academic entrepreneur is defined as the leadership process of creating economic value through acts of organizational creation, renewal or innovation that occurs within or outside the academic

145

Hafiza Adenan, Dang Merduwati Hashim, Adnan Jamaludin et al institution that results in research and technology commercialization (Farsi and Talebi, 2009). The leadership process occurs at the level of individuals or groups of individuals acting independently or as part of faculty or university systems, who create new organizations or instigate renewal or innovation within or outside the academic institutions. In the scholarly debate, there is an increasing interest in academic researches to analyze the process of academic involvement into commercialization and its economic and social consequences.

Academic entrepreneurship activities includes: Industry-university collaborations, university-based venture funds, university based incubator firms and startup founding by academicians.

3. A review of knowledge sharing and higher education institution Knowledge ought to be shared and transferred in the higher education institution (HEI) internally to enable isolated knowledge and experience to be utilized by the whole organization. Therefore, it has been determined that knowledge sharing becomes a major focus area in knowledge management as knowledge sharing serves as a link between the strata of individual knowledge, where the knowledge resides and the strata of the organization where knowledge generates its economic and competitive gains. Nevertheless, the knowledge management practice which considers new is the practice of sharing the available knowledge, thereby enabling members to make use of the information generated within the university. Hence, the study in 2005 involved all the 17 public universities in Malaysia found that existence of knowledge sharing culture in Malaysian public HEIs still very low (Suhaimee, et.al, 2006). The study of Shaari et.al (2010) implies that as academicians show positive attitude and tremendous feeling of enjoyment in their working environment, their self-efficacy and knowledge sharing level improve. Although it can be concluded that the academicians have positive attitude towards knowledge sharing especially when working with others, they have the tendency to share knowledge with their own clique rather than with everyone else. They do not prefer to share knowledge with those they do not trust or likeable to them.

4. A review of organizational culture In this research, the organizational culture refers to Goffee and Jones (2009) definition of culture. Goffee and Jones (2009) clarified that the culture is simplify into community. Communities are built on shared interests and mutual obligations and thrive on cooperation and friendships. Goffee and Jones (2009) divided the community into two separate human relations dimensions that are sociability and solidarity. Sociability is the measure of sincere friendliness among academicians whereby they are more like friends than co-workers (Carneiro, 2010; Goffee and Jones, 2009). The academicians are inclined to spend most of their time in sharing ideas either through face-to-face communication or any other medium in sustaining a high level of reciprocity.

Solidarity is the measure of the academician’s ability to pursue shared objectives quickly and effectively, in spite of their personal ties (Carneiro, 2010; Goffee & Jones, 2009) in the best interest of the HEI.

5. Theory of planned behavior and knowledge sharing In this research the theory of planned behavior (TPB) by Ajzen (1991) was used to determine the academic entrepreneur’s sharing research idea behavior. TPB is widely accepted model and used in finding factors influencing behavior as this theory is a general and penurious model of behavior specific that can predict a range of behavior. TPB assumes that individuals’ behavior is determined by behavioral intention and perceived behavioral control. TPB explained that behavioral intentions are motivational factors that show to what extent do people are prepared to perform a behavior. Attitude has been regarded to influence behavioral intention.

Kim and Lee (2005), found that an individual’s intention to share knowledge is driven primarily by attitude towards knowledge sharing. Subjective norm indicates that behavior is forthwith by one’s desire to act as important referent others act or think one ought to act. When applied to the focal behavior, subjective norm echoes participant perceptions of whether the behavior is accepted, encouraged, and implemented by the participant’s spheres of influence. Perceived behavioral control factors are individual natural factors and include the extent of information a person has, together with the skills, abilities, emotions, and necessity of that person regarding a specific behavior.

6. Conceptual framework Figure 1 shows the conceptual framework of the research. The research’s conceptual framework explained that the sociability and solidary culture defined by Goffee and Jones (2009) influenced the academic entrepreneurs’ intention to share their research idea. Their intention to share the research idea is influenced by their attitude, subjective norm and perceived behavioral control. Next, the intention either to sharing their research idea or not will affect the academic entrepreneur actual behavior of sharing research idea.

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Hafiza Adenan, Dang Merduwati Hashim, Adnan Jamaludin et al

Figure 1: The research’s conceptual framework

7. Problem statement In the area of education, sharing knowledge activities are able to improve universities’ performance as the main academic activities of universities are teaching and researching. By promoting sharing of knowledge, research activities could be enhanced due to sharing of idea and collaboration of research work which may subsequently result in proliferation of academic publication. Several studies for example Siemsen et.al. (2005) and Bock et.al (2005) have been conducted pertaining to knowledge sharing. However, most of these studies have been conducted in relation to organizations other than HEI. Nevertheless, little empirical research investigate the knowledge sharing behavior of academic entrepreneur at higher education can be found especially in Malaysia (Sohail and Daud, 2009; Sondergaard et.al., 2007; Ahmad, 2003; Ariffin, 2004). Bock et al. (2005) had identified that there are three motivating factors that have influence on individual's knowledge sharing behavior. However, the factors that influence individual’s knowledge sharing behavior in the organizational context are less understood. Hence, this study specifically focused on the influence of sociability culture and solidarity culture by Goffee & Jones (2009) on academic entrepreneur sharing research idea behavior at Malaysian private university colleges which is less discussed by other researchers in Malaysia.

8. Research objective The research objective is to investigate the influence of organizational culture on Malaysian private university colleges’ academic entrepreneurs’ sharing research idea.

9. Research methodology In order to achieve the objective mention above, this research used a qualitative research method. This method focuses on understanding from private university colleges’ academic entrepreneurs’ experience and interpretation. In this research, the qualitative research design used was multiple cases study. In this research, it refers to four private university colleges in Malaysia which it is a valuable method and useful in the exploratory and descriptive and early stages of research regarding academic entrepreneur sharing research idea behavior. In-depth interview, focus group discussion and document analysis were the data collection for this research. Based on the case study methodology of the research adapted from Yin (1994), the initial step involved the development of a conceptual framework. This step was then followed by the selection of the pilot case study and four main case studies and the design of the data collection protocol. Following the case selection and data collection steps, the individual case reports were developed. A cross-case analysis of the findings was then undertaken. This analysis provided the basis for the discussions and implications presented in the findings section of the article. Figure 2 shows the case study methodology of this research adapted from Yin (1994).

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Hafiza Adenan, Dang Merduwati Hashim, Adnan Jamaludin et al

Figure 2: Case study methodology adapted from Yin (1994

10. Research design The research design started with literature review discusses the literature from numerous sources in order to exhibit an in-depth knowledge of the research problem (Parmjit, et.al., 2006). A well-defined research problem is required before the researcher can commence the process of research design and subsequent data collection (Yin 1994). After review previous literature, research problems of this research were obtained. The development of conceptual framework is deriving from the literature review discussion and research objective.

The conceptual framework discusses the influence of organizational culture that is sociability and solidarity culture by Goffee & Jones (2009) on academic entrepreneurs’ sharing research idea behavior. Next was questions for in-depth and focus group interview were developed. The constructs in in-depth and focus group interview related with sharing research idea behavior were based on the Theory of Planned Behavior model by Ajzen (1991). Next, sample design developed. Both samples for pilot interview and main case study interview consist of academic entrepreneurs from five private university colleges in Malaysia. The sample of academic entrepreneurs for this research was selected by using purposive sampling. In this research the samples of main case study were consist of forty four academic entrepreneurs from social science and science faculties. The indepth interview concludes twenty academic entrepreneurs and the focus group consists of four groups of academic entrepreneur which six academic entrepreneurs per group. Next, five pilot interviews were conducted to improve the data collection processes before the main case studies commence (Yin, 1994). This phase represents the final preparation for data collection which is used more formatively to assist the researcher to develop relevant lines of questioning as well as providing some conceptual clarification for the research design as well. Permission to conduct the research obtained from private university colleges management. After obtaining approval, the requested lists of academic entrepreneurs were taken from private university colleges’ management. Then, the researcher send a letter to each of the academic entrepreneur selected to inform about the research and the date that it would take place. Each letter clearly explains the objective of the research. In addition, the academic entrepreneurs were informed about the importance of the interview, the confidentiality of their responses and that the data would only be utilized for the purpose of the research. Once the interviews have been conducted, recorded and transcribed, the information was analyzed and interpreted in order to produce the findings. Findings were inducted from the data.

11. Findings The followings are the findings of the research derived from the in-depth and focus group interviews of four private university colleges in Malaysia. The findings fulfill the research’s objective that is to investigate the influence of organizational culture on private university colleges’ academic entrepreneurs’ sharing research idea behavior.

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Hafiza Adenan, Dang Merduwati Hashim, Adnan Jamaludin et al

11.1 Sociability culture and academicians’ sharing research idea behaviour Both academicians from in-depth interview and focus group agreed that length of service as an academician and a good rapport among academicians had strengthened their friendship. Senior academicians who are also academic entrepreneurs have no problem sharing their research idea with others but with certain condition that relate with acknowledgement and trust. However, for junior academicians who are in the process of becoming academic entrepreneurs, they prefer sharing their research idea with those who have similar interest and with their faculty members only. Once, their research published and commercialize, they have no problem sharing their potential research idea with others. The existence of an organizational climate that promotes good relation among academicians influences the head of faculty to encourage the academicians to share their research idea. Furthermore, the head of faculty emphasize on the benefits of sharing research idea in the terms of enhancement in knowledge, experience and skill.

11.2 Solidarity culture and academicians’ sharing research idea behaviour Most of the academicians know their organization mission regarding achievement of successful research.

According to their view, their organization encourages research commercialization as to improve the organization’s reputation and to obtain profit as well. The establishment of Research and Development Centre is one of the organization’s efforts to encourage research activity. In line with this, the academic entrepreneurs are no hesitance to implement sharing research idea as long as the organization’s goal could achieve.

However, this condition should be supported with the efforts of the university college management by offering or facilitate appropriate and attractive incentive or reward. According to the academic entrepreneurs, the facilities available and the programs held show that their college is supporting the research activity including sharing research idea activity. However, only senior academicians who are also academic entrepreneurs are actively involved in those programs.

12. Conclusion and recommendations The research findings are consistent with the previous literature (Carneiro, 2010; Goffee and Jones, 2009; Ahmad, 2003; Ariffin, 2004) which determined that organizational culture influenced people knowledge sharing behavior. Parallel with this, the culture of private university colleges in Malaysia, either it is sociability or solidarity culture, has been influencing the academic entrepreneurs’ sharing research idea behavior. It was justified with the influence of both cultures on the private university colleges’ academic entrepreneurs’ attitude, subjective norm and perceived behavioral control that leads to intention to share or not to share their research idea with others. Based on the TPB by Ajzen (1991) the individuals’ behavior is determined by their behavioral intention and perceived behavioral control. Thus, it is clarify that the influence of sociability and solidarity culture on the private university colleges’ academicians’ intention and perceived behavioral control are the indication of their sharing research idea behavior. Therefore, it is recommended that the private university colleges continuing sociability and solidarity culture by developing more knowledge sharing programs, trainings or centers. The knowledge sharing programs or trainings should develop good rapport among academic entrepreneurs to strengthen their friendship. Therefore, the spirit of trust among them will obtained. It is because, the spirit of trust enable to eliminate sharing research idea obstacles. At the same time, the establishment of knowledge sharing center should equipped with the appropriate facilities such as information communication technology which support the communication via technology. Efficient communication technological facilities encourage the academic entrepreneurs to share their research ideas through technology.

References Ahmad, F. (2003). Tacit Knowledge Dissemination among UUM Lecturers. Unpublished Master degree dissertation, Universiti Utara Malaysia, Malaysia.

Ajzen, I. (1991).”The Theory of Planned Behavior”. Organizational Behavior and Human Decision Processes. Vol.50, pp 179211.

Ariffin, A. H. (2004). Managing knowledge in FIT academic environment: A proposed knowledge sharing framework.

Unpublished Master degree dissertation, Universiti Utara Malaysia, Malaysia.

Arokiasamy, L., Ismail, M., Ahmad, A., & Othman, J. (2009). “Background of Malaysian Private institutions of higher learning and challenges faced by academics”.The Journal of International Social Research. Vol. 2, No.8, pp 60-67.

Bock, G.W., Zmud, R.W., Kim, Y.G. Kim and Lee, J.N. (2005). “Behavioral intention formation in knowledge sharing examining the roles of extrinsic motivators social-psychological forces and organizational climate”. MIS Quarterly. Vol.29, No.1, pp 87-111.

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Etzkowitz, H. (2004) “The Evolution of the Entrepreneurial University”. International Journal of Technology and Globalization. Vol. 1, No.1, pp 64-77.

Farsi, J.Y and Talebi, K. (2009) “Application of knowledge management for research commercialization”, World Academy of Science, Engineering and Technology. Vol.49, pp 451-455.

Gibbons, M., Limoges, C., Nowotny, H., Schwartzman, S. and Scott, P. (1994) The New Production of Knowledge. London, Sage.

Goffee, R. & Jones, G. (2009). What holds the modern company together?. Harvard Business Review.

Iqbal, M.J., Rasli A, Low H.H, Bilal Ali M, Hassan I & Jalaee A. (2011) “Academic staffknowledge sharing intentions and university innovation capability”, African Journal of Business Management. Vol. 5(27), pp.11051-11059.

Mohayidin, M.G. et.al, (2007). “The application of knowledge management in enhancing the performance of Malaysian universities”, The Electronic Journal of Knowledge Management, Vol. 5, No.3, pp.301-312.

Pamjit Singh, Chan, Y.F., & Sidhu G.K.(2006). A comprehensive guide to writing a research proposal. Selangor: Venton Publishing (M) Sdn.Bhd. Saba F, McDowell D (2007). ‘Knowledge management for teachers: The collection, organization, and sharing of educational wisdom”. Educ.Technol., pp. 39-44.

Shaari, R., Rajab, A., & M.Y. Rosman. (2010). “The organizational issues of knowledge sharing among academic staffs in the Malaysian Public Universities.” International Journal of Knowledge, Culture and Change Management.” Vol.10, issues 6, pp 133-148.

Siemsen, E., Roth, A.V., Balasubramaniam S. (2005). “How motivation, opportunity, and ability drive knowledge sharing: The constraining-factor model”. Journal of Operations Management. Vol.26, pp 426-445.

Sohail, M.S. and Daud, S. (2009). Knowledge sharing in higher education institutions. Journal of Information and Knowledge management Systems. Vol.2, No.39, 125-142.

Sondergaard, S., Kerr, M., and Clegg, C. (2007). Sharing knowledge: ContextualizingSocio-technical thinking and practice.

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The Productivity of Innovation in Portugal Nuno Araújo1 and Leonardo Costa2 1 CATIM – Technological Center for the Metal Working Industry 2 Catholic University of Portugal at Porto nuno.araujo@catim.pt lcosta@ucp.pt

Abstract: In this research innovation is considered as a production process, with outputs and inputs. The aim of the research is to compare the productivity of innovation across the twenty seven Member States of the European Union (EU27), with a particular focus on Portugal. The data on inputs and outputs of innovation were collected from the Innovation Union Scoreboard 2010 report and cover the EU-27 Member States, from 2006 to 2010. The Total Factor Productivity index (TFP index) was used as the technique for data analysis. The choice of this technique was mainly determined by its flexibility and by data constraints. Two types of TFP indexes were computed: i) TFPt (time), which compares the productivity of innovation in each Member State with its productivity in a base year; ii) TFPs (space), which compares the productivity of innovation in each Member State with the productivity of the EU-27 average. Results show larger TFPs differences across Member States than TFPt differences. Concerning TFPt, there is a reduction of productivity in most of the Member States during the time length, which can be explained by the recent world financial crisis. This was the case of Portugal, where average TFPt in the time length is slightly below 1. The seven Member States that did not lose any productivity are mostly from Eastern Europe, Member Sates which have entered the European Union and acceded to its structural funds more recently. Concerning TFPs, Portugal presents average TFPs well above 1. The Portuguese average TFPs value is close to the one of Germany and higher than the one of Sweden. The Innovation Union Scoreboard 2010 report classifies Portugal as Moderate innovator and Germany and Sweden as innovation leaders. This research has found productivity of innovation in Portugal to be similar to the one of Germany and higher than the one of Sweden. Differences between Portugal, Germany, and Sweden, such as the ones reported in the Innovation Union Scoreboard 2010, can be explained by the fact of Portugal having fewer resources allocated to innovation than Germany and Sweden have.

Keywords: EU-27, innovation, Portugal, production process, productivity, TFP index

1. Introduction The aim of this research is the phenomenon of innovation in the 27 European Union Member States (EU-27).

Innovation is seen as a production process, with inputs or innovation production factors and outputs or innovation products resulting from this process.

The data used in this research are included in the Innovation Union Scoreboard 2010 study (UNUMERIT, 2011).

The latter was presented by the European Commission and compares the innovation performance of the EU27 Member States, presenting inputs and outputs of innovation. It was intended in this research to deepen this idea of dealing with innovation as a production process, by calculating measures of relative productivity for the various Member States of the EU-27, including Portugal.

The motivation of the research is connected to one of the author’s route of tracking processes of innovation in Portuguese Small and Medium Enterprises (SMEs). In the Portuguese business sector, SMEs represent 99.6% of the firms, create 75.2% of the jobs and generate 56.4% of the volume of national business” (Rocha, 2010). For lack of data in this area, this study has the Member States of the EU-27 as units of observation.

The investment in education, research, technology and innovation is seen as a key driver of growth. Innovative ideas can be converted into new marketable products and services that help to generate growth and quality jobs. The European Council called for the implementation of a strategy and integrated approach in order to foster innovation and take full advantage of the intellectual capital of Europe for the benefit of citizens, businesses (especially SMEs), and researchers. SME’s engage in innovation processes as a way to conquer competitive advantages, which allow them to cooperate in networks and/or compete for quality in niche markets.

The article is organized into four sections. After this introductory section, in section 2 a description is made of the productivity indicators used (TFP indexes), justifying their choice, as well as of the database used, inputs and outputs reported in the Innovation Union Scoreboard Study 2010. In section 3 results are illustrated and discussed. Finally, in section 4 the main conclusions are presented.

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2. Data and methodology used In this section a distinction is made between productivity and efficiency and the existent methodologies on productivity and efficiency analysis are described, justifying the use of the Total Factor Productivity index (TFP index) in the analysis performed in this research. The TFP index is a measure of productivity. The section ends with a description of the empirical model, that is, the two types of TFP index computed and the database used.

2.1 Productivity and efficiency The terms productivity and efficiency are sometimes used interchangeably. According to Eltis (1996), the concept of productivity was first used by the French economist Quesnay in 1766: "the quotient obtained by dividing production by one of the factors of itâ&#x20AC;?. As described, it is a concept of partial productivity. In this research we have multiple outputs and inputs and thus we use measures of total factor productivity (TFP indexes).

The notion of total factor productivity embraces the notion of technical efficiency of the observed units. The latter can be firms, countries, or other units. Technical inefficiency is measured as the distance between specific quantities of inputs or outputs and the amounts of inputs or outputs that define the efficient frontier (Caves et al. 1982; Fare et al. 1994). In other words, total factor productivity assumes the existence of technical efficiency (zero distance).

In time, production technology and/or the efficient frontier may change, which affects the total factor productivity (Coelli et. al., 2005). In space, observed units may operate in different zones of the efficient frontier or in different efficient frontiers and thus they can differ in total factor productivity.

2.2 Methods of analysis of productivity and efficiency and the choice of the TFP index Figure 1 illustrates the existing techniques for analysing productivity and efficiency. The most often used techniques are indicated with shading in the table: Data Envelopment Analysis (DEA), Stochastic Frontier Analysis (SFA) and Total Factor Productivity (TFP).

Figure 1 - Techniques for analyzing productivity and efficiency Source: Cullmann, Kappeler, and Hirschhausen (2006)

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Nuno Araújo and Leonardo Costa The techniques for analysing productivity and efficiency can be grouped in various ways (Coelli et al., 2005).

Comparing the most used techniques: 

The TFP index assumes the existence of technical efficiency. The same is not true for DEA and SFA.



The SFA involves the parametric estimation of functions. The same is not true for DEA and TFP index, which are non-parametric techniques.



DEA and SFA provide measures of relative efficiency among observed units. The TFP index provides measures of relative productivity among observed units.

The technique used in this research is the TFP index. The TFP index, computed for the EU-27 Member States, allows the comparison, in time, of the relative productivity for each Member State, and, in space, of the relative productivity across Member States. The used technique and data are described next.

Like DEA and as opposed to SFA, the TFP index is a non-parametric technique and thus more flexible in terms of assumptions. DEA requires, however, more information than the TFP index, particularly on prices. The choice of the TFP index as the technique of analysis in this research is justified by these two reasons.

In economics, index numbers are defined as real numbers that measure changes in a set of related variables.

Index numbers are used to measure changes in either prices or quantities, in time and in space. As quantity indexes, they may be on inputs, on outputs, or relating both, inputs and outputs, the latter being the case of the TFP index (Coelli et al., 2005).

The TFP index was used in several empirical studies. For example, Hooper and Hensher (1997) used it to measure the performance of airports. Their study, based on information from six Australian airports in the period from 1989 to 1991, refers to the Tornqvist TFP index to compare the productivity of the same airport, during the time length, and among different airports, in a same period of time. Kulshreshtha and Parikh (2001) used the Tornqvist TFP index to measure productivity in the coal sector in India, from 1980 to 1992. Fuglie (2004) conducted a study on total factor productivity of agriculture in Indonesia, from 1961 to 2000. His study shows that the TFP index rose in the 1970s and 1980s and stagnated in the 1990s. It also shows that, without new efforts, the objective of Indonesia in using agriculture for rural development and poverty relief would be jeopardized. Oh et al. (2008) used the TPP index in the study of productivity growth of manufacturing industry in Korea, from 1993 to 2003. They show that the TFP index had a sharp decrease between 1998 and 1999 and a slight decrease between 2001 and 2002. The former was mainly caused by the Asian crisis. Although there is a higher growth since 2000, productivity growth in Korean manufacturing industry remains low.

The choice of the Laspeyres TFP index, instead of the Tornqvist TFP index or other most often used TFP indexes, relates to the price information available. The Laspeyres TFP index only requires base year prices.

The TFP index is a ratio between an output index and an input index: (1)

TFPsv =

Output.Index sv Input.Index sv

s and v are two observations in time or in space. To compute the Laspeyres TFP index, Laspeyres quantity indexes on input and output quantities are calculated first: M

(2)

q =∑ L sv

i =1

pbi qsi pbi qvi

Again, s and v are two observations in time or in space. M is the number of inputs or outputs. Prices are base year prices that we assume as uniform and equal to 1.

2.3 The empirical model To estimate the empirical model the database included in the study Innovation Union Scoreboard 2010 (UNUMERIT, 2011) was used. The sample has a total of 135 observations, covering the Member States of the EU-27

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Nuno Araújo and Leonardo Costa from 2006 to 2010. Two types of TFP indexes, designated by TFPt (time) and TFPs (space), are estimated. To calculate these TFP indexes first the corresponding output and input indexes are computed.

Concerning the TFPt (time) index, for each year and Member State, the ratio among the values of inputs in the year and the values of inputs in the base year was computed. To get the output index a similar procedure was used with the outputs. The TFPt index results from dividing the value of the output index by the value of the input index. In what refers to the TFPs (space) index, the ratio of the values of the inputs of each Member State in each year with the EU-27 average values of inputs in the same year was computed. Similar procedure was used with the outputs. The TFPs index results from dividing the value of the output index by the value of the input index.

In both cases, TFPt and TFPs, time averages were computed for each Member State in the period under analysis.

The list of inputs and outputs of innovation included in the mentioned database is the following: a) I1 (Input 1) – Human resources; b) I2 (Input 2) – Research systems; c) I3 (Input 3) – Finance and support; d) I4 (Input 4) – Firms’ investments; e) I5 (Input 5) – Links & entrepreneurship; f) I6 (Input 6) – Intellectual assets; g) O1 (Output 1) - Innovator firms; h) O2 (Output 2) – Economic effects; Each of the above inputs and outputs results from the aggregation of several indicators. The reader is referred to the Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011) for more details.

3. Results In this section three types of results are presented: 

A correlation matrix that shows significant correlations between Member States time average inputs and outputs in the period from 2006 to 2010;



Average TFP indexes in time and space for each Member State;



The comparison of the results of Portugal in this research with the country results in the Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011).

3.1 Innovation as a production process Table 1 below shows the correlations between Member States time average inputs and outputs of innovation.

Time average inputs and outputs were computed to ensure that there is no autocorrelation in the observations. All reported correlations are significant at least at a level of significance of 5%.

Table 1: Correlations between Member States time average outputs and inputs of innovation I1

I2

I3

I4

I5

I6

O1

I1

1,000

0,618

0,727

0,609

0,726

0,534

0,396

I2

0,618

1,000

0,776

0,469

0,840

0,837

0,522

I3

0,727

0,776

1,000

0,473

0,723

0,750

0,390

I4

0,609

0,469

0,473

1,000

0,762

0,635

0,658

0,500

I5

0,726

0,840

0,723

0,762

1,000

0,801

0,739

0,534

I6

0,534

0,837

0,750

0,635

0,801

1,000

0,577

0,618

O1

0,396

0,522

0,390

0,658

0,739

0,577

1,000

0,417

0,500

0,534

0,618

0,417

1,000

O2 0,620 Source: Author’s estimation

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O2 0,620

Nuno Araújo and Leonardo Costa Three results should be highlighted from the above table: 

Inputs and outputs have positive and statistically significant correlations. More inputs generate more outputs. The correlation is not significant between O2 and I1 and between O2 and I3. Human resources do not seem to result in immediate economic results. Financing and support either. If a positive correlation exists between the variables in question it is not contemporaneous;



The two outputs have a significant and positive correlation. That is, Innovators firms and Economic effects are complements;



The six inputs of innovation considered have significant and positive correlations, that is, they are complements and not substitutes.

The above results support innovation as a production process that transforms considered inputs into considered outputs. TFP indexes in time and in space are presented next.

3.2 TFP indexes in time and space TFP indexes are obtained in two dimensions: 

TFPt (time), productivity of each Member State in each year is compared with productivity of the same Member State in the base year (2006);



TFPs (space), productivity of each Member State in each year is compared with productivity of the EU-27 average in the same year.

Table 2 and Figure 2 illustrate the average results for the period under analysis. Results are obtained for each EU-27 Member State in time (vertical axis) and in space (horizontal axis). Thus, each point of Figure 2 corresponds to a coordinate (TFPt, TFPs) associated to a particular Member State. The circles, squares and triangles indicate the three groups of Member States that have resulted from a cluster analysis. The groups can be identified along the TFPs axis.

Table 2: Time average TFPt and time average TFPs per Member State of the EU-27 Member State

Abbreviation

TFPt

TFPs

Belgium

BE

0,929

0,998

Bulgaria

BG

1,230

1,429

Czech Republic

CZ

0,995

1,336

Denmark

DK

0,846

0,815

Germany

DE

0,955

1,311

Estonia

EE

0,844

1,164

Ireland

IE

0,867

1,553

Greece

GR

1,179

1,776

Spain

ES

0,942

0,929

France

FR

0,921

0,913

Italy

IT

0,907

1,156

Cyprus

CY

0,856

1,385

Latvia

LV

1,139

0,544

Lithuania

LT

0,993

0,729

Luxembourg

LU

0,849

1,450

Hungary

HU

1,117

1,207

Malta

MT

1,002

2,468

Netherlands

NL

0,918

0,763

Austria

AT

0,957

1,036

Poland

PL

0,948

0,899

Portugal

PT

0,964

1,289

Romania

RO

0,911

1,573

Slovenia

SI

0,932

0,960

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Nuno Araújo and Leonardo Costa

Member State

Abbreviation

TFPt

TFPs

Slovakia

SK

1,028

1,281

Finland

FI

1,028

0,729

Sweden

SE

0,919

0,717

UK

0,852

0,764

United Kingdom Source: Author’s calculations

Figure 2: Time average TPFt and TFPs by Member State of the EU-27 Source: Table 2.

Two cross lines divide Figure 2 into four quadrants. Respectively, the lines indicate in the Figure values of TFPt = 1 and of TFPs = 1.

There are several results that derive from Table 2 and Figure 2: 

20 Member States of the EU-27 are in line TFPt = 1 or below. This means that, in time, these Member States have maintained or lost the levels of productive efficiency that they had in the base year of 2006.

This is the Portuguese case. However, of the 20 Member States listed, in time, after Lithuania, Portugal is the Member State that has kept the best results in this TFPt indicator, presenting even higher performance than Germany.



The 7 Member States above the line TFPt = 1 are mostly Member States of the Eastern Enlargement of the EU. With the integration into the EU, these Member States have had a strong economic growth, foreign investment, EU funds, tax incentives, in addition to the existing high levels of education and qualification of their population and to low labour costs when compared to other EU-27 Member States, which may explain these results.



The large differences across Member States are in space: i) 13 Member States have a TFPs equal to 1 or less than 1 (TFPs group average = 0.831); ii) 13 Member States have a TFPs higher than 1 but less than 2 (TFPs group average = 1.378) and iii) Malta has a TFPs higher than 2 (TFPs = 2.468).



The 13 Member States with TFPs = 1 or lower have levels of innovation productivity equal to or lower than the EU-27 average. Most of Northern and Central Europe Member States are in this group. Sweden, the leader of innovation, has a TFPs = 0,717 and belongs to this group. Several factors can explain these results: decreasing returns to scale of innovation, economic sectoral specialization in services, etc.



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Nuno AraĂşjo and Leonardo Costa ď&#x201A;§

The 14 Member States with TFPs> 1 have levels of productivity in innovation above the EU-27 average.

Southern Europe Member States as well as Germany and other Member States are placed in this group.

Malta, with a TFPs= 2.468 is a case apart. Portugal, with a TFPs = 1.289, is located near the industrial Germany, with a TFPs = 1.311, both Member States with a level of efficiency in innovation above the EU27 average.

In the next section the above TFPt and TFPs results obtained for Portugal are compared with the country results in the Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011).

3.3 TFPt, TFPs and Innovation Union Scoreboard 2010 results for Portugal Figure 3 shows the innovation performance of the EU-27 Member States according to the Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011). Portugal is below the mid-table, being classified as moderate innovator and leading this group.

Figure 3 - Innovation Performance of EU-27 Member States Source: Innovation Union Scoreboard 2010 (UNU-MERIT, 2011, p.4) The Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011) calculates the innovation performance based on the combined amounts of inputs and outputs of each Member State in relation to the EU-27 average.

For instance, ceteris paribus the amount of outputs, the innovation performance increases with the amount of inputs. In this research we have instead computed productivity measures of conversion of innovation inputs into innovation outputs.

According to the Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011), among other Member States, Sweden and Germany are innovation leaders, with Sweden leading this group while Portugal is a moderate innovator. Our TFPs results show Portugal as one of the more productive Member States of the EU-27 in terms of innovation, with a performance close to the one of Germany and well above the one of Sweden, the latter with a productivity of innovation below the EU-27 average.

Why is Portugal as productive in innovation as Germany is, and more productive than Sweden? These results can be understood in light of the ideas of Theodore Shultz (1964) on farmers of developing countries. Shultz supported that these farmers were efficient but poor. This research supports that Portugal is as productive in innovation as Germany is, and more productive than Sweden but has less resources allocated to innovation

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Nuno Araújo and Leonardo Costa than these two Member States. Even if the three Member States are operating in the same efficient frontier they must be operating in different zones of the frontier with different returns.

4. Conclusions In this research Innovation was treated as a production process converting inputs into outputs of innovation.

The data used were taken from the Innovation Union Scoreboard 2010 report (UNU-MERIT, 2011). The research found significant and positive correlations between inputs and outputs of innovation, which supports innovation as a production process and the calculation of productivity measures.

Using the TFP index technique, two types of TFP indexes were computed: i) TFPt (time), which compares in each year the productivity of innovation in each Member State with its productivity in a base year (2006); ii) TFPs (space), which compares in each year the productivity of innovation in each Member State with the productivity of the EU-27 average.

20 Member States of the EU-27 are placed in the TFPt = 1 line or below. This was the case of Portugal, where average TFPt in the time length is slightly below 1. The 7 Member States that are above this line are mostly from Eastern Europe. These results can be explained by the financial crisis, the EU structural funds, and the highly qualified and cheaper labour force of the Eastern Europe new Member States.

The biggest differences in productivity of innovation across the EU-27 Member States are in space. 13 Member States have a TFPs = 1 or below. Most of these Member States are from Northern and Central Europe. Sweden, the leader of innovation, is included in this group. These results can be explained by decreasing returns to scale of innovation, economic specialisation in services, and other reasons. The other 14 Member States show a TFPs > 1. Southern Europe Member States as well as Germany and other Member States are placed in this group.

Still concerning TFPs, the results for Portugal, Sweden, and Germany are interesting because of the differences in innovation investment. In comparison to Portugal, Sweden and Germany allocate more resources to innovation. However, the productivity of innovation in Portugal is similar to the one of Germany and higher than the one of Sweden. This appears to be a Theodore Shultz (1964) type of case. Portugal is as productive in innovation as Germany is and more productive than Sweden but it it allocates fewer resources to innovation than these two Member States.

References Araújo, N. (2011) Análise da Produtividade da Inovação em Portugal no Contexto da União Europeia, Master Thesis in Economy, Universidade Católica [portuguese document].

Caves D. W., Christensen L. R. and Diewert W. E (1982) “The economic theory of index numbers and the measurement of input, output and productivity”, Econometrica, vol. 50, n.6, p.1393–1414.

Coelli, T., Rao, D.S.P., O´Donnell, C., Battese, G.E (2005). An introduction to efficiency and productivity analyses, 2.ª ed., Springer, USA. Cullmann, A., A. Kappeler and C.V.Hirschhausen (2006) “Introduction to Efficiency and Productivity Measurement”, lecture in the 3rd Berlin Summer School on Infrastructure.

Eltis, W, (1966), "The Grand Tableau of François Quesnay's Economics," European Journal of the History of Economic Thought 3.

Färe, R., S. Grosskopf E. and Lovell, C. (1994) Production Frontier, Cambridge University Press, Cambridge.

Fuglie, K. O. (2004) “Productivity growth in Indonesian agriculture,1961–2000”, Bulletin of Indonesian Economic Studies, 40:2, 209-225.

Hooper, P.G. and Hensher, D.A. (1997) “Measuring Total Factor Productivity Of Airports– An Index Number Approach”, Transportation Research–E, vol. 33, n.º 4, pp. 249-259.

Kulshreshtha, M., and Parikh, J. K. (2001) “A study of productivity in the Indian coal sector”, Energy Policy, 29: 701-713.

Oh, I., Lee, J. and Heshmati, A. (2008) “Total Factor Productivity in Korean Manufacturing Industries”, Global Economic Review, 37:1, 23-50.

Rocha, L. (2010) Nível de maturidade das PME: Melhores Práticas de gestão no alinhamento estratégico dos SI/TI com o negócio, [On-line] http://hdl.handle.net/123456789/293.

Shultz, T. W. (1964) Transforming Traditional Agriculture, Yale University Press, Yale.

UNU-MERIT (2011) “Innovation Union Scoreboard 2010, The Innovation Union’s performance scoreboard for Research and Innovation” [On-line] Maastricht Economic and social Research and training centre on Innovation and Technology (UNU-MERIT) with the contribution of DG JRC G3 of the European Commission http://www.proinno-europe.eu/innometrics/page/innovation-union-scoreboard-2010.

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Business Incubators and Incubatees Søren Berg Jørgensen Roskilde University, Denmark Sberg@ruc.dk

Abstract: Awareness of the importance of entrepreneurs in relation to job creation has increased, which has encouraged policymakers to understand how vital entrepreneurs are to economic development. This development has generated increased attention towards business incubators and how they are seen as tools for economic development via networks of entrepreneurs. Despite this growing interest in business incubation, we still know very little in terms of how business incubators influence the entrepreneurs they seek to support and studies show that there appears to be a mismatch between what entrepreneurs want and what business incubators offer. Thus, the extent to which business incubators really understand their clients has to be questioned. This paper seeks to investigate how business incubators understand the entrepreneurial process, and how business incubators are designed to support incubatees and their entrepreneurial process.

Empirical data collected through interviews with business incubator staff compared with data from interviews with incubatees show that there is a difference in how business incubator staff and incubatees perceive and understand the entrepreneurial process and how it can best be supported. The incubatees see positive elements in both the planning and analytical elements of causational logic, as well as the partnership and network elements of the effectuation approach, whereas the business incubator staff believe primarily in the importance of teaching the incubatees causational logic by arguing for the importance of applying strategic planning and undertaking market, industry and competitor analysis as part of the entrepreneurial process.

Additionally, this paper argues for the importance of a quasi-partnership between business incubator staff and incubatees as a way of creating a more compressed business incubation process for the incubatees which is aligned with the partnership elements of the effectuation concept. A focus on quasi-partnerships might also improve the business incubators’ understanding of the entrepreneurial process and vice versa.

Keywords: Business incubators, entrepreneurs, effectuation theory

1. Introduction The business incubation research field has travelled far beyond its origins in the late 1970s. However, the field has stagnated to some extent through the undertaking of repetitive assessment studies and continued attempts to create a theoretical foundation for the business incubation concept (Böhringer, 2006). A recent focus on customer satisfaction in business incubators show that there seems to be a mismatch between what the incubatees want and what the business incubators offer (Abduh et al, 2007).

This gap that exists between the wants of the entrepreneurs and the reality of the business incubators has encouraged an emerging discussion of whether business incubator managers and business consultants really understand their clients and if the business incubation programmes they have designed match the needs of the entrepreneurs. This discussion can be linked to the current academic discussion of how expert entrepreneurs’ logic differs from that of novice entrepreneurs, exemplified by Sarasvathy’s (2001) effectuation theory. Following these assumptions, and based on the argument that there is a difference in terms of logic between novice entrepreneurs and expert entrepreneurs, this paper seeks to investigate how business incubators perceive and understand entrepreneurs and the entrepreneurial process.

The purpose of this paper is therefore to discuss the concept of effectuation in a business incubation context, and to investigate if business incubator staff and entrepreneurs have the same perceptions of how entrepreneurs think and act. Thus, the following problem statement was formulated: How do business incubator staff and entrepreneurs perceive and understand the entrepreneurial process? And how do business incubators support or hinder this entrepreneurial process?

2. Business incubators Business incubators are defined as organizations that provide office facilities, administrative services and professional advisors to entrepreneurs at the same location (Allen & McCluskey, 1990). Phan et al (2005)

159

Søren Berg Jørgensen merge science parks and business incubators within one definition by referring to them as institutions: ‘We define these institutions as property-based organizations with identifiable administrative centers focused on the mission of business acceleration through agglomeration and resource sharing’ (p.166). It can be questioned whether or not one can fully merge the two different terms as there appears to be a clear distinction among some researchers in the field between the definitions and purposes of business incubators and science parks. For example, Westhead’s (1997) understanding of the concept of science parks is related to scientific research with the purpose of creating an environment that can transform ‘pure’ research into commercial production. Bergek and Norrman (2007) argue that the business incubation concept should not be used for organizations such as science parks and technology parks as they are designed to support more mature companies. Thierstein and Wilhelm (2001) state that the different nature of business incubators can be seen in their infrastructure and the way in which they are geared towards their specific clientele.

In their study, Hughes et al (2007) focused on the fact that business incubators originally applied a top-down management style, namely that business incubator managers would offer and provide services to start-up companies. In contrast, recent research has shifted towards the importance of examining how incubatees can make use of business incubators’ networks and support elements. For example, Fang et al (2010) stress that business incubator managers have to activate and assist entrepreneurs based on the assumption that the entrepreneurs’ capabilities in terms of obtaining knowledge are critical to the success of the entrepreneur and the business incubation programme. Rice (2002) argues that business incubator managers should assist and guide the entrepreneurs as if they were quasi-partners and explicitly ground the importance of the relationship between the business incubator staff and the incubatees in the interdependent co-production of a value-adding business incubation process. Hence, the entrepreneurs and business incubator staff should be ready and willing to enter a co-production process and, according to Scillitoe and Chakrabarti (2010), a lack of allocation of time to interaction with incubatees by business incubator managers can result in sacrificing the success of the entrepreneurs and therefore also the success of the business incubator.

3. Entrepreneurs Investigating entrepreneurial personality traits and entrepreneurial cognition are considered to be two main approaches within the field of entrepreneurship which aim to discern the differences between entrepreneurs and non-entrepreneurs (Keh et al, 2002). This paper focuses on the discussion of entrepreneurial cognition; however, before looking into this, we need to define entrepreneurship and the role of the entrepreneur. In Shane and Venkataranam’s (2000) analysis of entrepreneurship as a research field, they present a conceptual framework encompassing two processes, namely the discovery and exploitation of entrepreneurial opportunity. Davidsson (2006) later defined these as follows: ‘Discovery refers to the conceptual side of venture development, from an initial idea to a fully developed business concept’ (p.76) and ‘Exploitation refers to the action side of venture development. … Exploitation thus simply means the attempted realization, or implementation, of ideas’ (pp. 76‒77). According to this process view of entrepreneurship, one can argue that it is the entrepreneurs’ task and challenge to manoeuvre, balance and manage the two different phases with the end purpose of establishing, growing and maintaining a profitable organization. From this perspective, different complementary cognitional concepts have been identified as to how the entrepreneur manages to think, cope, and take decisions in a context of uncertainty and change.

The aspects of effectual and causational logic differ in terms of the ways in which entrepreneurs process their decision-making. Sarasvathy (2001) distinguishes between the two in terms of means: choosing between means to create a particular effect (causation), and choosing between many possible effects from a specific set of means (effectuation). Effectual logic is grounded in a learn-by-doing method, where the entrepreneur will look at whatever resources he/she might have available and create a business idea and model based on these.

The business idea and model are then tested on stakeholders within the entrepreneur’s network, after which they will be adjusted based on feedback from the network. Additionally, the entrepreneur’s network is used as a tool for attaching resources through partnerships. In contrast, causational logic is based on the assumption that decisions should be taken by means of thorough analysis as the outcome of a decision can be forecasted.

In her 2003 article, Sarasvathy argued for three principles as the foundation of effectual logic and how it differs from a causational view, these being: 1) affordable loss rather than expected returns; 2) partners rather than competitive analysis; 3) leveraging contingencies rather than avoiding them. Sarasvathy (2008) then added additional elements by identifying further how expert entrepreneurs apply effectual logic: 4) starting with means rather than ends; 5) ignoring competition and stressing partnerships; 6) fabricating rather than finding a

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Søren Berg Jørgensen market; 7) unanticipated ends as opposed to preselected goals. The effectuation approach opposes the more traditional linear approaches to how the entrepreneurial process had been portrayed previously. Shane (2003) argued that the entrepreneurial process starts with the identification or discovery of opportunities, which is then followed by a series of tasks pursuing the opportunity, thereby differing notably from how Sarasvathy and Dew (2005) view the entrepreneurial process. Shane’s (2003) thoughts on the entrepreneurial process are based on the postulation that entrepreneurial activity is directional and methodical, although the possibility of feedback loops is also recognised. The directional approach and thoughts on the entrepreneurial process are much more static and each part is interdependent of the other, whereas the effectuation approach sees the entrepreneurial process as more interactive and dynamic. Shane’s (2003) view of the entrepreneurial process is aligned with causational logic. Bergendahl (2009) concluded this as none of the entrepreneurs investigated in her study followed the causation or the effectuation process completely. The entrepreneurs were operating somewhere in between the two processes throughout the investigated period and certain critical events and factors influenced the path followed in terms of either the effectuation or causation process.

4. Method In order to investigate how business incubator staff and entrepreneurs perceive and understand entrepreneurial logic, an explanatory ‘embedded’ multiple case study approach was adopted as described by Maaløe (2002:71), originating from Yin (1984); explanatory because this study seeks to explain how business incubators and entrepreneurs understand each other; embedded and multiple as this approach studies several case units, with a special focus on encased fields, which reflects the situation of entrepreneurs within the constrained environment of business incubators. The case studies are based on eight semi-structured interviews conducted with both entrepreneurs and business incubator staff. This form of interview is based on predetermined flexible themes, giving the researcher the possibility to explore new themes during the interview (Kristensen, 2007). The main gain of applying case studies is that they offer a way of understanding a phenomenon comprehensively (Easton, 2010).

In order to address the research design, a specific business incubator programme had to be identified. For this study a business incubator programme from Denmark called Growth Factories was selected. The Growth Factories programme is classified as a mixed business incubator, involving all sectors and industries. The Growth Factories concept consists of office space for entrepreneurs coupled with a 1.5- to 3-year growth programme with support from consultants, an educational programme, a mentoring scheme, and access to a formal and informal network. As the Growth Factories programme is classified as a mixed business incubator, it was important that the cases selected for this study represented a mix of industries. Another criterion for selection was that the cases consist of the founding entrepreneurs located at the Growth Factories to ensure that they had gone through an entrepreneurial process. Furthermore, the cases had to have been situated at the Growth Factories for a minimum period of eight months to ensure that they had participated in the business incubation programme and received support from the business incubator staff. As identified earlier in the review of entrepreneurship, there is a difference in how entrepreneurs think and act based on previous entrepreneurial experiences and therefore the case studies represent both novice and expert entrepreneurs.

From the Growth Factories, two business incubator managers and two business consultants were interviewed in order to investigate the perceptions of business incubator staff with regard to the entrepreneurial process undertaken by their clients.

In terms of the analysis of case studies, Yin (1994) presents two general strategies: one that examines the empirical data in relation to theories, and one that focuses on the description of a case. For this paper the first strategy was selected. In order to analyse how the responses were linked to different perspectives on the entrepreneurial process, effectuation theory was applied as a framework for understanding the different logics that might best explain how the entrepreneurial process can be understood. Thus, in order to operationalize the ideas of effectuation as a tool for analysis, after the interviews were conducted, the researcher searched for coding representing either effectual or causational logic. The coding of the empirical data involved identifying words and sentences that referred to the understanding of the concepts of causation and effectuation as depicted in the coding scheme below.

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Søren Berg Jørgensen

Figure 1: Coding scheme Both the entrepreneurs and the business incubator staff were interviewed about how they saw the entrepreneurial process and how the business incubator supported or hindered this entrepreneurial process.

All of the interviews were conducted on site at the business incubator and each interview lasted for about an hour. As the interviews were based on a semi-structured approach, the researcher was allowed to explore relevant points of interest which were not planned beforehand; however all of the interviews followed the same thematic structure, thereby ensuring that all respondents were asked the same questions. Thus, it would be possible to compare the data and gain an understanding of how business incubator staff and entrepreneurs might perceive things differently.

5. Results The results of the empirical data collection are presented in the figure below, following the preferred manner of presenting data from multiple case studies (Eisenhardt et al, 2007):

Figure 2: Results from interviews with entrepreneurs

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Figure 3: Results from interviews with business incubator staff

6. Discussion As identified through the review of the business incubation literature, there appears to be a mismatch between what entrepreneurs want and what business incubators offer. Based on this observation, this study sought to investigate how entrepreneurs and business incubator staff view the entrepreneurial process. For this purpose the concepts of effectuation and causation were chosen as a theoretical framework to enable better understanding of how entrepreneurs and business incubators perceive the entrepreneurial process.

Thus, the following discussion relates the empirical findings to the theoretical understanding of entrepreneurship introduced earlier in this paper. This approach is intended to improve our understanding of how business incubator staff and incubatees perceive each other, striving to break down the mismatch between how business incubation staff and incubatees view the entrepreneurial process.

As indicated from the empirical data, there does indeed seem to be a difference in how business incubator staff and incubatees view the entrepreneurial process. The business incubator staff believe in the importance of teaching the incubatees causational logic, as they argue the importance of applying strategic planning and of thorough market, industry and competitor analysis. From the interviews it became clear that the business incubator staff acknowledge that there is a clear difference between the incubatees and the support that each of them needs. The incubateesâ&#x20AC;&#x2122; needs are identified based on their current financial situation as well as the state of their business, and it is apparent that the business incubator staff have a clear predetermined understanding of what the incubatees need help with. This was clearly stated by one of the business incubator managers who stressed how business incubators should compel entrepreneurs to consider a more analytical approach towards their business. According to the business incubation literature, this top-down management approach has shifted towards a focus on how business incubator staff should guide incubatees into understanding the importance of obtaining new knowledge for their business via the networks of the business incubator. However, this shift in the literature does not seem to be reflected in the empirical findings, even though market knowledge and the importance of entrepreneurs exploiting networks are mentioned in the interviews. A focus on co-production in the business incubation process between the staff and the incubatees does not seem to be particularly salient in the case studies, although one of the business consultants did mention that he strives to provide the incubatees with potential customers whenever possible. It is clear from the business incubation literature that the importance of a quasi-partnership between the business incubator staff and incubatees should be prioritized. But from the empirical findings, this partnership perspective appears to be lacking, both among the business incubator staff and the incubatees. A quasi-partnership between business incubator staff and incubatees does match effectual logic and its understanding of the entrepreneurial process. Thus quasi-partnerships should be of particular interest to business incubators. A discussion of whether entrepreneurs enter business incubators to learn the benefits of planning and strategy

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Søren Berg Jørgensen or the more learn-by-doing elements of effectuation is highly relevant as we know that expert entrepreneurs apply effectual logic by focusing on commitment from central stakeholders, developing partnerships and learning by doing, inter alia, rather than the more causational elements of planning, developing strategy and marked analysis. If expert entrepreneurs apply this approach, then perhaps business incubators should also promote this in their work with entrepreneurs. This paper does not argue that business incubators should only practise effectual logic in their support system, but that different logics could be used at different stages in entrepreneurial development, a point which has also been argued by Bergendahl (2009). If we buy into this perspective, then business consultants need to learn the values of effectuation before it can be applied in business incubators.

In the entrepreneurship literature it is clearly stated that there is a difference between how entrepreneurs view the entrepreneurial process and that this differs based on whether the entrepreneur is a novice or an expert. The novice entrepreneurs are considered to apply causational logic, whereas expert entrepreneurs are considered to apply effectual logic. From the case studies, this theoretical assumption seems to be supported; however, as stated earlier in this discussion, studies from Bergendahl (2009) show that entrepreneurs make use of the different logics at different stages in their entrepreneurial process. This also seems to be the conclusion from the case studies of the incubatees, as they see positive elements in both the planning and analytic elements of causational logic, as well as the partnership and network elements of the effectuation approach. However, from the case studies it is clear that the incubatees believe that causational knowledge is what one can expect from business incubators as an entrepreneur. This makes sense as the nature of business incubators is to provide some sort of business structure and tools to incubatees. But if the research states that expert entrepreneurs apply effectual knowledge as an approach to building successful companies, then it could be argued that effectual reasoning should be prioritized more by business incubators, especially in terms of how business incubator staff view the entrepreneurial process. From the entrepreneurs’ perspective, there is no expectation that the business incubator staff should become quasi-partners in their entrepreneurial process, and nor is this expected by the business incubator staff.

7. Conclusion In order to investigate how business incubator staff and entrepreneurs perceive and understand the entrepreneurial process, and how business incubators support or hinder the entrepreneurial process, case studies involving both incubatees and business incubator staff were undertaken. The empirical findings were then discussed based on the literature relating to entrepreneurship and business incubation. From this it can be concluded that there is a difference between how business incubator staff and incubatees perceive the entrepreneurial process. The incubatees see positive elements in both the planning and analytic elements of causational logic, as well as the partnership and network elements of the effectuation approach. On the other hand, the business incubator staff believe primarily in the importance of teaching the incubatees causational logic, arguing the importance of applying strategic planning and thorough market, industry and competitor analysis as part of the entrepreneurial process. One of the business incubation managers even stressed how business incubators should force entrepreneurs to consider a more analytic approach in their entrepreneurial process. However, if entrepreneurship research claims that expert entrepreneurs apply effectual knowledge with success, then it could be argued that effectual reasoning should be prioritized in business incubators. In addition, the importance of a quasi-partnership between business incubator staff and incubatees deserves more attention in order to produce a more compressed business incubation process for the incubatees; this is highly recommended in the business incubation literature which is aligned with the partnership elements of effectual logic. A focus on quasi-partnerships might also improve the business incubator staffs’ understanding of the entrepreneurial process and vice versa.

References Abduh, M., D’Souza, C., Quazi, A., & Burley, H. T. (2007) Investigating and classifying clients’ satisfaction with business incubator services. Managing Service Quality, 17 (1), 74‒91.

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Entrepreneurship: Theory & Practice, 15 (2), 61‒77.

Bergek, A. & Norrman, C. (2007) Incubator best practice: A framework. Technovation, 28 (1), 20‒28.

Bergendahl, J. (2009) Entreprenörskapsresan genom beslutsprocesser i team En elektronisk dagboksstudie i realtid. [PhD Dissertation] Ekonomihögskolan, Lund Business Press, Lund Studies.

Bö hringer, A. W. O. (2006) Knowledge specialization and transfer: A knowledge based framework for business incubation.

Conference paper presented at the DRUID Summer Conference, 18‒20 June, Copenhagen.

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Principles, Practice and Policy, Harlow: Pearson Education, 129–151.

Easton G. (2010) Critical realism in case study research, Industrial Marketing Management Vol. 39, (1), 118-128.

Eisenhardt, K. M., & Graebner, M. E. (2007). Theory building from cases: Opportunities and challenges. Academy of Management Journal, 50 (1): 25.

Fang S.C., Tsai F.S., Lin J.L, (2010) Leveraging tenant-incubator social capital for organizational learning and performance in incubation programme. International Small Business Journal, Vol. 28, No. 1, 90-113.

Hughes, M., Ireland, R. D. & Morgan, R. E. (2007) Stimulating dynamic value: Social capital and business incubation as a pathway to competitive success. Long Range Planning, 40 (2), 154‒177.Keh H.T., Foo M.D., Lim B.C. (2002) Opportunity evaluation under risky conditions: The cognitive processes of entrepreneurs. Entrepreneurship Theory and Practice. Winter: 27(2),124-48.

Kristensen C.J. (2007) Interview med enkeltpersoner, Chapter 14 from Fuglsang L., Hagedorn-Rasmussen P., Olsen P. B., Teknikker i samfundsvidenskaberne, Roskilde Universitetetsforlag.

Maaløe, E. (2002) Casestudier af og om mennesker i organisationer – forberedelse, feltarbejde, tolkning og sammendrag af data for eksplorativ integration, test og udvikling af teori. Akademisk Forlag, 2. udg.

Phan, P. H., Siegel, D. S. & Wright, M. (2005) Science parks and incubators: Observations, synthesis and future research. Journal of Business Venturing, 20 (2), 165‒182.

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The Evaluation of Teaching in Higher Education Institutions Ana Louro1, Luís Lourenço1and Pedro Saraiva2 1 NECE - Research Unit in Business Sciences, University of Beira Interior, Covilhã, Portugal 2 Department of Chemical Engineering, University of Coimbra, Coimbra, Portugal analouro.consult@gmail.com lourenco@ubi.pt pas@eq.uc.pt Research supported by: Programa de Financiamento Plurianual das Unidades de I&D da FCT – Fundação para a Ciência e Tecnologia, Ministério da Ciência, Tecnologia e Ensino Superior. " Abstract: Over the years the role of higher education has assumed a growing importance in providing more and better services to citizens, which has meant that higher education institutions focus more attention on meeting these expectations. This has led to the emergence of the implementation of management systems and quality assurance in this area, with the aim of striving for excellence and continuous improvement. Because of the growing concern with stakeholder needs, evaluation has gained a higher degree of importance, resulting in the emergence of tools for measuring organizational and individual performance. With this research, we intend to make an analysis of the regulations for assessing the performance of teachers of public institutions of higher education in Portugal, published in the “Diário da República” (the official newspaper) up to the end of 2011. Document analysis is used to compare the performance assessment regulations of teachers between the two types of higher education institutions - universities and polytechnics and within each of these types of institutions. This research shows that individual performance assessments of teachers, in close liaison with other management tools, plays a central role in higher education institutions, even though there are differences in the assessment process between the two types of institutions. It also shows that there is no uniformity with regard to the parameters, or indicators, used, in terms of nomenclature. However, to overcome this predicament it was possible to group certain parameters and design a proposal for a single model that would enable the comparison of performance beyond the borders of each university or polytechnic. With this research we want to make a contribution to the scientific community, through observation of the reality under analysis, and assist governing bodies and key stakeholders to participate in performance evaluation, with the aim of continuous improvement.

Keywords: higher education, assessment, quality, performance

1. Literature review The public sector has been undergoing changes in its constitution and also in the way management is conducted in the organizations. In this sense, the reform movement known as New Public Management, launched in the United Kingdom and New Zealand during the 1980s, advocates the introduction of market mechanisms and the adoption of private management tools in order to improving service to citizens as well as increasing the efficiency and flexibility of management (Louro 2008).

These principles of new public management have been extended to the education sector (Fusarelli and Johnson 2004; Flynn 1999), although with some discrepancies in its application, particularly in terms of the mechanisms of performance assessment (Clarke and Newman 1997).

In Portugal deregulation and decentralization of services also started in the 1980s, which fostered the emergence of this paradigm, with the Consolidated Financial Administration Reform of the State. The government program of 2005-2009 proposed the realisation of an effective administration, in the service of citizens and businesses, where innovation is seen as key to the competitiveness of the Portuguese economy.

Afterwards, successive governments developed initiatives aimed at promoting citizenship, economic development and quality of public services (AR 2009).

Quality is understood as one of the most recent ethical concerns of public administration. Quality management is the effectiveness of the response of an institution or organization in their goal of providing services to citizens who expect a set of public responses to their needs (Villoria 1996). According to Domingues (2004), the quality of public services and of various instruments, the relationship between them, as well as the opportunities and constraints inherent in the quality of services, which have been studied by several authors over the last few years.

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Ana Louro, Luís Lourenço and Pedro Saraiva In order to measure quality it is necessary to have a method to assess it. In recent decades many researchers have focused on the concept of evaluation. To Barbier (1990) it is an act that allows the production of value judgments, based on pre-defined criteria. As Scriven (1995) indicates, it allows the determination of the value of something. Johnston & Clark (2005) show that the quality assessment of a service is closely linked to the ability of the institutions to meet the customers’ expectations and requirements, and can be measured by the difference between the expected service and the perceived service obtained (Fitzsimmons & Fitzsimmons 2006). On the one hand Frei (2006) states that customers may influence the quality of the service itself, if they are participants, and on the other hand, according to Afonso (2005), quality improvement of an organization is achieved through a reflective work of these same participants.

One of the key groups within the Higher Education Institutions (HEIs) are teachers, so it is important to understand their work. Simões (2000) addresses the concept of a teaching performance assessment activity, highlighting two distinct guidelines. In the first, the goal is a formative process in which better performance is sought by identifying problems, and in the second the teacher's performance is assessed at a given time and place.

The performance evaluation is a process of managing people, studied by (Harvey-Beavis 2003), who undertook a review of studies about Models of Performance-Based Reward, that suggest there are three main concepts: merit, knowledge and training. There is evidence of the advantages of the models associated with individual merit (Hoerr 1998; Kelley 1999); the motivation of teachers (Tomlinson 2000; Odden and Kelley 2002); the improvement of interpersonal relations (Solomon and Podgursky 2001); student outcomes (Odden 2001); and supporting the system itself (Solomon and Podgursky 2001). On the other hand, there is evidence of disadvantages associated with the models: namely the difficulty in making assessments (Storey 2000); the hierarchical culture (Cutler and Waine 2000); the incentive systems which did not motivate teachers (Chamberlin et. al. 2002); the effects of a lack of partnership (Chamberlin et. al. 2002); the cost of these incentive policies (Hoerr 1998; Chamberlin et. al. 2002); as well as an inadequate market approach (Malen 1999).

Faced with all of the attributes and problems contained in the different studies and given the Portuguese reality, it is important to locate this study in order to draw conclusions about the system that will be implemented, and the results that we will observe during 2013, 2014 or 2015, depending on the entry into force of PARs and the period to which they relate.

Therefore, the objective of this research is to study "the evaluation of teaching in Higher Education Institutions" as required by the Performance Assessment Regulations (PARs), through an analysis of various performance appraisal regulations of different HEIs that were published in the Official Journal until the end of 2011. Based on the analysis of the PARs of 26 institutions of higher education (14 universities and 12 polytechnics) it is possible to understand the similarities, differences and complementarities of current PARs and see if there are significant differences between them. Finally, it is possible to develop in the future the profile of teaching in higher education.

2. The profile of teaching performance evaluation on higher education institutions The institutions’ PARs seek to identify the profile that each institution has, regarding who the ideal teacher is, given the different contexts that may affect their performance.

In Portugal, there are 35 public institutions of higher education in total, 15 universities and 20 polytechnics / non-integrated schools.

Table 1: Higher Education Institutions Entities Universities Polytechnics Total

Number 15 20 35

In this first analysis, we will include 26 public higher education institutions, 14 universities, representing 93.33% of universities and 12 polytechnics, representing 60% of polytechnic institutions, whose PARs were published in the Official Journal until December 31, 2011.

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Ana Louro, Luís Lourenço and Pedro Saraiva Table 2: Higher Education Institutions with PARs published until 31/12/2011 Entities Number Percent Universities 14 93,33 Valid Polytechnics12 60,00 Total 26 74,29

This study encompasses 74.29% of the population, so it is possible to make statistical inferences for the population as a whole.

A measure, according to Sharma (1996), is an annexation of certain numbers or symbols to a characteristic according to certain rules. Thus, based on a detailed reading of the regulations, the objective of the research is to understand the similarities, differences and complementarities of existing regulations to evaluate teacher performance in higher education, in order to check whether there are significant differences, which enables us to compile a verification checklist. The fields included in this checklist are: code; name of HEI; objectives / scope; principles; aspects / criteria of evaluation (description and measurement); scale (qualitative and quantitative); assessment tools (yes / no and what); linkage to other management tools (yes / no and what); players, phases, application, publication and other observations.

In the table 3 we can observe the distribution of several criteria by universities and polytechnics.

Table 3: Criteria Criteria No University Management Yes No Teaching Yes No Research Yes No Knowledge and Technology Transfer Yes No Technical and Scientific Yes No Pedagogical Yes No Organizational Yes No University Extension Yes No Universality of Service Yes No Service to the Community Yes No Individual Development Yes

Frequency 14 12 13 13 11 15 22 4 14 12 14 12 14 12 16 10 23 3 25 1 25 1

Percent 53,8 46,2 50,0 50,0 42,3 57,7 84,6 15,4 53,8 46,2 53,8 46,2 53,8 46,2 61,5 38,5 88,5 11,5 96,2 3,8 96,2 3,8

It appears that research is the most commonly evaluated element, being present in 15 of the entities, followed by teaching, with 13 observations. For its part, individual development and community service is only evaluated in one institution.

If we consider each of the groups, we can see that the nomenclature is uniform, with three criteria: scientifictechnical, pedagogical and organizational. There is only one entity that has a different system. At university level, only the “university management” is consensual.

However, it is necessary to assess the way the criteria are measured in each entity, which introduces a new variable, called the criteria of assessment, which resulted in seven different positions for the institutions as a whole.

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Ana Louro, Luís Lourenço and Pedro Saraiva Table 4: Criteria Assessment Teaching, Research, Universality of Service, Service to the Community,, Individual Development Teaching, Research, University Management, knowledge and Technology Transfer Teaching, Research, University Management, University Management, University Extension Teaching, Research, University Extension , Universality of Service Technical and Scientific, Pedagogical, Organizational Technical and Scientific, Pedagogical, Organizational, University Extension Research, University Extension, University Management Total

Universities

Polytechnics

1

0

4

0

7

0

1

0

0

11

0

1

1

0

14

12

The number of criteria, used to evaluate teaching, varies between 3 and 5 and is not the same across all institutions analyzed.

A summary of the analysis shows that there is more homogeneity of the sample in polytechnic institutions.

Eleven of them have 3 criteria, only one institution uses four.

In the case of universities, the criteria (teaching, research, university management and university extension) have a higher rate of use. It also appears that none of the universities uses the criteria (technical and scientific, pedagogical and organizational) predominant in polytechnics.

In each of the elements a set of parameters are considered, a total of 443 in the 26 HEIs, 226 in the universities and 217 in the polytechnic in an initial analysis.

However, we need to understand the meaning of these parameters, undertake a micro-analysis of the different PARs, and verify if, ultimately, we can work with 443, or if it is possible to make groups, based on similar meanings. After this, with the set of parameters obtained we can use a cluster analysis, which hopefully will give us some idea of the evolution and the state of evaluation of teachers in HEIs and contribute towards a definition of a single model of performance, a single PAR. When we talk about evaluation of teachers it is important to refer to the assessment tools HEIs apply. In the sample under study we can observe the report of the type of activities performed - surveys of students, reports of the evaluation committees, and so on, whose results are detailed in table 5.

Table 5: Assessment Tools Assessment Tools Assessment tools

Report of developed activity Surveys of students Reports of the evaluation committees Tables of goals and their achievement reports Form of assessment Various information in internal database

Universities 14 9 4 1 1 1 1

Polytechnics 12 5 4 0 0 1 0

We can also see that all HEIs indicate linkage to other management tools, such as a business plan, action plan or strategic plan, as we can see in the table 6.

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Ana Louro, LuĂ­s Lourenço and Pedro Saraiva Table 6: linkage to other management tools Linkage to other management tools Refer to the existence of linkage Didnâ&#x20AC;&#x2122;t refer to the name of the management tool applied Business plan Action plan Strategic plan

Universities 14 8 2 1 3

Polytechnics 12 9 1 0 2

Either in the case of assessment tools or in the linkage to other management tools, there are some entities that did not refer to which management tools were applied. At this point in our research it is not possible to give the reasons for that omission of data. To measure the different criteria of the HEIs we use a scale of evaluation, qualitative and quantitative, but one that is not consensual in every institution. Instead we have 13 different combinations, as you can observe in the table below.

Table 7: Qualitative criteria of the scale of evaluation Scale of evaluation Excellent, Very Good, Good, Not relevant Excellent, Very Good, Good, Adequate Inadequate Excellent, Very Good, Good, sufficient ,inappropriate Excellent, Material, Good, Fair Excellent, Very Good, Good, inadequate Excellent, Adequate, Relevant Positive, Positive, Positive, Not Enough Excellent, Relevant, Sufficient, Inadequate Excellent, Material, Regular, insufficient Excellent, Very Good, Good, Good, not satisfied Excellent, Very Good, Good, Negative Excellent, Very Good, Good, Not Enough Excellent, Very relevant, Hardly relevant, Relevant, inadequate Total

Universities 3 1 1 2 3 1 1 1 1 0 0 0 0 14

Polytechnics 0 0 2 0 3 0 0 0 0 2 1 3 1 12

It is not possible to make a comparison between the quantitative criteria, because does not have the same terminology or does not appear in all institutions in the analysis.

There are several participants in the evaluation process, from teachers, assessors, rapporteurs, the presidents of polytechnics or deans, directors of faculties and departments, and the terminology is not consistent between universities and polytechnics, nor within each of these groups (an issue that will have to be addressed by the HEIs) so there is not a reliable way to display such data. A similar situation is observed when we talk about the participants (teachers, deans, several commissions, and others) in the PAR to the participants.

All of these evaluations are done for the purpose of the career progression of teachers, although at present in terms of increased salaries, this is frozen by budget constraints. Normally it is done every three years.

However, two institutions (one university and one polytechnic) undertake it annually.

3. Conclusions The performance evaluation of teachers is a key instrument in the process of managing an institution, using a set of techniques of private management (Bordogna 2007), although the differences between these sectors should be taken into account (Emery and Giauque 2005). The studies undertaken over the last few years refer to the difficulty in creating performance indicators and the difficulty about their interpretation (Smith & Mayston 1987; Simon et al. 2002), a fact which is evident in the number of criteria and parameters used by Portuguese HEIs. Analysis of the data proves that the design aspects of assessment, at the macro level, are not similar for the two populations under review (universities and polytechnics), and should be seen as an instrument of evaluating the activity of teachers, whether for internal or external use. This means that it allows the entire community to reflect on their activities or knowledge, in order to fulfill the mission of the institution they belong to.

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Ana Louro, Luís Lourenço and Pedro Saraiva It is necessary to explore the data at a micro level, with a reduction in the number of parameters which evaluate the different criteria of PARs in every institution. With this data we could do a cluster analysis which would give us a definite idea of the evolution and the state of evaluation of teachers, and achieve the definition of a single model of evaluation for each teacher’s performance, a single PAR. Some of the presented results such as assessment tools, linkage to other management tools, scale, participants, are aspects which need to be confirmed with higher education institutions, since they have missing or inadequate explanatory data, a situation that is expected to be addressed in the next phase of the study.

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Chamberlin, R., T. Wragg, G. Haynes and C. Wragg (2002) “Performance-related pay and the teaching profession: a review of the literature”, Research Papers in Education, Vol 17, No. 1, pp 31-49.

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A Trust-based Framework for Enhanced Absorptive Capacity: Improving Performance, Innovation and Competitive Advantage Athar Mahmood Ahmed Qureshi and Nina Evans University of South Australia, Adelaide, Australia Athar.Qureshi@unisa.edu.au Nina.Evans@unisa.edu.au

Abstract: In rapidly changing and dynamic environments an organisation must have dynamic capabilities to sustain its competitive advantage among rivals. Knowledge Management research has investigated these capabilities. One such a capability is absorptive capacity (AC) that can be described as the ability of an organisation to acquire, assimilate, transform and exploit knowledge gained from external sources to apply to commercial ends. Although AC has been extensively studied as a construct during the last two decades, survey-based empirical studies have only paid attention to the linear relationship between AC and performance measures. However, trust-related issues have not yet been studied with respect to AC operationalisation in organisations. This research seeks to offer a holistic approach for studying how trust influences AC as an antecedent as well as a fundamental ingredient, bridging knowledge sharing, transfer and absorption. This paper looks at how organisations can enhance their AC with more sophistication by establishing trust culture and by qualifying trust as an antecedent for enhancing AC. The basic premise of this paper is that enhanced absorptive capacity has four interrelated linkages. The first linkage relates to trust values and trust-worthiness leading to knowledge sharing. The second linkage relates to knowledge sharing and its antecedents, leading to knowledge transfer.

The third linkage relates to knowledge transfer and its antecedents leading to knowledge absorption. The fourth linkage relates to knowledge absorption and its antecedents enhancing AC. The paper also argues that the effective enhancement of AC demands various enablers in each linkage, such as information technology infrastructure and social integration mechanisms. A framework is proposed to establish these linkages and to open further research avenues.

Keywords: trust, knowledge sharing, knowledge transfer, knowledge absorption, innovation, absorptive capacity

1. Introduction In the twenty first century, people deal with large amounts of data and information. The data and information is not transformed into knowledge unless people are aware how they can extract value out of it. For this reason, knowledge management (KM) is an essential science to explore and research. KM has been an established discipline since 1991 (Nonaka, 2007). Furthermore, it is a reference to technology that offers to take care of the issues like finding-, classifying-, ensuring quality of-, storing-, maintaining-, using- and motivating people to contribute knowledge since knowledge is often not documented (Gu & Warren, 2004; Liebowitz, 1999; Turban & Aronson, 2001). Esterhuizen, Schutte and du Toit (2011) are convinced that an organisation that is “knowledge management proficient” is more innovative in nature and will perform competitively.

KM literature suggests that, among the capabilities that enable organisations to improve performance and gain sustainable competitive advantage is AC, the ability of organisations to acquire knowledge, assimilate, transform and exploit knowledge that is gained from external sources (Cohen & Levinthal, 1990a). Although, AC is widely researched in KM literature, yet a growing number of researchers and practitioners are focusing on AC as a measure of the ability of an organisation to gather external knowledge and disseminate/absorb it into the organisation processes and routines; towards innovation and competitive advantage (e.g. CepedaCarrion, Cegarra-Navarro & Jimenez-Jimenez, 2012; Noblet, Simon & Parent, 2011; Ratten, 2004; Soosay & Hyland, 2006; Tortoriello, 2006; Volberda, Foss & Lyles, 2010). Furthermore, Von Krogh (2000) asserted that merely gaining the knowledge is not a benefit for the organisation. It should be shared among individuals, groups, functions or systems in that organisation.

Trust is a construct identified by the KM literature that enables knowledge sharing (Huotari & Iivonen, 2004) and transfer mechanisms. Trust is a “tacit foundation for relationships” and has been widely discussed in organisational context and ethical agreements (Baumard, 1999). Furthermore, trust influences AC and vice versa. Organisations that are more trust-focused, are more likely to have a high level of AC (Ratten, 2004). This research will therefore contribute to theory by increasing the understanding of trust-AC linkage.

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Athar Mahmood Ahmed Qureshi and Nina Evans This paper draws from KM literature and proposes a set of linkages between trust, knowledge sharing, knowledge transfer, knowledge absorption and enhanced AC, along with their antecedents and enablers. The first linkage relates to trust values (i.e. propensity to trust) and trust-worthiness as antecedents to knowledge sharing. The second linkage relates to knowledge sharing (i.e. organisations’ knowledge sharing culture, activities and infrastructural support to share knowledge) and knowledge sharing antecedents (i.e. the traits and factors that need to be in place before knowledge sharing is formalised) as antecedents to knowledge transfer. The third linkage relates to knowledge transfer (i.e. organisations’ knowledge transfer culture, activities and infrastructural support to transfer knowledge) and knowledge transfer antecedents (i.e. the faith, attributes, processes and activities that needs to be in place before knowledge transfer is formalised) as antecedents to knowledge absorption. The fourth linkage relates to knowledge absorption (i.e. the functioning of the four absorptive capacity dimensions) and knowledge absorption antecedents (i.e. functionalities, environment, culture and enablers that needs to be in place for effective knowledge absorption) as antecedents to enhanced absorptive capacity. The conceptual framework is shown in Figure 1.

Figure 1: Conceptual Framework

2. Conceptual framework 2.1 Absorptive capacity AC is a well-established capability of an organisation because it is embedded in knowledge, processes, people and culture. AC identifies, assimilates, and exploits the external knowledge to commercial ends (Cohen & Levinthal, 1990a; Zahra & George, 2002). Importance is given to external knowledge because inventions are mostly due to the borrowing of knowledge rather than innovations (March & Simon, 1958). Furthermore, AC is a construct to integrate external knowledge and it is the capability of applying external knowledge to commercial ends (Van Den Bosch, Wijk & Volberda, 2003). Moreover, by studying the complex linkages between the “properties of knowledge, firm’s AC, and innovation performance”, Wang and Han (2011) concluded that if an organisation possess higher AC, relationship between its knowledge properties and innovation performance will be more pronounced. Therefore, AC is the “quality which enables knowledge to be converted into new products, services or processes to support innovation” (Cepeda-Carrion, Cegarra-

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Athar Mahmood Ahmed Qureshi and Nina Evans Navarro & Jimenez-Jimenez, 2012; Harrington & Guimaraes, 2005; Newey & Zahra, 2009; Zahra & George, 2002).

Considerable research has been performed about AC in the last two decades. However, few, if any, attempts have been made to study AC from an operationalisation perspective (Noblet, Simon & Parent, 2011), in order to propose a roadmap to enhance AC. This study therefore contributes to further understanding of AC enhancement. We propose a framework as a guideline to achieve gradual enhancement in important linkages between trust, knowledge sharing, transfer, absorption and AC enhancement.

2.2 Trust Trust is an established, yet diverse field of research (Bachmann & Zaheer, 2006; Kramer, 2006). Literature uses a number of terms that directly or indirectly refer to trust (e.g. cooperation, confidence, and predictability).

These and various other terms have only complicated the phenomenon of trust (Mayer, Davis & Schoorman, 1995). Furthermore, it is difficult to measure the value of trust in a relationship, as we generally realise its value only after losing it (Moore, 2002). Moreover, trust is “not a behaviour (e.g., cooperation) or a choice (e.g., taking a risk) but an underlying psychological condition that can cause- or result from such actions” (Sitkin, Rousseau, Burt et al, 1998). As indicated by Mayer, Davis and Schoorman (1995), the importance of trust has been dramatically increasing among the “workforce composition” and the “organization of the workplace”.

In their seminal paper Mayer, Davis and Schoorman (1995) defined trust as “the willingness of a party to be vulnerable to the actions of another party based on the expectation that the other will perform a particular action important to the trustor, irrespective of the ability to monitor or control that other party”. Similarly, Rosanas (2009) defined organizational trust as the “relationship between two people where one takes an action making him vulnerable to the other”. Being vulnerable is risk-taking, where “trust is not taking risk per se, but rather it is a willingness to take risk” (Mayer, Davis & Schoorman, 1995). Therefore, trust is a social capital resource which is generally embedded in relationships among people (Berger & Luckmann, 1967; Dovey, 2009; Misztal, 1996; Nahapiet & Ghoshal, 1998). Although the role of trust in group processes has been well researched, less is known about the impact of trust on AC (Noblet, Simon & Parent, 2011). This is the gap in literature that justifies the motivation behind this study. Therefore, we propose the linkage between trust and AC. 2.2.1 Antecedents of Trust Contemporary scholars have acknowledged the three antecedents of trust identified by Mayer, Davis and Schoorman (1995), namely ability (i.e. skills, competencies, traits and characteristics that are essential to influence a specific domain), benevolence (i.e. the degree or level to which the first person believes the second person wants to do good to the first person) and integrity (i.e. the valuation that the first person do to judge whether or not the second person will adhere to acceptable principles) (Evans & Wensley, 2009; Mayer, Davis & Schoorman, 1995; Parra, Nalda & Perles, 2011; Schoorman, Mayer & Davis, 2007). Furthermore, they have agreed that no further addition is justified to the list of antecedents because of synonymous terms used in the literature. Therefore, this research will adopt the original three antecedents of trust (Mayer, Davis & Schoorman, 1995) with their traits to evaluate organisations, identify trust issues and influence factors causing AC operationalisation.

2.2.2 Trust as an Antecedent Trust is qualified as a potential antecedent as well as a consequence to knowledge acquisition, knowledge creation, knowledge sharing, knowledge transfer, knowledge absorption, innovation, improved performance, collaboration (Dale, 2012; Huotari & Iivonen, 2004; Joanne & Inder Jit Singh, 2010; Kharabsheh, 2007; Lin, 2011; Mayer, Davis & Schoorman, 1995; Parra, Nalda & Perles, 2011; Politis, 2003a, 2003b; Spraggon & Bodolica, 2012) and AC specifically by Joanne and Inder Jit Singh (2010); Kharabsheh (2007); Noblet, Simon and Parent (2011). Furthermore, trust is declared as an antecedent to knowledge sharing that, along with other enablers, enable knowledge sharing and knowledge transfer to achieve competitive advantage (Joanne & Inder Jit Singh, 2010; Kharabsheh, 2007). As a consequence, trust influences AC and as a consequence of increased AC, trustworthiness nourishes further in organisations. Therefore, the level of trust will increase. Organizations

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Athar Mahmood Ahmed Qureshi and Nina Evans that promote trust-culture and are more trust-focused will have higher level of AC (Ratten, 2004). This is the first linkage in reference to the proposed framework. The paper, therefore, makes the following propositions: P1:- the higher the degree of trust in an organisation the higher the level of knowledge sharing P2:- the higher the degree of trust in an organisation the higher the level of absorptive capacity P3:- the higher the level of absorptive capacity of an organisation the higher the degree of trust in an organisation

2.3 Knowledge sharing Incorporating new knowledge into existing knowledge from external or internal sources is a usual practice in organisations. It is the capability of an organization to create new knowledge, disseminate it, and embody it in services and systems (Nonaka & Takeuchi, 1995). Furthermore, in organizations, this creation of knowledge depends on the understanding of the organisation, i.e. how it learns (Mishra & Bhaskar, 2011; Schon, 1975).

Moreover, merely gaining the knowledge through externalisation or internalisation is of no benefit, unless it is shared among individuals, groups, functions or systems of the organization (Von Krogh, 2000). That will enhance the level of AC. Knowledge sharing is the spinal cord of knowledge creation (reference). It leverages organizational knowledge (Mishra & Bhaskar, 2011), enables knowledge transfer among the employees (Joanne & Inder Jit Singh, 2010) and drives the organisation to optimum performance and competitive advantage (Joanne & Inder Jit Singh, 2010; Mishra & Bhaskar, 2011).

2.3.1 Antecedents of knowledge sharing Trust is identified as the first fundamental antecedent to knowledge sharing. In their research Joanne and Inder Jit Singh (2010) proposed a model of knowledge sharing for organisations. Trust is nominated as the primary antecedent that will enable knowledge sharing. Along with trust, they have identified psychological and social processes, culture, pre-existing relationships, external incentives and previous experiences as antecedents to knowledge sharing. Whereas the other antecedents are also the consequences of trust being at the first place, the level of trust is also influenced by them. Some have positive and some have negative influence on the level of trust. Furthermore, from the sequence of the antecedents and top-down structure of the model, it is very obvious that trust is on the top and is the highest preference, and is the foremost necessity (conditional prerequisite) to other antecedents. Altogether, these antecedents will therefore enable knowledge sharing.

The model of antecedents of knowledge sharing proposed by Kharabsheh (2007) draws from the strategic marketing literature, therefore we do not acknowledge it as a standard universal knowledge sharing model to guide KM world. His model establishes links between antecedents, enablers and knowledge sharing from the context of strategic marketing literature. Furthermore, the model considers trust as an enabler among other enablers and not as an antecedent. Even though we do not acknowledge this model (Kharabsheh, 2007) as an ideal organisational knowledge sharing model, we still agree with many principles proposed by the model. We acknowledge and adopt information technology (IT) infrastructure, positive interactions (i.e. social integration mechanisms) and rewarding system as important enablers for trust-building, knowledge sharing, knowledge transfer and knowledge absorption to enhance AC. This is the second linkage in reference to the proposed framework. The paper, therefore, makes the following propositions: P4:- the higher the degree of knowledge sharing within the organisation the higher the level of trust P5:- the higher the degree of knowledge sharing within the organisation the higher the level of absorptive capacity

2.4 Knowledge transfer Knowledge transfer is one of the distinct mechanisms in organizations that influences AC (Cohen & Levinthal, 1990a) in a unit-to-unit setting, or department-to-department setting, or between the external environment and the organization, or between an internal network and an external network (Frans, Henk & Michiel de, 1999). These mechanisms are usually bidirectional, enabling in-bound knowledge transfer (i.e. enriching organizations from external sources) or out-bound knowledge transfer (i.e. enriching external networks with self-knowledge) (Kharabsheh, 2007). Furthermore, knowledge transfer mechanisms are challenged when we evaluate the two types of knowledge to be transferred, i.e. explicit knowledge and tacit knowledge. Explicit

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Athar Mahmood Ahmed Qureshi and Nina Evans knowledge can be represented by various means, for example numbers and words. It can also be easily communicated through agreed principles and codified routines (Kharabsheh, 2007). Explicit knowledge can be easily recorded into books, manuals, blueprints, et cetera. The best practice to transfer this kind of knowledge is through the “impersonal communication of technological transfer method” (Kharabsheh, 2007; Rebentisch & Ferretti, 1995). In contrast, tacit knowledge, e.g. instincts, premonitions, individual’s experience, expertise actions, reactions, values or emotions (Nonaka & Takeuchi, 1995; Silke & Alan, 2000) is very hard to formalize and communicate. It is very personal and also very challenging “at least not via impersonal communication methods” (Kharabsheh, 2007). Tacit knowledge can be transferred through socialisation mechanisms (Nonaka, 1994) which means in a social network setting where source and the recipient work alongside (Kharabsheh, 2007). Therefore, success of knowledge transfer is pretentious and is affected by some critical factors, e.g. the AC of the source and the recipient, previous experiences and related knowledge (Volberda, Foss & Lyles, 2010).

2.4.1 Antecedents of Knowledge Transfer The twin terms, namely knowledge sharing and knowledge transfer are often used one after another in KM literature (e.g. Kharabsheh, 2007; Volberda, Foss & Lyles, 2010). However, few researchers (e.g. Joanne & Inder Jit Singh, 2010) attempted to distinguish them. In this research, we adopt trust and knowledge sharing as the two core and foremost antecedents that triggers knowledge transfer mechanisms (Joanne & Inder Jit Singh, 2010; Kharabsheh, 2007). Other antecedents to knowledge transfer are identified as motivation, characteristics of knowledge, strategic similarity, leadership and types of contexts (Minbaeva, 2007; Osterloh & Frey, 2000; Spraggon & Bodolica, 2012; Szulanski, 1996). Furthermore, scholars have identified supporting enablers that influence the knowledge transfer experience, namely organisational structure, culture, business strategy, leadership, social integration mechanisms, relationships, information technology (e.g. Brachos, Kostopoulos, Soderquist et al, 2007; Dayasindhu, 2002; Michael, 1999; Spraggon & Bodolica, 2012; Zheng, Yang & McLean, 2010), proximity (e.g. Davenport, 2005; Tallman, Jenkins, Henry et al, 2004), cognitive (Weick & Roberts, 1993), physical and ‘Ba’ (Nonaka, Toyama & Konno, 2000). This is the third linkage in reference to the proposed framework. The paper, therefore, makes the following propositions: P6:- the higher the degree of knowledge sharing within the organisation the higher the level of knowledge transfer P7:- the higher the degree of knowledge transfer within the organisation the higher the level of trust P8:- the higher the degree of knowledge transfer within the organisation the higher the level of absorptive capacity of the organisation

2.5 Knowledge absorption Knowledge absorption is one of the constructs of AC (Badding, 2011; Cohen & Levinthal, 1990a). “Knowledge absorption serves as the foundation for AC” (Badding, 2011). Furthermore, for effective learning, improved performance and increased innovativeness, organisations must start learning. Within the process of learning, prior knowledge plays a significant role and contribute to organisation’s new “venture capabilities” (Badding, 2011). Cohen and Levinthal (1990b) stated “prior related knowledge confers an ability to recognize the value of new information...and apply it to commercial ends” (p. 128). Moreover, Badding (2011) in his doctoral thesis identified knowledge absorption as a significant contributor to organisational learning and AC enhancement.

The common belief about the success is that it resides with the capabilities of organisations to integrate their learned or acquired knowledge and not merely within the knowledge itself (Badding, 2011; Grant, 1996).

Furthermore, if organisations do not integrate their learned or acquired knowledge to their work force and systems, it becomes useless to the organization (Badding, 2011). Moreover, Grant (1996) asserted that improved performance, innovation and competitive advantage resides within the ability of an organisation to effectively integrate and apply knowledge to commercial ends.

Henceforth, KM literature highlights the importance of knowledge absorption for organisations to enhance their AC. The literature equally necessitates the identification of a roadmap to achieve effective knowledge absorption. Furthermore, we need to identify antecedents of knowledge absorption in order to succeed absorption.

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Athar Mahmood Ahmed Qureshi and Nina Evans 2.5.1 Antecedents of Knowledge Absorption KM literature identifies the various antecedents of knowledge absorption. In this paper we propose that the primary set of antecedents is trust, knowledge sharing and knowledge transfer (Castelfranchi, 2004; Chen, 2004; Joanne & Inder Jit Singh, 2010; Spraggon & Bodolica, 2012). The secondary set of antecedents is the four dimensions of AC (Cohen & Levinthal, 1990b) to effectively integrate the knowledge, for improved performance, competitive advantage and success (Cohen & Levinthal, 1990b; Joanne & Inder Jit Singh, 2010).

Furthermore, we propose social integration mechanisms and IT infrastructure as strong enablers for knowledge absorption. This is the fourth linkage in reference to the proposed framework. The paper, therefore, makes the following propositions: P9:- the higher the degree of knowledge transfer within the organisation the higher the level of knowledge absorption P10:- the higher the degree of knowledge absorption within the organisation the higher the level of trust P11:- the higher the degree of knowledge absorption within the organisation the higher the level of absorptive capacity of the organisation

3. Conclusion In this paper, we have presented a comprehensive framework to enhance AC. The framework will be tested in the Australian Healthcare industry. Adopting the constructivist philosophical worldview, this research seeks to offer a holistic approach for studying how trust influences knowledge sharing, knowledge transfer and knowledge absorption as an antecedent, and as a fundamental ingredient in both intra- and inter-organisation contexts. Study will be conducted by adopting a qualitative research methodology for conducting the empirical investigation through exploratory case studies, using semi-structured interviews to collect data. The research will be interpretive in nature and will adopt descriptive purpose because the study will identify and investigate the issues and influence factors behind the concept building. Furthermore, this research will contribute significantly to the body of knowledge by extending the notion of knowledge management from that of the development and maintenance of systems (i.e. collecting, storing and disseminating the information and data) to one that recognises the importance of trust to knowledge sharing, knowledge transfer, and knowledge absorption activities, processes and strategies. A trust-based holistic model will be developed to assist organisations to fulfil organisational, people/social, and technological requirements as well as to achieve knowledge culture, improved performance, innovativeness, competitive advantage, success and henceforth, enhanced AC.

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Leveraging Entrepreneurial Knowledge Competencies and the Outcomes among Academic Librarians in Malaysia Haziah Sa’ari, Rusnah Johare, Dang Merduwati Hashim and Hafiza Adenan Faculty of Information Management, Universiti Teknologi MARA, Shah Alam, Malaysia azie.crystal@gmail.com rusnahj@salam.uitm.edu.my merdu61@yahoo.com hafizaadenan@ymail.com

Abstract: Entrepreneurial knowledge competencies can be defined as a person’s ability to recognize and exploit intellectual assets opportunities and transform them into innovations which will lead to innovation performance and competitive advantage. However, there has been little discussion on entrepreneurial knowledge competencies among academic librarians especially when the devastating effect of the global economic crisis on libraries has pressured them to use entrepreneurial approaches to generate income and explore innovative ways for sustainability. The main objective of this paper is to explore the entrepreneurial knowledge competencies among academic librarians and the outcomes measured by top management. This research capitalized on a qualitative technique which involved interpretative and descriptive analysis of words to gain in-depth understanding of a specific phenomenon. The study is significant to academic librarians and library management for improving competency and upgrading their innovation performance.

Keywords: entrepreneurial competencies, innovation performance, academic librarian, competitive advantage

1. Introduction The success of knowledge-based economy depends on the optimum recognition of the role of both knowledge and technology in economic expansion. Knowledge-based economy is interpreted as the role of knowledge that has taken on greater importance compared to other natural resources, physical capital and low skill labor (OECD, 1996). In addition, an exploration into exploiting various aspects of human knowledge for competitive advantage should be in line with the objectives of the knowledge-based economy itself. It is considered as an approach in which the generation and exploitation of knowledge has turned out to play a predominant role in the wealth creation process. Further, there seems to be an accelerating shift in global economics that has changed the recognition towards universities. Universities have experienced substantial changes in their mission and responsibilities, especially research universities (RU). The main objectives of RU are not limited to education and research aspects, but increasingly also cover technology transfer and commercialization activities (Vincent-Lancrin, 2006). Hence, they are influenced by contributors towards economic prosperity and are key institutions of innovation systems (Edquist, 2005). Fuller (2006) has articulated that the university is a basic institution for knowledge entrepreneurial activities. The constant creation of human capital (through education) and knowledge capital (through research) is invested in fostering business, governmental and societal causes. Malaysia, like many other countries, has shifted the economy base to that of knowledge economy where a much higher proportion of wealth creation and economic activity is underpinned by higher level skills and innovation. In order to enhance the Malaysian university’s reputation, the Ministry of Higher Education (MOHE) is constantly encouraging universities to play a vital role in national development, as well as regional and international development, based on clustering of knowledge activities (Khaled Nordin, 2011). Up to 2012, five public-funded higher institutions were granted RU status: namely, Universiti Malaya, Universiti Kebangsaan Malaysia, Universiti Sains Malaysia and Universiti Putra Malaysia and Universiti Teknologi Malaysia. Among the criteria of auditing, RU status was granted to universities based on support facilities and professional services which were offered by libraries and professional academic librarians. In other words, academic librarians directly contributed to universities’ achievements and recognition (Noh, 2012). Therefore, it is important to study and re-evaluate their competencies in line with the higher education environment (Parry, 2008).

2. Literature review Knowledge has always been of significance in economic activity. McDonald (2002) claims that knowledge is valuable to any organization where it enables the holder of the knowledge to gain an advantage in the market.

A competitive advantage can result from offering superior perceived value produced at an equal cost, equal perceived value at lower cost or both higher value and lower cost relative to competitors. This advantage

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Haziah Sa’ari, Rusnah Johare, Dang Merduwati Hashim and Hafiza Adenan might be the organization’s strength to capitalize on the opportunity, or hold off a threat by acting on this knowledge and changing its behaviors. In the context of the university environment, universities transform their knowledge into new products and processes of value through the process of knowledge creation where it plays the critical role to succeed (Nonaka & Takeuchi, 1995; Gold et al., 2001). Knowledge entrepreneurship starts with the ability to recognize the potential value of knowledge, such as research findings from universities, and ends in the implementation of innovation aimed at the realization of desired value.

Knowledge entrepreneurship is focuses on the realization of opportunities meant to improve the production (research) and throughput of knowledge rather than to maximize monetary profit. Therefore, knowledge entrepreneurship can be defined as the capability of recognizing the accurate or precise knowledge and other innovations which lead to upgrading an achievement in knowledge production. In the context of organizational learning, knowledge entrepreneurs utilize information from the environment and knowledge that the organization already possesses, for innovations in order to improve organizational performance or customer value (Senges, 2007 & McDonald, 2002). Skrzeszewski (2006) has reiterated that librarians are knowledge entrepreneurs. They have the ability to manipulate the knowledge asset. He argues that the focus is based on identifying and realizing an opportunity, rather than exploiting existing intellectual capital. Moreover, the knowledge-based economy and the growth of knowledge management has provided new opportunities for librarians to expand existing roles and utilize the skills they have honed to meet organizational objectives (Hayes, 2004). However, the changing economy is not fully adapted by librarians and their competencies are being questioned especially because the great economic recession has had a negative impact on libraries and librarians (Germano, 2011). Besides that, the abnormal increase in costs of resources has pressured librarians to reach an unattainable level (Panda & Mandal, 2006). When budgets are spiraling down, it becomes increasingly hard to maintain existing subscription lists as required by users (Bosch & Henderson, 2011). In order to overcome those issues, librarians are highly recommended to use an entrepreneurial approach and demonstrate entrepreneurial competencies to face challenges and for professional survival (Malhan, 2011; Davis, 2008; Feret & Marcinek, 1999). Additionally, as part of the university, their performance must be aligned with the larger objectives of the university as they have an impact on the university’s research achievement (Doan & Kennedy, 2009; Budd, 1995; 1996; 2006; Noh, 2012).

3. Conceptual framework The proposed conceptual framework for this study is based on entrepreneurial knowledge competencies among academic librarians adapted from previous studies on entrepreneurial competencies and entrepreneurship literature. The dependent variable indicates competitive advantage while the independent variables are measured by entrepreneurial knowledge competencies dimensions. The mediating variable is measured by innovative performance as illustrated in Figure 1. Entrepreneurial competencies can be defined as clusters of sets of related knowledge, attitudes and skills to produce outstanding performance, and maximize profit, while managing a business venture or an enterprise (Man et. al., 2002). By adapting the definition from previous literature, this paper offers the definition of entrepreneurial knowledge competencies as a person’s ability to recognize, respond and exploit the intellectual assets opportunity and transform them into innovations which will lead to innovation performance and competitive advantage. Previous study revealed that there is a positive relationship between entrepreneurial competencies (the antecedents focus on recognizing opportunity and strategic venture planning), innovation and competitive advantages (Covin & Miles, 1999).

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Figure 1: Proposed entrepreneurial knowledge competencies and the outcomes among academic librarians The constructs of the variables are as follows:

3.1 Recognizing opportunities by utilizing intellectual assets Kirzner (1973) introduces the definition of recognizing opportunities as “alertness to changed conditions or to overlooked possibilities”. Recognizing opportunity is viewed as a personal insight to discover new methods and ending up with the new solution after the previous related venture has been well analyzed to avoid any risk for failure (Ulhoi, 2005). In the profession of librarianship, the librarian must be able to recognize opportunities offered by intellectual assets as the most potential opportunity to implement new library ventures (Skrzeszewski, 2006). Intellectual assets refer to knowledge, information, intellectual property and experience which could be manipulated and utilized for revenue generation and gaining competitive edge for organizations (Steward, 1997). The outcome of recognizing opportunity can be at both the individual and organizational level. The employees in organizations who have this ability are regarded as part of the entrepreneurial strategy in exploring resources to generate revenue and potentially lead to the organization’s competitive advantage. In addition, this type of employee would enhance discovering opportunity and exploiting technology extensively in order to increase new ideas in the entrepreneurial venturing process (Krueger Jr, 1998; Hostager et. al., 1998; Shane, 2000; Manev et. al., 2005). Therefore in this study, recognizing opportunity can be described as the academic librarian’s capability in recognizing, selecting, utilizing and exploiting the intellectual assets as potential opportunities for improving services/products, or reducing the library expenses.

3.2 Formulating strategic venture planning Formulating strategic venture planning is concerned with the planning patterns of organizational adaptation to the market through which a business seeks to achieve its strategic goals (Matsuno & Mentzer, 2000). The emphasis is on deciding business strategy in order to attain superior performance (Slater, Olson & Hult, 2006).

Strategic venture planning is also addressed as strategic orientation in entrepreneurial literature. According to Zhou et. al. (2005) strategic orientation reflects the firm’s philosophy in conducting business through the formation of a set of values and beliefs that guide the firm’s attempt to achieve superior performance. In the library, the strategic venture planning, also called master plan, is revised after current issues, trends, or users’ needs have been analyzed (Skrzeszewski, 2006). In addition, strategic venture planning is highly required because of limited resources, expensive technologies as well as increased costs of library materials and resources (Rader, 1989). Hence, in this study, formulating strategic venture planning refers to the academic librarians’ capability to plan strategically for recognizing potential opportunities in order to venture new library business projects and to achieve its strategic goals.

3.3 Innovation performance According to Glynn (1996), the measurement of innovation performance is based on the individual level because it plays a direct role in organizational innovation performance. Innovation performance is defined as an initiative of the employees to create new process, products, market in the organization (Amo & Kolvereid,

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Haziah Sa’ari, Rusnah Johare, Dang Merduwati Hashim and Hafiza Adenan 2005). It is measured based on the supervisors’ rating of the innovative behavior of their employees (Zhou & Shalley, 2003). The measures used for measuring the innovation performance are based on quality, quantity, timeliness and cost effectiveness (Lynch & Cross, 1991). In the context of this study, the innovation performance of academic librarians is measured by the evaluation of the chief librarian as prescribed in their job description.

3.4 Competitive advantage Peteraf (1993) defines competitive advantage as “sustained above normal returns”, on the other hand Porter (1993) argues that “competitive advantage grows fundamentally out of value a firm is able to create for its buyers that exceeds the firm’s cost of creating it”. The competitive advantage of the firm, created from the capability of the strategic innovation, involves what changes the firm will make in its technology, products, and processes to create value internally along with what opportunities it will pursue and what threats it will avoid outside the firm (Mintzberg, 2008; Kimberly et. al., 2012). In this study, competitive advantage refers to an advantage or superiority gained by a library from the creation of new products, services or work processes which differ from or are not offered by other libraries.

The main objective of this paper is to explore the entrepreneurial knowledge competencies among academic librarians and the outcomes measured by top management. To achieve the above objectives, the following research questions were used as guidance in the study, (1) How do academic librarians demonstrate entrepreneurial knowledge competencies? (2) How are entrepreneurial knowledge competencies measured as an outcome by the top management of academic libraries?

4. Research methodology This study used the qualitative method as it focuses on understanding from the academic librarian’s point of view, experience and interpretation. The qualitative method, such as in-depth interviews and case studies, is an excellent approach to studying the behavioral perspectives of management competencies. The methodology may provide insights into competencies from a process perspective that traditional quantitative methods may not bring to light (Hindle & Yencken, 2004). Smith and Morse (2005) affirm that due to the broad concept of competencies, it is a challenge to measure something which is elusive and slippery as a concept manifests itself differently in different contexts, changes over time, and is not directly observable. In using the multiple cases study, the three main cases of research universities located in Klang Valley, Malaysia were selected. The summary of data collection is shown in Figure 2. Based on the case study methodology of the research adapted from Yin (1994), the initial step in the study involved the development of a conceptual framework. This step was then followed by the selection of the pilot case study and three main case studies and the design of the data collection protocol.

Figure 2: Summary of data collection Following the case selection and data collection steps, the individual case reports were developed. A crosscase analysis of the findings was then undertaken. Figure 3 shows the case study methodology of this study.

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Figure 3: Case study methodology adapted from Yin (1994).

5. Research design Research design started with a literature review, which discusses the literature from numerous sources in order to exhibit an in-depth knowledge of the research problem. A well-defined research problem is required before proceeding with the process of research design and the data collection (Yin, 1994). After an extensive review of the previous literature, research problems of this study were obtained. The development of the conceptual framework is derived from the literature review discussion and research objective. Next, questions for in-depth and focus group interviews were developed. The constructs in in-depth and focus group interviews are related to entrepreneurial competencies among academic librarians based on the previous literature. Next, the sample design was developed. Both samples for pilot interviews and main case study interviews consist of academic librarians from three RU in Selangor (one of the RU for the main study is the same as for the pilot but the researcher interviewed different sample/academic librarians). The sample of academic librarians for this study was selected by using purposive sampling. The samples of the main case study consist of forty-five academic librarians (nine groups with five academic librarians per group) and three chief librarians from selected RU. Next, five pilot interviews were conducted to improve the data collection processes before the main case studies were conducted (Yin, 1994). This phase represents the final preparation for data collection which is used more formatively to assist the researcher to develop relevant lines of questioning as well as providing some conceptual clarification for the research design as well.

Permission to conduct the research was obtained from the top management of academic libraries involved.

After obtaining approval, the requested lists of academic librarians were taken from the top library management. Then, the researcher sent a letter to each of the academic librarians selected to inform them about the research and the date that the interview would take place. Each letter clearly explained the objective of the research. In addition, the academic librarians were informed about the importance of the interview, the confidentiality of their responses and that the data would only be utilized for the purpose of the research. Once the interviews have been conducted, recorded and transcribed, the information was analyzed and interpreted in order to produce the findings. Figure 4 shows the studyâ&#x20AC;&#x2122;s research design process.

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Figure 4: The research design process

6. Findings The analysis of the study has produced the following findings: (a) Academic librarians’ perceived recognition of opportunities by utilizing intellectual assets The opportunity to develop or venture new library business projects is encouraged or influenced by using academic librarians’ experience, knowledge and library resources which are already available in the library environment (such as technology and library resources) or by utilizing their built in competencies (such as experience and knowledge). The informant mentions that the prior knowledge has been gained from formal education in higher education and the advantages credited for those having more than one professional qualification or in various knowledge disciplines, especially related to the parent institution’s market niche.

Besides, personal traits such as self-alertness make them able to recognize the opportunity earlier than other employees. (b) Academic librarians’ perceived formulation of strategic venture planning The academic librarians agreed that the competencies in developing strategic venture planning are vital to ensure that the recognized opportunities are successfully implemented. However, this planning is not only confined to the limited timeframe or duration of projects, but academic librarians also need to be able to think of expansion in the future. This includes forward planning on unexploited information or library resources and the unmet needs for services or resources as required by users. The academic librarians agreed that the library’s mission and objectives need to be revised to be aligned with the university but have to be guided by the core values of the library. (c) Academic librarians' perceived innovation performance From the in-depth interview with the chief librarians, in order to explore the outcome measurement, the respondents agreed that innovation performance influences the competitive advantage. The innovation performance among academic librarians is measured based on the development or implementation of new processes, new services or new solutions by utilizing their knowledge or experience. The availability of technology and their competence to exploit those technologies also relatively contributed to perform innovatively. The rewards and recognition is given by the top management to those who initiated the performance innovatively. (d) Academic librarians’ perceived competitive advantage

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Haziah Sa’ari, Rusnah Johare, Dang Merduwati Hashim and Hafiza Adenan Competitive advantage is created when the academic library can retain the library users by constantly offering them expected services/resources which cannot be provided by another library or its competitors. It is also includes the recognition, reputation and image of the library by other parties or departments in the university.

7. Conclusion The entrepreneurial knowledge competencies perceived by academic librarians are encouraging and they are agreed that the competencies should be embraced for sustainability. Overall, the findings are also significant indicating that librarians should adopt an entrepreneurial approach for money-making opportunities as well as become more innovative and creative about selling commodities and services. Moreover, the librarian or information professional must possess entrepreneurial competencies to maximize working competitiveness and strategic success.

Acknowledgement Special thanks to Stan Skrzeszewski for the seed of motivations and professional advice.

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2th International Conference on Innovation and Entrepreneurship University off Bangkok, Thailand 6-7 February 2014 For further information contact info@academic-conferences.org info@academic conferences.org or telephone +44-(0)-118-972-4148