Benefits and Challenges of University - Industry Interactions: A Critical Perspective

Jeremy Howells, Ronnie Ramlogan and Shu-Li Cheng Manchester Institute of Innovation Research, University of Manchester

Outline
Introduction Challenges Benefits and Impacts Regional Impacts Conclusions and Policy Implications

Introduction: Objectives

Main objective is to develop a better understanding of the impacts of HEIs on the innovativeness and competitiveness of regional economies. To identify the various avenues through which universities interact with local firms, businesses and other intermediaries in relation to research and innovative activity. Analyse how this, in turn, influences firm performance and the overall competitiveness of local and regional economies.

Introduction: Project Outline

3 UK regions: North West, Wales and East of England 2 main elements: 1) Firm level survey: 6,000+ firms - random sample by region - stratified by economic activity and size - response rate just under 10% 2) University survey: 15+ HEIs across 3 regions (3X5)

Challenges
Number of major challenges in universityindustry interactions: Simple lack of information about what is on offer from universities Quality of information re. innovation provided by universities once contact made

Challenges

Source: UK CIS

Challenges

Generally low level of engagement with universities as partners (CIS4 data).. . although in this study the use of universities and HEIs not as low as expected.

Challenges
Distribution of Types of Collaborations (%)

Customers

Suppliers

Partner companies

Universities/HEIs

Public R&D

Competitors

Other 0% 5% 10% 15% 20% 25% 30% 35%

Challenges
Key problems remain in terms of basic mismatches in terms of relevance, time horizons and expectations this is especially true for SMEs where resources and time are limited and where demand frequently centres on highly applied, short term technical issues which universities often find difficult to address and lack interest for the academic concerned

Challenges
Reasons for Not Collaborating by Region (%)
Their activities are not relevant for our business

We do not know what Univs/HEIs have to offer

Collaboration is costly and time consuming

Wales

There is a mismatch of objectives and expectations

EoE NW

Univs operate in the long term - need short term solutions

We speak different languages

Other
0 10 20 30 40 50 60 70 80

Benefits and Impacts

In general open innovation framework via R&D and technical outsourcing activity has important effects on innovation. . thus significant and positive results between R&D and technical outsourcing and innovation in terms of products/services, processes and even organizational innovation

Benefits and Impacts

Association between Innovation and R&D and Technical Outsourcing (%)
R&D and Technical Outsourcing No Yes Prod/Services No Yes Processes No Yes Org. Methods No 89.17 Yes 75.42 All associations are significant 10.83 24.58 90.55 70.19 9.45 29.81 93.33 69.92 6.67 30.08

Benefits and Impacts

Universities moreover have an important impact, especially in new product/services and process innovation.

Benefits and Impacts

Impact of Collaboration on Innovation (Logistic Regression Analysis) *
Products/ Organ. Services Processes Methods 8.6 4.2 4.6 6.0 5.1 2.8 3.6 3.2 4.6 4.4 3.1 3.3 3.9 4.2 3.2 2.9 3.5

Public R&D institutions Universities/HEIs Suppliers Customers Partner companies Competitors

*: results presented as odds ratios

Note: all results shown are significant at 5% Note: missing cell = insignificant odds ratio

Benefits and Impacts

Although little or no difference between formal and informal links.

A Model of University Industry Collaboration

Logistic regression Number of obs Wald chi2(12) Prob > chi2 -565.96549 Pseudo R2 = = = = 993 73.45 0.000 0.1131

Log pseudolikelihood

Inno Process Org. method EoE Wales Uni collab

Formal Informal

Odds Ratio 0.90 0.90 1.02 1.19 4.30

4.33 4.36

Robust S.E. 0.164 0.164 0.281 0.368 1.105

1.420 1.390

z -0.60 -0.60 0.06 0.56 5.66

4.47 4.61

P>z [95% Conf. 0.549 0.626 0.549 0.626 0.954 0.591 0.578 0.647 0.000 2.594
0.000 0.000 2.279 2.331

Interval] 1.283 1.283 1.748 2.181 7.112

8.239 8.143

Size (ln emp) Age (young<=5) Sector - S ProcXEoE ProcXWales OrgXEoE OrgXWales

1.37 1.17 0.72 0.46 0.66 0.69 0.92

0.104 0.295 0.165 0.132 0.190 0.191 0.243

4.17 0.62 -1.43 -2.70 -1.43 -1.33 -0.30

0.000 0.535 0.153 0.007 0.152 0.185 0.764

1.182 0.713 0.461 0.263 0.378 0.405 0.552

1.590 1.917 1.129 0.810 1.163 1.190 1.548

Regional Impacts

In terms of benefits and impacts it is important to recognise significant regional variations in terms of actor collaboration significance on various forms of innovation East of England (EoE) effects greatest across all actor types North West (NW) more limited and Wales also sparse (only via other firms i.e. suppliers and customers)

Impact of Collaboration on Innovation (Logistic Regression Analysis)

Products/Services NW EoE Wales NW Processes EoE Wales Organisational Methods NW EoE Wales

Public R&D institutions Universities/HEIs Suppliers Customers Partner companies Competitors

Note: ***: p <0.001; **:p <0.01; *:p <0.05 Note: ~: model cannot be estimated

~ ** ** *

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

* ** **

~ * * * ** ~

** *** ** ** **

* *** ** *** ** ** ~

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

*** *

Regional Impacts

How does the impact of firm collaboration with universities and other partners pan out by region? Although Wales has lowest contacts, Welsh firms seem to value these contacts and perceived impacts most highly - in terms of perceived profitability, productivity and improvements to business systems (Stray Dog Syndrome) North West in the middle and EoE lowest some indication of marginal return effects?

Regional Impacts
Distribution of Impacts for Firms with University Collaboration
Developm ent of new techniques /m ethods /s kills Im proved profitability Im proved m arket s hare Other (pleas e s pecify) Introduction to new networks Mas tering new technology Product divers ification Im proved productivity Pos itive Environm ental Im pact Im proved bus ines s /production s ys tem s
0% 10% 20% 30% 40% 50% 60% 70%

Wales EoE NW

Conclusions

Complex interaction between use (and not using), impact and value in relation to universities and other providers Openness and collaboration associated with major impact on likelihood to innovate (evident in firm growth and performance). . in particular university collaboration does have a big impact on innovative performance

Conclusions

However regional variations are important Indication of displacement activity with Welsh firms having to make use of consultants more. but when Welsh firms do use universities they value them more even if their actual impact (for whatever) is much more marginal Clearly policy intervention in relation to innovation and higher education policy is supported but not one size fits all Different regions need to work on different dimensions

Thank You
jeremy.howells@mbs.ac.uk