|
|
|
|
|
|
|
|
|
|
  |
 |
  |
USAID Mission to Poland
Europe & Eurasia
>> E & E Home >> Poland >> Assistance Areas >> Private Sector >> Activity Reports >> Fabrykat 2000
Success Stories
Assistance Areas
SEED Reports
Contact Information
Last updated: Thursday, 25-Jun-2009 16:24:04 EDT
Appendix A
Appendix B
Fabrykat 2000
MANUFACTURING TECHNOLOGY TRANSFER PROJECT
(FABRYKAT 2000)
USAID/POLAND CONTRACT NO. 181-C-00-98-00319-00
FINAL REPORT
Table of Contents
From September 1998 - September 2000, USAID/Poland conducted its first technology transfer program called FABRYKAT 2000. Its purpose was to develop the capabilities of four Technology Transfer Centers (TTCs) located in the Polish cities of Warsaw, Lodz, Wroclaw, and Krakow. ME&A (Mendez England & Associates) was the prime contractor. The ME&A FABRYKAT 2000 team included the following subcontractors, each of whom played key roles in the implementation and successful achievement of project tasks: Association of University Research Related Programs, Ben Franklin Technology Center of Southeastern Pennsylvania, Booz Allen & Hamilton, Doradca Consultants Ltd, Innovation Associates, Inc, National Coalition for Advanced Manufacturing, National Technology Transfer Center, and Segal, Quince, Wicksteed Ltd.
A major impetus for the program was Polish accession to the European Union, which is slated for 2003. When FABRYKAT 2000 began in September 1998, only the Lodz and Wroclaw TTCs were staffed and operational. However, neither was engaged in manufacturing extension or technology commercialization activities and the Warsaw and Krakow TTCs had not been founded. Two years later, all of these centers are operational and have established themselves as important players in the economic growth of their regions. They have aligned themselves with research centers, provided training seminars on productivity, and offered technical assistance to companies.
FABRYKAT 2000 TTCs addressed the manufacturing extension needs of their SME clients through plant layout analysis, manufacturing process improvements, materials engineering, product improvement, new product development, development of new markets, attraction of joint venture partners, and other services. These were performed by U.S. and Polish industry specialists. Their technology commercialization activities supported the special needs of high tech firms by providing access to seed capital financing, management assistance, and networking opportunities.
ME&A and its partners in FABRYKAT 2000:
facilitated the establishment of new TTCs in Warsaw and Krakow
trained the Polish TTC management and staff in all aspects of technology transfer operations and program management
provided specialized assistance from U.S. and Polish solution experts to each center's SME clients, while mentoring TTC staff members
assisted the TTCs in promoting themselves as engines of local and regional economic growth and undertaken activities designed to enhance TTC resources
Establishment and improvement of the TTCs was facilitated by providing them with organizational, management, and programmatic options suited to the unique environments in which they operated. TTC staff training was accomplished by development and dissemination of a technology transfer best practices manual, which focused on model U.S. and European programs; visits to U.S. technology transfer centers by TTC staff and management; and substantial on-the-job training in Poland by Polish, U.S., and British experts.
Industry specialists from U.S.-based manufacturing extension centers and non-competing U.S. companies, as well as Polish experts, worked through the TTCs to provide manufacturing extension services to SMEs, which were screened and selected by the TTCs. This assistance was provided initially through on-site visits to the TTCs' clients on a sector basis with follow-up work being conducted via the internet, faxes, or telephone whenever possible. Many of the assisted firms are candidates for equipment and technical services from U.S. companies, and are investment and partnering opportunities for U.S. companies interested in establishing a foothold in the expanding EU market.
TTC promotion was conducted at the national, regional, and local levels through a variety of mechanisms. Among the most effective were TTC sponsored conferences that brought together regional and local government officials, who were sources of TTC funding, and real and potential SME clients, who would benefit from government support of the TTCs. The TTCs also participated in technology trade shows, which raised their profiles, benefited from media exposure, public relations activities, and one-on-one contact with legislators, government ministries, and managers of government supported programs.
Major accomplishments of FABRYKAT 2000 include:
Functioning TTCs. Four TTCs are successfully marketing technology transfer services to their SME client base and have on-going relationships with industrial associations, chambers and other relevant parties that represent potential clients. They have established working relationships with sources of business assistance for their clients that the TTCs are not currently providing as well as sources of financing for SME client firms.
Assured operational funding. Each TTC has at least two years of operational funding following the conclusion of FABRYKAT 2000. TTC staffing paid for by FABRYKAT 2000 is continuing with support from other sources. The TTCs have each implemented fee-for-service activities and generate at least 15-24% of their revenue from a full range of technology transfer services. Their efforts to educate public officials, to create a better understanding of the importance of technology in national/regional economic growth, have resulted in financial support from several Polish government sources and European Union programs. There are also good prospects that governmental and grant support will increase on a yearly basis along with fee-based revenue.
Strong record of SME technology transfer assistance. The TTCs contacted 126 SMEs in the last ten months of the program. U.S. consultants accompanied by TTC representatives met with management of 106 of those firms. After the meeting, they filed a consulting report that, among other things, recommended additional assistance tasks or dropping the firm from further consideration. Additional work was recommended for 63 firms with a total of 228 action recommendations. Each TTC developed relationships with U.S. and Polish solutions specialists who are available to provide technical assistance to their SME clients on matters relating to manufacturing extension and technology commercialization. A Web-based approach to providing technical assistance and other services is being implemented by a successor organization to the program, which will facilitate domestic and international business and consulting transactions.
Other accomplishments. FABRYKAT 2000 developed a six-unit technology management curriculum to attract students to the field. It is currently being taught in three Polish universities. The program also supported efforts by the Warsaw TTC and others to develop a major research park. Finally, significant efforts have been made for FABRYKAT 2000 TTCs to become the beneficiaries of offset programs related to military and commercial contracts with the Polish government, which have the potential for being a long-term source of TTC financing.
FABRYKAT 2000 has demonstrated that technology transfer fills a critical niche in Polish SME assistance programs. Each of the TTCs in the program showed there is a strong demand for manufacturing extension by established SMEs, which far exceeds the TTCs' ability to provide it. They also demonstrated there is a demand for technology commercialization . The Warsaw TTC has aligned itself with an established Berlin-based seed capital and enterprise management firm and has already completed one substantial investment in a TTC-assisted high tech firm for which the TTC has been well compensated. Other deals are in progress. The Krakow TTC has been instrumental in getting regional governmental support for a seed capital fund to finance technology commercialization in the region. This has the backing of the national government's regional administrator and a strong chance of becoming a reality.
The rapid success of FABRYKAT 2000 in Poland augers well for its application in less developed economies where resources to improve SME productivity and international competitiveness are scarce and the need for them to compete effectively is imperative. Technology transfer programs complement other economic development programs on the SME assistance spectrum. They are not substitutes for them. There is a growing realization among international donors that established SMEs in developing countries need specialized help.
On September 10, 1998, ME&A (Mendez England & Associates) was awarded a two-year contract from USAID/Poland, titled Manufacturing Technology Transfer Project (FABRYKAT 2000) to develop an intensive technical assistance effort to improve the competitiveness, free market focus, and profitability of Poland's small and medium-size enterprises (SMEs).
The overall project was designed to help Polish SMEs meet the competition they will face upon Polish accession to the European Union. The project supported the USAID strategic objective of ensuring that private sector development is stimulated at the firm level by building a sustainable technology transfer and manufacturing modernization network. At the core of this network are four Technology Transfer Centers (TTCs) in Lodz, Wroclaw, Warsaw and Krakow and the Polish Business and Innovation Centers Association (SOOIPP) headquartered in Poznan. SOOIPP has become the successor organization to FABRYKAT 2000.
The program had four components: assessment of U.S.-based institutions, network development, TTC development and enhancement, and SME intervention assistance through TTCs - which are discussed in the following sections of this report. Annual Plans were developed for each component. Progress on achieving individual tasks was reported in the Quarterly Reports. Additionally, a Monitoring and Reporting system was established and assessments were made every six months on achievement of goals and objectives. As those reports indicate, virtually all programmatic goals were achieved at the highest possible levels.
The ME&A FABRYKAT 2000 team included the following subcontractors, each of whom played key roles in the implementation and successful achievement of project tasks:
Association of University Research Related Programs (AURRP), an association representing 80 percent of U.S. and Canadian research parks and research parks in 35 other countries, as well as technology incubators and a variety of organizations involved in the development and operation of technology projects. AURRP was tasked to participated in the network development and TTC development.
Ben Franklin Technology Center of Southeastern Pennsylvania (BFTC), an industry-government organization that maintains the largest portfolio of seed stage companies in the nation and supports the development of technology-based enterprises and the diversification of the region's economy through technological transformation of the existing economic base. BFTC was tasked to participate in network development.
Booz Allen & Hamilton (BAH), a global management and technology consulting firm that provides strategy, systems, operations, and technology services to clients on six continents through two business sectors--the Worldwide Commercial Business and the World Wide Technology Business. BAH was tasked to participate in the SME intervention assistance through TTCs.
Doradca Consultants Ltd. (DCL), a Poland-based professional services firm providing corporate finance, strategic marketing services, legal advisory, quality management, privatization and restructuring, and management consulting to SMEs in Poland and Russia. DCL was tasked to participate in TTC development and enhancement and SME intervention assistance through TTCs.
Innovation Associates, Inc. (IA), a small-woman-owned business providing services in technology-based economic development and employment creation in the U.S. and abroad, which is known for its series of international best practice work on technology-based economic development. IA was tasked to participate in the assessment of U.S.-based institutions.
National Coalition for Advanced Manufacturing (NACFAM), an industry-led education, services, and research organization, which provides leadership in building national policies, programs and services in the fields of technology deployment to small and medium-sized firms, public-private technology R&D partnerships, and workforce skill standards development. NACFAM was tasked to participate in SME intervention assistance through TTCs.
National Technology Transfer Center (NTTC), a funded center focused on enhancing technology transfer and commercialization knowledge and skills to help take technologies from laboratory to market by supporting the commercialization efforts of federal agencies, universities, and industries with courses and information products. NTTC was tasked to participate in the assessment of U.S.-based institutions and network development and enhancement.
Segal, Quince, Wicksteed Ltd. (SQW), an economic development and management consulting firm with extensive experience in Poland and other Eastern European countries, which specializes in technology transfer related activities. SQW was tasked to participate in the assessment of U.S.-based institutions and TTC development and enhancement.
An expatriate Chief of Party and a Polish Technology Business Coordinator, along with support personnel, staffed the FABRYKAT 2000 office in Warsaw. The TTCs and SOOIPP were supported by eight Polish Technology Business Analysts who were resident at their respective organizations.
1. Assessment of U.S.-Based Institutions
A compendium of 15 best practices case studies titled, “U.S. and European Models of Technology Transfer and Manufacturing Extension Programs,” prepared by Innovation Associates and Segal Quince Wicksteed, Ltd., was widely disseminated both in print and via the FABRYKAT Web site, as well as through formal and informal information exchanges.
Staff at each TTC specifically mentioned this manual as a program highlight because it contributed significantly to their understanding of the numerous options they had to choose from in developing their TTC organizationally and programmatically. Appendix A provides a summary of the best practice case studies and key lessons learned. After each key lesson, we have indicated its impact on FABRYKAT 2000.
The “best practices” experiences of these institutions in many cases resulted in concrete ties and relationships between the Polish TTCs and their foreign counterparts. This was particularly fruitful in the context of two separate two-week field trips to various institutions throughout the U.S. as well as a “Sister TTC” internship program, under which Polish TTC staff spent two weeks in each of two counterpart institutions, enabling them to compare and contrast the two U.S. organizations and how they related to their own institutional experience and potential. Moreover, this endeavor provided an overview of the variety of issues that need to be addressed in the context of building an appropriate technology transfer and manufacturing extension infrastructure. On a more limited scale, similar contacts were established with a number of West European counterparts. As a result, FABRYKAT 2000 participants could distill some of the critical lessons learned from programs in the United States and Europe and include them in every aspect of FABRYKAT 2000 activities in Poland with what can be considered a substantial degree of success.
To enhance the future availability of academically trained personnel for existing and future TTCs, a one-year technology management curriculum was developed under the auspices of the National Technology Transfer Center of Wheeling, and implemented by Prof. Tom Wielicki of the University of California (Fresno); it is currently being taught at three institutions of higher learning – the Warsaw School of Economics, the Wroclaw University of Technology, and the Nowy Sacz School of Business -- to ensure the future availability of trained personnel in this vital sector. Appendix B contains a detailed curriculum and course description.
These activities not only highlighted the importance of technology in economic and social development, but also achieved a major paradigm shift among key Polish opinion leaders in which technology transfer is no longer being viewed solely as the flow of innovation from academia to industry, but rather is focused on market-oriented support to SMEs in meeting both technological and competitive challenges.
2. Network Development
This FABRYKAT 2000 component was aimed at facilitating the flow of information, ideas and contacts among key players in the private and public sector on a national, provincial and local level, and forging international links. It often involved a fundamental changing of mind-sets from an autocratic, competitive model to a cooperative, coalition-building one. This effort remains a work in progress.
Concrete results include:
bolstering of the national-level Polish Business and Innovation Centers Association (SOOIPP)
establishing close ties with international organizations
creation of regional consortia
local initiatives in locations as disparate as Nowy Targ, Trzebiechow, and Mikolajki.
Providing SOOIPP with the operational capability to maintain, nurture and further develop these links is the critical challenge to the sustainability of the nascent technology transfer infrastructure developed in Poland thus far.
Despite the termination of financing for further technology transfer work in Poland by USAID, there is an obvious need to continue such efforts, at a minimum to bring to a successful conclusion both the institution-building initiatives referred to above and the specific company-related projects initiated under FABRYKAT 2000. To this end, the SOOIPP, which has a 10-year history as a 120-member NGO promoting small business development, incubators, and innovation centers throughout Poland, and is currently seeking to transfer the successful Polish experience in economic transformation to Ukraine, Kazakhstan, and other areas of the former Soviet Union, has undertaken to continue the work of FABRYKAT 2000.
In the area of institution building, SOOIPP has identified the following tasks as immediate priorities:
Creation of a professionally-staffed Warsaw-based Coordination Office to act as a clearing house of information and contacts both within the in-country network of TTCs and particularly with U.S. and other foreign consultants, investors, and potential clients and suppliers; it also will act as the focal point for advocacy and educational efforts (see below).
Provide assistance to the Krakow Regional Development Agency in finalizing its plans to set up a regional seed capital fund, which is to serve as the first model of such a fund in Poland to finance high-tech start-ups and modernization of SMEs. Support similar efforts currently being initiated by the Lodz TTC.
Help the Military University of Technology finalize its strategic and operational plans for the Warsaw Technopolis Science & Technology Park and help identify funding and investment sources.
Finalize the implementation of the Lean Manufacturing Program at the Wroclaw TTC and its implementation in other TTCs where required.
In the broadly defined area of advocacy and education, the SOOIPP Coordinating Office must develop the professional capability to present appropriate lobbying position papers, respond to Requests for Proposals with or on behalf of TTCs, and pursue relevant educational and promotional opportunities. Initially it will focus on the following efforts started by FABRYKAT 2000:
On the provincial level it will continue to focus on the successful implementation of the Technology Transfer and Innovation Council launched by the Marshall of the Malopolska province legislature and on the Mazovian Accord on Innovation and Technology Transfer, inter alia to ensure that appropriate funding is provided for these initiatives.
On the national level, in addition to supporting central government funding (including the Committee for Scientific Research, Ministry of Economy, Ministry of Defense, Ministry of Labor, as well as EU-sources) for technology transfer and SME development efforts, it will continue to lobby for liberalized implementation regulations for the Decree on Offsets currently being developed by the Ministry of the Economy. Offset obligations of several billion dollars which will be incurred by foreign armaments, aerospace and telecommunications companies over the next few years under Poland’s NATO obligations constitute a major opportunity for the development of the country’s high-tech SMEs and the technology transfer infrastructure.
On the educational front, seek to obtain funding for and implement additional courses in the technology management curriculum initiated by FABRYKAT 2000.
Explore the potential to adapt the experiences gained in FABRYKAT 2000 to the needs of Ukraine and implement a similar program there. This initiative would meet a strategically important need, further hone the skills of SOOIPP and the TTC network’s staff, take advantage of proven international consultants, provide a further marketing opportunities for Polish SMEs, and hopefully contribute to the revenue base and sustainability of SOOIPP itself.
In the area of direct assistance to SMEs, the SOOIPP Coordination Office will host the server for a dedicated communication system, which makes possible secured direct communication between the TTCs, individual service providers and potential investors, clients, and suppliers, while also making possible the posting on the web company offers and requirements, as well as bids to provide consulting services. Under this objective, SOOIPP will focus on the following priorities:
Bring to fruition the more than two dozen cases which have received initial technical assistance from FABRYKAT 2000, been identified by U.S. consultants as high potential and high opportunity SMEs, but for whom delivery of assistance could not be completed in the time frame of the program. Conclusion of these efforts are particularly important, both to the TTCs and the SMEs involved; moreover such success stories will bolster efforts vis a vis local, regional and national authorities, potential funding NGOs and investors and strengthen the links between Polish and American companies.
Continue to help the TTC network in identifying, verifying and providing assistance to new clients, primarily by identifying appropriate U.S. sources of expertise and potential partnering.
International
On the international front, close ties were established not only with such FABRYKAT 2000 subcontractors as the National Coalition for Advanced Manufacturing, the Association of University-Related Research Parks or the National Technology Transfer Center and numerous local government, academic and business organizations in the U.S., but also with key technology transfer and related institutions in the UK, Germany, France, Finland, Greece, as well as Ukraine, which should become a major beneficiary of the Polish experience in the near future.
Regional Consortia
Two regional consortia were established. The Krakow Center for Technology Transfer is a member of the Regional Technology Transfer Council, which was formed under the aegis of the provincial parliament Marshall. An additional benefit is the prospective creation of a Malopolska venture capital fund with public and private equity. The Warsaw Center for Technology Transfer is part of the coalition of the Mazovian Accord on Innovation and Technology Transfer to promote the creation of the Warsaw Technopolis Science and Technology Park on the grounds of the Military University of Technology.
Local Initiatives
In addition to the four pilot TTCs, FABRYKAT 2000 has supported technology transfer initiatives in a dozen other locations throughout Poland ranging geographically from Lublin and Mielec to Szczecin and from Zabrze to Gdansk and Koszalin. Most importantly, it has provided extensive and intensive training in Poland, Western Europe, and the U.S. to more than a dozen TTC staff members, including one-month internships at U.S. sister institutions, and mentoring in providing assistance to individual client SMEs. This investment in knowledge and experience constitutes the program’s key legacy and provides a competent, professional nation-wide network of people and institutions for further technology transfer and SME development efforts.
3. TTC Development and Enhancement
FABRYKAT 2000 over two years aimed to make a noticeable impact on the development of the institutional structures for technology transfer in Poland at both national and regional levels. At the start of the process, there was little coherent effort at the national level and a fragile and incomplete effort at the regional level. Recognizing the long-term nature of institutional development led to an ambitious effort to upgrade the regional level infrastructure in four selected regions as well as efforts at the national level targeted at overall technology policy appreciation and specialist tools to accelerate technology transfer.
The initial regional strategy set out in the original proposal was to develop a generic Level 1 plan that would be applicable to all four regions and indicate how to provide the full range of technology transfer services. At a subsequent stage this would be converted into a specific plan for each of the four target regions that was tailored to the particular strengths and opportunities of the region. Each of these would in the final stage be converted into a business plan setting out the sources and applications of funds and the development strategies that each was to pursue. The business planning exercise proved useful in concentrating efforts on future strategies for new business development. This client and market focus of future efforts was perhaps the greatest single lesson learned by the TTCs during the whole exercise.
To provide a context for this report, the following is a brief characterization of the four regions in which the TTCs operate:
Krakow. This provincial capital has a long academic tradition with three strong higher education and research institutions (HEIs) that behave competitively rather than collaboratively. This spills over into a plethora of under-resourced initiatives sponsored by different camps and each projecting themselves as the region’s TTC. The main partner with which FABRYKAT 2000 had chosen to work was among the most effective technology to business networks in the region specializing in environmental or green technologies and having the legal form of a not-for-profit foundation. Among its sponsors are international programs, large and small firms, both local and international, and local agencies, but it has no formal links to any of the main HEIs or the provincial authorities.
Lodz. This city has a strong base of light industry, textiles, engineering and chemicals and an established and nationally accredited TTC that is set up as a department of a larger Foundation promoting SME development. It has proved successful in promoting the only research commercialization projects that have gained funding for product development from the national program sponsored by the Foundation for Polish Science. It has no formal links with any university or research center or with the local or regional administrations.
Warsaw. The TTC in the capital city is a recently formed unit based in the University of Warsaw, which is at an early stage of defining its distinct identity within a large and traditional university structure. It is supported largely by resources in-kind from one faculty and can neither act independently nor be clearly identified as a distinct organizational unit within the broad framework of the University. As such it is at the early credibility building stage within the University community.
Wroclaw. This TTC is also within a University structure, but has both a national accreditation and a clear identity built from several years of successful operation mainly as an industry focussed training provider. The municipal council has a technology development strategy that has also been adopted at the regional level so the broad policy environment is positive. There has also been considerable inward investment from international sources that provide a reasonably dynamic business climate in which the TTC can operate.
Plans for the four TTCs
ME&A's proposal envisaged this as being a three stage process:
Stage 1, development of a generic level 1 plan that would indicate the full potential range of services a TTC might provide and would show the range of skills and sponsor arrangements that might be necessary to develop such a fully functioning model
Stage 2, adaptation of this generic model to the particular practice in each of the four cities to indicate what range of services were currently being provided and what might be the central thrust of development from each TTC to improve both the quality and range of its service offer, particularly to SMEs
Stage 3, development of a strategic business plan for each of the TTCs that analyzed their current strengths and weaknesses and explored the opportunities they face as well as the threats.
Inevitably, this neat pattern of work did not match the reality that was found in the four TTCs selected for focussed assistance. The key aspects of the realities that complicated the work of the FABRYKAT 2000 team were:
institutional – in two of the TTCs they are essentially semi-autonomous agents within their parent organizations – the universities of Warsaw and Wroclaw - and do not envisage any further degree of autonomy being desirable for the foreseeable future.
organizational – two of the centers are located within independent NGOs but both are subsidiary elements to the main business of the host organization – these are respectively an SME incubator in Lodz and a Foundation promoting an environmental agenda in Krakow
content/competence - four distinct emphases found in the four centers, namely:
business training with a quality assurance emphasis and information services in Wroclaw
new technology product development from the research base in Lodz
business services and networking with an environmental theme in Krakow
collaborative research project which emphasizes the potential of the University based researchers in Warsaw
different levels of maturity – with one in its early stage of establishment (Warsaw), one looking to develop a new role as it faces tough competition in its initial training market (Wroclaw), one seeking a positive move in the regional policy environment that would give it funding to diversify (Krakow) and the fourth looking to create the conditions for more operational independence (Lodz).
Due to these differences, there seemed to be less merit in following the three-stage process set out in the proposal. Rather, there was merit in concentrating effort on the second and third steps. This would most quickly reach a point where directly relevant help could be provided to the four centers tailored to their particular strengths and focussed on the direction of development they proposed to adopt.
The level 2 plans were developed for each TTC to the extent that their current activities were noted in outline and the main emphasis of their development plans set out. It is here that some degree of commonality of the TTCs emerged in that all four were sufficiently encouraged by the US experience in manufacturing extension services that they all chose to give this aspect a high priority in their new services development efforts.
Concurrent with the efforts in the four target regions, the institutional development team contributed fully to the broader debate surrounding technology transfer policy and programs elsewhere in Poland. This effort was largely concerned with presentations at a range of workshops, seminars and conferences. Additionally efforts were made to encourage joint initiatives across the four pilot TTCs so that they could both share their practical experience and be supportive of each other through developing mutually reinforcing expertise.
The final institutional development input made by the team related to the promotion of a seed capital fund as a key missing element in the technology commercialization agenda. We contributed to seminars and workshops on the experience of seed and venture capital through Europe and then went on to develop with the Malopolska Regional Development Agency. The background to this initiative is described below.
TTC Specific Approaches
Because of the heterogeneity of the four TTCs, it was decided to press forward with specific development strategies for each center. In Lodz, Warsaw, and Wroclaw, this generally followed the same pattern with an assessment of their strengths and the opportunities for development they faced. Weaknesses and threats were also examined and help given as appropriate to each case.
While these activities are here described in isolation, they were also elements of the broader FABRYKAT 2000 project where complementary inputs were also being made by other team members. As previously discussed, these included study tours to the United States to build partnerships between TTCs and their US equivalents and specific training events on management aspects of TTC operations. Practical help was also provided by example with TTC staff working alongside Polish and American consultants in the delivery of technology services to SMEs in their region.
However, in Krakow, a radically different strategy was adopted because of the distinctive challenges of that region. There, considerably more effort was devoted to building an inclusive regional development strategy that could be owned and led by the newly emerging regional level of government. The opportunity was to generate the local and regional commitment to funding that is such an important element of the many successful State level programs in the USA and of regional level programs in Europe.
Alongside these programs within the four targeted regions there were efforts made both to broaden the impact at a regional level and to develop a national level commitment to TTC activities. The main elements of these efforts are reported in the next section of this report.
In addition to the strategic advice there were also delivered to each TTC specific material and guidance on topics raised during the consultancy visits. These ranged from contacts with European programs and potential partners to briefing material on particular techniques used in TTCs in western market economies. Also, for one TTC, a study tour was arranged to the UK, and the program for this is also described in the final part of this section of the report. An interesting outcome of this tour has been the preparation of a joint bid between Malopolska and the Eastern Region of the UK for a program of regional innovation and technology transfer which will provide a continuing impulse to the work of FABRYKAT 2000.
Malopolska Seed Capital Fund
An early comment at various regional fora for technology transfer was that new business opportunities were being missed because of the lack of venture funds, especially but not only at the early seed stage of funding. The widely respected regional development agency in Malopolska was being challenged to take a lead and set up such a seed fund for new technology based businesses.
A workshop was run looking at both international experience of seed and venture capital in Western market economies and the Polish experience of venture capital, which was at best very patchy. The workshop was attended by senior representatives of the provincial government and senior staff of the regional development agency (RDA) and at its conclusion the willingness of the RDA to examine the case for launching a seed fund in Malopolska was reaffirmed.
Working with staff of the RDA, a program of work was started that aimed to prepare a business plan for the launch of a seed fund. The first step was to undertake a survey of both demand side (i.e., firms and potential entrepreneurs) and supply side (i.e., sources of equity finance) in the region. Questionnaires were designed and the study framework agreed on. Staff of the RDA carried out the survey.
The first outcome of the survey was to confirm that there was a real need – i.e., that there were real examples of potential new technology businesses that had failed to be launched because of the lack of early stage finance. The second was a confirmation of the funding gap – i.e., there was no other source of seed funds operating in Malopolska and even at the later stage of venture capital there was only beginning to emerge some funding sources. Even these were not geared specifically to the special needs of technology based firms although being interested in those firms which had strong growth potential inevitably led to some interest in new technologies.
Based on this confirmation of need and absence of market response, which is entirely to be expected at the present stage of Poland’s move from planned to market economy, it was decided to go ahead and prepare a business plan. This work was also carried out in a close participative style with RDA executives working alongside the FABRYKAT consultants.
4. SME Intervention Assistance Through TTCs
While strengthening TTC managerial and technical capabilities was a critical program component, of equal importance were efforts to provide direct assistance to each TTC's SME client base. Significant program resources were devoted over the final year of the project to assisting the TTCs in this regard. Doradca Consultants Ltd of Gdynia and the National Alliance for Advanced Manufacturing of Washington, DC, (NACFAM) played significant roles in implementing this part of the project.
Doradca was tasked with identifying manufacturing industry sectors from which prospective SMEs would be selected for assistance by the TTCs. In consultation with the TTC, eight sectors were selected based on the fact that they were experiencing rapid expansion and were populated by significant numbers of SMEs. These were: chemical industry, environment services, information technology, food processing, industrial automation and control systems, medical sector, measuring and test equipment, and automotive industry.
Number of SMEs Assisted
ME&A established a project goal of contacting at least 100 SMEs (an average of 25 per TTC) from which to select SMEs for technical assistance. In fact, the TTCs contacted 126 companies and a questionnaire for each one was submitted to Doradca for analysis. Of these, ten were rejected for a variety of reasons ranging from company withdrawal to not meeting basic program criteria. The remaining 116 received a visit from Doradca and the TTC after which ten more companies were eliminated from further consideration, leaving a balance of 106 firms.
U.S. consultants accompanied by TTC representatives, met with management of the remaining 106 companies. After the meeting, they filed a consulting report that, among other things, recommended additional assistance tasks or dropping the firm from further consideration. Additional work was recommended for 63 firms with a total of 228 action recommendations, an average of 3.6 per firm.
"Success Stories"
Quantification of benefits to the TTCs' SME clients is difficult. In most cases, benefits from the assistance provided had not been fully realized due to the relatively short time between provision of technical assistance and termination of the program in September, 2000. Nevertheless, the following examples are indicative of the types of technical assistance provided by the ME&A team through the TTCs, and the benefits that accrued to both the assisted firms and the TTCs as a result:
ABM Solid was introduced to U.S. firms that could provide technology of interest to the company relating to surface preparations for powder coatings and utilization of waste. The firm is evaluating this technology and organizing financing to purchase it. A strong relationship developed between the Krakow TTC and ABM Solid because of this activity.
Acus-Caterina, a producer of women's apparel, benefited significantly from expert consultant advice it received on Internet applications to promote its products and electronic sales. The company's fashion collection was presented to US contacts and raised significant interest. Follow-up is proceeding. This was a Warsaw TTC assisted project.
AMG.net., an internet provider and web site designer, was the beneficiary of a comprehensive market analysis for its e-commerce services, which was viewed by company officials as a significant contribution to their understanding of market potential. The firm is regarded by the Lodz TTCs as its best client. During the FABRYKAT 2000 project, the firm increased its value ten times and was able to graduate from the Lodz incubator and acquire its own facilities.
Ascor developed two projects in cooperation with the Warsaw TTC and supported by FABRYKAT 2000 experts. One was aimed at starting production and sales of a plastic aseptic vial. The second involved starting production and sales of a medical device for screening early stage melanoma cancer. FABRYKAT 2000 help for the first project involved preparation of a marketing study of the vial as well as finding the right technology and equipment in the U.S. The outcome of the study was negative, i.e. the Polish and CEEC market is too small for the assumed production. However, the technology was identified and a U.S. company was found that offered help in design and implementation of the equipment. This information saved Ascor from investing in a product that lacked a large enough market. The future of the project depends upon Ascor's ability to find additional applications for the vial.
For the second project, Ascor purchased the license to produce the melanoma detection device, but lacked required R&D capabilities for its further development. The Warsaw TTC was able to obtain a $75,000 R&D grant from the Foundation for Polish Science and to develop a prototype of the device. The Warsaw TTC also introduced Ascor to bmp, a German seed capital fund based in Berlin, which is considering a $4M investment in the device. This activity has formed the basis for a strong relationship between Ascor and the Warsaw TTC, which have signed a collaboration contract.
Eko-Karpaty benefited from a marketing study provided through the Warsaw TTC for an active carbon fiber developed at two Polish research institutes. The institutes and the company are presently evaluating the study, which is very promising. Commercialization of the product is expected.
Epocca was the beneficiary of a franchising study that will serve as a model on this subject for all TTCs. After initial discussions with FABRYKAT 2000 experts it started its own web site and is planning expansion into the US market. The collection of its products was presented to US contacts and raised a significant interest.
Expol, a producer of fruit concentrates, juices, and wine required a technology for apple pectin production. FABRYKAT 2000 financed an assessment of available technology, which was performed by a Fluor Daniel subsidiary. The goal was to find the appropriate technology and a vendor willing to sell it to Expo both of which were achieved. Expol is in negotiations with the firm. The financial scope of the project is $10M. As a consequence of this activity, the Krakow TTC has developed a strong relationship with Expol and stands to earn substantial fees from the project.
Internet Data System obtained first round seed capital financing from bmp of $600,000, which was arranged by the Warsaw TTC. The TTC earned a finder's fee on this transaction. This led to finding a major investor in the firm allowing it to grow from 30 employees in 1999 to 100 a year later.
MinBud, a chemical producer, found a technology to optimize the firm's production process through a FABRYKAT 2000 consultant that has resulted in a 30% saving in electrical energy in producing its products.
MSS, an environmental cleanup technology firm, benefited from a FABRYKAT 2000 marketing study for chromium recovery from waste. Three major markets were analyzed - India, China and Taiwan. The results showed a great potential for the MSS technology to be exported to those markets. Additionally a number of other projects were defined in the field of heavy metals recovery and utilization.
Secura BC, a chemical and environmental protection firm, benefited from a FABRYKAT 2000 marketing study for a new line of products and training in business planning. Consequently, management significantly changed its product commercialization strategy, which is expected to be more advantageous.
Tarnokop, a producer of shoe soles and heels, received FABRYKAT 2000 assistance in reducing polyurethane production waste in its manufacturing process. The program also provided expert advice in improving its CAD/Cam system.
Technical Assistance Process
Had the TTCs been staffed with experienced industrial engineers with significant business backgrounds, they would have contacted SMEs in their region, explained the manufacturing extension process, worked with the TTC in identifying problems this process could solve, located an industry expert to address the problems, and followed-up to determine client satisfaction with services rendered.
Since the TTCs were not staffed with experienced personnel, a process was adopted that was designed to maximize TTC involvement, but was dependent on outside technical assistance much of it from the U.S. While TTC staff benefited significantly, the tradeoff was lengthy delays of from four to six months from initial contact with the SME by TTC staff to the first visit by industry specialists.
The process typically followed these steps:
TTC staff sent out a questionnaire to prospective clients and followed-up with a visit or phone call to determine management's level of interest.
Once completed, the questionnaire was sent to Doradca for evaluation to determine if the firm met basic criteria for receiving assistance.
If it met the criteria, the firm was visited by representative from Doradca and the TTC. Doradca then prepared a report that described the firm, technology problems, and other important issues, which was reviewed by the TTC.
This report was then sent to ME&A's Warsaw office for translation into English, so it could be understood by U.S. experts.
Once translated, the profile was sent to NACFAM in Washington, DC along with profiles from other companies in the same industrial sector. NACFAM then began the process of locating appropriate industry specialists and making travel plans for them.
To economize on travel costs, a two or three-person team of industry specialists was organized and traveled to Poland for discussions with various firms from that industrial sector, accompanied by TTC staff. After experts completed their client interviews, they consulted with FABRYKAT 2000 Warsaw office and TTC counterparts and began the process of developing follow-up recommendations. The follow-up reports were typically completed back in the US and forwarded by email to the FABRYKAT2000 Warsaw office.
TTC representative would present the report to their SME client. If follow-up tasks were recommended and SME client agreed to them, consultant would be notified and arrangements made to address those tasks.
This system educated the TTC staffs in the actual elements of a manufacturing extension program. It was necessarily complex due to staff inexperience and the international nature of the program, which also required complex travel arrangements and translation of technical documents.
Post-FABRYKAT 2000 Assistance Process
To simplify, accelerate, and expand TTC-to-SME manufacturing extension services and technology transfer, the FABRYKAT 2000 project team and NACFAM consultants have collaborated on the development of a web-based service entitled TTCnet, which is being deployed by SOOIPP, the successor organization to FABRYKAT 2000.
TTCnet is designed to work as follows: Companies contact the TTCnet through a web browser and post their business problems into the TTCnet database. The posted problem is routed to a "solution architect," who is the client point of contact for services delivered over TTCnet. Once the solution architect accepts the problem, a customized collaboration environment is established - a "virtual workspace" - using eRoom software, which is a web-based collaboration tool. TTCnet can provide cost-effective technology transfer services to clients in Poland by serving as the access gateway service to all types of consulting needs for companies. It can be viewed at the following Web site: http://www2.pct.edu/courses/abierly/ttcnet/.
While TTCnet can save significant time and money in paring TTC clients with expert consultant assistance, its value will be demonstrated by the extent it is used. TTCs will need to convince their clients that the expert consultant who is in another country can be trusted with confidential company information and the consultants must be convinced he or she will receive payment for services rendered. This confidence is typically developed by face-to-face contact, which still may be necessary. However, once confidence in each other is established, TTCnet could become the vehicle for further contact between the parties.
Before FABRYKAT 2000 ended, ME&A's Project Manager interviewed staff from each TTC to determine their view on how they felt the program could be improved and what aspects of the program they liked best. Suggested improvements include:
Requiring each TTC to contact at least 25 firms was too much for the TTCs' staff abilities at the time the contacts were made. While only one TTC did not contact that many firms, all felt that working with only five-ten companies would have achieved the program objective of demonstrating how TTCs interact with their SME clients.
Working with so many companies in such a relatively short period created assistance expectations with most SMEs that the TTCs could not actually fulfill.
While 106 of the 126 firms contacted were visited by industry specialists, in most cases there was a lengthy delay between the time a company was contacted and help arrived. TTC staff felt that the technical assistance implementation system required streamlining to ameliorate this problem.
The SME assistance aspect of the program should have started earlier to allow more time to work with each SME. All those interviewed felt that a small SME assistance demonstration program five-six months after FABRYKAT 2000 started would have been helpful.
An increase of at least two technical staff members at the program office in Warsaw would have helped alleviate the technical assistance process bottleneck created by their absence.
Study tours for TTC staff would have been improved if participants had been able to receive certification for the things they learned about technology transfer and manufacturing extension programs.
The "Sister TTC" study tour should have been held early in the first year instead of early in the second year of the program. All participants desired more SME specific training during that tour.
fforts to promote the TTC's as engines for local and regional economic development at the national level did not seem to bear much fruit.
FABRYKAT 2000 local staff could have done more to promote TTCs in their own regions.
Overall the program was too short. It should have been at least 36 months instead of 24.
Highlights of the FABRYKAT 2000 program noted by TTC staff include:
Back to TopThe project manual titled: “U.S. and European Models of Technology Transfer and Manufacturing Extension Programs,” which was prepared by Innovation Associates and Segal Quince Wicksteed, Ltd. TTC staff members felt this reference document was particularly useful in familiarizing them with the many activities that TTCs undertake and the variety of organizational models from which to choose.
The three study tours were cited for their educational hands-on training value. TTC staff said they benefited significantly from visiting U.S. TTCs and seeing first hand how they performed
Greatly increased TTC visibility and credibility with:
sources of funding such as the EU and regional and local government in Poland, as well as organizations like the Foundation for Polish Science, which resulted in grants to the TTCs ensuring their continued funding
SMEs in their region, which expanded their client base
sources of private financing for SME expansion and institutional support for commercialization of applied technology, which enhanced and strengthened their credibility with clients and potential clients
Polish and international industry specialists and business consultants who have become the primary source of specialized technical assistance, joint ventures and investment partners the TTCs have to offer their clients
Know-how about marketing their services to SMEs, establishing a relationship with management, and brokering provision of technical assistance, which allowed the TTCs to take a proactive role in serving the SME community as opposed to waiting for the SMEs to find the TTC and ask for assistance
For further information, please see the following two appendices:
Appendix A - Best Practices Case Studies and Key Lessons Learned
Appendix B - Technology Management Curriculum Development
 |
|||
Last Updated on: June 25, 2009 |
