Universities Relationships With SME’s

Michael D. Moberly    March 24, 2014    ‘A long form blog where attention span really matters’.

Two points for context…

First, to the readers of this blog I suspect there is no need to elaborate on the reality that growing percentages of the content of today’s products and/or services consist of attractive technological inputs and features that provide consumer conveniences and elevate market space competitiveness.  And agreed, most, if not all of such inputs – features are rooted in intangible assets, particularly intellectual and structural capital.

Second, it’s certainly no secret that there are few (company) business models that specifically reflect or encompass a desire to assume the costs and risks associated with incurring the levels of vertical – horizontal integration necessary to single-handedly achieve exclusive mastery and ownership of each technology and skill set required to develop, manufacture, market, and sell products and/or services to be housed under a single (corporate) roof.

This readers, sets the context for this post!

SME’s and SMM’s can be sources of complimentary intellectual and structural capital…

Rooted in my 20+ years in academia and many years of subsequent consultancy practice directed almost exclusively to serving small and midsize companies, ala SME’s and SMM’s, I believe, anecdotally of course, that corporations, universities, and their respective R&D and technology transfer offices, and (faculty) researchers themselves, are inclined to be receptive to pursuing (research) relationships, partnerships, and/or alliances within their respective tier, i.e., universities designated as a Carnegie I or II research institutions or conversely, with Fortune 1000 companies.  For various reasons, SME’s and SMM’s, aside from technology exclusive companies, are seldom or certainly infrequently recognized as originators and/or contributors of useable (cutting edge) intellectual or structural capital sufficient to compliment or convert university’s basic research into the highly sought after path towards commercialization.

So, for readers who may still be thinking this is merely another piece about ‘startups’ and/or university-based spinoff’s, I have failed to bring clarity to my point.  My position is this; many, if not most SME’s and SMM’s develop, own, and harbor a substantial amount of intellectual and structural capital which is not nearly as routinely or aggressively sought or tapped into as is warranted or at the level many of their Fortune 1000 ‘first cousin’ competitors experience.

Not so flatteringly, my years of experience in academia, there are varying levels of assumed self-importance and even superiority some universities express through their culture, key administrators, faculty, and technology transfer units which variously inhibits some from engaging the unacknowledged and untapped intangibles embedded in SME’s and SMM’s as collaborative supplements to emerging (university-based) research.

Yes, I am a strong advocate for university research leadership to moderate their culture and adjust and broaden their strategic research practices to encourage and allow monitoring the SME and SMM environment.  One important product of which is identifying particularly effective SME’s and SMM’s whose success originates solely from their intangibles, i.e., intellectual and structural capital particularly, much of which in my experience, can be aligned with specific research interests and/or initiatives of a university.

Two way vs. one way transfer of intangibles…

What I am referring to is certainly not a mere one-way ticket of knowledge transfer from SME’s and SMM’s to academia, rather as open ended round-trip tickets for…

  • knowledge (intellectual, structural capital) collaboration and transfer
  • intended to forge      strategic relationships to respectfully exploit and advance relevant intangibles and competitive advantages, and
  • capture knowledge spillovers that otherwise would likely be lost.

University’s  as stand alone ‘ivory towers’…

The time-honored vision of university’s being stand alone ‘ivory towers’ removed from worldly concerns and external influences is now much more myth than reality, at least in my view.  That’s largely the result of  legislation and other initiatives introduced during the late 1980’s and early 1990’s during which a significant shift in the academic research community began whereby researchers and scientists were now being encouraged to work more closely (collaborate) with private sector interests.  One reason of course was to speed the transfer – commercialization of ideas from academia to the marketplace..  (The above was inspired by my extensive conversations with the Congressional Research Office researcher and author of ‘Is Science For Sale?: Transferring Technology From Universities To Foreign Corporations. Report by the Committee on Government Operations.October 16, 1992. House Report 102-1052)

One consequence of this heightened motivation and receptivity to negotiate external collaborations was that a growing number of colleges and universities, through their respective licensing and technology transfer units, realized and were provided with legitimate pathways and motivations to become more entrepreneurially oriented, and thus externally competitive.

In other words, university research administrators and faculty researchers were, with some rapidity, becoming more receptive to considering new and/or distinctive opportunities and platforms for collaboration with private sector entities.  These were also recognized as additional means to seek and secure financial support for continuing (on-going) research and their related activities. There is little doubt such receptivity was prompted and/or at least influenced by a second realization, which is the potential commercial value and revenue generation (royalty) potential which could evolve from the commercialization of internally or collaboratively generated inventions or ‘breakthroughs’.

Broadly speaking, university inclinations to be more open and receptive to exploring – pursuing external (contractual) alliances or consortiums with private sector entities are now commonplace.  In fact, for numerous institutions, a primary responsibility of the university technology transfer director’s is to do just that.   Too, a rather obvious benefit to both parties is that such collaborative arrangements are acknowledged as a relatively quick, accepted, and legitimate (two-way) pipeline to access specific bases of knowledge and expertise, i.e., intellectual and structural capital to complement a company’s existing competencies related to the development of future products and services.

It would behoove university research administrators and technology transfer directors to keep a keen eye on (monitor) particular SME’s and SMM’s which are producing value laden intangible assets which in many instances, paths for application and commercialization have already been demonstrated.  But, with collaboration and the infusion of additional research products, even greater mutually beneficial commercialization opportunities can emerge.

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