Design, policy mix & implementationof the RIS3 in the Czech Republic

Riga, 25-26 February 2014Jiri Blazek, Veronika Czesana, Gabriela Daniels

Main success achieved - overview:

• Governance:

– formation of a National RIS3 Coordination Board

– establishment of regional RIS3 managing structures initiated

• Process:

– hiring a highly competent facilitation team

– creation of a network of 14 regional RIS3 managers

– raising awareness about RIS3 among key actors

– elaboration of the first draft of RIS3 by December 2013

– organisation of the first meetings of innovation platforms at the national level and in

most of the regions

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Main bottlenecks in RIS3 design & implementation and related Qs

• Insufficient guidelines for entrepreneurial discovery process:

Q: Domains of future specialisation should be selected by entrepreneurial/innovation

platforms, but who and how selects the platforms?

Q: How many platforms are needed to achieve the envisaged change of sectoral

structure? What should be the size of platforms? How should they be managed?

• Scepticism about a possibility to select future domains of specialisation (many

uncertainties, and also limited willingness to discuss opportunities among the

potential competitors)

•Conflict between i) requirement for a respect to the critical size and ii) search for a

perspective or emerging domains of specialisation (political choice and responsibility)

• Stress of RIS3 on selectivity versus a need to involve partners intensively

(partners/entrepreneurs should even steer the process)

Main bottlenecks in RIS3 development & implementation and related questions

• Difficulties with objective selection of priorities (domains of specialisation).

• Unclear definition of „priorities“ and their width (should it be „Nanotechnology

in paper mill industry“, or „ICT“ or even „productive technology“?)

• Difficulties with setting measurable goals in vertical priorities

Q: How to quantify the expected outputs and results in vertical priorities?

• Missing practical guidance how to achieve upgrading in GPNs/GVCs.

• Rigid and cumebrsome programming process of the EU ESIF versus stress

on continuous learning process and flexibility of RIS3.

• Difficulties with stimulation of private R&D&I investment

Q: How to attract private investments to RIS3 implementation?

RIS3 design & implementation: responsible entities

• RIS3 ex-ante conditionality being fulfilled at the national level

• Regional dimension of RIS3 strategy ensured by 14 regional annexes

elaborated at the level of each NUTS3 region

– annexes will include more specified national priorities in relation to the

specifics of the R&D and innovation potential of the region.

• Guarantee of the fulfillment of RIS3 ex-ante conditionality in CR: Ministry of

Education, Youth and Sports (hereinafter “MEYS”).

• Coordination & strategic authority for preparation and implementation of

RIS3: National RIS3 Coordination Board

• Advisory support in design & implementation kick-off phase: „RIS3 facilitator“

(external highly qualified consultancy)

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RIS3 aproach (design)

• Given the still relatively limited level of development of the innovation

system in CR at both national and regional level, CR introduces the following

aproach to the RIS3 prioritization:

– Horizontal (cross-cutting) = new types of activities supporting the enhancement of

the innovation system, e.g.:

• introduction of pro-innovation support schemes to strengthen cooperation

between research organizations and corporate sector (innovation vouchers,

mobility support schemes between the triple-helix spheres, technology transfer)

• support of education in technical fields (support of talents),

• spin-off, start-up, incubation support, etc.

– Vertical = focus on specific competitive, progressive sectoral/subsectoral R&D

areas – „domains “ with strong growth potential

Regional RIS3 managers

• Regional S3 activities are coordinated by 14 (RI)S3 managers (local

experts hired in each region by MEYS); functions:

• Elaboration of regional annexes (in cooperation with facilitator and

reg. government)

• Regional partnership building = initiation of establishment of regional

managing & implementation structure for RIS3

• Organization of innovation platforms (round tables) - bringing

together triple-helix actors (gathering ideas RIS3 design &

implementation)

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Regional RIS3 structures

• multi-level structure for management and implementation of RIS3 will

(based on joint methodology) secure following functions:

managing (Regional Innovation Council),

executive (implementation entity),

consultation (innovation platforms gathering stakeholders from business and R&D)

coordination

(S3 manager)

monitoring/evaluation

(external entity).

Concrete setting of entities

responsible for individual functions

are subject to individual solution

in each region.

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Regional council for innovation/

competitiveness

(managing function)

Monitoring &

evaluation unit

S3 manage

r

Innovation platform X

Innovation platform II

Innovation platform

I

Implementation entity

local regional development agency/ innovation centre/ science & technology park/

regional authority office, etc.

(implementing function)

National RIS3 - current state & next steps• National RIS3 strategy: elaborated in 1st draft (by 12/2013)

RIS3 is built upon (and in line with) current strategic documents (National Innovation Strategy, Strategy of International

Competitiveness, National R&D&I Policy, Priorities of Oriented R&D&I Until 2030)

• 01-05/2014: negotiated in a series of national round tables (innovation platforms)

First „round table“ held in 01/2014 – gathering mainly representatives of business sphere (directors of

a large number of key innovative companies involved). Feedback: positive

More to come: innovation platforms shall be established gathering triple-helix stakeholders to help

refine (focus) the priorities - both horizontal and vertical

Innovation platforms design: built around the strongest identified domains of possible (vertical)

specialization:

Meanwhile: the same proces in each region ( regional innovation platforms refining identified

horizontal and vertical priorities)

Regional RIS3 - current state of affairs• Regional annexes: elaborated in 1st draft (by 12/2013)

• However, level of advancement differes among regions (approx. ½ more advanced, ½ less

advanced)

• The same with local partnerships/structures and their readiness to manage & implement RIS3

interventions)

• Differences caused by: different institutional situation (including level of politic support) and

different historic level of experience with R&D&I support

For many regions: RIS3 = major change in perspective regarding regional development

and competitiveness support

• However, with expert guidance, now: RIS3 annexes elaborated in first draft – consisting of analytical

part (covering: review of already existing tools for innovation enterpreneurship support, identification of regional

stakeholders, problem analysis, SWOT analysis, stakeholder analysis and proposal of management and

implementation structure for RIS3) + strategic part

• regional annexes serve as one of the information inputs for national RIS3

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Next steps

Main problems of the innovation system in the Czech Republic - starting point of the national RIS3:

• Weak endogenous business sector and low level of entrepreneurship

• Economic development of CR highly dependent on the activities of foreign

companies

• Unfriendly regulatory conditions for business

• Insufficient quality of public research

• Mismatch between R&D focus of public R&D institutions and business & weak

collaboration

• Weak management and administration of R&D

• Insufficient quality of education system

• Disfunctional system for identification of talents and work with them

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Current draft of horizontal S3 priorities = key „ areas of change “

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Strengthen the culture of multilevel governance in the

area of employment, economic development and

social inclusion

Strengthen the culture of multilevel governance in the

area of employment, economic development and

social inclusion

Increase the demand for

innovation in companies;

Increase the rate of business & new start-ups; Increase the

internationalisation of SMEs

Increase the demand for

innovation in companies;

Increase the rate of business & new start-ups; Increase the

internationalisation of SMEs

Increase the relevance of

research

Increase the relevance of

research

Strengthening competitiveness of CR based on innovation and knowledge use

Strengthening competitiveness of CR based on innovation and knowledge use

Growth of performance, size and number of innovative businesses

using the opportunity on the global markets

Growth of performance, size and number of innovative businesses

using the opportunity on the global markets

Specialization of firms leading to new products and markets

Specialization of firms leading to new products and markets

Improving the quality of education and efficiency of the education system

Diversification of Czech economy through the creation of new companies and the

arrival of investors carrying out activities with higher added value

Diversification of Czech economy through the creation of new companies and the

arrival of investors carrying out activities with higher added value

eGovernmenteBusiness and ICT in

the businessInfrastructure

eGovernmenteBusiness and ICT in

the businessInfrastructure

Improve the quality of graduates;

Identify and use talents

Increase the quality of R&D workers

Improve the quality of graduates;

Identify and use talents

Increase the quality of R&D workers

Improve the quality and

problem orientation of research in knowledge domains

relevant for smart

specialization

Improve the quality and

problem orientation of research in knowledge domains

relevant for smart

specialization

- Social Innovations - strengthening of multi-level partnerships in the areas of

employment, economic development and social

inclusion

- Social Innovations - strengthening of multi-level partnerships in the areas of

employment, economic development and social

inclusion

- R&D -improve the quality of public research

- R&D -improve the quality of public research

- R&D -increase the

economic benefits of public research

- R&D -increase the

economic benefits of public research

- Human Resources – greater range of

human resources in the number and

quality for innovative business, R&D

- Human Resources – greater range of

human resources in the number and

quality for innovative business, R&D

- ICT/Digital agenda - development of

eGovernment and eBusiness

- ICT/Digital agenda - development of

eGovernment and eBusiness

Regulatory and institutional changes in the national innovation system

Business and Innovation– higher

innovation performance of

firms and growth of entrepreneurship

Business and Innovation– higher

innovation performance of

firms and growth of entrepreneurship

National S3 priorities & regional specificities

Regional priorities are -with rare exceptions- focusing (refining) national priorities

Overall S3 self-assessment

Towards a strategic governance to support S3 priorities

• Relevant actors from triple-helix spheres involved in:

innovation council (coordinating and strategic policy-making function)

• On regional level: being designed and built (somewhere already functional)

• On national level: National RIS3 Coordination board innovation platforms (enterpreneurial discovery driven process) - on national as well as regional

level - formed around both horizontal and vertical priorities (domains)

• In regions with weak innovation system, mainly horizontal platforms prevail in initial stage (vertical

platforms might arise later)

• Identification of actors (platform members) at regional level already done (some platforms already

functional), at national level still to come

– Innovation platforms should remain engaged throughout the whole policy cycle (design, implementation,

assessment) • Coordination mechanisms

• On national level: MEYS, National RIS3 coordination board & national S3 manager (to be engaged in

03/2014)

• On regional level: regional S3 managers (already functional)

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Towards a strategic policy mix for implementation of S3

• Given the nature of RIS3 (focus on RDI), policy-mix should be as flexible as possible:

– no prescription of specific instruments in RIS3, but examples of instruments for each priority are

provided;

– wide space for bottom-up initiatives is envisaged

• Key (but not the only ones) RIS3 implementation tools are relevant operational programmes 2014+ namely OP Research, Development and Education (MEYS), OP Enterpreneurship and Innovation for Competitiveness (MIT) and OP Prague

• Policy instruments:

– Identification of proper policy instruments is considered an important component of entrepreneurial discovery process, which should follow the selection of priorities.

– Proposed instruments: both horizontal (cross-cutting) and vertical instruments are foreseen, on

both national and regional levels (majority with help of ESIF OPs)

– S3 is on-going learning process, but given the current state of R&D&I in CR, it is necessary to put the initial emphasis upon the horizontal measures in order to:

» fix at least the major bottlenecks within the innovation system

» form a basis for mutual understanding by finding common problems and joint solutions.

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RIS3 Implementation scheme draftactivity examplesprioritiesprogrammes project type

Towards a strategic policy mix for implementation of S3

• In addition to individual projects and supportive regional schemes funded

via OPs (cofinanced by national/regional funding), there is a special tool:

– „smart accelerator“ within OP RDE - will facilitate not only preparation of

various regional support schemes/prioritised individual projects, but also the

capacity to implement RIS3 strategy at national as well as regional level

(stronger support to S3 managers, support for implementation structures,

monitoring and evaluation, facilitation of enterpreneurial discovery process).

• Between the main two OPs (OP RDE and OP EIC) a Memorandum of

Cooperation was closed mechanisms for implementation of RIS3

priorities into the OPs are being designed in joint cooperation

Towards a strategic policy mix for implementation of S3

• Financial framework for RIS3: not yet been settled, however:

• vast majority of the planned interventions implementing the RIS3 on both national and

regional level will be implemented through the structural funds the RIS3 budget will be to

a large extent derived from the financial frameworks of the relevant OPs

• Main obstacles in building a coherent and strategic policy mix:

• strong tendency of keeping status quo in policy design (not only by the managing

authorities, but also by the beneficiaries)

• missing/insufficient evaluation of effectiveness and efficiency of existing support schemes

(mostly various procedural evaluations)

• limited know-how about state-of-the-art approaches in RDI support (devil is in detail)

Measuring and assessing RIS3

• Evaluation: both internal and external forseen at national & regional level

• Monitoring indicators - Already indicated in national RIS; 2 different types:

1) Performance indicators (these will monitor efectiveness of tools/interventions/activities =

whether RIS3 manages to reach its goals and targets)

– Monitoring - these will comply with monitoring indicators of relevant OPs

– Other - beyond the scope of monitoring indicators (data collected via special surveys &

analyses)

2) Process indicators (these will monitor whether RIS3 functions as forseen)

• Follow up:

•National RIS3 (including the budgetary framework) should be updated approx. after 2-4

years

•Regional RIS3 annexes should be more flexible in this respect should be regularly

updated in approx. 2-year periods

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Qs for peers

Q1: How many platforms are needed to achieve the envisaged change of sectoral structure? What

should be the size of platforms? What mechanism should be applied for selection of actors? How

should the platforms be managed?

Why: there are insufficient guidelines for entrepreneurial discovery process (rules for innovation platforms)

What has been done:

• first platform held in 01/2014

• actors: mainly representatives of leading innovative enterprises

What worked:

• attention and interest of the bussiness sphere was raised

• strong participation

What did not work:

• academia and public R&D sphere got offended that they were not involved in the event in an equal

share as the bussiness sphere

Qs for peers

Q2: How to quantify the expected outputs and results in vertical

priorities?

Why: Difficulties with setting measurable goals in vertical priorities

What has been done:

• Currently, there is an ongoing process of priority identification and

search for monitoring indicators

Qs for peers

Q3: To what extent does a change of priorities require a change of OPs endorsed

by the EC?

Why: Rigid and cumebersome programming process of the EU ESIF versus stress on

continuous learning process and flexibility of RIS3.

What has been done:

• currently, the reference to the RIS3 strategy in the OPs is rather vague

What workes:

• Current OP text leaves enough space for regular update of the RIS3 (living

document and process) while not causing difficulties for the OPs

What does not work:

• The EC requires to incorporate the RIS3 in the OPs’ text in a greater detail which

might close doors for the OP to be able to reflect on the RIS3 updates

Qs for peers

Q4: How to attract private investments to RIS3 implementation?

Why:

• There is almost nonexistent history of private investments to support government

strategy

What has been done:

• Currently, there are private (measurable) investments expected only in the form

of:

• project cofinancing by private company sources (pushed mainly by the state-

aid rules)

• financial instruments pay-off (financial instruments introduced scarcely –

mainly by MIT)

Thank you for your attention

• Ministry of Education:

veronika.czesana@msmt.cz

gabriela.daniels@msmt.cz

blazek@natur.cuni.cz

• Ministry of Industry and Trade:

prihodova@mpo.cz

petr.ocko@mpo.cz