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The Current Situation and Problems in China’sTechnological Innovation Service System
2006-03-15
By Lu Wei, Durectir-general of the Department of Techno-Economic Research, the DRC
The technological innovation service system is an important component of the national innovation system. Internationally, there is no explicit definition of technological innovation services. Technological innovation services are embodied in the innovation system. As technological innovation services are vital to the innovation system and are somewhat unique, the authorities in charge of science and technology have called for the establishment of a technological innovation service system in order to make pertinent policies more effective.
The technological innovation services discussed in this article refer to the provision of knowledge, technology, experience, funding, human resources, information, infrastructure, experimental places and other services to technology innovators as well as the activities to coordinate and harmonize the links and exchanges between various technology innovators, aiming at promoting cooperation and realize technological innovation. Specifically, they include consulting evaluations, research result applications, knowledge dissemination, venture investments, technological services, technological transfers, education and training, intellectual property agency and other services. The carriers of technological innovation services are various types of incubators, productivity promotion centers, technological evaluation and consulting institutions, vocational training institutions, science and technology information centers, universities, research and development institutions, patent agencies and venture investment institutions. They are called “innovation service institutions” for short. This article focuses on discussing innovation services that are related to scientific and technological services.
I. Features and Development Trends of Technological Innovation Services
1. Basic features of technological innovation services
Technological innovation services are part of the services industry. They have both the general features of the services industry and the characteristics of innovation activities. According to the definition of the services industry, research and development, technological services and consulting services all fall within the scope of the services industry. According to the definition of technological innovation, technological innovation itself is aimed at producing technologies that can be commercialized. Only those service activities that provide innovators with intermediate inputs into research and development, can technological services and professional consulting be regarded as technological innovation services. Technological innovation services promote links and interactions between innovators, facilitate the flow and rational allocation of technological resources and reduce the barriers to and the transaction cost of information, technology, management and financing in the course of technological innovation. Technological innovation services have the following features:
First, they provide intermediate services. Technological innovation services provide innovators and especially the manufacturing industry with intermediate inputs such as knowledge, technology, information, experience and fund, mainly taking the form of evaluation, consulting, designing, introductions, tests and transactions. Second, they are highly specialized. Technological innovation services are knowledge and technology-intensive services, and the qualifications of the practitioners determine the quality of the services. Therefore, they require highly qualified personnel. Third, as knowledge, technology and information have the characteristics of quasi-public products, technological innovation services constitute externality. Fourth, as earnings often lag behind innovation and are highly uncertain, the economic results of a considerable amount of technological innovation services manifest themselves only after a period of time. For example, the efficiency of technological transfer cannot be proved until the technology-utilizing parties have gained positive results. As a result, an accurate price of technological innovation services is generally difficult to be set in advance. Fifth, the effects of the services depend on both the supplier and consumer. Sometimes, the cabilities of users can directly affect the results of services. For instance, the result of any technological transfer highly depends on the ability of the technology absorbers and thus the responsibility for service results is difficult to decide. Sixth, the low barriers to entry make it difficult for existing suppliers to expand business scale. As the development of the innovation services industry depends on the enthusiasm of technology innovators, it is necessary to boost the demand for technological innovation services in the market.
2. Development trends in technological innovation modes and innovation services
Economic globalization and the development of knowledge economies and information technology present challenges, and thus brought changes to the traditional organization modes of technological innovation. The first change has been a shift from vertical integration to networking, and from a linear mode of innovation within a limited number of enterprises to networked innovation based on cooperation between numerous participants. Cooperation among competitors has been strengthened. The second change is that competition has boosted investment in R&D, revitalized innovation activities and increased the demand for innovation services. The third is a higher degree of specialization. In order to effectively utilize global scientific and technological resources, R&D outsourcing has been on the rise, which has stimulated specialization of every component of the innovation process, and hence furthered the division of labor in technological innovation services.
The networking and specialization of innovation processes have brought about changes to the mode of innovation services. As a result, technological innovation services have taken on new trends and features.
The first such feature is the development of networking and specialization of innovation processes. As the mode of innovation becomes increasingly networked and specialized, technological innovation services have also become increasingly networked and specialized in order to effectively utilize resources. With the help of information technology, information, knowledge and expert resources can be shared through regional, national and international network.
The second is the diversification of operators and a higher degree of marketization. In the past, the governments of various countries have established many innovation service institutions. But as the government-funded, nonprofit institutions were designed primarily to provide public-good services, it has been difficult for these institutions to develop on a large scale so as to meet the growing and diversifying demands. With the expansion of market demand for innovation services, more and more private capital has entered the field of innovation services. Accordingly, an increasingly number of commercial innovation services have emerged. To improve their efficiency, some government-funded institutions have also been privatized.
The third is specialization in services and the integration of functions. Higher specialization in technological innovation processes require more targeted specialized services and diversified integrated services. Therefore, an institution cannot limit itself to just providing one or several specialized services. Accordingly, some institutions have emerged that offer several kinds of scientific and technological services simutaneously.
The fourth is continuous innovation in service modes. In the past, innovation service institutions primarily provided downstream services for innovation activities, such as research result applications and market development. Today, innovation services are expandingintoupstream areas such as direct participation in the innovation activities of universities and research institutions, and the establishment of long-standing cooperation relationships.
The fifth is pursuit of chain operations and economies of scale. To pursue economies of scale, some innovation service institutions have introduced the chain and transnational operation modes.
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