Economic Clusters 2003 Dr. Terra

Strengthening Economic Clusters and Value Chains through the

development of Knowledge Portals

Dr. José Cláudio C. Terra

Damascus, October 20, 2003

Promoting Information Technology for

Industrial Trade Facilitations - UNIDO

page 2www.terraforum.com.br

The purpose of this presentation (paper) is to

establish the conceptual bases for the

development of a knowledge portal applied to a

generic economic cluster and value chain and to

report the initial results of a few Communities

of Practice developed across a number of

different Research Institutes in Brazil.

Strengthening Economic Clusters and Value Chains

through the development of Knowledge Portals


But, first…

…a bit of background





Distance:

Approximately

4.000 Km


STRUCTURE OF THIS PRESENTATION

Some theoretical foundation

The context

The project

Early results

Lessons learned

Next steps & expectations




The context

The project

Early results

Lessons learned

Next steps & expectations

Final Considerations


Clusters Economics

- Linkages

- Informal learning networks

- Collaboration and Competition

- Common Resources

- International Ambition

- Linkages with Academia and

Government

Knowledge Management

- Identification, Generation,

Organization and Dissemination of

Information

- Tacit and Explicit Knowledge

- Communities

- E-learning

- Intangible Assets

Corporate Portals

- Single Point of Access

- Ubiquity and ease of use

- Open and closed communities

- Access and Publication

- Collaboration

Conceptual Model: Synergy of Concepts between

Clusters, Knowledge Management and Corporate Portals




Clusters Economics

- Linkages



- Common Resources



Government




Information


- Communities

- E-learning

- Intangible Assets

Corporate Portals





- Collaboration


Some theoretical foundation (1)

Michael Porter, in his famous book

The Competitive Advantage of Nations,

called attention to the atmosphere of

learning, cooperation and high

competition existing in micro-regions.



Anna Lee Saxenian related the

development of Silicon Valley, starting

with the informal flows and networks of

collaboration and knowledge among

enterprises, universities and government

Source: Saxenian, A., Regional Advantage: Culture and Competition in Silicon Valley and

Route 128, Harvard University Press, 1996



The Japanese kairetsus and the just-in-

time methods of production, initially

developed by Toyota, have spread

throughout the world and have as one of

their bases a very high level of cooperation

and exchange of information among

enterprises in the productive chain.



In Europe, there are already reports that speak of a new

corporate structure: the “syndicates of companies”,

that is, associations of small and medium companies,

which do not compete against each other and which are co-

proprietors of “cooperatives” which assume responsibility

for activities in common , such as: marketing,

distribution, entry into foreign markets, licensing of

technology, etc.

Source: The Economist, Will the corporation survive? November 1st, 2001



“Research looking at knowledge networks between SMEs

in Australia showed that even when there was adoption of

networked technologies to allow connectivity between the

companies, the potential for knowledge exchange was

highly dependent on the level of trust. Similar work on

SME collaboration in Asia showed that information

sharing and learning was based on the prior existence of

trust and an atmosphere of continued trust building.”

Source: Braun, P., Digital knowledge networks: Linking communities of practice with innovation. Journal of

Business Strategies, 2002. 19(1): p. 43-54., in: Inter-Organizational Communities of Practice

by C. van Winkelen



“Collaboration is: “a cooperative, inter-organizational

relationship that relies on neither market nor hierarchical

mechanisms of control but is instead negotiated in an

ongoing communicative process”

Source: Lawrence, T., N. Philips, and C. Hardy, Watching whale watching. Exploring the discursive foundations of

collaborative relationships. Journal of Applied Behavioural Science, 1999. 35(4): p. 479-502. in: Inter-Organizational

Communities of Practice by C. van Winkelen



Government

Academia Industry

ETZKOWITZ, H. e LEYDESDORFF, L. - The dynamics of innovation: from National Systems and "Mode 2" to a Triple Helix

of university-industry-government relations. In: Research Policy, v. 29, n. 2, pp. 109-123, fevereiro 2000., in: Plonski, G.A., Public

Oral Examination as part of its candidacy to Full Professor at Business School at the University of São Paulo, July 16, 2003

Triple Helix I Triple Helix II Triple Helix III

Government

Academia IndustryAcademia Industry

Government



“The network is the enterprise”

Manuel Castells




Clusters Economics

- Linkages



- Common Resources



Government




Information


- Communities

- E-learning

- Intangible Assets

Corporate Portals





- Collaboration


In the mid-nineties, Knowledge Management

emerged as a discipline and a formalized

organizational function, initially in private

enterprises and, a little later, in government

offices and state-owned enterprises and in

supranational entities, such as The World Bank

and the United Nations.




Information Management

Managing Knowledge

Philosophy

Psychology

Management Science

Anthropology

Sociology

Economics


Managing Knowledge

Management Science

Strategy

Human Resources

Organizational Culture

IT

Finance

R&D & Innovation

Marketing



Typical Knowledge Management Objectives

Acceleration of the generation of new knowledge with competitive value:

Increased collaboration among employees;

Facilitation of employee access to the sources of training (on-line and

off-line), information and knowledge;

Supply of personalized information just-in-time (dealing with information

overload);

Preservation and Protection of the intellectual capital existing in the

company;

Leveraging of the knowledge existing in the company and in the external

environment to better serve the customers;

Improvement of the decision-making process at all levels of the company

(management, production and on the front line);

Reduction of costs and of re-working:

Don’t reinvent the wheel; and

Avoid activities which add little value.


KM Initiatives in Governments from OECD countries

Source: KM Practices in 140 government organizations )Ministires/Departments/Agencies of Central Government), OECD, GOV/PUMA

(2003)1, 27th Session of the Public Management Committee, 3-4 April, 2003

Organisational arrangements (decentralisation of authority, opening up

bureaucratic divisions, use of information and communication

technologies etc.);

Personnel development (mentoring and training practices, mobility etc.)

and management of skills;

Transfer of competencies (databases of staff competencies, outlines of

good work practices, etc.);

Managerial changes and incentives for staff to share knowledge (staff

performance assessment and promotion linked to knowledge sharing,

evolution of the role of managers, etc.).

Broad Definition of KM


44.8

26.1

21.7

5.8

0

5

10

15

20

25

30

35

40

45

Yes No, but it will certainly

become a priority in the

next 2 ye

No, but it will probably

become a priority in the

longer run

No

Good knowledge/information management is one of the top five internal priorities of your

organisation






10

12

14

16

18

20

22

8 10 12 14 16 18 20Perception of level and quality of KM practices, organisational and cultural change

(improving with higher score on the indicator)

Efforts made at improving KM

(increasing with higher score on the indicator)

Pol Bel

Por

Hun

Irl US

NorKor

Swe

Slo

Den

Eng

Fin

Ger

Gre

Can

FraIce

Group 1Group 2

Group 3







13

14

15

16

17

18

19

13 14 15 16 17

Efforts made at improving KM

(increasing with higher score on the indicator)

Finance

Trade & Industry

JusticeLabour

Prime Minister's

OfficeHealth /Social

Affairs Foreign

Affairs

Economy

EducationInterior

StateReform/Public Administration

Group 1Group 2

Group 3

Perception of level and quality of KM practices, organisational and cultural change

(improving with higher score on the indicator)




Clusters Economics

- Linkages



- Common Resources



Government




Information


- Communities

- E-learning

- Intangible Assets

Corporate Portals





- Collaboration


Areas of a Knowledge Portal for Strengthening an

Economic Cluster Productive Chain

Information Flows;

Collaboration;

Training of Personnel;

Business Generation;

Promotion of Innovation; and

Optimization of Resources.


I - Information Flows (1)

OBJECTIVES OF THE PORTAL MOTIVATION

Provide broad access to updated, relevant information focused on the productive chain

The portal can serve as an information

source for all organizations:

Various kinds of reports and market

studies are not normally accessible to most

companies;

In certain cases, companies lack the

financial resources to acquire the reports;

in others, the companies do not even know

the reports exist;

It is also possible, via the portal, to reach

a large enough scale to look for and

organize widely-available data.


I - Information Flows (2)


Collect information from the companies to execute and rapidly update sectoral studies

It’s possible, via the portal, to establish

quite simple and automatic mechanisms

for data collection from the companies.

This not only permits reductions of cost,

but also of time required to carry out

research and industry diagnoses.

One can also think about creating

innovative indicators of the evolution of

the industry’s intellectual capital.


II - Collaboration (1)


Promote information exchange and collaboration among companies in the productive chain

The portal can use various tools which

permit the virtual exchange of information

(discussion forums, chats, etc.) and also

the decentralized publication of the

contents by the companies participating in

the cluster.

Stimulate the development of “Practice

Communities” involving persons from

diverse companies.

These may include information about the

company itself, as well as a description of

projects in progress.

It’s also possible to consider areas such

as “Urgent Questions”.


II - Collaboration (2)


Promote interchange between the private sector and knowledge sources in the public sector and academia

The portal may be designed to provide

quite specific information so that,

especially small businesses, have

instantaneous access to governmental

reports (e.g., trade missions) and

academic information (e.g., lists of experts

and national and international laboratories

relevant to the sector).

Persons from academia, research

institutes and government may also utilize

the portal to monitor the companies’

activities, projects and needs.


III – Training of Personnel (1)


Centralize and reduce the cost by on-line training

On-line training modules may be made

available to all the companies.

There’s a clear reduction in the individual

costs of licensing and development of the

courses.

Increases are evident in the speed of

dissemination of new concepts.

Divulge opportunities for off-line training

The portal may have an area for the

divulgation of recommended opportunities

for training offered by third parties.


III – Training of Personnel (2)


Create a more efficient job market

The portal may become a reference centre for work opportunities.

The liquidity and the “oxygenation” of the market are increased.

Elements of confidentiality must be introduced in order to assure the adherence of the companies.

Promote greater use of information technology and Internet tools

The very opportunity to utilize the portal may become an important incentive for a more intense use of IT

Courses in IT are ideal for training via the Internet.

Special conditions for acquiring computers could be offered to participating small businesses.


IV – Business Generation (1)


Promote opportunities for business between companies

Mechanisms so that companies may promote their commercial interests and find partners within and outside the cluster is quite interesting.

The promotion of the formation of temporary and/or permanent consortia may be facilitated by e-project tools.

Promote local companies globally

The portal may help to divulge the products and services of the cluster and also for the quick localization of and contact with the companies.

If translated to the English language, the portal could serve as an excellent marketing tool and help develop

international business.


IV – Business Generation (2)


Promote electronic trading

Tools which permit the rapid

configuration of e-business may be made

available on the portal.

The tools may be pre-negotiated and

adapted to meet the needs of the

productive chain.

Auction-like electronic markets may also

be established.


V – Promotion of Innovation


Promote success stories The portal may be utilized to describe success stories among cluster companies. These kinds of stories are known to incite innovative behaviour.

Disseminate technical norms

The faster diffusion of technical norms has a positive impact on the productive quality.


VI – Optimization of Resources


Map and optimize the utilization of the productive resources of the productive chain

Just as multinationals do it internally, the

industry portal may enable associated

companies to “rent” some of their idle

resources.

A market may also be created for trading

competencies and intellectual capacity.

Provide common services to all the companies

The portal may be utilized to automate

the providing of electronic services (e.g.,

travel reservations, accounting, etc.).




The context

The project

Early results

Lessons learned



The Context (1)

Association of Research Institutes (ABIPTI)

125 member organizations

Lobbying

Benchmarking

Training

Publications


Location of

participating

organizations

Distance:

Approximately

2,500 miles


The Context (2)

15 Research Institutes are selected (best

managed & top performers)

From small (300 researchers) to large

organizations (3000 researchers)

From very focused (e.g. agriculture, oil, nuclear)

to very diversified research institutes

From private foundations (few) to government-

owned (States and Federal)




The context

The project

Early results

Lessons learned



The Project (1)

The Goal: Bring KM

concepts and practice to 15

selected Research Institutes


The Project (2)

A Knowledge Portal was developed with key functionalities

to support the development of Communities of Practice:

Knowledge Bases;

Members’ Directory;

Content and Document Management;

Advanced Search;

Events Management;

Alert and Subscription Tools, Forums, Personalization, etc).


The Project (3)

The initial focus on the development of Communities

of Practice across all organizations aimed at rapidly

achieving tangible results and, therefore, also

fostering the development of KM initiatives within

each one of the fifteen research institutes. An

important consideration in the choice of Communities

of Practice was the fact that these institutes had very

different technological capabilities and interests.


Generic Domains related to the management skills and techniques of research institutes

Management of Intellectual Property;

Quality Management;

Technology Forecasting and Monitoring;

Client Relationship Management (CRM);

Scientific Domains that may involve a number of institutes but not all of them

Environment;

Design;

Chemistry;

Food quality.

National themes domains defined by the Federal Government’s Industrial Policies

Support to Exports;

Support to Small and Medium Enterprises.

Possible Domains for the Communities of Practice

The Project (4)


Selection of CoPs to get started…

The Project (5)

Three CoPs were selected: Management & Commercialization of Intellectual Property

and Quality Management, and “Geological Risks”. These topics were chosen for the

following reasons:

There was enough critical mass both in terms of available digital content, as

well as interested and qualified personnel;

They are well-defined domains and are non-proprietary in nature;

They are topics that can engage and motivate wide participation;

They are strategic topics with a wide gap between the top and bottom

performers;

A core group that had a sense of a Community were identified;

A few experts that could help with valuable initial content were also identified;

These are topics that are directly related to the services provided to the clients

of these research institutes;

These communities can rapidly expand to include personnel from other types of

organizations (industry, government and universities, etc).


…and now…

…understanding a bit of the

phases of the project


The Project (6)

Training

in KM

Project

Plan

Seek

Support

Foster

CoPs

Roll-out

Portal

200

researchers

were trained

throughout

Brazil

Develop a

strategy:

CoPs are

chosen

Develop

horizontal

and focused

CoPs

Choose

Technology

platform

Get CEOs

to meet and

discuss KM

Show

Benchmarks

Show

prototype

Face-to-

face meeting

Invite

experts

Hire

dedicated

moderators

Use free

web-base tool

Start with

good content

Launch

event

Train users




The context

The project

Early results

Lessons learned



Early Results

KM goals are fairly well-understood at senior

management levels

Greater understanding of skills, competencies and

methods used by different Institutes in the domains

supported by CoPs

Some tips, ideas, and documents have been exchanged

A core group of researchers that have embraced CoPs

and KM

Demand for building many other CoPs




The context

The project

Early results

Lessons learned



Lessons Learned

Do not underestimate the need for fostering social

contact – (Latin culture???)

Definition of a domain and then taxonomy is critical

Find leaders and “cool people”!!

Technology is not that important…changing mindset

is huge!

Attention to IT skills of involved personnel

Use a PULL strategy…not a PUSH strategy

Attention to the ENERGY!!




The context

The project

Early results

Lessons learned



Final Considerations (1)

Just as is the case when applying portals to

Knowledge Management in large privately-

owned companies, the main challenge is not

technological. There are several strategic,

operational and organizational elements that

are critical to the success of such initiatives.



The initiative described here is significant in its ambition.

Its success may have a profound impact on how Brazil

integrates the considerable amount of knowledge that is

available in this very large country, but that is currently

very much dispersed. Geographical isolation is no longer a

viable option for any organization or even country.

Individuals and organizations now seek information and

knowledge regardless of their location.



These kinds of initiatives are of particular importance to

developing countries. Such countries do not have the

resources of most multinationals that are developing their

own internal knowledge portals and leveraging knowledge

from all over the world. The route for inter-organizational

collaboration through knowledge portals is not an easy

route, but one that is very promising. Indeed, it is probably

a necessity to compete in the Knowledge Era.


Thank You!Dr. José Cláudio Terra

[email protected]

www.terraforum.com.br