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Universities of Technology as Conduits for
Innovation and Regional Economic Development
in South Africa
SATN Conference 2009
15 - 17th July 2009
CPUT, Bellville Campus, Cape Town
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Presentation OutlinePresentation Outline
Introductory RemarksIntroductory Remarks
South Africa’s ChallengesSouth Africa’s Challenges
Tshumisano Trust: Tshumisano Trust: Enabling Enabling Innovations & Knowledge Transfer Innovations & Knowledge Transfer from UoT’s to the Productive Sectorfrom UoT’s to the Productive Sector
Exemplary Strategies for Regional Exemplary Strategies for Regional Economic development - Economic development - RALISRALIS
ConclusionsConclusions
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Key Elements for Sustained Economic Growth
Human Capital
Information and Communication Technology (ICT)
Innovation - Diffusion & Exploiting of Science and Technology outputs
Vibrant Entrepreneurial Culture (namely High Growth, Innovative SME’s)
Source: 2001 Organization for Economic Co-operation and Development (OECD) Ministerial Report, The New Economy: Beyond the Hype. OECD, Paris.
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Why Small & Medium Enterprises
(SME’s)??
SME’s are central to Economic Growth and
Employment Creation in OECD and BRIC
Countries
Benefit of Economics of Scope rather than
Economics of Scale – nimbleness and
shielded from Exogenous shocks
More likely to offer steadier and flexible
levels of Employment even during an
economic downturn
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South Africa’s Growth Challenges
Innovative&
Entrepreneurial firms
Factor/Efficiency-driven Economy Innovation-driven Economy
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Regional Economic
Development – The Evolving role
of Higher Academic Institutions
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In the past, Universities focused on their core mandates: Teaching and Research
Changing government priorities as well as Budget cuts led to a Universities plays a more active role in society globally referred to as Third Mission:
Participation in industrial development and competitiveness on a regional/local level (LRIS) via a networked approach
Specific focus on Small and Medium Enterprises (SME’s) which are seen as engines for economic growth and job creation
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Productive Sector
Education
Advice,Consulting
Interns
Postgraduate students solve
problems & write thesis about it
Updated know-how on currentchallenges >> updated curriculum
Technical services (testing / metrology, prototyping)
Contract research
Academic secondment to industry
Universities
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South African Government
Response
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“TSHUMISANO”
Tshumisano Trust is an Agency
of the
National Department of Science and Technology
to Strengthen Technology Transfer and
Diffusion Initiatives at Universities of
Technology to Support SME's
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“TSHUMISANO”
Technology Stations Programme
This is achieved by Establishing Technology
Stations (Technology Transfer Centers) at
Universities Nationwide
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The Technology Stations Programme,
is designed to strengthen and accelerate the
interactions between Universities and SME's.
The Technology Stations funded under this
Programme will play a major role in identifying the
specific needs of SME's and will provide the
adequate technology solutions based on the
Universities' of Technology full potential
to improve the competitiveness of their SME
clientele in selected sectors.
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ENVISAGED OUTCOMES
Within the supported SME’s:
Improved competitiveness through world class
products, production technologies or services.
Increasing capacity for continuing technology
assimilation and innovation.
Within the participating Universities:
Improved and enriched R&D as well as teaching and learning activities leading to:
Better understanding of SME needs
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TECHNOLOGY STATIONS TECHNOLOGY STATIONS
Location & ScopeLocation & Scope
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Agro Processing and Chemical Cluster
• To Support the Chemicals and the Agro-Processing Industry.
• Formulations, Pharmaceutical and the Natural/Indigenous Products, Detergent & Paint .
• Testing and analysis in manufacturing low-end products.
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Primary Manufacturing Cluster
• The secondary manufacturing cluster focuses on advanced manufacturing and value adding services within three critical industrialized sectors
• Specialises focus is in product development and prototyping
• Application of Smart materials, textiles and reverse engineering
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Secondary Manufacturing Cluster
• This is a support cluster with service of system automation and processing of materials.
• Material compositions and casting (foundry) solutions.
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18
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IAT_ ProjectIAT_ ProjectManagement UnitManagement Unit(Advisory Board)(Advisory Board)
Tshumisano Tshumisano TrustTrust
CEOCEO
National Tooling National Tooling CoordinatorCoordinator
IAT_WCIAT_WC
StellenboschStellenboschUniversityUniversity
IAT_ECIAT_EC
Walter Sisulu Walter Sisulu UniversityUniversity
IAT_GPIAT_GP
TshwaneTshwaneUniversity University
of of TechnologyTechnology
StructureStructure
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Summary of Activities Summary of Activities
FY2008/9FY2008/9
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Are We doing Enough as
Compared to Our
Competitors?
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Zhongguancun Science Park
Started 1988:
Employees over: 1 million people. Incubate over 20 000 High Technology SME’s
Well know graduate: Lenovo
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Addressing Regional
Economic Challenges - The
RALIS Initiative in the South
African Clothing & Textile
Industry
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The Role of the Local
University of Technology:
CPUT as a Case Study
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Clothing and Textile Technology Station
(Technology Transfer Center)
Situated at the Cape Peninsula University of Technology in Western Cape
The Technology Transfer Center was established in 2001 with funding from the National Department of Science and Technology
TSP was established by through an implementation agency called the Tshumisano Trust
It provides innovative solutions and skills development to SME’s in this industry to ensure they are globally competitive in terms of product and process innovation
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The sector is concentrated in Kwazulu-Natal and Western Cape Provinces
It employs over 150,000 people in South Africa
There are approx 2,000 active clothing, textile, footwear and leather companies of which 80% are clothing and textile industries
86% of these companies are classified as SME’s (employing less that 500 employees)
This industry generated sales of R34 billion to total manufacturing output – however only 20% of it is exported
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Challenges to the
Clothing & Textile Industry in
SA
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Cheaper imports from low cost countries
Proliferation of illegal imports and dumping of clothing and textile products
Low output per employee in SA firms
Low level of Technology investment and upgrades by SME’s
Emergence of world class manufacturing practices in competitor countries
Threat posed by Global Value Chain phenomenon
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Role-players in the Clothing and Textiles Industry in Western Cape
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Access to GovernmentalSkills Levy
Clothing and Textile Firms(SME’s)
CPUT TSCTProduct/Process
Improvement & Testing
CLOTEXAccess to mentorship, training and
Information on trade contracts
UNIVERSITIES OF TECHNOLOGY
Access to Industry relatedTraining and Experts
CTFL-SETAFunding
of Training
TEXFEDTrade matters and
Legislative changes
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Rapid Appraisal of Local Innovation System
(RALIS): The Case of the Clothing & Textile Industry
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A methodology that could yield, within a short period of time,
• a diagnosis of the main features of a local innovation system
• main mechanisms and bottlenecks in innovation, technology upgrades and knowledge transfer in a specific industry
• a number of proposals for practical activities to strengthen the local innovation system and thus improve competitiveness especially amongst SME’s.
It is a rapid, practical, bottom-up participatory, network stimulating and innovation – oriented approach to value chain development and Local and Regional Development
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Process of Initiating and Executing the Clothing and
Textile RALIS
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The RALIS process started with a major stakeholder meeting, represented by all 4 pillars in 2004
Bottlenecks within the Clothing and Textile value chain with specific focus on SME’s in the sector was highlighted
The participatory diagnostic engaged 90 leaders and senior managers across the whole sector value chain
Innovation systems and processes along the value chain was diagnosed, identifying opportunities to improve the competitiveness of the sector – by means of innovation and technology
A limited number of practical proposals, championed by recognized key actors in the industry was then agreed upon – categorized as quick wins, medium and long term activities
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Outcomes of the Clothing and Textile RALIS
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15 quick win, medium and long term proposals to address key issues such as marketing, productivity, quality and service levels was the result
In 2008 an assessment of the outcome and impact of the RALIS was conducted
Out of the 15 initiatives identified, 80% was realized
The RALIS led to a plethora of collaborative activities among key industry stakeholders – not willing to work together prior to the exercise i.e. encourage clustering
It established basic methodologies which now enable stakeholders and companies to work together more effectively
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Conclusions & Policy Recommendations
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UoT’s can and do play as critical role in regional economy in terms of:
Innovation upgrade
Skills Development
They can act as “magnets” to attract troubled companies in key regional industries to share best practices & learning through clustering activities
Going forward, there is a need to expand the work of Government entities such as Tshumisano to enhance the role of UoT’s in local, regional & national economic activities
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THANK YOU!!THANK YOU!!