Volga | Finance, business | Technology & innovation

Universities must be integrators that unite innovation ecosystem elements, stakeholders in Nizhny Novgorod think

15 Sep '14
A modern university is much more than just an educational institution or research hub. It is also a crucial player in a market-driven innovation economy. This new role of Russian universities in the world of technology was the center of attention in Nizhny Novgorod last week where government officials, Russian and international business players and university leaders got together for a roundtable discussion, which was part of the 2014 International Business Summit. One of the key co-hosts of the major event was the Technology Commercialization Center (TCC), a new department of the Lobachevsky State University of Nizhny Novgorod (UNN) set up to provide a fast track for university tech projects to find global markets.

Universities can not only be part of the new regional innovation ecosystems; they have the full capacity to evolve as a kind of ‘cement’ to reinforce such ecosystems, all the parties in the roundtable discussion underscored. Those were four, representing the government, science, business, and the youth. Kendrick White, an American entrepreneur and VC with 20 years of experience in Russia, and now the UNN vice rector for innovation, served as the moderator.

It is difficult to talk about the development of a successful innovation ecosystem—an environment where poor penniless developers are nonsense—in a society that still regards a well-off entrepreneur as a crook, noted UNN Rector Evgeny Chuprunov in an introductory speech. “What we lack is a set of systematic efforts aimed at building a cult of the successful person. If a person is prosperous in business, has built companies, made money and let others do likewise, we must respect such a person.” The fostering of a “respectful and appreciative” attitude towards a successful individual is one of the tasks that any university should have for years to come, Mr. Chuprunov said.

Hard as it may be to commercialize globally in today’s convoluted international politics, the development and promotion of new technologies which the whole world needs is a cross-border activity, emphasized Alexander Bedniy, the UNN vice rector for international activity. “We must not forget that an ecosystem should not only be regional but rather ‘glocal,’ interacting closely with the outside world. Innovators must understand how the global market works. We live in a globalized world, whether we welcome the thought or not.”

The vice rector reminded the audience that IT, biotechnology and other sectors which we primarily look at as a field of innovation have only been on the rise across the planet because it is globalization that has been driving progress in these sectors.

Rector Chuprunov backed the point. He talked about UNN students who join professors and researchers in trips to America where they discuss partnerships for their projects and one has even registered his U.S.-based subsidiary in Maryland already. “This might not sound particularly great that we go abroad to commercialize, but my answer to that is plain and simple: as we want to focus on supporting our country, we need to first find a place where what we do is in demand now. And it will be developing where it is in demand,” Mr. Chuprunov said.

A “golden mean” to keep a “reasonable balance”

A tech product hitting the market is a key metric for any innovation ecosystem. This brought about a heated discussion at the roundtable of how deeply a university should commit itself to this activity, once completely alien to Russian academia, and at what cost. Many called for a “reasonable balance.”

Sergei Gurbatov, the UNN vice rector for research activity, for one, drew attention to a certain disproportion that as he had read was the case in England where business was purportedly beginning to overtake science. “Instead of doing fundamental sciences, universities begin to focus on solving individual companies’ internal problems.”

The scientist warned against following too much in the footsteps of such universities in Russia where most of the technologies that came to light decades ago in the Soviet Union are old news today. “We must think of 20 years from now,” he said, adding that demanding that scientists do commercialization would be wrong. There should be special people for that, he concluded.

Alan Thompson, the Russia director of the Russo-British Chamber of Commerce, weighed in with an argument that supported Mr. Gurbatov’s idea. Talking about where such “special people” may come from, he set the example of the UNN Technology Commercialization Center:

“Setting up an entity like TCC is probing exactly into the ‘golden mean’ between a situation in which scientists indulge too heavily in business and the other extreme where there’s no business at all. With such partners around, researchers can do what they can do best without bothering to push their products through markets. We have a two-way bridge here. On one end stands business that has to have a certain comprehension of what language to use in discussing things with science, and on the other we have science that is expected to respond accordingly. And now we have a TCC kind of structure that becomes this very bridge, offering the two sides sources of funding and a venue to discuss snags that emerge on both ends.”

According to Mr. Thompson, the Russo-British Chamber of Commerce hails the TCC initiative and hopes to “…provide assistance, wherever possible, from our businesses to bring the initiative to the attention of both the market and the scientific community, and to look forward to progress as a result.”

“We need to nurture leaders with proper business skills”

Kendrick White encouraged academia to be pro-active in trying to help industry meet its growing needs for innovation products. But there’s another dimension to this collaboration, too. If a university can offer business new technologies, business, in its turn, would do great stepping forward and helping academia train specialists to a level which industry deems adequate.

According to Olga Chepyuk, the head of the Intuition community student business incubator at UNN, “early involvement of young people in both science and business is required,” and business is expected to ‘plug’ students into real projects as early as they begin studies.

The topic aroused interest from almost everybody at the roundtable. Larissa Kolchina, the deputy chief of KPMG’s Volga regional office, echoed Ms. Chepyuk’s idea. In fact, she went so far as to suggest that companies get the youth involved as early as in high school, because she believes “…adolescents lack basic knowledge and skills, they possess no leadership traits, and they find trouble navigating through career opportunities.” Ms. Kolchina views the raising of leaders, who are still so few, as one of the paramount objectives for any region developing its innovation ecosystem.

Louisa Alexandrova, the chairwoman of the St. Petersburg Organization of Business Angels (SOBA), gave a firsthand account of how she had faced deep-rooted problems with would-be leaders and businessmen in Russia. Of about 50 projects her organization considers each year for investment, more than half have to be scrapped, she admitted. “The problem is not lack of technology elaboration; the problem is people who are behind the projects and who turn out to be not ready or willing at all to build a real business; they do not understand a tad of their markets.” To rescue their projects, St. Pete angel investors—people who would prefer to be focused on business transactions and matchmaking between investors and innovators rather than teach ABCs of business—have had to create a separate entity acting like a proof-of-concept sort of center and a ‘primer’ for project teams.

UNN Rector Chuprunov said industrial players should not only bring students into projects but also invest funds in them. “Yes, that costs money and years of cooperation, but it pays off handsomely—as it has, for example, in our 14-year-long interaction with Intel, with the international company scouting and screening its potential employees from among UNN students.”

Another example of the practical implementation of such strategies came from Roeland Van Gestel, the president of the International Community Association of Nizhny Novgorod (ICANN) that incorporates 50 foreign entities operating locally, including 20 industrial companies. A Dutch national living and working in Russia for years, Roeland knows well that interests and goals are different at Russian universities and global commercial companies; however, he believes common ground has been found.

“We have signed a memo of intent with the Lobachevsky State University of Nizhny Novgorod and the Alexeyev State Technical University of Nizhny Novgorod, which paves the way for showing a small (and then growing) group of students what we are, how we work; and we intend to train them in skills and knowledge which we deem necessary for our companies. The program also includes a one-month on-the-job training session for each of the students at our companies. He may or may not come back to us at a later stage; but what’s important is that he will get the feel of a daily operational routine at a factory, and he can do so without interrupting his third or fourth year of studies. When he graduates, he will be much better prepared for a career at a large-scale organization.”

They called the project “MOST,” which stands in Russian for “bridge.” It will include 28 training sessions and 13 factory tours for an inaugural group of ICANN-picked students. When feedback comes later from the host factories, it will be clear if the university curricula meet the needs of international industry. Mr. Van Gestel hopes this will help the universities embrace these needs better, and is grateful for the opportunity.

Funding applied research and creating linkages is key

Interaction between business and science is vital on all fronts, not just personnel hiring, emphasized Eduard Fiyaksel, a Nizhny entrepreneur with years of experience, professor, the president of the Start Invest Volga Association of Business Angels and head of the venture management chair at the regional branch of the Higher School of Economics.

“Business is expected to become a customer of applied research and pay for it. With fundamental sciences, of course, the state must remain the primary customer,” he said.

Another way of cultivating an innovation ecosystem by encouraging collaboration between business and science is the development and adoption of a university community centered partner program where the key participants are mentors. The initiative may also cover all sorts of brokers and service providers for innovators.

There is such a program currently building a network of mentors at UNN, said Anton Turchenko, a department head at the Technology Commercialization Center. “We’re developing this to pursue a three-pronged goal of training innovators in business skills as they keep working on their projects, creating market linkages by contacting partners and sharing ideas, and corroborating business ideas with the scrapping of those considered unviable,” he explained.

TCC has undertaken this in the hope of bringing experienced people on board to help young university entrepreneurs get mentor support and advice as their projects progress.

This is exactly the function any modern university should have as a key element of an innovation ecosystem in the contemporary world—the function of an integrator that unites parties, UNN Rector Evgeny Chuprunov said in a concluding remark.
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