Tasnim Sultana, Jamal Nazrul Islam, Haradhan Kumar Mohajan, Rajib Datta, Int. J. Eco. Res., 2012, so, v3i5,

ISSN: 2229-6158

ORGANIZATIONAL MODELS IN UNIVERSITY-INDUSTRY

COLLABORATION: INTERNATIONAL PERSPECTIVE

Tasnim Sultana

Assistant Professor, Department of Marketing, Premier University, ,

Bangladesh, E-mail: [email protected]

Jamal Nazrul Islam

Emeritus Professor, Research Centre for Mathematical and Physical Sciences,

University of Chittagong,

Haradhan Kumar Mohajan *

Premier University, Chittagong, Bangladesh, E-mail: [email protected]

Rajib Datta

Department of Finance, Faculty of Business Studies, Premier University,

Chittagong, Bangladesh. Cell: +8801819895389, E-mail: [email protected]

* Corresponding author

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ISSN: 2229-6158 ORGANIZATIONAL MODELS IN UNIVERSITY-INDUSTRY COLLABORATION: INTERNATIONAL PERSPECTIVE

Tasnim Sultana Assistant Professor, Department of Marketing, Premier University, Chittagong, Bangladesh, E-mail: [email protected] Jamal Nazrul Islam Emeritus Professor, Research Centre for Mathematical and Physical Sciences, , Bangladesh Haradhan Kumar Mohajan Premier University, Chittagong, Bangladesh, E-mail: [email protected] Rajib Datta Department of Finance, Faculty of Business Studies, Premier University, Chittagong, Bangladesh. Cell: +8801819895389, E-mail: [email protected]

Abstract This paper aims at developing a taxonomy, which uses both institutional and functional criteria. Departing from the assumption that there are several evolutionary stages in the development of university-industry collaboration, which embrace unstructured to fully structured and complex modes, the paper identifies five stages: (i) ad hoc collaboration at an individual level, (ii) development of internal support structures, (iii) creation of autonomous support structures, (iv) setting up of individual enterprises and (v) national and transnational networking. These five development stages include organizational forms, such as Industrial Liaison Offices, University-Industry Research Centers, Trading Companies, Foundations, and, Affiliate programs and Consortia. Each of these organizational models is reviewed in terms of its objectives, functioning and predominance in different regions of the world. Without attempting to be exhaustive specific case examples are included from the African, Western European and Latin American countries. These case examples draw particular attention to some of the crucial management aspects in the development of university-industry collaboration. These lessons will refer to the choice of an appropriate organizational model. It will provide also some guidelines for the strategic and operational management of these relations. Key Words: Collaboration, Organizational model, University, Industry.

1. INTRODUCTION can be divided into six categories as follows The relations of business schools with their (Wei et al. 2011): socioeconomic environment have become a  Research in inherent difference in topical issue in the literature on higher mission and objective focuses education over the past twenty years or so. directly on company issues Recently universities are receiving a single (Dierdonck and Debackere 1988, funding stream of Higher Education Ditzel 1998, Fassin 2000). Innovation Funding (HEIF) in terms of  Research in the difference in direct funding, which creating supports a organization structure and policy wide range of business–university pays little attention to the firms that interaction and rewards success in commercialize inventions, but rather generating business income. As a result focuses on issues relating to the contribution of science and technology to university (Caroline and Jeannette business competitiveness is improving 2011). graduate enterprise and employability, and  Research in differences of addressing specific business skills orientation philosophy and interests requirements (Wilson 2012). of individual researchers is The economic literature concerning beginning to receive attention university-to-industry knowledge transfer

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recently (Kathrin 2010, Waverly and  improved interaction for the Emily 2011). development and adaptation of  Research in effectiveness of degree programs, University-Industry arrange-ments  improved employment prospects and mechanisms for collaboration for students, (Carayannis et al. 2000);  supplemental income from  Research in benefits and costs in the consulting, allowing academic staff process of University-Industry to improve their salaries, and collaboration (Geisler 1995, Siegel  enhancement of the business and Waldman 2003). schools’ image as a contributor to  Research in evaluation of the the economy. university-industry collaboration From the practical evidence it is proved that performance (Michael and Alok placements, internships and other work 2002, Timothy et al. 2007). experience of the university students in industries are extremely valuable to Likewise, this issue has moved high on the students, both in terms of their academic agenda of business school’s success. Some performance and their employability skills aspects in this regard are discussed here. (Driffield et al. 2011, Green 2011, Reddy and Moores 2006, Little and Harvey 2006, 1.1. Benefits of Business School-Industry National Council for Work Experience Collaboration for Business Schools (NCWE) 2003). At the present time, some benefits for business schools are seen as underlying 1.2. Determining Factors of Type of stronger collaboration with industry as Collaboration and Its Degree of Intensity follows: Most business schools worldwide have by  opportunity to attract additional now some type of interaction with local, funds for initial teaching and national or multinational industry. The type research thereby increasing of interaction and its degree of intensity financial autonomy of business depends on many external and internal schools, especially if government factors for instance the existence of: core funding is tightly linked to . research capacity within the specific academic purposes, business school,  cooperative research with . an industrial base involved in enterprises as a lever to attract ‘Research and Development’ (R & more public funds if there are D) activities, governmental project funds for . the existence of governmental collaborative research programs, policies, initiatives structures or  acquisition or access to up-to-date programs to stimulate collaborative equipment, R & D,  opportunities for faculty and . a tradition of interaction between students to become familiar with business school and industry, state-of-the-art industrial . an entrepreneurial culture within management systems and the higher education sector, and enhancement of their familiarity of . an academic reward system and the constraints of industry, incentives.

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unstructured to highly structured 2. OBJECTIVES OF THE STUDY organizational models can be distinguished: The primary objective of this paper is to o Informal collaboration. highlight the different models of university- o Setting up internal support industry collaboration. Specific objectives structures. are as follows: o Creating autonomous support a) To present the readers with a structures. continuum of organizational models o Setting up independent support encompassing both the least and structures. most structured. o National and transnational b) To explore the benefits of networking. ‘university-industry collaboration’. c) To study the feasibility of different 4.1. Informal Collaboration models of ‘university-industry The informal links of individual academics collaboration’. with enterprises have been and still current practice in higher education institutions. The 3. METHODOLOGY extent of such linkages depends mainly on The paper is based mainly on secondary the type and professional specialty of data. Helpful information from different institution. In many cases, informal magazines, and articles published in interactions with the productive sector different journals were abundantly used. represent an important means for individual Different models of university-industry researchers to upgrade their salaries. Higher collaboration have been studied. Some cases education institutions may benefit from this on these models have been presented to interaction because it reduces the risk of prepare this paper. brain drain for economic reasons. However, if there are no rules and control of the use of 4. ORGANIZATIONAL MODELS OF staff time, such informal links with industry COLLABORATION DEVELOPED IN can conflict with professional commitments, DIFFERENT COUNTRIES i.e., teaching or research. In North America and in several Western European countries university-industry Case 1: 20% Formula (Kelly 1992) relations have a long-standing tradition and 20% formula is applied by some Western they have developed into a multitude of European universities. Under this formula, a organizational models. In Latin America and staff member may, under certain Asia, relations have been developing rapidly circumstances, and with the permission of over the past decade. In other regions, in the head of institution, take one day off per particular in Africa, relations are not as week for private consultancy under the densely interwoven and less structured. The condition that work is not done during term African continent perhaps with the time and that it should complement the exception of Nigeria and certainly of South research interest of the academic and his/her Africa, has a much lesser developed profile department. of university-industry relations. Five categories of interaction relation to different 4.2. Setting up Internal Support stages in the evolution of university– Structures industry relations from the most

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The most developed organizational models faculties and outside organizations. are to be found in countries where INTRO’s main aim is to bridge the institutions are located in a market oriented ‘development gap’ between the university’s environment and enjoy simultaneously a research output and industrial application. In high degree of autonomy, i.e., in North order to accelerate interaction between America and more recently so in Western business and academia, INTRO introduced Europe. In Western Europe, such an an active company visit program and in approach has been strongly supported by return invites companies to visit university national governments, which have keen facilities. INTRO manages the INTRO Link, interest in technology transfer and joint an industrial affiliate program which was continuous education activities as a means to established to provide companies or upgrade the international competitiveness of individuals who undertake research & their economies. development direct access to National University of Singapore (NUS) facilities and The Industrial Liaison Office research output. Member of the INTRO The attempt to institutionalize and structure Link program make an annual contribution the collaboration of an institution with to the university according to their category industry has become most visible with the and are offered special services, such as creation of ‘Industrial Liaison Offices’ general assistance in research and (ILOs). The function of such units is to development, direct access to databases and provide an interface for the supply and other information and assistance in the demand of higher education products, that identification of their training needs. is, (i) to identify all resources available for The setting up of Industrial Liaison Offices collaborative ventures; (ii) to set up data has become quite common practice bases and any other required information worldwide. In sub-Saharan Africa, a survey source; (iii) to promote and market the conducted by Blair (1992) found that six of institutions’ relevant expertise and services; the 15 universities surveyed possessed an (iv) to negotiate and advise on commercial institutional structure, dedicated to pursuit of contracts, their costing and legal terms. Such consultancy, such as a university consulting offices are generally part of the central company, or an industrial liaison office. In administration and closely supervised by the the case of the University of Dar-es-Salaam, academic authorities. the Faculty of Engineering comprises an These units may be regarded as serving the industrial liaison office, which is attached to university community and be funded out of the dean’s office in order to coordinate the the university budget; or they may be practical training of students and industry’s understood as a commercial enterprise, and needs for qualified engineers. fees may be charged for services rendered. 4.3. Creation of Autonomous Support Case 2: The Industry and Technology Structures Relations Office of the National Many universities worldwide have created University of Singapore (Chou 1993) structures enjoying a certain amount of In 1992, the National University of management autonomy such as University- Singapore established the Industry and Industry Research Centers, Higher Technology Relations Office (INTRO) in Education Trading Companies, Constancy order to provide a ‘one-stop-shop’ for

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Centers, Foundation, Incubators and Science public employment constraints, the direct Parks. participation of academic staff as paid consultants. Since they may be companies University-Industry Research Centers: with limited liability, the mother institute Setting up Sectoral Structures may be protected from the economic risks The University-Industry Research Centers these structures face. can be created by some particularly enterprising researchers, by national The University Consultancy Center authorities, and also by the universities The Consultancy Center model is quite themselves. The University-Industry predominant in African Countries. Its aim is Research Center is a predominant model in to provide a university interface for all those North American and Western Europe. In who are interested in expert advice by most countries in this region, “the group of university staff. For instance (Djangmah the directors of the center is recruited from 1992) in Ghana, the three national the faculty of the university; in fact they are universities: Legon, University of Science professors at several institutes in the and Technology, and the University of Cape department of information technologies Coast have all set up University Consultancy (Gering and Schmied 1992). Centers.

4.4. Commercializing University Case 3: The Technological Consultancy Products-Setting up Independent Support Center of the University of Science and Structures: Consultancy Center, Trading Technology at Kumasi, Ghana Company and Foundations (Djangmah 1992) With a view to promoting the The Technology Consultancy Center (TCC) commercialization of university projects, of the University of Science and Technology more and more institutions are establishing at Kumasi, was already established by the separate structures. Such structures may be council in 1972. The TCC at Kumasi has, called ‘University Consultancy Centers’, if over the years, developed into a major center they concentrate on the provision of export for the development, promotion and transfer advice, or ‘Higher Education Trading of appropriate technologies, in particular for Companies’, more predominant in Western small-scale industries, despite the fact that Europe, or ‘Foundations’ in Latin America, its initial mission was the provision of if the services offered by the university consultancies. The TCC at Kumasi is an encompass a wide range of products. All autonomous university unit with a these external structures aim at creating management board chaired by Vice- favorable conditions for commercial Chancellor and on which all the deans of the activities or exploiting the results of faculties serve. This principle was set up to technology transfer with the primary make the board a high-level decision- purpose of creating financial benefits for the making body which represents the mother institution. Their higher degree of University at large. The TCC director is autonomy allows them to constitute appointed by the Vice-Chancellor. The governing bodies with the needed expertise University of Science and Technology and experience, the development of their provides funds for the payment of staff own strategic plans the ability to employ salaries, office expenses and transport. It is, staff with a required specialty unfettered by in particular, the production units that

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ISSN: 2229-6158 contribute widely to the total income of they conduct R & D tasks for industry or TCC. The TCC experienced considerable government, as well as produce and market difficulties in its attempt to transfer a good or a service (Osterrieth 1993). A technology from the university to the Trading Company does not need to have any entrepreneurs until it set up the Intermediate employees, as all its management and Technology Transfer Unit (ITTU). The support services are bought as required from objective was to assist local craftsmen and the parent institution (Leonard 1992). engineers to establish their own workshops and to apply the improved production Foundations techniques they have seen in practice. The Foundations have been established in TCC at Kumasi can be considered as a particular in Latin American universities, successful structure for technology transfer. but their functions and functioning is quite However, its role in attracting funds for the similar to that of the Trading Companies. university and supplementary income to the They have private non-profit-making status staff has been rather limited. The Center has with the purpose of bypassing bureaucratic been very successful in attracting funds rules existing within universities, in technical assistance, travel grants and particular, in the area of financial donations from many nongovernmental management of the projects contracted with organizations, development agencies United firms. Foundations may cover the activities Nations Educational, Scientific and Cultural of all departments, or only a single one. Organization (UNESCO), foreign governments and sector ministries of the Case 4: The Foundation of the Central Ghana Government, but less so from the University of Venezuela (Project private sector. Columbus 1990) The Foundation at the Central University of The Higher Education Trading Company Venezuelan Research Type University was These specific companies were established created in 1982 as a non-profit making in almost of the Western European countries private association with legal personality, and they are particularly frequent in the UK. with a capital of 80 million bolivars. Its Several Western European governments function is to commercialize university have supported the setting up of these research products and to act as a body that organizations, such as through the creation receives donations for the University. As of a favorable legal environment, allowing a such, the Foundation can be considered as higher education institution to become a being primarily concerned with income shareholder in a private company. Thus, in generation. Ireland, the universities have been entitled to The Foundation works through a network of hold some shares in an enterprise (Frain so-called enterprises which produce goods 1992). and services out of university research. Such Trading Companies are autonomous enterprises exist in five areas: interfaces for the management of the  production, distribution of products university’s commercial activities, usually at for the health sector, a non-profit making basis. They may run  laboratory analysis, specialist facilities, consultancies, short  production and distribution of course work and even run Science Parks. In cosmetic products, general, they support technology transfer, or

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 production of educational and spreading also to Western Europe and Asian training materials, and countries (cf. Example of National  expert advice in petrol extraction. University of Singapore). They may cover Some enterprises are tightly controlled by three related, but different types of their academic unit; others have a higher university-industry relations as follows: degree of autonomy. Some do limit their i) formal industry-university action to contractual research or to research program often organized commercialize the results of their research; under the auspices of a national others are involved in activities, such as agency concerned with production, which are outside the traditional promoting R & D, scope of university activities. The ii) a university-wide or centralized management structure of these enterprises is affiliate program, and relatively simple since their executives are iii) a focused or decentralized university professors and they have their affiliate program, typically offices on the university campus. These operating within an academic enterprises have emerged from the Faculties department. and research Centers. They are private The focused affiliate program is by far the companies. 90% of the capital belongs to the most common type to be found in the USA, Foundation and 10% to the University. An organized by the university, firms with agreement has been established between the interest in a given area “affiliate” with a University and the Foundation that profits department or faculty possessing a national will not be distributed according to the reputation in that area. Member firms pay proportion of share holding, but shall benefit affiliation fees. Such type of affiliation university research. 15% goes to the allows firms to have an influence on the Foundation, 15% to the Faculty in which the direction of university-based research in an research is conducted, 60% goes to the area of direct interest to the corporation, an research unit to which the enterprise is inside track on acquiring technological attached and the remaining 10% is kept as a information, access to researchers and reserve in the enterprise. graduate students of the department (Burke and Light 1990). 4.5. National and Transnational Networking The National Consortium Another model independent from the above The consortium model is well developed and logic of development stages in university- has been particularly successful in countries industry relations is that of networking of the European Union (EU) with less numerous institutional partners. The developed national R & D policies and university may be the driving force behind programs and where opportunities for the networking of a number of enterprises, collaboration with industry were less such as through the creation of an ‘affiliates developed. In these countries, such as program’, or a national or government or Portugal (Sellar 1990), Italy (Romagnoli international non-government organization. 1991), and Spain (Castillo et al. 1995) such consortia represent the most developed The Industrial Affiliate Program structures for collaborative activities with Such programs have a long-standing enterprises. tradition in North America, but are

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Transnational Initiatives Summer Internship Project, iii) In the Western European context for Collaboration through consultancy, and iv) instance, the European Union (EU) has Collaboration through seminars, workshops played an important role in the networking and conferences. of several industries and universities in a selected number of research areas, in i) Collaboration through designing and particular in the pre-competitive research updating business course curriculum: domain. The purpose of such networking is To make the curriculum more effective, the the pooling of expertise and knowledge for industrial executives may be co-opted as the R & D activities in some of the high tech members of the academic body of the areas such as information and business school, who can provide significant communication technologies and inputs to the designing and updating the implementation of an applied research curriculum. However, the survey of some project with a particular development literature indicates that ‘business school- objective. industry collaboration’ for a better business curriculum can operate at four major stages. Discussion methods: These are as follows: Some public as well as private universities . policy perspective, wish to organize some program to improve . designing and developing the their visibility along with generating some curriculum, funds. But within the existing status of the . review of the existing university system, public financed university curriculum, and departments/faculty in Bangladesh cannot . implementing the curriculum. collect fund by any other means except the allocation of the government. The present study observes that most business school in ii) Collaboration through summer Bangladesh organize some seminars, internship project: workshops and conferences every year and As a part of the course requirement, in most the industry meets the faculty members of of the business school in Bangladesh, the business schools at such venues. Such students are expected to work on a project in type of seminars provides a forum for a the industry involving fieldwork. The return, dialogue between business school and which may be expected from such type of industry. interface through ‘summer internship project’, is that some real problems of the University-Industry Collaboration industry are intimated to the business Bangladesh Perspective schools through this process. Also some of Several researches indicate that there is a the projects reports with suitable additional positive role of Business school-industry information can be developed into good Collaboration in improving the quality of cases for the classroom discussion. For this, business education. In this view the level of students require the support to the industry collaboration between business school and in providing the necessary information. In industries in Bangladesh that may exists in this regard, the initiative has to come from the form of: i) Collaboration through the top management of firms in respond to designing and updating business course the request from business schools. curriculum, ii) Collaboration through

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ISSN: 2229-6158 iii) Collaboration through consultancy: dialogue between business school and The broad terms of reference of consultancy industry. are added commercial value to academic expertise and knowledge, and to market the 6. CONCLUSION intellectual and infrastructural resources of As the relations of higher education business school for national and industrial institutions with enterprises are developing, development. Emanating from this broad they become also more difficult to manage. objective, the specific objectives of such Management of these relations refers to both consultancy may include the following: strategic and operational management  to provide technical support to issues. Strategic management of university- industry, industry relation means that guidelines have  to promote and foster goal- to be established which allow universities to oriented industrial research and make use of these relations to better fulfill development both at industrial their overall mission. Operational premises and business schools, management relates to structures, rules and and procedures, such as those concerning the  to foster exchange of information control of newly created semi-autonomous and technical experts between structures. Also financial and personnel business school and industry, to management as well as management of work in generic areas of interest. contracts and intellectual property issues are becoming increasingly important. A program concerned with developing university-industry relations must receive iv) Collaboration through seminars, top management backing in order to receive workshops and conferences: recognition by the academic community, Seminars, workshop and conference are who, in many cases will have to collaborate important means for ‘business school- actively in it. Indeed, such programs industry collaboration’. But paucity of fund perform a secondary function at the is a barrier for arranging such type of university whose traditional tasks are discussion methods. Some public as well as teaching students and doing basic research. private universities wish to organize some Academic staff will only support a program to improve their visibility along university-industry program if they perceive with generating some funds. But within the its usefulness for the institution, for instance existing status of the university system, in terms of generating income and widening public financed university research opportunities. Finally, it is departments/faculty in Bangladesh cannot important to ensure that the thrust of the collect fund by any other means except the program matches the needs of industry. In allocation of the government. The present that respect, it is essential to link a limited study observes that most business school in number of leading local business people Bangladesh organize some seminars, through their membership in a central workshops and conferences every year and governing board. Likewise, the board must the industry meets the faculty members of include senior academics and administrators the business schools at such venues. Such from the university to ensure that activities type of seminars provides a forum for a and policies are consistent with the academic strengths and aspirations of the

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