Version 20 January 2014
Regional Innovation Monitor Plus
Regional Innovation Report Saxony-Anhalt
To the European Commission Enterprise and Industry Directorate-General Directorate B – Sustainable Growth and EU 2020
www.technopolis-group.com
Regional Innovation Monitor Plus
Regional Innovation Report Saxony-Anhalt
technopolis |group| in cooperation with
Dr. Andrea Zenker Dr. Henning Kroll Fraunhofer ISI
Table of Contents
1. Main Trends and Challenges in the Regional Innovation System 5 1.1 Recent trends in economic performance 5 1.2 Recent trends in regional innovation performance 8 1.3 Identified challenges 15 2. Innovation Policy Governance 16 3. Innovation Policy Instruments and Orientations 27 3.1 The Regional Innovation Policy Mix 27 3.2 Appraisal of Regional Innovation Policies 32 3.2.1 Knowledge production 32 3.2.2 Knowledge transfer 33 3.2.3 Innovation support 34 3.3 Good practice case: Industrial Initiative for Central Germany 39 3.4 Towards Smart Specialisation Policies 41 3.5 Possible Future Orientations and Opportunities 44 Appendix A Bibliography 47 Appendix B Stakeholders consulted 50 Appendix C Statistical Data 51
Table of Figures
Figure 1: Economic performance indicators...... 7 Figure 2: Innovation Performance Indicators...... 9 Figure 3: R&D expenditure per sector of performance...... 13 Figure 4: Share of R&D expenditure per sector of performance ...... 14 Figure 5: GERD and GDP trends ...... 14 Figure 6: Technological & non-technological innovators ...... 15
Tables
Table 1: Innovation Policy Governance Saxony-Anhalt...... 19 Table 2: Innovation Policy Institutional Set-Up and Available Human Resources .26 Table 3: Existing regional innovation support measures...... 31
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Table 4: Project approvals and allocated subsidies of innovation programmes in Saxony-Anhalt 2010-2012 ...... 34
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Commonly Used Abbreviations: BERD Business Expenditure on Research and Development EAFRD European Agricultural Fund for Rural Development EMFF European Maritime and Fisheries Fund ERDF European Regional Development Fund ESF European Social Fund FTE Full-Time Equivalent GDR German Democratic Republic GERD Gross Expenditure on Research and Development GOVERD Government Expenditure on Research and Development HERD Higher Education Expenditure on Research and Development RIM Regional Innovation Monitor
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PREFACE
Launched in 2010, the Regional Innovation Monitor1 continues to be one of the flagship initiatives of DG Enterprise and Industry of the European Commission. From the outset, it aimed at supporting sharing of intelligence on innovation policies in some 200 regions across EU20 Member States. RIM Plus aims to help regions to improve their innovation policies based on better and harmonised policy intelligence. The new contract aims to contribute to the development of more effective regional innovation policies and promote policy learning. Building upon the experience gained and results obtained during the implementation of the RIM in the period 2010-2012, the RIM Plus service evolves towards providing practical guidance to regions on how to use the collected information, establishing a network of regional experts with thematic specialisation, and organising specialised workshops taking into account the relevance and potential interest among the regional innovation policy makers. RIM Plus covers EU-20 Member States: Austria, Belgium, Bulgaria, the Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, the Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Sweden and the United Kingdom. This means that RIM will not concentrate on Member States where the Nomenclature of territorial units for statistics NUTS 1 and 2 levels are identical with the entire country (Estonia, Latvia, and Lithuania), Malta which only has NUTS 3 regions, Slovenia which has a national innovation policy or Cyprus and Luxembourg which are countries without NUTS regions. The main aim of 30 regional reports is to provide a description and analysis of contemporary developments of regional innovation policy, taking into account the specific context of the region as well as general trends. All regional innovation reports are produced in a standardised way using a common methodological and conceptual framework, in order to allow for horizontal analysis, with a view to preparing the Annual EU Regional Innovation Monitor Plus report. European Commission official responsible for the project is Alberto Licciardello ([email protected]). The present report was prepared by Andrea Zenker and Henning Kroll. The contents and views expressed in this report do not necessarily reflect the opinions or policies of the Regions, Member States or the European Commission. The Regional Innovation Access Point and Knowledge Hub presenting further details of the regional innovation measures, policy documents and regional organisations in Severoiztochen is accessible through the RIM Plus online inventory of policy measures here: http://ec.europa.eu/enterprise/policies/innovation/policy/regional- innovation/monitor/region/select Copyright of the document belongs to the European Commission. Neither the European Commission, nor any person acting on its behalf, may be held responsible for the use to which information contained in this document may be put, or for any errors which, despite careful preparation and checking, may appear.
1 http://ec.europa.eu/enterprise/policies/innovation/policy/regional-innovation/monitor/
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Executive Summary
1. Main Trends and Challenges in the Regional Innovation System Saxony-Anhalt is one of the eastern German federal states. The region faced substantial political and economic transformation since the 1990s and is characterised by fragile economic structures and a comparatively high dependence on large industrial companies that – frequently not headquartered in the region – have their research facilities elsewhere. Further, the region characterised by intra-regional disparities: Economic activities are largely concentrated in a limited number of cities, while other parts are sparsely populated and dominated by agricultural activities. Economic activity in Saxony-Anhalt remains strongly characterised by the chemical industry, as well as mining, machine building, food industries, public services, transport, logistics and agriculture. Nonetheless, new fields were developed, mainly in automotive, biotechnology, medical technologies, information and communication technologies, and renewable energies (particularly wind energy, photovoltaic). Saxony-Anhalt steadily recovered from substantial structural challenges due to economic transformation since the beginning of the early 1990s, and was only to a moderate extent affected by the recent crisis. Accordingly, unemployment figures keep decreasing steadily – down to about half their end-1990s level – even though still above the national average, Challenge 1: Unbalanced Structure of the Regional Innovation System Besides some large industrial players that only to a moderate extent engage in research and development activities in the region, Saxony-Anhalt’s economic structure is mainly characterised by small and medium-sized enterprises from which only a modest share perform R&D and innovation activities. Given the region’s vulnerability in terms of unemployment, both types of businesses are needed to keep in check. While various efforts are addressing this problem and try to connect the regional economic base to the regional research sector’s generation of knowledge no complete, short-term alleviation of the problem can realistically be expected from them. While targeted engagements in new industries may help to transform the regional economy they must also be treated with care – as the equally quick rise and fall of the region’s photovoltaic industry has impressively demonstrated. Challenge 2: Demographic Change and Outmigration A further challenge of particular importance is the substantial outmigration of the region’s qualified labour force. As the outmigration of students and graduates reduces the region’s qualified human capital base and weakens the regional research and innovation system, Saxony-Anhalt becomes less and less attractive as an investment location for technology-oriented firms and/or research organisations – potentially prompting a vicious circle or downward spiral with a view to first innovative capacity and later socio-economic well-being. Summarised in poignant terms, Saxony-Anhalt seems caught in a self-fulfilling prophecy of losing its attractiveness and overall reputation as an attractive location to live and work in. Challenge 3: Budgetary Restraints Jeopardising Research and Education In the past, Saxony-Anhalt’s regional economy was strongly supported by European Structural Funds and national cross-subsidies, while the regional tax base remains rather limited. In the future, however, it will face significant decreases of financial
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inflows, resulting not only from the loss of their Convergence status, but also from expiring national cross-subsidisation and binding requirements to reduce public debt. These budgetary constraints will not be possible without dire consequences for public spending, both in higher education and research and in innovation promotion. Tough choices will have to be made across the board and research and innovation policy is likely to be high on the list of potential victims. 2. Innovation Policy Governance • In short, the Ministry of Sciences and Economic Affairs is the central actor on the political level of strategy definition. Following the previous regional elections, the formerly separated responsibilities for innovation and research are now integrated under the roof of one regional authority. The responsibility for innovation policy is since then co-ordinated under “one roof” in one directorate, facilitating strategy building processes. Research policy is organised in different directorates, but still in the same ministry. While the horizontal coordination of different responsibilities and competencies has thus been substantially simplified and improved it remains diverse and challenging – as in most German regional administrations. The region’s managing authority for EU Structural Funds, for example, is located in its Ministry of Finance. • The Ministry of Sciences and Economic Affairs recently initiated and organised a process of strategy development for the next funding period’s regional innovation strategy. This process is coordinated with the Ministry of Finances, the State Chancellery and further regional stakeholders that are in charge of research and innovation issues. Among those is the Investment Promotion Bank Saxony-Anhalt the main actors with a view to the implementation of innovation support programmes, and the Science Centre WZW, a regional think tank. Further important players are the two chambers of trade and industry, and intermediaries like technology centres, knowledge and transfer centres, among them for instance Steinbeis institutes, R&D and competence centres, and further institutions. Further, there are a number of networks and clusters that aim to induce growth and employment through science-industry linkages. Various initiatives have been set-up and public supported during the last years. As a result, today’s structure comprises diverse themes and technologies, complemented by projects that were successful in national programmes. In science and research, the Land targets excellent and application-oriented basic research, as well as knowledge and technology transfer. 3. Innovation Policy Instruments Generally, the Land pursues the approach to interlink research and innovation in order to initiate and bring forward innovative activities. This model leads to a focus the following three key elements of regional research and innovation policies: (i) Fostering knowledge production, (ii) Promoting knowledge transfer, and (iii) Supporting innovation activities. Policies aimed at knowledge production support excellent application-oriented fundamental research in core research fields. Those aimed at knowledge and technology transfer, in contrast, are reflected in various measures to support the exchange of resources between the research and industrial sectors. This is realised on different levels, for instance through network activities, measure to support personnel exchange, awards, as well as collaborative research projects. Support for innovation in regional businesses, finally, is oriented on the given conditions, more precisely the limited level of (absorptive) capacity in most regional companies. Hence, various instruments have been put in place to raise awareness and provide low-threshold incentives for innovation. Against this general background , the following three support measures are considered as central to the strategy and will be continued in the next funding period: • support for research and development projects; • knowledge and technology transfer; and
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• innovation assistants. 4. Conclusions: future actions and opportunities for innovation policy From the analyses of available documents, regional visits and stakeholder interviews, the following actions and opportunities can be emphasised as most promising: • Further focusing on core areas It seems reasonable to further focus on core areas that were developed in the last years. This refers to competence fields in research, and also to regional specialisation and lead markets, as conceived in the new innovation strategy. This is in line with the necessary concentration of financial funds during the next years. • Consolidation of existing structures Saxony-Anhalt’s innovation system substantially evolved during the last years; many structures were newly established. This refers to research infrastructure (e.g. applied research institutes), as well as to intermediary organisations like clusters and networks. To maintain a coherent innovation system, existing structures should be professionalised and improved – instead of creating additional ones. • Focusing on innovation in regional companies To increase innovation activities in the regional business sector, the continuation of low volume measures that raise awareness and support business innovation seems important. When cuts are made in light of budgetary constraints, these measures, although cross-sectional, should be upheld with priority. Without securing their basis, all ambitious, more focused measures will very likely come to naught. • Further supra-regional cooperation Cooperation across federal state borders enables access to complementary resources, not only in terms of human resources and finance, but also in relation to infrastructure and ‘critical mass’ that might support successful applications for third-party funds, or broaden the existing knowledge base. Despite its contested nature, the issue should remain on the agenda and all pragmatic options regularly explored. • Enhancing participatory approaches The current strategy building process of RIS3 is based on a high level of participation of regional key stakeholders, interest groups and the broader public. The envisaged continuation of consultation and coordination processes seems promising in order to raise identification with strategy-building processes and to access all available knowledge and expertise in the process of policy implementation. • Establishing a monitoring and evaluation system Finally, Saxony-Anhalt needs to develop a monitoring and evaluation system that allows showing the progress made in implementing the innovation strategy. Harmonising the indicator systems between the strategy and the operational programmes will be one of most immediate challenge but also a source of future opportunity for better policy design.
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1. Main Trends and Challenges in the Regional Innovation System
1.1 Recent trends in economic performance Saxony-Anhalt is one of 16 federal states of Germany. Located in the central-east of Germany, it covers a total area of 20,445 km². The state has a population of 2.26m inhabitants (2012). It borders the states of Brandenburg, Saxony, Thuringia and Lower Saxony. Its capital is the city of Magdeburg with 232.364 inhabitants (2012). Further major cities are Halle (233.705), Wittenberg (135.395), Stendal (120.182), and Dessau (120.182). With a population density of 112 inhabitants per km² it is one of Germany’s most sparsely populated regions. Saxony-Anhalt was first created as an administrative unit following WWII bringing together some formerly prosperous regions of ‘Mitteldeutschland’ (Central Germany) around Halle/Saale with structurally weak areas around Magdeburg and further north. With much of the former industrial core around Halle/Saale damaged or destroyed during the war, however, the whole region had become a structurally weak regional economy soon to be split into two different GDR districts. During times of the planned economy, the regional economy was purposefully ‘reconstructed’ by the creation of large state combines in the machine building and the chemical industry. The local SME sector, to the contrary, which had never had a very strong standing in the region was further suppressed during planned economy times. Following reunification and economic transformation, most of the once prominent heavy industries went into decline and either defaulted due to an obvious lack of competitiveness or were taken over by international investors (in the case of the chemical industry). To this day, therefore, Saxony-Anhalt remains one of Germany’s regional economies most challenged by fragile economic structures and a comparatively high dependence on a few large industrial players, many of which are not headquartered in the region. Likewise, regional economic activities remain centred on a limited number of cities and towns surrounded by sparsely populated areas dominated by agricultural activity. Reflecting this unbalanced structure, the regional economy remains characterised by chemical industries, mining, machine building, food industries, as well as public services, transport, logistics and agriculture. In 2009, for example, the chemical industry alone realised more than €16.5b of turnover (NORD/LB 2012) – exceeding a level of 30% of the region’s GDP. Beyond those, new momentum has been developed in sectors like automotive production, biotechnology, medical technologies, ICT, wind energy, and photovoltaics. In 2012, the region’s GDP amounted to about €52.8bn, or 2.0% of national total. Regional GDP per capita reached €22.933 and remains, with only 71.04%, below the German average of €32.281. While regional economic output has been notably affected by the economic crisis, the economy has recovered and is back on a path of growth. In a similar manner, regional GDP per capita has continued to display a positive trend, following a brief setback in 2009. Nonetheless, the overall trend of GDP growth from 2005 to 2012 has been less dynamic than on national average (16%/19%). In 2012, the region realised a slight trade deficit with exports amounting to €14.9bn and imports amounting to €15.7bn. The regional export quota of 28.2% is low by German standards (41.5%), in part since the landlocked character of the region does not support exports, in part due to a factual lack of international competitiveness. Like many East-German regions, Saxony-Anhalt displays high unemployment rates by German standards (11.5% compared to 6.5%) although the severity of the situation has somewhat lessened in line with the positive national-level economic development during the recent years. At the beginning of the 2000s unemployment continuously exceeded 20% while in 2013 the trend seems bound to reach 10%. Nonetheless, structural unemployment in Saxony-Anhalt remains high and difficult to eradicate
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given the weak overall structure of the regional economy. Even in 2012, long-term unemployment amounted to 5.5% and thus to more than double of the national average of 2.5%. Undoubtedly, however, large progress has been made not only compared to the situation in 2000 (11.7% / 4.0%), when the legacy of reunification was still very strong, but also to the more recent benchmark of 2005 (12.5% / 5.8%). These figures, however, can be considered somewhat misleading, since Saxony-Anhalt suffers from substantial out-migration as a result of this relatively poor regional availability of employment opportunities. Despite notably improving unemployment rates, the number of local regional force has thus decreased by more than 1% during the last five years. As those employees who decide to leave the region are often among the young and qualified, negative demographic trends emerge as a secondary challenge, in particular in Saxony-Anhalt’s less affluent, more rural areas. In the course of the past seven years, the overall region has lost an alarming 8.5% of its former inhabitants, compared to a mere 2.3% population decrease on the national level. In certain peripheral areas, these figures look even far less appealing. In 2012, the regional labour force amounted to 1.01m, 2.5% of national total, while the economically active population reached 1.23m, or 2.9% of national total. As in the rest of Germany, most employees work in the service sector (71.5%, 2012), about a quarter (26.2%) work in industry and construction. While even in this agriculturally-oriented landscape only 2.2% remain active in the agricultural sector (national average 1.6%). In line with the economic structure outlined above, much of today’s employment in the region remains concentrated on enterprises in the field of logistics, retail and infrastructure as well as in the region’s traditional key industries. Among those of the region’s top 100 firms active in the industrial sector in 2011, 27% of employment is concentrated in the chemical industry, 17% in the food industry, 16% in machine building, 12% in the metal industry and 5% in polymer processing (NORD/LB 2012). From a regional perspective, a large share of the employees work in the region’s main economic centres Magdeburg, Halle, Dessau-Roßlau, and Bitterfeld-Wolfen (around 250,000) while much of the remaining workforce is concentrated in the chemical and the mining industry (Leuna, Schkopau, Zielitz, Zeitz), outside of urban areas. While the industrial activities are mostly located in the south and central Saxony-Anhalt, the northern parts of the region remain underdeveloped. The largest employers in the region are (NORD/LB 2012, 2010, bold: major changes): • Deutsche Bahn AG (German Railways), 2011: 8.050, 2009: 8.060, transport • Dow Group Germany, 2011: 5.400, 2009: 5.956, chemical industry • Deutsche Post AG, 2011: 5.100, 2009: 5.100, logistics • EDEKA Märkte, 2011: 4.347, 2009: 4.113, retail • Public Utilities Halle GmbH, 2011: 3.276, 2009: 3.361, public utilities • MIBRAG, Mitteldeutsche Braunkohle, 2011: 2.269, 2009: 2.121, soft coal mining • K+S Kali GmbH, 2011: 2.236, 2009: 2.169, potash mining • Hermes Fulfilment GmbH, 2011: 2.100, 2009: 1.380, logistics • Mitteldeutsches Druck- und Verlagshaus, 2011: 1.947, 2009: 1.900, newspaper • regiocom GmbH, 2011: 1.732, 2009: 1.119, IT services • Q-Cells SE, 2011: 1.600, 2009: 2.780, photovoltaics • walter services Holding GmbH, 2011: 1.588, 2009: 1.750, services • IFA Gruppe, 2011: 1.469, 2009: 657, automotive supplier • Salutas Pharma GmbH, 2011: 1.461, 2009: 1.343, pharma • GP Günter Papenburg AG, 2011: 1.360, 2009: 1.971, construction • Mitteldeutsche Erfrischungsgetränke GmbH, 2011: 1.241, 2009: 1.168, drinks. While employment in the chemical and construction sectors remains on the decline, job growth has been realised in the field of logistics as well as by some small ‘rising stars’ in more dynamic sectors such as IT services and automotive. In summary, Saxony-Anhalt’s industry remains characterised by a few large players without which the regional economy would run into severe difficulties. Beyond the large players, however, small and medium sized enterprises (SME) remain responsible for the lion’s share of employment in the local industrial sector. With more than 63% of industrial and 76% of overall employment, SMEs play a similarly important role than in other parts of ‘Mitteldeutschland’, such as Saxony (63%/64%) or Thuringia (76%/79%). Both with a view to industrial and overall employment, their
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share is substantially more important than in German as a whole (43%; 68%). Other than in South-Western Germany, for instance, many of these SMEs follow traditional business models and do not display outstanding international competitiveness – while they share SMEs more general problems concerning financial and human resources. Figure 1: Economic performance indicators
DEE Sachsen-Anhalt
ECONOMIC INDICATORS
GDP per capita
GDP growth rate (2000-2010)
Long term unemployment rate
Labour produc vity growth
Regional Compe veness Index 2013
Employment in agriculture (%)
Employment in industry (%)
Employment in business sector (%)
Employment in public sector (%)
Employment in Science & Technology (%)
LABOUR PRODUCTIVITY
B-E Industry (except construc on)
C Manufacturing
F Construc on G-I Wholesale and retail trade, transport, accomoda on and food service ac vi es J Informa on and communica on
L Real estate ac vi es M_N Professional, scien fic and technical ac vi es; administra ve and support service ac vi es
0 20 40 60 80 100 120 140 160 Performance rela ve to DE Performance rela ve to EU
Source: Eurostat. In light of both the European (EU27) and the German average (Figure 1), Saxony- Anhalt displays the picture of a somewhat lagging region in several dimensions such as GDP per capita, the long-term GDP growth trend, high structural unemployment, a limited growth of labour productivity, and a certain focus on the public service sector. Furthermore, the region is among the most agriculturally oriented and includes some of the most peripheral areas in Germany. That notwithstanding, it should be acknowledged that, while lagging behind nationally, the region’s share of employment in manufacturing, science and technology, as well as its 2013 Regional Competitiveness Index, exceed the European average.
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In brief, Saxony-Anhalt’s regional economy remains weak in national comparison, while it still participates in some of the positive developments within one of the most competitive Member States. Evidently, the regional economy is dependent on mining, heavy industries, public transportation and the service sector in order to create and maintain employment – and faces difficulties to build new economic centres in an aging, structurally weak area that faces strong intra-national competition for both investment and human capital.
1.2 Recent trends in regional innovation performance As Figure 2 clearly illustrates, Saxony-Anhalt is a region that falls under the Convergence objective (in part: phasing-out) of European Union’s regional policy. It receives substantial structural funds investment in the fields of business innovation and core RTDI. Interestingly, the respective investments do not only exceed the German but also the European average. Nonetheless, it should be noted that this situation will change substantially after 2014, when the region is likely to lose its Convergence status as well as a substantial amount of national (public) co-financing. With a view to performance, the benchmarking against both national and European averages illustrates that Saxony-Anhalt is a region with a less than impressive population of highly qualified employees and a below average share of employment in high-tech industries and knowledge-intensive services. In light of the industrial structure outlined above, however, the figures could also be read as cautiously encouraging (i.e. indicating less poignant weaknesses than could be expected). Likewise, the estimated share of innovators in the SME sector remains slightly above average, in at least the European perspective. From a national perspective, however, the situation in Saxony-Anhalt’s SME sector must appear fairly bleak.
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Figure 2: Innovation Performance Indicators
Source: Eurostat. In general terms, Saxony-Anhalt’s research and development sector remains one of the most fragile in Germany, in particular with a view to business-driven RTDI activities. While it has increased in the last half of the past decade (cf. Figure 3, Figure 5), the region's overall expenditure on R&D still contributes less than one percent (€662m in 2011) to the German total (€67bn). Furthermore, the local research and development intensity remains well below national average (1.37% compared to 2.82%). More importantly, the share of business expenditure on Saxony-Anhalt’s total R&D expenditure amounts to only 32.4% - compared to nearly 70% on national average. Overall, regional business R&D expenditure (regional BERD) accounts for only €214.5m, so that its intensity reaches a mere 0.44% compared to 1.91% on national average. Overall, Saxony-Anhalt’s share of BERD in GERD is the nation’s third lowest after Brandenburg (25%) and Mecklenburg-West Pomerania (32%). In Baden- Württemberg and Bavaria, to the contrary, the business share in total R&D reaches close to 80%. While the trend is positive, the regional business R&D expenditure per capita reaches a mere €100, while on German average it comes close to €500. Even in European (EU27) comparison, Saxony-Anhalt remains lagging behind.
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With a view to the government and the higher education sector, on the contrary, the trends in expenditure per capita can be considered positive. With more than €100 per capita spent for public research and a similar amount for R&D in higher education, Saxony-Anhalt clearly exceeds the EU 27 standard regarding GOVERD, and reaches it regarding HERD. In no perspective, however, does it exceed the German average. As a similar consequence of the region’s comparatively fragile research and innovation system, the number of R&D personnel employed in the region amounted to a mere 6.912 FTE, compared to 534.565 FTE for Germany in total. Again, only 2.474 FTE of those can be attributed to the business sector, while 4.438 FTE are active in higher education and public research (2.144 and 2.294, respectively). Overall, the regional share of R&D personnel in total employment amounts to a mere 0.64%, compared to the national average of 1.39%. As regards R&D personnel in the business sector, this contrast is even stronger between 0.23% in Saxony-Anhalt and 0.86% at national level. In line with this, local Human Resources in Science and Technology (HRSTC) amount to 607.000 staff, 2.9% of all German employees with the same background. In relation to overall employment, the HRSTC numbers are below national average (18.3% vs. 20.9%) As could be expected with a view to the presence of high-tech production facilities but absence of R&D units, however, the lag is somewhat less pronounced than for R&D employment as such. In terms of research infrastructure Saxony-Anhalt is home to two main universities: the more generalist Martin-Luther University in Halle and the Otto von Guericke University of Magdeburg with a pronounced focus on technology, engineering and the natural sciences. In addition to these two full universities, four full universities of applied sciences (former ‘Fachhochschulen’), two art academies, one theological academy, and one police academy are located in the region. All together, the region’s higher education institutions spend about €215m annually on research and development, thus contributing more than 30% to the overall regional R&D effort. In terms of higher education, 40.2% of the relevant age group in Saxony-Anhalt become involved in tertiary education, which is about national average (42.4%). Likewise the number of students per FTE university personnel remains comparatively moderate with 10.7 (national average 10.9) and a substantial share of international students (8.4%) indicates a certain attractiveness of the local university landscape. Unfortunately, however, a number of students seem to leave the region’s higher education institutions during their studies. The share of graduates in the relevant age group (25.8%), even if in line with the Eastern German (28.0%) average, remains notably below the national average (30.9%). Nonetheless, local professors supervise on average 0.89 Ph.D. theses, in line with national average (IWH, Fraunhofer ISI, Euronorm, 2013). Beyond the higher education sector, a significant part of public research activities in Saxony-Anhalt is performed in 27 non-university institutes and a number of private research institutions. Among the most prominent of them are the following: • Fraunhofer Institute for Factory Operation and Automation IFF (Magdeburg) • Fraunhofer Institute for Mechanics of Materials IWM (Halle) • Fraunhofer Center for Silicon Photovoltaics CSP (Halle) • Max Planck Institute for the Dynamics of Complex Technical Systems (MD) • Max Planck Institute for Social Anthropology (Halle) • Max Planck Institute of Microstructure Physics (Halle) • Max Planck Research Unit for Enzymology of Protein Folding (Halle) • Helmholtz Centre for Environmental Research UFZ (Leipzig, Halle, Magdeburg) • German Center for Neurodegenerative Diseases, Helmholtz Association (MD). Furthermore, seven institutes from the Science Association Gottfried Wilhelm Leibniz, as well as numerous other federal and regional research institutions are located in the region (BMBF, 2013). Altogether, Saxony-Anhalt’s public research institutions spend about €250m on R&D thus contributing the remaining third to the region’s total expenditures on research and development. In 2009, 2.1% or €232m of federal
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funding for R&D were spent in Saxony-Anhalt, in line with 2.9% or € 271m of regional level funding (BMBF, 2012). Undoubtedly, Saxony-Anhalt thus disposes of key public research organisations; although it keeps lagging notably behind all other Eastern German regions except Mecklenburg-Western Pomerania. In terms of scientific output, researchers in Saxony-Anhalt published 6.954 Web of Science listed publications between 2008-2010, which amounts to a mere 2.6% of the German total (266,648) and 14.1% of publications in Eastern Germany (49,204). Hence, Saxony-Anhalt ranks 13th among the 16 German federal states, including the city states. Moreover, Saxony-Anhalt’s output of publications has declined from 2005 to 2009, other than in e.g. Saxony or Berlin. With a view to scientific productivity, 569 papers were published per thousand researchers (FTE), exceeding both the German (290) and the Eastern German (482) average. This, however, is largely a consequence of the limited presence of business researchers who statistically lower the average elsewhere, since they generally publish less (IWH, Fraunhofer ISI, Euronorm, 2013). The largest challenge for Saxony-Anhalt’s innovation system is the poor development of localised knowledge and technology transfer activities between the region’s scientific and the business sector. In a recent study, a local think tank identifies three main reasons (WZW, 2010): 1) The dominance of small and medium-sized firms (SMEs) in Saxony- Anhalt’s regional economy. As a result of this structure, local markets for complex solutions remain underdeveloped. Further, many local firms display a lack of technological absorptive capacity as well as a lack of financial resources to engage in science-industry collaborations with an unclear outcome. More generally, universities and local SMEs tend to live in ‘separate worlds’ that have little inclination to interact. Even if they tried, most firms’ employees do not have the skills to realistically assess the potential utility of research results. 2) Structures at universities and public research organisations. Within many research organisations, knowledge and technology transfer remain insufficiently acknowledged as an important “third task” beyond teaching and research and it is difficult to identify contact persons for specific themes. Even where the intention is present, a lack of qualified personnel and physical infrastructure hinder to set up technology and knowledge transfer. Finally, the fragmented research infrastructure often leaves gaps in the match between the local industrial demand for solutions and the locally available research capacities in the field. 3) Lack of professionalism in the technology transfer infrastructure. While a number of technology transfer offices and cluster organisations exist, the range of services they offer tends to lack transparency. No one-stop-shop principle has so far been implemented. The quality of some of the services themselves is low, and their administration requires improvement and professionalisation. A further limitation to local technology transfer activities is that local universities co-operate less with external partners than elsewhere. In 2010, the regional amount of third party funding acquired per professor amounted to €176.200, which was much less than €261,700 on national or even €240,100 on Eastern German average. Moreover, the relation between higher education expenditures and third party funding has remained stable throughout the past decade while it has nearly doubled in other Eastern German states. This is notable in particular as Saxony-Anhalt, since 2002, has increased its overall expenditures for higher education only to a very limited extent (<1%) (IWH, Fraunhofer ISI, Euronorm, 2013). As a result of the weak R&D activities in the business sector and the near absence of technology transfer, regional inventors filed for a mere 359 patents at the European Patent Office between 2006 and 2008, amounting to 0.5% of German (70,633) or 10% of Eastern German total (3,697). Likewise, regional patenting intensity of 118.7 per working population remains far below both the national (593.4) and the Eastern
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German (215.6) average (IWH, Fraunhofer ISI, Euronorm, 2013). Evidently, the lack of larger firms and local corporate R&D centres can in no way be compensated by the fragmented high-tech activities in the vicinity of some of the region’s universities and public research organisations. In summary, Figure 3 and Figure 4 underline that despite substantial investment in public research, and in the higher education sector (since around 2008), the regional research intensity of the private business sector could not notably be raised. This is in part due to the fact that some of the most prominent economic activities in Saxony-Anhalt are by their very nature not very research oriented, among them medium-scale opencast mining, refineries and production of bulk chemicals, logistics, public utilities, and retail. Likewise, the employment share of high-tech industries and knowledge-intensive services amounted to 5.9%, clearly below the national average of 8.5%. This is a basic structural issue which remains difficult to address through support measures alone. In part, it is due to an unfavourable distribution of firm sizes in the local enterprise sector. The latter is to more than 95% composed of small firms with less than 50 employees. As Figure 2 and Figure 6 illustrate, these SMEs are less innovative than others in Germany, so that no significant amount of R&D expenditure can be expected. Further, their below average inclination to co-operate with others adds to the lack of innovativeness in the local SME sector. Finally, Saxony-Anhalt may be home to large production facilities in e.g. the chemical sector, but only in few cases to headquarters or noteworthy central research facilities that would conduct on-site R&D in Saxony-Anhalt as well as register and hold private IPR in the region. Consequently, the number of locally filed EPO patents per million inhabitants (39.9) remains far below the German average (277.0). Beyond the information provided in terms of estimated regional CIS data, additional German survey results confirm that the share of innovators in local firms and the share of regional turnover that they generate (32%/54%) remains significantly below the national (40%/66%). It is however in line with the Eastern German (33%/53%) average. When only focussing at the industrial sector, the share of innovators in firms and turnover (42%/63%) remains both below the national (51%/87%) and the Eastern German (47%/71%) average. With a view to exports, the discrepancies between Saxony-Anhalt (59%), Eastern Germany (79%) and Germany as a whole (88%) are even more obvious (IWH, Fraunhofer ISI, Euronorm, 2013). Finally, the regional propensity to set up new businesses is the lowest in the country. In 2011, only 118.9 new businesses were registered per 10,000 labour force, compared to 146.8 on Eastern German and 193.8 on national average. Even some years after the peak of the economic crisis, Saxony-Anhalt remains one of only two federal states with a negative balance of business registrations of -4.0 firms per 10,000 persons of the labour force. In a similar manner, the region registered 55.9 start-ups per 10,000 labour force compared to at least 66.6 in Eastern Germany and 94.7 nationwide. (IWH, Fraunhofer ISI, Euronorm, 2013).
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Figure 3: R&D expenditure per sector of performance.
Source: Eurostat.
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Figure 4: Share of R&D expenditure per sector of performance
Source: Eurostat Figure 5: GERD and GDP trends
Source: Eurostat
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Figure 6: Technological & non-technological innovators
Source: Eurostat.
1.3 Identified challenges With a view to the main challenges, both the analysis of statistical data and a number of expert interviews have confirmed that Saxony-Anhalt faces three main challenges on its way to create and maintain regional innovative potential. Challenge 1: Unbalanced Structure of the Regional Innovation System As has been illustrated above, Saxony-Anhalt’s regional economy is characterised by mostly non-innovative small and medium-sized firms on the one hand, and a number of large industrial players on the other. Both of those are needed to keep in check the region’s high vulnerability in terms of unemployment, and thus remain in the focus of regional economic policy. Neither of the two groups, however, is very inclined or even interested in innovating and filing intellectual property rights in the region or collaborating with local universities. Even though the region’s higher education institutions are not of lesser quality as such, their disciplinary orientation forms a poor match with the regional industrial structure. Consequently, building regional innovative capacities may require focusing on new industries – which can be risky, as the recent fall of the Eastern Germany photovoltaic industry has proven. Alternatively, local universities can seek to attract matching firms ‘on campus’ through industry- research campus models (see below) which, however, is unlikely to bring about structural changes in the nearer future. Summing up, Saxony-Anhalt’s economy is one that by its very nature is not very receptive to strategies of economic transformation. To the contrary, the regional economy remains strongly dependent on a number of incumbent industrial players and a limited number of more recent growth poles. Challenge 2: Demographic Change and Outmigration The outmigration of qualified personnel is one of the region’s major challenges in three main perspectives. Firstly, the outmigration of students weakens the regional research system and decreases its political legitimacy, as regional legislators will be unwilling to pay for the education of students that move before graduation or will at least work elsewhere later on. Secondly, the selective outmigration of the local labour force renders the region unattractive for potential investors. While firms may be interested in local excellence in research, the lack of potential employees may encourage them to move elsewhere. Thirdly, the outmigration of the younger and better-educated part of the population turns the region into a less attractive place to live in and settle. Even if technologically more advanced or otherwise economically successful firms invest in the region, Saxony-Anhalt’s overall reputation as an investment location is unlikely to further the development of these first movers’
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investments into thriving clusters. In the past, larger technology-oriented investments in the industrial sector have remained isolated and sporadic. Challenge 3: Budgetary Restraints jeopardising Research and Education Since reunification, the development of Saxony-Anhalt’s regional economy has been substantially invigorated by both European structural funding and intra-national cross-subsidies. The region’s revenue from taxes, on the contrary, unsurprisingly mirrors its overall economic performance. In the coming years, moreover, all Eastern German regions will lose a significant amount of both types of funding as they are about to lose Convergence status. The national cross-subsidisation scheme will expire in 2019 (financial equalisation system, solidarity pact for Eastern Germany). Moreover, the German regions will be constitutionally barred from incurring further public debt from 2019 (Schuldenbremse, literally: brake on debt). In consequence, not only many of the region’s current funding programmes, but also the available basic funding for universities and public research institutions will have to be cut back substantially. Although declining birth rates will eventually reduce the needed capacities in higher education, the required cutbacks come to fast and to substantial to allow for anything like a smooth transition. Further, a certain critical mass is necessary to maintain a qualified education and qualification structure and thus to provide skilled graduates. In the nearer future, Saxony-Anhalt will have to substantially scale down both its higher education activities and those public research activities that cannot acquire substitutive funding from excellence-bound federal budgets or the industrial sector. While, theoretically, this situation may constitute an opportunity to reduce the local scope of research activities to those that best match regional needs, it also harbours the risk of intensified battles for the distribution of funding among organised interest groups with other priorities.
2. Innovation Policy Governance
As one of the 16 German federal states, Saxony-Anhalt has a State Parliament and a State Government, based in the regional capital of Magdeburg. The regional parliament – elected every five years – is the Land’s constitutional body. It hence passes federal state laws, decides on the regional budget, elects the Minister-President and supervises the government and the administration. The Minister-President is the head of the federal state government, and determines the guidelines of the regional government’s policy. Currently nine ministers are responsible for policies in their departments, while the State Chancellery coordinates the government’s and the administration’s work and assists the Head of Government. Saxony-Anhalt has a representation in Berlin and in Brussels. Generally, the German research and innovation system is differentiated and decentralised. It can be characterised by its multi-level governance structure, mainly resulting from the federal organisation system of the German state. This leads to dispersed responsibilities for innovation policies – including the strategic and conceptual levels as well as the design and implementation of measures – between the federal and the federal states level. The precise division of responsibilities is regulated in the German constitution and generally follows the subsidiary principle, complemented by certain fields of activity where federal and regional levels cooperate. In education policy, including all matters of higher education, German federal states have full responsibility, although most follow certain basic rationales which are applied nationwide. National research funding in Germany is granted by means of (medium and long- term) institutional funding, departmental research (including contract research) and (short and medium-term) project funding in different research fields. Project funding and departmental research is mainly granted by the Federal Ministry of Education and Research (Bundesministerium für Bildung und Forschung, BMBF), but also by other ministries, mainly the Federal Ministries of Economics and Technology
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(Bundesministerium für Wirtschaft und Technologie, BMWi), and of Defence (Bundesministerium der Verteidigung, BMVg). The governmental budget foresees to spent 42.7% for institutional funding of the research infrastructure, 50.0% for project funding and departmental research, and 1.7% for the higher education sector for 2013 (total budget foreseen: €14,439.9m). Direct project funding and departmental research (€6,431.7m foreseen for 2013) is mainly granted by BMBF (52.4%), BMWi (12.8%) and BMVg (12.6%). The remaining 22.2% are allocated by further ministries (BMBF 2012: 430 and BMBF Data Portal). Institutional funding contributes to basic funding of non-university research performers and research funding organizations (while institutional funding of the higher education sector is under responsibility of the federal states): The German non-university research organisations – the largest four being the Max Planck Society for the Advancement of Science, the Fraunhofer- Gesellschaft, the Helmholtz Association and the Leibniz Association which are complemented by various further institutions – receive a certain share of their budget through public basic funding shared between the federal government and the federal state where the research institutes are located. In 2010, public institutional funding amounted to €7.07b (from which €4.9b by the federal government). The largest recipients are the German Research Foundation (32.3%) and the German national research centres of the Helmholtz Association (28.9%) whose basic funding (about two thirds of the total budget, cf. www.helmholtz.de) is provided with 90% by the federal government. Equally, basic funding of the Fraunhofer Gesellschaft’s institutes (about one third of the total budget) is granted with 90:10 shares by the Federal and the regional governments, while the share is 50:50 for institutes of the Max-Planck- Gesellschaft (KMK, [2013]). Further funding for science and research on the national level is granted by the German Research Foundation (www.dfg.de) that allocates funds (provided by the federal government and the federal states) for high-quality (basic) research projects. Further, research projects are commissioned by industry as well as through foundations, while the KfW, the government-owned development bank (www.kfw.de) grants support in innovation-related matters, among other fields (BMBF 2012: 440). Hence, as all German federal states, Saxony-Anhalt also contributes to basic funding of non-university regional research institutes and to DFG funds. As the regional budget (target figures 2014) shows, the Land foresees to spend €115.7m for non- university research institutions, including €22.6m for the German Research Foundation, €21.4m for four institutes of the Max Planck Society located in Saxony- Anhalt, €64.5m for four regional institutes of the Leibniz Association, and €4.1m for two large research centres of the Helmholtz Association. €5.5m are foreseen for five facilities of the Fraunhofer-Gesellschaft in Saxony-Anhalt. On the other hand, Saxony- Anhalt benefited from 2.1% of federal R&D funding in 2010 (€242.2m) (BMBF 2012: 437). On the level of national strategy-building, the most important document of the last years is the Hightech Strategy. Launched in 2006, it is the first comprehensive and inter-ministerial framework for German innovation policy (BMBF 2006). The Hightech Strategy refers to innovation in a broad perspective, i.e. it includes science and research as well as bringing products onto the market, and thus aims at integrating and coordinating different policy fields. Seventeen innovation and five cross-sectional areas as well as diverse supporting programmes and measures target the development of Germany into a knowledge research intensive industrial and service location – the most prominent being the Initiative of Excellence at German universities, the Leading-Edge Cluster Competition, the Higher Education Pact or the Joint Initiative for Research and Innovation, to name just a few. This approach was further developed, resulting in the High Tech Strategy 2020 (BMBF 2010), which basically pursues the goal to contribute to the resolutions of global problems and challenges. Five fields of action (climate/energy, health/nutrition, mobility, security and communication), specific objectives and strategies towards their realisation are formulated.
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In addition to the High-Tech Strategy and its supporting measures, the German federal government launches various research and innovation programmes. Main funding bodies are the Federal Ministry of Education and Research (BMBF) and the Federal Ministry of Economics and Technology (BMWi). Among them are the following programmes, which also include projects in Saxony-Anhalt (see section 3.2) • Central Innovation Programme SME (Zentrales Innovationsprogramm Mittelstand, ZIM) of BMWi • Entrepreneurial Regions (Unternehmen Region), the BMBF innovation initiative for the New German Länder, • Leading-edge Research and Innovation in the New German Länder, (Spitzenforschung und Innovation in den Neuen Ländern) of BMBF • Industry-Science Research Campus (Forschungscampus) of BMBF. In addition to the federal government, the federal states (Länder) are responsible for research, innovation and technology policies in their specific region. Technology and innovation policies have a certain tradition in (western) German federal states, starting from the 1980s onwards, while the eastern German Länder are active in innovation policies since the 1990s. Generally, the ministries for research and education and for economics (with individual specific orientations) are the most important players on the regional level. In Sachsen-Anhalt, the current government bundles responsibilities for science and economic affairs in one ministry (see below). In a broad perspective, the division of labour between federal and regional levels can be characterised as follows: While the national level targets the development of positive framework conditions in Germany and the development of large-scale fields of relevance for the whole country (e.g. new technologies or solutions to grand challenges that require the bundling of forces), the regional level focuses on the specific conditions of its territory (enterprise structure, predominant sectors, levering potentials and resources, specific weaknesses and challenges). In some policy fields, both parties can engage (so-called Gemeinschaftsaufgaben (national-regional joint agreements)), particularly in improving the regional economic structure and in improving agriculture and coastal preservation. Those tasks are realised by the federal states, but the federal government is involved in the conception and funding. Legal base for Gemeinschaftsaufgaben is the German constitution. Before the Föderalismusreform in 2006 (reform process of German federalism), the development of universities and university hospitals was the third joint initiative; since then, federal and regional governments can cooperate based on specific legal rules in the development of universities, the supra-regional support of research activities, and in international comparative analyses of the education systems. In addition, there are various mechanisms for coordinating the federal and regional levels, the most prominent in RTDI-related matters being the Gemeinsame Wissenschaftskonferenz (Joint Science Conference, www.gwk-bonn.de). Members are federal and regional ministers responsible for science and research on the one hand and for finances on the other hand. The Conference specifically devotes its activities to research funding, policy strategies in science and research and the science system and focuses on issues that affect both the federal and the regional levels. The goal is to coordinate policy activities of common interest while preserving own competencies at the same time and thus to contribute to the strengthening of the science and research location of Germany. More specifically, the Joint Science Conference members act jointly in promoting (i) non-university research institutions and projects, (ii) science and research projects in higher education, and (iii) construction of research buildings in higher education institutions in cases of supraregional importance. Saxony-Anhalt is represented by the Minister of Science and Economy and the Minister of Finance. The Kultusministerkonferenz (Standing Conference of the Ministers of Education and Cultural Affairs of the Länder in the Federal Republic of Germany, www.kmk.org) unites the ministers responsible for education, higher education, research and cultural
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affairs of the German federal states. Since – as determined by the German Constitution – educational and cultural affairs are under responsibility of the German federal states (so-called Kulturhoheit der Länder, cultural sovereignty of the German states), the Standing Conference deals with questions of education, higher education, research and cultural policies with supra-regional importance. Overarching goal is to build joint opinions and coordinated political will, as well as the representation of joint interests. The cooperation of regional ministers in the Kultusministerkonferenz is coordinated by the Länder themselves and aims at achieving a certain degree of common ground in education, science and culture throughout the whole country (for the sake of mobility, equivalent educational opportunities and representation of interests). Activities focus for instance on comparability and mutual recognition of degrees, securing quality standards in schools, vocational schools and higher education institutes, or the promotion of cooperation between scientific, education and cultural institutions. The Minister for Education and cultural Affairs and the Minister of Science and Economy Saxony-Anhalt are involved in this body; the Minister of Education and Cultural Affairs being the chairman in 2013. The Wissenschaftsrat (German Council of Science and Humanities) advices both the federal and regional German governments on questions of higher education and research. Recommendations are based on comprehensive analyses, including international comparative investigations, and on assessments of the societal framework and conditions. Specific fields of activities concern higher education, the German Excellence Initiative, research policy questions, research ratings, the German research infrastructures, evaluation, university investments and accreditation, and medicine. Recently, the Science Council published an evaluation of Saxony-Anhalt’s higher education system (Wissenschaftsrat 2013). For Saxony-Anhalt, the Minister of Science and Economy and a State Secretary of this Ministry are among the members of the Council of Science and Humanities. Besides members from the federal and from regional governments, the Council involves public figures and scientists. Table 1 summarises innovation policy governance in Saxony-Anhalt, also referring to the national level and to national-regional coordination mechanisms. The different aspects will be detailed in the following section. Table 1: Innovation Policy Governance Saxony-Anhalt Description Comment Degree of general regional Federated entity (Land) German federal states autonomy with both executive and (Länder) have substantial legislative powers; political autonomy based on limited independent tax own legislative powers; raising powers (but financial equalisation Factually, the tax base in mechanism between Saxony-Anhalt is too weak to German federal states, leverage much budgetary and financial allocations options for regional innovation to Eastern German states policy beyond ERDF/ESF after 1990) funded initiatives Degree of autonomy with High degree of autonomy The most relevant field of regard to innovation policy in RTDI policy, autonomy is the federal states’ not least due to primary full responsibility for their responsibility for regional regional higher education higher education system. In addition, German Länder launch innovation and technology policies to promote innovation activities in their regions Set-up of regional governance (comparatively) Unusual for German Länder, system centralised Saxony-Anhalt has a joint (centralised/de-centralised/ ministry for science and fragmented) economic affairs, bundling
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responsibilities across the innovation chain; this alone, however, does not counter or amend all structural complexity in Germany’s regional governance for RTDI Nature of the process of Input from both sides Most German Länder have a strategy development (participatory, based on long established (even if partly (top-down/bottom-up/ consultation processes informal) tradition of participatory within the region) stakeholder consultation Intra- and inter-regional somewhat developed There are multiple fora of co-operation co-ordination between the federal states, these fulfil their purpose but are at times fraught with political dispute; On the strategy level, cross- border co-operation is a fairly new but emerging topic On the implementation level, there are various cross-border initiatives in terms of innovation and cluster projects Source: RIM Plus repository (Saxony-Anhalt, Germany). Considering financial autonomy and funding of R&D activities in Germany’s federal states, the German Länder are an independent level of government and are endowed with own rights and obligations. The specific tasks allotted to the Länder are laid down in the German Basic Law (Grundgesetz). In order to fulfil these tasks, the Länder have a budget that they control freely and independently. A certain mechanism of aligning the Länder revenues is in force in order to enable all states to create and maintain equal living conditions for their population. Länder budgets have the following sources: (i) Tax revenues (income tax, corporation tax and value added tax revenues are divided between the federal and the Länder levels; further taxes are specifically federal or specifically Länder taxes. Among the latter are for instance inheritance taxes or transaction taxes such as real property transfer taxes), (ii) the total Länder share is distributed among the 16 federal states (basically according to the number of inhabitants and business places of companies), (iii) a financial equalisation mechanism targets the equalisation of revenue between richer and poorer states, and (iv) poor Länder are granted supplementary federal funding (Bundesministerium der Finanzen 2013). Saxony-Anhalt has an annual budget of about €10b (Landesregierung Sachsen-Anhalt [2013a]). In 2014, about €1.02b are foreseen to be spent by the Ministry of Science and Economic Affairs (from which about one forth for economic affairs and three forth for science, including higher education institutions and non-university research promotion) (cf. regional budget, downloadable at Saxony-Anhalt’s Ministry of Finance’s website). As one of the Eastern German states, Saxony-Anhalt will be confronted with decreasing public funding from the German solidarity agreement (financial allocations to the five Eastern German Länder in order to achieve a level of economic activity comparable to the Western states), the so-called Schuldenbremse in order to decrease public dept, and the European Structural Funds in the coming years. This will also affect the conception of research and innovation policies and will require new approaches to allocate available funds in the most efficient way. The current federal state government – a coalition of the Social Democratic Party and the liberal-conservative Christian Democratic Union, in office since 2011 – defined growth, fairness and sustainability as its main guiding missions for the current legislative period (2011-2016) (CDU/SPD, 2011). Main challenges are demographic
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change, financial consolidation and globalization. Concerning science, research and innovation, the coalition agreement emphasises the following aspects: • An efficient science landscape is considered crucial for the further development of the federal state; the government thus aims to strengthen the universities and to stabilize framework conditions for non-public institutes. Further, cooperation between higher education and non-university research institutions, science-industry networking and basic research will be promoted. • The government seeks to increase the share of students in Saxony-Anhalt and supports the further development of scientific centres and clusters. Further objectives are to increase participation in H 2020, to establish high-level research institutes, innovation and application-oriented research. • Business promotion will be to an increasing extent oriented at research and value added intensive companies. New modes of support shall be deployed to increase the flexibility and effectiveness of public support policies to more strongly target regional strengths (clusters and knowledge-intensive sectors). • Economic promotion policies will be coordinated with the two other central German states of Brandenburg and Mecklenburg West-Pomerania. • Implementation and management of support is delegated to external institutions (Investitionsbank, Investitions- und Marketinggesellschaft Sachsen-Anhalt mbH). • In the field of industrial innovation, the government aims at focusing its policies on supporting existing strengths along with establishing new and future-oriented sectors. • A broad approach of research and innovation policy shall be pursued, strengthening of innovation capacity and innovativeness, technology-oriented start-ups and the promotion of SME and their innovation efforts. • Strengthening clusters through networks and collaborative projects are considered as pertinent means to develop regional value chains. • The current Innovation Council will be strengthened and developed into a Cluster and Innovation Council. Accordingly, innovation policy integrates the further development of the cluster strategy in order to contribute to a comprehensive approach of research and innovation policy The key public actor in research and innovation policy is the Ministry for Sciences and Economic Affairs Saxony-Anhalt (MWW). Following the previous regional elections, the formerly separated responsibilities for research and for innovation are merged in the present Ministry of Sciences and Economic Affairs. Innovation policy is thus now in responsibility of one regional ministry (“under one roof”) facilitating coordination and strategy-building processes (though research and innovation policies are organised in different Ministry Departments). This re-organisation process substantially simplified horizontal coordination of different responsibilities and competences – and remains an exception in Germany. This ministry has the following main tasks (mirrored in four departments): 1. Economic system, administration, law 2. Research, innovation, European affairs 3. Business development, energy, mining 4. Universities and science. An important focus of the federal state’s science and economic policy is the strengthening of regional companies' innovation potentials and capacities. One important challenge in this respect is the low level of private engagement in research and development activities. Therefore, the key measure of regional policy is to support interlinkages and networking between regional SMEs on the one hand and regional
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universities on the other hand, in order to promote SMEs to use, implement and exploit innovative impulses from the regional science sector. For instance, transfer vouchers were introduced after the 2011 elections, which aim at enhancing science- industry cooperation in order to contribute to fruitful technology and knowledge transfer in Saxony-Anhalt. Transfer vouchers address regional universities and companies, and promote student engagement in regional industry on the one hand, and company access to university knowledge on the other hand. They not only refer to technical issues, but also include marketing, management and human resource aspects. The regional government wishes to increase regional companies' competitiveness, value added and income and finally to support the employment of graduates in the region. The MWW’s directorate 2 ‘Research, Innovation and Europe’, employing about 50 public servants, holds the central responsibility for innovation policy and some issues in research policy which are not covered by directorate 4. Besides innovation, the department is in charge of the research infrastructure, excellence and start-up support, while higher education policy is addressed by another unit, though located in the same Ministry. Secondary education and school policy, in contrast, belong to the responsibilities of the Ministry for Education and Cultural Affairs. Budgetary aspects of the federal state are under the auspices of the Ministry of Finance which is responsible for the regional budget plan, regional taxes, financial allocations among the different ministries’ and hosts the managing authority for EU Structural Funds. Summarising, the Ministry of Sciences and Economic Affairs is the central government actor on the level of innovation strategy building and innovation policy development, in close coordination with the federal state’s managing authority for EU Structural Funds, hosted by the Ministry of Finance, and the State Chancellery. The Ministry of Sciences and Economic Affairs also initiated and organised the strategy building and consultation process for the Regional Innovation Strategy 2014 – 2020. The basis for this strategy has been developed by an external study (VDI Technologiezentrum GmbH/GIB Gesellschaft für Innovationsforschung und Beratung GmbH 2013) that relies on the elements of (i) empirical findings on the regional economy, science and education, as well as a socio-economic analysis, (ii) an evaluation of existing innovation and cluster policies, (iii) a strategic process aiming at the identification of regional innovation potentials and strategic goals for the further development of the federal state, and (iv) a broad consultation process. Since the mid-2000s and the reorganisation of the regional research and research promotion, the Wissenschaftszentrum Sachsen-Anhalt Lutherstadt Wittenberg WZW (Science Centre Saxony-Anhalt) engages in supporting linkages within the science sector, i.e. between university and non-university research institutions, and between regional science and industry. Its general mission is to support the federal state’s science policy and exchange processes between science, economy, policy and the public. WZW’s members are the two regional universities, the regional universities of applied sciences, the majority of the research institutes operating in the region, and the Ministry of Sciences and Economy. Besides research organisation and quality management, WZW supports the Competence Network for Applied and Transfer- Oriented Research KAT (see below) and promotes information exchange through platforms and networks. WZW is involved in the new innovation strategy building process through their integration in participative processes, and through their statements reflecting the specific situation and opinion of their members. WZW has five permanent employees and further 15 persons employed through third-party funds (see also Table 2). During the last decade Saxony-Anhalt’s regional science policy followed the aim to establish a limited number of core areas in regional research, leading to specific research profiles in the state’s science sector (regional Excellence Offensive, further pursued in the Framework Agreement Research and Innovation 2011-2015). Organising science in key fields follows the rationale to concentrate available funds and thus to create and support strong and competitive research potentials in cooperation between universities and non-university research institutes. Up to now,
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this rationale led to various excellent networks in science, for instance in Behavioural Brain Sciences; Nanomaterials; Biosciences and informational processing; Biosystems, and in the Humanities. The management of policy support programmes in Saxony-Anhalt is to a large extent delegated to the regional Investment Promotion Bank (Investitionsbank Sachsen- Anhalt, IB, see also Table 2). The Bank has about 360 employees and is located in Magdeburg. It manages financial support for regional businesses, agriculture and the environment, real estate, media, culture and education, tourism, sports, and municipalities. Further, IB is the inspection authority for EU funds and in charge of EU Structural Funds controlling. Among these tasks, the Investment Promotion Bank is in charge of innovation support and the management of related programmes. Regional innovation supporting programmes cover a broad spectrum of innovation support for regional actors, except equity capital. Equity investment is granted by IBG Beteiligungsgesellschaft Sachsen-Anhalt mbH. Thus, IB covers about 80-90% of innovation supporting measures in Saxony-Anhalt and 100% of technology-oriented programmes. It maintains regular exchanges with regional Chambers of Trade and Commerce, and diffuses relevant information (e.g. new funding guidelines) through personal contacts (e.g. technology centres, clusters), its newsletter, information events, regional media and also house banks. The application procedure for innovation project tenders is organised in a two-step procedure (project outlines which are evaluated, and full proposals for a pre-selected number of applications; no competitive selection procedure); here, IB and the Ministry of Science and Economics are jointly deciding about the first selection process while the further steps of the call process and project management are realised within the Investment Promotion Bank (while the Ministry is involved in exceptional cases only). However, regular exchanges between the Ministry and the Bank are taking place, ensuring a high level of information on both sides; and the Strategy Department of the Investment Promotion Bank was involved in the drafting of the Regional Innovation Strategy 2014-2020. Saxony-Anhalt has two Chambers of Commerce (Magdeburg in the northern part of the state and Halle-Dessau in the southern part). They represent regional companies in all sectors and offers information, service and consulting in business start-up, management, innovation support, qualification, innovation, location and internationalisation. Regional handcraft companies are represented by the regional Chambers of Crafts in Magdeburg and Halle. In order to support innovation and exchange processes within the region, Saxony- Anhalt has a strong intermediary structure ranging from networks and clusters to technology transfer and competence centres. The Competence Network for Applied and Transfer-Oriented Research KAT (Kompetenznetzwerk für Angewandte und Transferorientierte Forschung) is a transfer network composed of the regional higher education sector with a specific focus on providing solutions for regional businesses, i.e. has a clear and dedicated focus on knowledge and technology transfer. Its general mission is oriented at the idea of acting as innovation catalyst for regional companies in order to strengthen their competitiveness. KAT follows a needs-oriented approach and cooperates with regional Chambers, Associations and transfer institutes in order to facilitate the exploitation of research findings for business enterprises. Not only research and development and innovation projects are targeted by KAT, but the network also provides access to its infrastructure and equipment facilities. One prominent development, based on the KAT competence ‘transfer centre medical technology’ is the high-profile Industry-Science Research Campus STIMULATE that now receives substantial national-level funding for a long period (see above). In 2012, the KAT competence centres at universities of applied sciences (Fachhochschulen) reported €9.5m third-party funds originating from industry, regional, national and European funds, often achieved in collaborative projects (e.g. Fraunhofer institutes). KAT members actively address regional companies,
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particularly SMEs, in order to motivate them for engagement in innovation. Main instruments are technology transfer through personal visits (‘scouting technology transfer’) and transfer vouchers; in 2012 a total of 623 vouchers (see page 20) were implemented (Hochschule Anhalt et al. 2012). KAT, its missions and goals, are constantly discussed with representatives of the Ministry of Sciences and Economic Affairs and further developed along the Land’s innovation strategy and its strategic guidelines. Among others, the network currently targets the further market-oriented development of its competence centres; focusing on regional companies that did not participate in knowledge and technology transfer so far (“transfer scouting”); strengthening cooperation with the regional patent agency, and more strongly focusing on intellectual property rights; or supporting innovative start-ups in cooperation with universities and through the ego.-innovativ programme (see page 35). KAT cooperates with regional initiatives, chambers, associations, networks and clusters. KAT’s advisory board supports its strategic development and is also involved in the evaluation of its activities (Hochschule Anhalt et al. 2012). Saxony-Anhalt has various regional networks and clusters. Cluster policy was one target of the previous innovation strategy 2013 (Ministerium für Wirtschaft und Arbeit Sachsen-Anhalt ) that integrated the results of an analysis of regional cluster potentials (VDI Technologiezentrum GmbH/Technopolis Austria GmbH 2008). Clusters receive public funding for a period of six years; the Ministry defines target agreements with each individual cluster. Supported clusters are for instance in automotive (MAHREG), Chemistry and plastics in Central Germany (see also section 3.3), biotechnology, machinery and plant construction (SMAB), renewable energies (CEESA), information technologies Central Germany, and recycling economy. Networks and clusters are considered important preconditions for creating growth and employment in the region, particularly through balancing the existing disadvantages through the high share of SMEs. Concerning regional networks, the Land hosts for instance INNOMED, a regional network for neuro-medicine technology, the plant biotechnology network InnoPlanta, is engaged in Polykum eV., the association for plastics engineering and polymers Central Germany, and hosts a further network in food production. Further initiatives were established in the frame of Federal innovation programmes and receive funding from the Federal Ministry of Education and Research and the Federal Ministry of Economics and Technology (ZIM, leading- edge cluster competition, ‘Entrepreneurial Regions’, see page 38). Finally, Saxony-Anhalt hosts various knowledge and technology transfer centres, information services, R&D and competence centres, business incubators, or demonstration centres (Landesregierung Sachsen-Anhalt, [2013b]). They act as incubators for young innovative enterprises, engage in technology transfer, offer consulting and support for start-ups. EU Structural funds are used for co-financing these structures; in their evaluation on Cohesion Policy Programmes, Grusevaja et al. (2013: 58) particularly emphasise the positive development of the Technology and Incubator Centre Halle at the Weinberg Campus: After 1990, a technology park with university and non-university research, the technology centre and a biocentre were established on a former vineyard area. In the meantime, the Weinberg Campus evolved into a network of university and non-university research institutes and companies. A specific organization – weinberg campus e.V., a registered association – engages in networking, further promotion and marketing and further activities. A further actor in the regional innovation landscape is the patent agency ESA (ESA Patentverwertungsagentur Sachsen-Anhalt GmbH) that addresses higher education and research organisations and their inventory potentials. Main target is the commercialisation of inventions of regional research institutes. In this respect, the agency provides information, analyses patent potentials and provides patent and market analyses, coordinates application procedures and accompanies exploitation (licences, contract negotiations, start-up processes). Concluding, Saxony-Anhalt has a differentiated landscape for research and innovation support. Various elements were established during the last decades and are now focusing on consolidation, interlinkages with other regional partners and quality
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management, while new structures are only foreseen in exceptional cases. Main targets are excellent research, efficient transfer and networking for boosting innovation activities in the region. Table 2 gives an overview of human resources in innovation policy institutions.
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Table 2: Innovation Policy Institutional Set-Up and Available Human Resources Policy stage Primary organisation Number of Total number of Change in the Summary assessment personnel employees number of directly in charge personnel directly in charge over the last five years Strategy Saxony-Anhalt n.a. 1.714 n.a. In Saxony-Anhalt, the key responsibility for development Ministry of Sciences and (EP 06/08) innovation strategies lies with the MSEA, as it Economic Affairs covers the key areas of science and economy. What (MSEA) it lacks, however, is the complementary responsibility for higher education (even research in Saxony-Anhalt n.a. 8.711 n.a. higher education) which rests with the MECA. Ministry for Education (EP 07) Hence the co-ordination of policies across and Cultural Affairs institutional boundaries constitutes a continuous (MECA) and persistent challenge. Programming Ministry of Finance n.a. 3.448 n.a. The regional managing authority is located at the Saxony-Anhalt (EP 04) MoF, thus further complicating the cross- departmental interaction at a political level. Implementation Investment Promotion n.a. 360 n.a. The implementation and processing of most policy Bank Saxony-Anhalt programmes is delegated to the IPB, which is positive step towards a one-stop shop and the administration’s professionalization. Monitoring and Research Centre n.a. ca. 20 n.a. The WZW is a local think tank tasked with critical evaluation Saxony-Anhalt review of regional RTDI policies on behalf of but (WZW) independent from the regional government. The establishment of such institutions is always positive. External Consultants not applicable not applicable not applicable External, independent evaluations according to the professional standards defined by the German Evaluation Society (DeGEval) have a strong tradition and are considered essential for policy review and strategy development. Source: RIM Plus repository (Saxony-Anhalt, Germany), Interviews, MF 2013a, MF 2013b
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3. Innovation Policy Instruments and Orientations
Very clearly, innovation and innovation support belongs to the most important objectives of the regional government in order to contribute to growth, competitiveness and employment: The Investment Promotion Bank approves about 120 grants per year (the foreseen number of approvals for the 2007-13 funding period is outperformed with about 20%). In 2012, for instance, the Investment Promotion Bank’s grants for technology and innovation support programmes amounted to €28.7m (+ €4.5m compared to 2011) (Investitionsbank Sachsen-Anhalt 2013: 10). Given the moderate business research and innovation rate, the Land’s policy orientation can be characterised as aimed at linking and co-ordinating research and innovation policy, i.e. to use regional research competencies and knowledge transfer as important vehicles to further develop innovation awareness and activities in regional companies. This linkage and co-ordination of research and innovation policy in a comprehensive approach is facilitated through the concentration of science, research and innovation aspects within one Ministry.
3.1 The Regional Innovation Policy Mix In terms of strategies, the regional research and innovation policy mix is oriented and based on the following main documents: • Innovation Strategy Saxony-Anhalt 2013, followed by the new Regional Innovation Strategy 2014-2020 and the • The Framework Contract Research and Innovation 2011-2015, • Embedded in the ERDF (and partially ESF) documents (Operational Programme 2007-2013, and the documents for the new 2014-2020 period). Based on an analysis of regional conditions and potentials, Saxony-Anhalt’s previous innovation strategy (Innovationsstrategie Sachsen-Anhalt 2013) developed the following guidelines: • Further establish existing innovation areas and develop new fields, • Further develop and support innovation-related infrastructure (incl. networks and clusters), • Focus on universities and non-university research organizations in the context of innovation and economic development, • Support knowledge and technology transfer, • Support education and qualification considering the specific needs of the regional economy, • Support innovative and knowledge-intensive start-ups , • Further develop inter-departmental approaches within the state government, • Further develop approaches to merge regional, national and European funding for the support of innovation in the region. The new ‘Innovation Strategy 2014-2020’ more specifically focuses on technical requirements of the structural funds and the ex-ante conditionality for smart specialisation as a contribution to the Europe 2020 strategy. This new regional innovation strategy is based on empirical analyses, the evaluation of previous innovation and cluster policies, the identification of innovation resources and potentials as well as strategic objectives, and a – in the current form - newly established two-stage consultation process within the region (see also section 3.4).
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On the base of this broad, evidence-based consultation process, ten main guidelines were developed for the next funding period. • Focusing regional innovation policy on lead markets, exploiting specialization advantages and further strengthening regional cluster and network structures in order to strengthen the regional profile, • Focusing on information and communication technologies, creative industries and other key or cross-cutting technologies for the development of Saxony-Anhalt's position on selected lead markets, • Developing innovation potentials in regional small and medium-sized enterprises that do not innovate so far, and to make use of endogenous potentials, • Further developing science potentials within the regional innovation system and exploiting them in the regional economy, education, social and health systems, • Efficiently using and further developing the application-oriented research infrastructure in a strategic way, • Strengthening the culture of entrepreneurship and foster firm foundations, • Securing the regional availability of a qualified labour force by providing qualification models from early childhood to vocational training and higher education graduation, as well as enabling lifelong learning, • Considering gender aspects and fostering equal opportunities for men and women, • Making use of all available funding instruments and resources, • Securing efficient and durable structures for implementing the strategy and establishing a transparent monitoring and evaluation system. Lead markets have been defined in five areas: (i) energy/ machines/ plant construction/ resource efficiency, (ii) health and medicine, (iii) mobility and logistics, (iv) chemistry and biotechnology, and, (i) food and agriculture. In addition to these lead markets, cross-cutting key technologies are understood as crucial impulses for the regional economy. In this regard, specific regional strengths were identified in manufacturing technologies, micro systems, new materials and light weight construction. One important aspect of innovation policy in Saxony-Anhalt is the introduction and implementation of a culture of entrepreneurship as an overarching strategic element of the Regional Innovation Strategy. Against the background that the region’s current endogenous technological potentials are still quite limited, regional policy makers concede that the attraction and acquisition of external enterprises still has its role to play in Saxony-Anhalt. Considering this aspect, the Ministry of Sciences and Economic Affairs aims to raise a broad awareness for innovation across the federal state including an active outreach to businesses that so far did not innovate. To that end, the regional government deploys the resources of existing regional clusters and regional research and transfer structures as well as the Competence Network for Applied and Transfer-Oriented Research (KAT). Generally, and considering the limited number of innovating companies (besides the fact that emerging (niche) markets face severe global competition), the Ministry seeks to include all (innovation-oriented) regional companies in its lead market strategy. Against this background, lead markets are rather broadly defined and allow integrating various sectors and activities. As explained above, innovation promotion in Saxony-Anhalt follow the rationale of an integrated research and innovation approach, thus integrating various elements of science and research promotion on the one hand, and of business innovation support on the other hand. (1) Science and research policies As explained above, education policies are under the full responsibility of the German Länder. In this context, Saxony-Anhalt’s regional government and the higher
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education institutes jointly define objectives to be achieved during a given period; currently for the timeframe from 2011 to 2013. These objectives are presented in target agreements that detail the different objectives, the respective reference indicators, and the date of the achievement. Likewise, these agreements also contain budgetary responsibilities and commitments of the Land Government. Concerning innovation, the agreements emphasise the exploitation and commercialization of findings from basic research as important aspect, embedded in the conception of innovation as integrating process of basic research, application-oriented research, knowledge transfer to industry, the public sector and civil society. Further aspects are the acquisition of third-party funds and the further development of core research fields, university integration in the KAT network, measures to promote young scientists, etc. In the frame of the re-organisation of the regional research sector in the mid-2000s, structures of core science fields were established (Offensive for the Promotion of Networks of Scientific Excellence). Basic rationale is not only the concentration of public funds on pre-defined priority areas, but also to create efficient and competitive areas of cutting-edge research that, in turn, are oriented at the principle of application and commercialisation potentials. In order to guarantee higher education institute a certain planning reliability for the establishment and development of those key science fields, the Land government and regional universities agreed on a framework agreement research and innovation, which extends the Excellence Offensive to the 2011-2015 period. (2) Business innovation support Regional business innovation support is covering a broad range of R&D and innovation related activities in the region and is equally well adapted to the specific regional conditions. Support measures for regional companies range from grants for innovative business start-ups and entrepreneurial consulting to R&D support, knowledge and technology transfer, as well as combined innovation support and qualification for university graduates in the frame of ‘innovation assistants’. Besides equity capital and patent promotion (though being supported until the end of 2011), the Investment Promotion Bank offers and manages the diverse supporting programmes, while equity capital is provided by IBG. Generally, innovation support plays a crucial role in Saxony-Anhalt, and leads to about 120 proposal approvals per annum. Table 3 gives an overview of innovation promoting measures; among which ‘R&D support’ and ‘Knowledge and Technology Transfer’ are considered as the most important ones that meet a high demand of regional businesses. Since the number of high-tech innovation performers is moderate, the regional innovation programmes for the private sector aim at giving incentives for innovative activities to be introduced, including medium-tech or low-level innovation. In 2012, 111 R&D projects were supported, leading to grants of €22.4m (total investment: €44.4m; 53.4% for individual projects, 25.8% for collaboration projects between universities and industry, and 20.8% for collaboration projects between companies). The whole range of technology and innovation supporting measures led to grants of €28.7m in 2012. The measure ‘knowledge and technology transfer’ supports innovation intermediaries. This measure helps to transfer new knowledge to SMEs and to reduce technological and economic risks. Examples for eligible support are innovation advice, market research or the use of laboratories. 50 projects were supported in 2012 (€2.7m grants) from which 32 took place in manufacturing. In total, 204 projects of knowledge and technology transfer support benefitted from public support between 2007 and 2012 (€11.2m grants) (Investitionsbank Sachsen-Anhalt 2013). The Investment Promotion Bank internally evaluates the projects; particularly the technical feasibility and economic potentials are monitored on the base of milestone reports. Evaluation is facilitated through close contacts to the business clients. In addition, external evaluations are realised about five years after the funding expires. For the next funding period, it is planned to extent innovation support beyond prototype development and
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to (re-)introduce patent support. Project proposals will be evaluated according to their economic success potentials and particularly along their potential to provide workplaces. Further, the decrease of public funds has to be taken into account. In total, funding guidelines will be adopted to the current market conditions. The presented measures are co-financed by the EU Structural Funds, mostly from the European Regional Development Fund ERDF, but also from European Social Funds ESF (mainly in the field of qualification). The regional ERDF operational programme 2007-2013 represents 57% of total European Funds in Saxony-Anhalt and is the most important funding source in the region. It is organised along five priority axes (plus technical assistance): • Innovation, Research and development, Education: Strengthening the R&D location of Saxony-Anhalt (€494m) • Competitiveness of the regional economy: Strengthening entrepreneurial competitiveness (€640m) • Industry-related infrastructure: Further development of industry-oriented infrastructure (€258) • Sustainable urban structures and education infrastructure (€263) • Environmental protection and risk prevention (€200m) • Technical assistance (€77) Obviously, the second priority (“increase of economic competitiveness”) absorbs the highest share of funds. Main objectives are the creation of durable workplaces, infrastructure investments, and small and medium-sized enterprises. The Saxony-Anhalt Cabinet agreed on the objectives for European Funds in the 2014- 20 funding period for the federal state. Overarching goals are sustainable growth, employment and innovation, while environment protection, gender equality and the handling of demographic challenges are defined as cross-cutting issues. Overall, Saxony-Anhalt defined a strategic profile of “innovation”-“energy”-“education”- “demography”-“quality of life”. These strategic areas are supposed to contribute to the Europe 2020 objective of smart, sustainable and inclusive growth, based on a transversal approach across the different EU Funds. Such an integrative model not only requires region-wide coordination, but also the development of integrative funding guidelines. In the specific field of innovation, the strategy focuses at promoting innovative processes along the whole chain of research – innovation – market introduction, thus including fundamental research, application-oriented research and development, product development and commercialisation. The orientation at lead markets and endogenous potentials in this respect aims at strengthening existing resource and exploiting new potentials. ERDF-supported measures are co-funded by ESF means in cases where qualification measures are involved.
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Table 3: Existing regional innovation support measures Title Duration Policy Priorities (Plus) Budget Organisation responsible More information Research and Development 1993 – 2013 4.1. Direct funding to business R&D € 22.4 million Investment Promotion Keywords: and innovation (factual Bank Saxony-Anhalt Appl. bus. research, allocation SME in 2012) Protection and Use of 2007 – 2013 4.4. IPR protection and exploitation € 600.000 Investment Promotion Keywords: Innovations 4.3. Fostering start-ups and gazelles (factual Bank Saxony-Anhalt IPR, SME, (Patent Promotion) allocation Start-ups/spin-offs (expired since 12/2011) in 2011) Knowledge and Technology 2007-2013 2.3. Knowledge transfer structures € 2.7 million Investment Promotion Keywords: Transfer between academia and industry (factual Bank Saxony-Anhalt Inn. supp. services, 5.4. Innovation management and allocation Knowledge transfer, advisory services in 2012) SME Hugo Junkers Innovation biannually 5.3. Innovation awareness-raising € 40.000 Saxony-Anhalt Ministry of Keywords: Award Saxony-Anhalt since 1990 Sciences and Economic Innovation culture, Affairs Skills for innovation IB Innovation Loans available 4.1. Direct funding to business R&D € 2.57 million Investment Promotion Keywords: (Saxony-Anhalt IDEE) since 2010 and innovation (loans Bank Saxony-Anhalt Appl. bus. research, 4.2. Organisational, process and other approved Early stage-financing, non-R&D innovation in 2010) Start-ups/spin-offs 4.3. Fostering start-ups and gazelles Support of Innovation 1993 - 2013 3.1. Mobility of researchers € 2.1 million Investment Promotion Keywords: Assistants and Exchange 3.2. Training and life-long learning of (factual Bank Saxony-Anhalt Knowledge transfer, of Personnel researchers and any other personnel allocation Skills for innovation, 2.3. Knowledge transfer structures in 2012) SME between academia and industry Source: RIM Plus repository (Saxony-Anhalt, Germany), Interviews, IB 2010, IB 2011, IB 2012
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3.2 Appraisal of Regional Innovation Policies The most important challenge of Saxony-Anhalt’s regional innovation system is related to the regional business structure – to a large extent made up by small and very small enterprises – and their weaknesses in research, development and innovation: Due to their small size, they are lacking capacities and resources to perform R&D and to engage in innovation activities, which, in turn, are necessary to guarantee firms’ market position and competitiveness in the medium and long term. Directly linked to this weakness is the lacking availability of knowledge in the region that, combined with the (partial) weak absorptive capacity of regional companies, leads to the fact that existing innovation potentials are not fully used. Adding the low number of larger companies in the region (that mostly perform their R&D in other regions), the modest share of business expenditures on research and development becomes apparent. This situation is leading to the following options: • There is a need for improving R&D and innovation in the regional business sector in a broad sense, including awareness raising and the provision of favourable framework conditions, • Many regional firms still have to be enabled to engage in R&D and innovation; i.e. the necessary resources –in the sense of knowledge, absorptive capacity, but also financial and human resources – must be made available, • Particularly in a region like Saxony-Anhalt, regional firms must be provided with reliability and planning security in the sense that external support will be granted during the whole process of innovation once started. In this sense and given the limited resources in a comparatively small region, the combined research and innovation policy approach as implemented in Saxony-Anhalt can be characterised as committed and coherent. It considers the whole knowledge production, intermediation, and innovation process through its focus on: • Knowledge production in regional scientific institutions. In order to efficiently coordinate existing potentials and target limited resources, the state follows an approach of concentrating research efforts in various selected core fields. However, this does not mean that science policy is exclusively concentrated on these selected areas, since the federal government also promotes innovative scientific and research projects that are not part of the core science fields • Knowledge transfer between the different regional actors: universities, non- university research institutes and regional businesses • Comprehensive support of innovation processes. These points are illustrated in more detail in the following paragraphs.
3.2.1 Knowledge production Knowledge production in scientific institutions relies on several pillars. First of all, Saxony-Anhalt – as every German federal state – is responsible for higher education policy and related investments. The Ministry of Sciences and Economic Affairs thus provides universities with funds for their education and qualification mission. Objectives and targets are defined and scheduled in target agreements between each university and the Ministry of Sciences and Economic Affairs. Additionally, a comprehensive agreement between all regional universities and the Land Government lays down rationales and missions for the higher education sector and regional government. The current operative agreement for 2011-2013 details how state and universities will target joint objectives in light of decreasing funds and the main challenges related to demographic changes and budgetary consolidations constraints. For Saxony-Anhalt’s government, the following principles are pertinent: (i) High- quality research and education, (ii) Increasing quality and performance of regional universities in order to lever Saxony-Anhalt’s attractiveness, (iii) Increasing
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incentives, (iv) Achieving planning reliability within a multi-annual period, (v) Further development of higher education structures. For universities, on the other hand, important principles are: (i) Securing responsibilities of universities through governance instruments and quality management, (ii) Measurement of results, (iii) Performance-oriented allocation of funds, (iv) Reporting to Land parliament and government, (v) Further development of controlling systems (Landesregierung Sachsen-Anhalt/Hochschulen des Landes Sachsen-Anhalt 2010). Basically, the (further) development of Saxony-Anhalt’s higher education structure is oriented along the principle of competitive research in specific core areas and regional profiles. It further refers to the necessity of contributing to cooperation within the (regional) innovation system. More precisely, this refers to networking measures like knowledge and technology transfer, supply of specific courses of study, improved education, etc. These measures were initiated in the frame of the Excellence Offensive – the regional strategy towards competitive and excellent science, determined in the Framework Agreement Research and Innovation between the regional government and regional universities 2007-2010, which is based on principles of core research fields and Competence Centres (2007) (MK/WZW e.V. 2007; Landesregierung Sachsen-Anhalt/Hochschulen des Landes Sachsen-Anhalt 2007) – and are continued. The regional Science Centre WZW is in charge of developing appropriate incentives. Further, attracting third-party funding, for instance from national research programmes and from industry as well as interlinking existing research and development resources are an important means to enhance R&D and innovation in the region. Important focus receive new forms of cooperation and organisations within the higher education and research sector, i.e. collaboration structures between universities and universities of applied sciences, with non-university research facilities and regional businesses. Of high importance in this context is the KAT network. Application-oriented research and knowledge and technology transfer should be in line with the Innovation Strategy 2013 that had a strong emphasis on the building and development of clusters (Landesregierung Sachsen-Anhalt/Hochschulen des Landes Sachsen-Anhalt 2010). The support and consolidation of core scientific fields is one of the current rationales of regional science policy and determined in the Framework Agreement Research and Innovation. In this context, the regional budget for the year 2014 foresees a total of about €10m for these objectives (Land Sachsen-Anhalt 2013). European Structural Fund means are mainly foreseen to strengthen science-industry cooperation. In addition to granting support for research activities in core scientific fields and Competence Centres, the Land Government financially promotes external research activities, the funding principles for which are determined in a specific Guideline (Kultusministerium Sachsen-Anhalt 2008). In this respect, new research topics, proposals to the German Research Foundation, to national and European Union research programmes, infrastructure, collaborative research centres, young researchers, of teaching related research can for instance be promoted. Proposals are submitted to the Science Centre WZW.
3.2.2 Knowledge transfer Knowledge transfer within the federal state and also beyond its borders receives high priority in order to promote knowledge exchange, joint research and development activities and innovation among regional actors. Particularly under the given context conditions of widely lacking large enterprises with R&D facilities in the region, the Land seeks to bundle existing resources and exploit regional potentials. Prominent example in this context is the KAT network that was implemented at regional universities of applied science with the central mission to strengthen their linkages with regional businesses. This network is not restricted to universities of applied science, and regional universities are also contributing to this network. A further measure in this context is transfer vouchers, introduced in 2012, that aim at initiating exchanges between scientific research and business development. It precisely targets exchanges between students and regional companies, thus the application of student
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projects and theses in businesses. The measure has several goals: Besides the opportunity for students to gather business experience, the company gets access to scientific knowledge of regional universities. The measure intends to create positive impacts for both contributing actors and additionally to prevent student emigration after their graduation. Additional measures are diverse platforms, organized for knowledge transfer and exchange and managed by the Science Centre WZW.
3.2.3 Innovation support Research, development and innovation support is one important policy line in Saxony- Anhalt; innovation support was introduced in the early 1990s and is since 1994 explicitly formulated as objective in ERDF interventions. As Grusevaja et al. (2013: 60) show, total of €1,297m of ERDF funds were spent on innovation between 1994 and 2011 (on average 6% of total expenditures). In addition to the above-mentioned activities and measures which are addressing the regional science and research sector, the Land developed various measures that target innovation activities within regional businesses. Innovation is in this context broadly understood and covers a wide spectrum of activities beyond research and development in high technology fields. This is rooted in the Land’s philosophy of initiating and enhancing innovation in the small and very small regional enterprises in order to embed the awareness of innovation in the region. Eligible for support are thus also activities leading to improved processes within companies (process innovation, low and medium tech innovations). All in all, supporting measures address the various phases of companies’ innovation processes. Clearly, “Support of Research and Development” stands out as the quantitatively and financially most important measure (cf. Table 3 and Table 4). It supports research and development projects in individual applicants or in collaborative projects. Further important measures are the promotion of knowledge and technology transfer and the support of innovation assistants (former: innovation managers). These measures are complemented measures to promote innovative company start-ups in the context of the “ego.-innovativ” programme for supporting university-based start-ups (e.g. loans through “ego.-START” for innovative, technology or knowledge based firm foundation; “ego.-PLUS” for research and development, investment or market introduction of products, processes or services; or “ego.-PROTOTYPEN” for innovative start-up projects). Additionally, financial support for innovation consulting and – more broadly – in entrepreneurial decision taking (Beratungshilfeprogramm Sachsen- Anhalt) are supported. IDEE is an innovation loan that supports company founders, professionals or SMEs in the stage after product development, i.e. for introducing innovative concepts into the market or strengthening economic power. Further promotional measures address specific technological areas such as energy efficiency, waste management industries or creative industries. Table 4: Project approvals and allocated subsidies of innovation programmes in Saxony-Anhalt 2010-2012
Source: Own compilation, based on IB, 2012; IB, 2011; IB, 2010
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The Hugo Junkers Award for Research and Innovation originating in Saxony-Anhalt, finally, is a further measure to provide incentives for innovation to excellent scientists as well as to raise public awareness for the technological achievements of the winner projects. The prize money enhanced in the last three years and is €90,000 in the 2013 competition. Following the comprehensive design of research and innovation support in Saxony-Anhalt, the award targets both entrepreneurs and scientists from the regional university and non-university research sectors (IMG, 2013). Various aspects of the regional research and innovation policies address the challenges referred to in section 1.3. Clearly, the unbalanced and not innovation-oriented economic structure is one of the main problems hampering the generation of transformative impulses for the regional economy (see also Grusevaja et al. 2013: 82/83). Nonetheless, a slow process of socio- economic consolidation is apparent during the last years – despite a notable setback during the 2009 crisis – and it is likely that regional policies have played a role in this. Even in the past, combining and linking research and innovation policies has enabled regional policy makers to concentrate existing resources, not only in the sense of financial resources but also with a view to S&T infrastructure or human resources. In a small region like Saxony-Anhalt, the consolidation of political responsibilities for research and innovation under the roof of one ministry and even – to a large extent – one directorate seems a meaningful step towards defining and achieving targets in regional innovation policy. While there is of course still room for improvements and further development, processes of consultation and coordination could be significantly improved since the last regional elections. A further main challenge remains that the regional economy remains the local business sector’s limited inclination towards R&D and innovation. As it the European 3% goal of spending 3% of GDP for research will remain elusive for the nearer future. Hence, it is addressed not only by traditional support measures from knowledge production, technology transfer to business innovation but also complemented by measures considered suitable to raise awareness and leverage latent potential such as networking structures, clusters and exchange platforms. Against this background, the regional government follows an approach aimed at consolidating, professionalising and assuring quality within the established structures appears coherent. Instead of creating new support structures in (ir)regular intervals, the regional government rightfully invests into a continuous process further developing existing support structures while submitting them to a regular and gradual thematic reorientations. Despite all efforts, however, cooperation and professional technology transfer need to be improved further: According to regional stakeholders, most knowledge and technology transfer in the region can be traced back to a small number of key persons. To sustainably anchor innovation activities in Saxony-Anhalt this base would need to be broadened and cooperation between different actors would have to be broadened within the region and beyond regional borders. The second challenge, demographic change and outmigration, may develop into a limiting factor for the future of Saxony-Anhalt. Firstly, a certain “critical mass” is necessary with regard to the regional labour force that engages in knowledge production, technology transfer, innovation, as well as in qualification and education. Further outmigration may lead to a further decrease of absolute potentials in an already small region – with the danger of seeing them fall to sub-critical levels. Secondly, there is a strong qualification dimension to outmigration in the sense that the young and/or qualified leave the region while the old and/or less qualified are more likely to stay. Hence, a specific shortage may evolve with regard to highly qualified employees and researchers that innovative companies and research facilities need to successfully perform their activities. This aspect is particularly important in the context of the much-discussed shortage of skilled labour that many German companies raise concerns about. Finally, outmigration and demographic change are
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likely to hurt the region’s attractiveness as a destination for future investments by both innovative corporations and national research organisations. Finally, the decreasing availability of public funds foreseen for the upcoming years poses a pertinent challenge to the integrity of the regional innovation support system. With financial consolidation and debt reduction having assumed constitutional character, Saxony-Anhalt’s government has no choice but to take serious measures to cut public expenditure. As regional actors are far from able to sustainably finance innovation from internal sources, reducing public support for R&D and innovation would probably have serious consequences and counteract much of the innovative momentum as well as many of the socio-economic advances realised so far. So far, the regional government states that it aims to tackle this challenge through the efficient combination of available funds, i.e. the co-funding of measures from different European Funds, national and regional budgets. In fact, however, the expected decrease in funding is such that serious structural adjustment will be needed not only in the current funding system but in the overall public research system – and, for that matter, many other domains of regional policy. As it stands, genuine policy debates on options to deal with this challenge have only just begun. Under the thematic priority “research, development, innovation”, the federal state government foresees to fund 54.45% of the total budget through Structural Funds means (ERDF: 31.8%; EAFRD: 2.7%; EMFF: 20.0%). While ERDF means are predominantly foreseen for promoting research and innovation in regional businesses, as well as in linkages between companies, research and higher education (23.75%) and in the further development of research and innovation infrastructure (8.0%), EAFRD funds will be spent for increasing the knowledge base and innovation in rural areas (1.7%) and for increasing linkages between agriculture, food production and forestry, as well as research and innovation (1%). EMFF funds, finally, are foreseen for technological progress, innovation and knowledge transfer in aquaculture (10%) and in fishery (10%). All measures will be co-financed by the responsible departments of the regional government. In a general perspective, ERDF targets capacities in research centres and investment in research and innovation, while EMFF and EAFRD complement the promotion of research and innovation in their specific areas of application. Means of the European Social Funds ESF are foreseen to be spent for science-industry transfer aspects, excellence orientation in higher education and non- university research, and gender aspects in science and research. The combined use of funds from different EU funds has a certain tradition in Saxony-Anhalt; already in the 1990s Saxony-Anhalt combined funds from different sources in the light of urgent problems to be tackled after reunification. To do this successfully, however, funding criteria and approaches will have to be coordinated (Grusevaja et al. 2013: 76, 79). Important national sources of co-funding originate under the national-regional joint task ‘Improvement of the Regional Economic Structure’, the currently most important co-funding instrument for industrial investment in Germany’s regions. Under the heading of a constitutional joint task, funding is allocated to grants for investment in industry, infrastructure and tourism. In Saxony-Anhalt, funds from this joint task and from EU ERDF Funds are combined for co-funding innovation investments in regional businesses (Landesregierung Sachsen-Anhalt, [2013c]). In a high-level evaluation, the German Science Council came to a positive assessment of Saxony-Anhalt’s higher education and non-university science and research landscape. After deep restructuration processes in the 1990s and structural reforms, Saxony-Anhalt’s research sector is currently on a consolidation-oriented development path and has strongly benefitted from the regional Excellence Offensive that started in 2005. In summary, the Science Council states that scientific competitiveness was strengthened and appreciates the transfer-oriented approach in the KAT network, driven by the Excellence Offensive. It recommends to further focus on scientific profiling and strategy building processes as well as on exploitation of regional cooperation opportunities (Wissenschaftsrat 2013).
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Equally, the results of an external evaluation of research, development and innovation support in the context of EU Structural Funds (Ramboll Management 2011) states that the region’s programmes for R&D and innovation supporting cover very well every stage of the whole innovation process and are well aligned with one another. Additionally, it shows that research, development and innovation funding has positive impacts on the immediate beneficiaries’ development. In a survey among companies and research facilities that received support, most respondents confirmed that their initial objectives were reached and that R&D and innovation funding contributed to their economic success. According to IFOK GmbH (2010) the regional research infrastructure is differentiated, targets both societal and technological challenges and addresses different forms of knowledge and technology transfer. Referring to the challenge of demographic change, the Science Council emphasises the pertinent role of Saxony-Anhalt’s university systems for countervailing demographic change and for making the region attractive for young students from other regions. The Science Council appreciates the positive developments achieved during the last years and states that a more efficient higher education system can unlock further potentials for attracting and retaining qualified people (with all positive impacts on the regional economic system) (Wissenschaftsrat 2013). In addition to regional and European co-funded innovation support measures that are strongly targeting R&D and innovation on the one hand, and networking and transfer on the other hand, applicants from Saxony-Anhalt succeeded in obtaining a substantial volume of funds from national programmes, both high-profile and standard. As shown above, regional initiatives were positively evaluated both in programmes covering the whole of Germany, as well as in initiatives that are explicitly launched for the Eastern German states. In the context of the nation-wide Central Innovation Programme SME (ZIM, funded by BMWi) which is targeting SMEs, public and private non-profit research and technology organisations and their development of new or significantly improved products, processes or technical services in all branches and technological sectors, facilities in Saxony-Anhalt received €6.5m in 2008/09, €19.3m in 2010, €28.8m in 2011, €19.0m in 2012 and €16.6m in 2013 (disbursed grants). For 2013, this represents 4.2% of the disbursed means in Germany. The total sum of approved funds amounts to €124.1m in Saxony-Anhalt (www.zim-bmwi.de/statistik). Further, two leading-edge clusters co-funded through the national Leading-Edge Cluster Competition are located in Saxony-Anhalt and in Central Germany (with contribution of Saxony-Anhalt actors) as well as one of the high-profile Industry-science Research Campus (STIMULATE). In addition to regional clusters and networks which are supported by the regional government in automotive, chemistry/ plastics, polymers, biotechnology, food, machinery and plant production, renewable energies, information technology, resource management, neuro-medicine, and green biotechnology, various so-called Innovative Regional Growth Cores (Innovative regionale Wachstumskerne, part of the BMBF programme ‘Entrepreneurial Regions’) were established in Saxony-Anhalt. This federal initiative specifically targets enterprises, education and research organisations that establish the ‘core’ of a regionally oriented innovation initiative with distinct thematic profile (e.g. cooperative research, development, qualification projects). Since 2001, the measure addresses initiatives in the Eastern German states and so far allocated funding to 43 growth cores (total investment: €270m). Basic rationale of such initiatives is the development of core competences, leading to patent applications and market introduction, following a phase of intense investment in research and development. The Federal Ministry of Education and Research followed the goal to exploit and systematically further develop existing potentials and competencies in Eastern Germany. Basic for the application is a sound market- oriented strategy. Initiatives are financially supported through grants (project support) during a period of three years (www.unternehmen-region.de). In Saxony-Anhalt, the following initiatives were selected for funding in the context of this measure:
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Table 5: Innovative Regional Growth Cores in Saxony-Anhalt Innovative Thematic profile Funding Investment Regional period (€m) Growth Core Therapeutische Industrial production of therapeutic 2001- 5.83 Proteine – Halle recombinant proteins. 2003 Focus: Technology platform (including pilot cultivation, computer-assisted optimisation for shortening time to market and new therapeutics). Partners: University, regional enterprises Pharma MD – New pharmaceuticals allergies, apoplexia, 2001- 5.69 Magdeburg and autoimmune diseases. 2003 Focus: Two pharma platforms. Partners: Universities, research institutes, pharmaceutical companies AL-CAST – Development and production of 2005- 4.61 Harzgerode aluminium castings. 2008 Focus: Technological platform including the development, production and testing of aluminium cast. Partners: University, Fraunhofer institute, regional companies, business promotion (public-private partnership) ALFA – Fibre alliance, tailored composite 2006- 5.19 Haldensleben products for mass markets. 2009 Focus: Technology platform for products for construction industries, telecommunication and machine construction made of composite material. Partners: Research institutes, Technology transfer agency, regional companies ReactiveWetCoating Development innovative technology in 2004- 6.59 – Bitterfeld-Wolfen surface coating, component production, 2007 construction of special-purpose machines. 2007- Partners: Regional companies, 2010 technology centres, municipalities, qualification and finance institutions, R&D services and research institutes Thale PM – Thale Multifunctional construction components 2008- 6.71 through innovation in materials, 2011 processing, and quality. Partners: University and non-university research institutes, regional companies WIGRATEC, Fluidised bed granulite technology. 2009- 12.35 WIGRATEC+ - Focus: development of innovative plant 2012 Weißandt-Gölzau and process technologies for high-quality fine chemicals, drugs, food and biotechnology products. Partners: Universities, companies ibi - Leuna Innovative lignite in Central Germany. 2011- 10.64 Focus: Networking of process stages from 2014 deposits to material transformation. Partners: universities, companies, cluster, consulting.
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Source: Own compilation, based on BMBF documents (www.unternehmen-region.de) and documentations of growth core initiatives Besides Innovative Regional Growth Cores, the BMBF programme ‘Entrepreneurial Regions’ contains various further support lines (Innovation Forums, Centres for Innovation Competence, ForMaT, Growth Cores Potential, InnoProfiles, Partnership for Innovation, and the initial programme InnoRegio that already started in 1999) in the Eastern German states. Saxony-Anhalt receives funding for a total of 64 regional initiatives (BMBF, [2013a]). The region further benefits from support for two ‘Leading-edge Research and Innovation in the New German Länder’ projects: (i) ViERforES in embedded systems (Magdeburg), and (ii) ProNet-T3 in protein sciences (Halle). This programme aims at strengthening the capacity for innovation and the economic potential in eastern Germany through promoting long-term university and non-university research cooperation. Finally, the Industry-Science Research Campus STIMULATE, located in Magdeburg, engages in technologies for image-guided endoscopic surgery. At the core are the Otto-von-Guericke-Universität Magdeburg and Siemens AG that envisage to establish a German Centre for Image-guided Medicine in Saxony-Anhalt. The funding programme of the Federal Ministry of Education and Research supports medium- and long-term public-private partnerships with this measure. Ten Research Campus were selected in 2012 and receive funding for a period of up to 15 years for joint research activities (up to €20m, BMBF, [2013b]). In general, these examples not only clearly illustrate the high focus on networking initiatives in Saxony-Anhalt but also evidence the region’s leading actors ability to successfully apply for of higher-threshold national and European funds.
3.3 Good practice case: Industrial Initiative for Central Germany In this regional report, we will present a good practice case that is neither a case of a good design of support measures nor a case of an innovative governance set-up on the side of the regional government. Instead, we will present a relevant and nationwide unique case of self-governance on the part of the regional industry that exists and acts as a complement to the regional support system. According to its mission statement, the Industrial Initiative for Central Germany IICG (Wirtschaftsinitiative für Mitteldeutschland) “brings together key corporations, business chambers and local authorities from from Saxony, Saxony-Anhalt and Thuringia with the common aim of promoting the successful development and marketing of the traditional economic region of Central Germany”. The initiative was set up in 2000 as key decision makers of in particular the local chemical industry decided that a new type of initiative was due which allowed the design of support actions along the value chain and across regional administrative borders. Hence, the initiative does not only focus its activities to Saxony-Anhalt but also involves stakeholders from Saxony, Brandenburg, and to a more limited extent Thuringia. The central idea behind its establishment was to create a ‘one-stop-shop’ mostly for the larger industrial players with activities in more than one of the four central German federal states. Due to the high-level commitment of these leading companies, the initiative commanded a budget of more than €1m fairly soon after its foundation. SME, to the contrary, are not considered a main target group of the industrial initiative as their needs can more commonly be addressed within the individual federal states. Today, IICG membership includes more than 55 regional companies, representing an overall annual turnover of more than €50b, three local chambers of commerce, several public institutions, as well as the cities of Leipzig, Halle/Saale, Magdeburg, Jena, Gera, and Dessau. Additionally it cooperates with a number of local partners. In summary, the industrial initiative initiates and finances different types of activities in three main areas of activity [IICG, 2013]:
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Promoting innovation and sustainability: IICG promotes the creation of a sustainable framework throughout Central Germany to promote innovation in the economy by focusing and networking existing campaigns and activities and supporting the development of successful cooperation models. Organising and supporting growth processes: IICG organises and supports processes of sustainable economic growth, particularly for the benefit of SMEs. All participants, networks and partners can participate on an equal footing, enabling added value to be achieved as a team effort. Promoting communication and marketing: IIGC promotes communication processes throughout Central Germany, enabling decision makers from industry, commerce, science, politics and government to forge closer contact and share ideas more efficiently. In addition, it helps promote the region’s image and raise its profile. In more concrete terms, the organisation finances the following type of activities: Cluster Management – the ‘Cluster Process in Central Germany’ The IICG supports the formation of clusters in interrelated sectors with an above- average concentration of businesses and public research institutes in Central Germany. As of 2012, the IICG co-operates with nine clusters, among which five are genuine ‘Central German Clusters’, initiated mainly by the industrial initiative. Activities are pursued in the following industries: Automotive, Biotech/Life Sciences, Chemical Industry and Plastics, Food Industry Cluster, Information Technology, Solar Technologies, Optoelectronics, Microelectronics, and Logistics. Furthermore, it has organised the German Cluster Conference a two-day gathering of 300 participants took place in October 2008. Examining various cluster processes in Germany, the program aimed to portray the benefits of cluster processes. The Award of Innovation Prizes ‘for Central Germany’ Once a year, the initiative awards the “IQ Innovation Prize for Central Germany”. Every year it awards prizes totalling € 83,000 as well as a membership of the IICG. Career Networks and Human Capital Once a year the initiative organises the “Central German Graduates Congress”, the biggest and most important job fair for students from Saxony, Saxony-Anhalt, and Thuringia – an event which is also found useful by non-members such as SME. In less regular intervals, it organises the Central “Germany Future Conference” that explains international economic trends to local employers in an effort to strengthen the region’s competitiveness. Themes tackled since 2001 include creativity, corporation, growth and its external image. Place Marketing By means of a specific image-film, a regular magazine (mitte l punkt), a series of publications, a general and a statistical newsletter, as well as different types of events, the industrial initiative promotes not only its own and the activities of its members but also the region of Central Germany as an investment location. In its early years the industrial initiative openly lobbied for the ‘grand idea’ of a fusion of the central German federal states. This ambition, however, was soon abandoned in favour of a constructive approach within the given framework conditions, not least to improve the working relations with the existing regional governments. As a matter of principle, all activities initiated and funded by the industrial initiative have to be focused on creating initial momentum for the development of joint actions. On the long run, all activities are expected to become self-sustaining through private contributions (“services by local firms for local firms”) or eventually be discontinued.
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Activities with a visibly questionable potential of reaching this goal will not be supported from the outset. From the beginning, the industrial initiative was driven by high-level executives of the region’s key industrial players who promoted the idea among other key firms as well as the main regional municipalities. Hence, while the initiative can be characterised as driven by the corporate sector, it does not merely pursue corporate interests up-front. Instead, it seeks to find joint solutions in the interest of both the companies and the participating public entities and municipalities – e.g. with a view to maintaining a well-trained local labour force. Consequently, the industrial initiative is in regular and close contact with high-level decision makers in the state chancelleries of all federal states concerned, as well as the German Federal Ministry of Economics and Technology. In summary, while the industrial initiative has no interest to be co-opted by singular regional policy makers it has no interest in bypassing them either. As a general rule, it is interested in developing a good mutual accord in both parties best interest. As a further matter of principle, the industrial initiative does not accept public funding to co-finance any of its activities. Thus it remains accountable only to its membership and can take decisions independently from political requirements. As its membership is mostly composed of larger firms, it can leverage substantial annual membership fees (> € 15.000) sufficient to maintain the annual budget around €1m. While the budget has already been higher during the boom years, it had to be reduced during the economic crisis and some planned activities were cancelled. As a (desired) side effect, this fee based financial model keeps its membership focused on larger firms. In 2012, the industrial initiative’s central management office employed three permanent and three part-time employees besides the operative business director. High-level representative roles (‘executive board’, ‘supervisory board’) are assumed on an unpaid, voluntary basis. In the individual clusters, the wages of one or two cluster managers can be funded for the first years but in the mid-term have to be financed from the membership fees contributed by the individual cluster’s target group. While the industrial initiative collaborates with successful cluster initiatives launched by regional policy makers in selected areas, such co-operation is only then pursued if it serves the interests of IICG’s membership. In principle, the initiative understands its activities as complementary to those already offered by regional policy makers. In summary, the industrial initiative IICG is a somewhat particular success example in that it did not emerge as a direct result of government action but based on the initiative of key stakeholders of the regional industry and from regional business associations. Although it thus cannot be considered a case of good policy, letting the local industry find its own way can still be considered an interesting case of alternative governance. Moreover, the resulting organisational form is a unique success story in Germany and displays many interesting characteristics and problem-oriented approaches which can serve as a relevant point of reference for policy makers elsewhere.
3.4 Towards Smart Specialisation Policies Saxony-Anhalt’s government is currently in the process of finalising and approving the Regional Innovation Strategy 2014 – 2020 that will form an essential part both in fulfilling the ex-ante conditionalities for the following ERDF/ESF programming period and in elaborating Saxony-Anhalt’s position with a view to the Europe 2020 strategy. With regard to the latter, it corresponds with the federal state’s six overarching guidelines for Europe 2020 – these are focused on (i) finances and modern administration; (ii) education, families, citizen engagement, (iii) economy and labour, (iv) energy, (v) infrastructure, rural area, (vi) cosmopolitan Saxony-Anhalt (Staatskanzlei Sachsen-Anhalt 2010).
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The new Regional Innovation Strategy 2014 – 2020 is based on a combination of different methodological approaches which, taken together, can be seen as forming a broad-based, in-depth “process of entrepreneurial discovery”. At first, the process began with an analysis to identify innovation resources, potentials, as well as strategic objectives to build an evidence base. Second, it continued with a targeted review of past evaluations of innovation and cluster policies. Finally, a broad based consultation process was introduced in the region to ensure a ‘new quality’ of stakeholder consultation (“entrepreneurial discovery”) – even in a region that features a certain, successful tradition in this regard. • The local consultation process was implemented in two stages: Firstly, through a questionnaire-based survey, followed by broad discussion. This public survey aimed at establishing the basis for a new vision on the further innovative development of Saxony-Anhalt, based on an as broad as consultation of regional actors. The Minister of Science and Economy launched the consultation process in October 2012 in Magdeburg and called scientists, researchers, entrepreneurs, business founders, as well as teachers, trade unionists, environmentalists, and students to participate in the survey in order to make contributions to the future structural policy in Saxony-Anhalt. Main sections of the questionnaires included the development of goals and visions for thematic core areas, as well as the definition of needs and challenges in priority areas. Important aspects addressed are future-oriented markets, innovation and entrepreneurial culture. A core objective of this process was to include, yet go beyond the consultation of the regions “usual suspects”. In the end, input was provided by stakeholders from all sectors of the regional innovation system (business, public and intermediary). In total, 146 questionnaires were returned by regional stakeholders, about one third of them by regional businesses. On their basis, existing draft proposals on the future role of lead markets and key enabling technologies in Saxony-Anhalt’s regional innovation policy were adapted and revised. Secondly, the data-based analysis’ and the questionnaire-based survey’s findings were validated or adapted in roundtable discussions. Once defined, the individual lead markets’ and the cross-sectional technologies’ (factually: ICT) challenges were discussed in separate six roundtable discussion meetings. In those, discussions were deepened with a view to field-specific opportunities and challenges of the respective focal areas – by field-specific experts. In all of them, opportunities for science-industry co-operation and regionalised technology transfer played a major role. Finally, the consultation process and its intermediate results became subject of interministerial working group discussions and will soon be finally submitted to and approved by the state cabinet (VDI Technologiezentrum GmbH/GIB Gesellschaft für Innovationsforschung und Beratung GmbH 2013). In the meantime, representatives of industry such as local chambers of trade and industry published their statements and brought forward the specific perspective of their clients and members, after promoting the consultation process on their webpages. In the end, five lead markets were defined for Saxony-Anhalt based on the results of both the analytic, evidence-based process and the stakeholder-oriented consultation process. In the upcoming support period, research and innovation activities will be predominantly promoted in these areas – in which key regional stakeholder see endogenous potentials and which at the same time seem to harbour promising potential to address the region’s and the nation’s key socio-economic challenges. An important step towards implementing the new strategy and to establish a “sustainably smart specialisation” is the fact that standing working groups have been set up for each lead market, bringing together regional experts from science, businesses, policy, administration and intermediary actors such as cluster agencies. These working groups are expected to develop roadmaps for the lead markets and to define concrete projects and activities – as well as to deepen policy maker’s understanding of the new approach and readjust it should the need arise in the course of the next programming period. The regional government foresees to successively
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build up working groups for each lead market and has recently started with a working group in chemistry. The whole process is considered as a ‘learning activity’ that will consider and take into account stakeholder feedback throughout the next support period. As a new instrument, it thus has a somewhat experimental character. In the future, working group will convene in regular intervals and, based on presentations and statements, discuss the further development of the lead market in which they are involved. To ensure that the working groups accompany the process of lead market implementation and application across the programming period from 2014 to 2020, it is foreseen that the Ministry of Sciences and Economic Affairs stays in regular exchange with the working group members. To summarise, the regional innovation strategy is conceived as an integrated basis for the further strategic development of RIS3-inspired policies and their implementation, including the continuous assessment of the defined core fields and their adaptation, if necessary. In short, the region wishes to initiate a collective learning process based on decentralized responsibilities integrating all relevant actors (VDI Technologiezentrum GmbH/GIB Gesellschaft für Innovationsforschung und Beratung GmbH 2013). According to the ministry’s plans, the existing regional clusters play a crucial role in this context: the cluster managers are among the key stakeholders to be integrated in the current and future activities of the working groups. Cluster managers are considered as ‘regional multipliers’ who bring in knowledge and experience of and relay discussions among their cluster members to political decision makers. Hence, the opinion of companies will be continuously heard, even though they cannot be formally consulted on a regular basis. A further new element in the regional innovation policy is the dedicated mirroring of regional potentials for cross-innovation with more generic trends. For each lead market, SWOT (strengths-weaknesses-opportunities-threats) are elaborated and confronted to megatrends and strategic goals. On this basis, specific profiles for the region can be drafted. More fine-tuned analyses and profile adjustments are foreseen to be realized by the regional working groups, leading to the definition of initiatives and leading projects. Against this background, the definition of lead markets along existing potentials and market opportunities is complemented by a new focus on horizontal issues (key enabling technologies; KET). An important focus in this respect will be put on information and communication technologies. In general, Saxony-Anhalt disposes of a good basis in this field. To further develop existing resources and to deploy ICT as a key enabling technology for other sectors and technologies, however, further investment, both in infrastructure and in technology development will be required. Besides the central focus on ICT, other KETs (nanotechnology, micro- and nano- electronics, new materials, biotechnology, production technologies), as well as media and creative industries will receive specific attention as core horizontal fields in terms of technologies. Moreover, societal challenges such as demographic change, qualification aspects, gender and cultural issues, and participation in society are examples of horizontal issues that the new innovation strategy will take into account. Importantly, however, Saxony-Anhalt does not intend to close the door on a broad-based approach to regional innovation policy. Despite the lead market focus or – more precisely – as a conscious complement to it, low volume measures such as support for “innovation assistants” or “innovation vouchers” shall remain open to all applicants. As before, those measures have the key objective to raise awareness for the practical utility of innovation in SMEs and to involve more actors than before in the regional innovation system. If anything, the regional government thus intends to lower the threshold of participation. A sectoral, technology or more innovation based focus will intentionally not be imposed on these measures – as experience has already clearly demonstrated that there is no demand when hurdles are raised too high.
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3.5 Possible Future Orientations and Opportunities The analysis of existing documents as well as regional visits and stakeholder interviews allows the authors to summarise the following options for Saxony-Anhalt’s future innovation policy: • Focus more on core areas in order to bundle resources and potentials It will be important for Saxony-Anhalt to develop an individual regional profile based on endogenous strengths. This should include the further refinement and strategic development of regional lead markets. In the context of the Regional Innovation Strategy 2014 – 2020, Saxony-Anhalt developed five lead markets, i.e. areas in which the highest structural impact can be expected based on regional resources and global development trends. Accordingly, the regional government pursues a strategy of building and establishing core scientific fields and excellent research competences in the science and research sector. This seems to be a coherent approach in the light of seriously decreasing financial resources and – due to the limited size of the region – innovative potentials. So far, regional analyses and evaluations tend to advise an even further reduction of priority areas in order to define a profile that differentiates Saxony-Anhalt from other regions. Certainly, the current approach should thus not be broadened or blurred. Similarly, the Science Council strongly advises to intensify cooperation structures between different actors of the regional higher education and research sectors to enhance their performance and reputation on the national and international scale. According to the Council, the establishment of further co- operation platforms could be considered as an effective means to further cooperation and exchange. It advises to concentrate higher education in selected areas and to introduce instruments that prevent the immediate cut of budgets (Wissenschaftsrat 2013). Concerning financial resources, the preparatory study for the regional innovation strategy refers to the need for a concentrated use of available funds and resources, i.e. the combination of regional, national and European research funding. Certain experience from doing so is available from past support periods. The remaining and constantly evolving challenge is to deal with the different criteria and requirements of different programmes (Grusevaja et al. 2013). • Further development and professionalisation of existing structures The general structure of Saxony-Anhalt’s innovation system has broadly evolved during the last years and decades; in particular, new research and intermediary structures (such as clusters and networks) were established. Nonetheless, many regional stakeholders continue to emphasise the need to further professionalise the existing structures and to better adapt the services of the innovation system structures to the specific needs of regional businesses. This also includes both clusters and transfer structures in higher education organisations. One major challenge is that a stronger engagement in knowledge and technology transfer would require more resources for drafting proposals and to engage in match-making between firms. As few of the managers in charge are so far able to fulfil these expectations in a satisfactory manner, training measures and the interregional exchange of experiences in the field of technology transfer and cluster management will be needed. During the next years, their consolidation, professionalisation, as well as the improvement of the quality of their services should be the core of related activities (e.g. certification of cluster management). New structures, to the contrary, should only be set up in exceptional cases. Following this approach seems coherent in the sense of establishing a sustainable and coherent innovation supporting system.
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• Higher focus on innovation activities in regional companies As clearly stated above, a limited number of actors in the regional business sector display a strong awareness of the opportunities of innovation leave alone an active engagement in innovative or research and development activities. Consequently, the Land government has developed various approaches to address this fact which seems consistent with a view to the given situation. First of all, it is important to provide potential recipients of funding with a reliable and relevant support framework. In the past, some measures proved to be insufficiently adapted to the regional situation and out of touch with the potential recipients’ needs (e.g. innovation assistants). As a result, the underlying guidelines had to be modified. In the future, theses lessons should be taken into account and actively considered in the planned process of continuous consultation. Beyond low level enabling measures such as support for innovation assistants, the (re- )introduction of patent support and the extension of innovation funding beyond the phase of prototype development are considered as important challenges for the next programming period. In all cases, much potential lies with a careful consideration of realistic thresholds. Secondly, regional stakeholders express the need for a more professional technology transfer that specifically addresses those firms with a so far limited interest in innovation. Hence, a further focus on knowledge providers and (better) intermediaries within the regional system could be worthwhile: As has been shown by various studies, the service sector, and particularly knowledge-intensive business services, can have a significant effect on innovation activities in their client firms. Equally, many innovation activities, in particular in SMEs, are not exclusively or not at all based on research and development processes (“innovation without research”). In a small, technologically not too well endowed region like Saxony-Anhalt, significant potential could lie in measures supporting service sector and/or low-tech innovation – both directly and indirectly. • Further supra-regional cooperation In the given situation, Saxony-Anhalt could benefit from further supra-regional cooperation. Along these lines, the Science Council has recommended to intensify the cooperation between central Germany’s universities across federal state borders (Halle-Jena-Leipzig) (Wissenschaftsrat 2013). With a view to the regions’ industrial sector (at least mid- to large-size firms) the success of the Industrial Initiative for Central Germany provides a similar signal. In both cases, cooperation provides a larger pool of resources, not only in terms of finance and/or qualification, but also in terms of cross-regional infrastructures and “critical mass”. Undoubtedly, efforts in the field of cross-regional cooperation face various challenges from both a political and an administrative point of view. Some of them are genuinely rooted in the federal system and the administrative and legal procedures attached to support policy on the regional, the national as well as the European level. Nonetheless, a good share of them also relates from the potential partners’ diverging interests that would have to be aligned. In spite of – or precisely because of – this, studying international experiences would seem promising to come up with viable ideas for intensified strategic cooperation or at least the introduction of one or the other flexible support measure and action. In the course of the discussions on lead markets, important first steps have been taken in this regard. • Establishing a monitoring and evaluation system As laid down in the preparatory study a new, comprehensive monitoring and evaluation system will be established for the new regional innovation strategy under the provisions of the ex-ante conditionality. This process will be a challenge as it requires the definition of result indicators that can with a certain degree of plausibility be attributed to support measures deployed in the region. As is known, this is a difficult yet not impossible task.
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In spite of this new monitoring, the external assessment of regional policies’ impacts will have to rely on specific evaluations. So far, external evaluations were mandated only occasionally and published even more rarely. For the time being, the lion’s share of regional monitoring and evaluation is performed within the administration and not published – to a certain extent based on the premise that the small size of the region enables regular exchanges between the all concerned actors anyway so that an undue formalisation of the process should/can be avoided. Project monitoring in the sense of controlling has in part been delegated to the WZW (science-sector related projects and initiatives) and in part to the Investment Promotion Bank (innovation support). • Maintaining and enhancing participatory approaches The described level of systematisation of stakeholder involvement in strategic processes is a comparatively new element in Saxony-Anhalt. In addition to the fact that a broad variety of knowledge and competences can be integrated this participatory processes may lead to an increased acceptance of the developed strategy. As the regional government foresees to resume this integrative approach through discussion processes in working groups and feedbacks to policy and administration, substantial potential seems to lie in deepening and strengthening this process.
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Appendix A Bibliography
1. Bullerjahn, J. [2013]: Jens Bullerjahn: Perspektive 2020+ für Sachsen-Anhalt, Eckpunkte meines Programms. www.bullerjahn2011.de/perspektive-2020-plus/ [retrieved 25/10/13 ]. 2. Bundesministerium der Finanzen (2013): The Federal Financial Equalisation System in Germany. Online: www.bundesfinanzministerium.de/Content/DE/ Standardartikel/Themen/Oeffentliche_Finanzen/Foederale_Finanzbeziehungen/ Laenderfinanzausgleich/The-Federal-Financial-Equalisation-System-in- Germany-.pdf?__blob=publicationFile&v=2; www.bundesfinanzministerium.de/ Web/DE/Themen/Oeffentliche_Finanzen/Foederale_Finanzbeziehungen/Laende rfinanzausgleich/laenderfinanzausgleich.html [retrieved 17/10/13].
3. Bundesministerium für Bildung und Forschung (BMBF) (2006): Ideen zünden! Die Hightech-Strategie für Deutschland. Bonn, Berlin: BMBF.
4. Bundesministerium für Bildung und Forschung (BMBF) (2010): Ideen. Innovation. Wachstum. Hightech-Strategie 2020 für Deutschland. Bonn, Berlin: BMBF.
5. Bundesministerium für Bildung und Forschung (BMBF) 2012: Bundesbericht Forschung und Innovation 2012, BMBF: Bonn/Berlin. 6. Bundesministerium für Bildung und Forschung (BMBF) [2013a]: Studie: BMBF-Innovationsprogramm ist gut für Wachstum im Osten www.bmbf.de/press/1775.php [retrieved 25/11/13]. 7. Bundesministerium für Bildung und Forschung (BMBF) [2013b]: Forschungscampus": Public-Private Partnership to Foster Innovation www.bmbf.de/en/16944.php [retrieved 25/11/13]. 8. Christlich Demokratische Union Deutschlands, L.S.-A. (CDU)/Sozialdemokratische Partei Deutschlands, L.S.-A. (SPD) (2011): Sachsen- Anhalt geht seinen Weg. Wachstum, Gerechtigkeit, Nachhaltigkeit. Vereinbarung über die Bildung einer Koalition in der sechsten Legislaturperiode des Landtags von Sachsen-Anhalt 2011 bis 2016. Online: www.sachsen-anhalt.de/fileadmin/ Elementbibliothek/Bibliothek_Politik_und_Verwaltung/Politik%2BVerwaltung/ Dokumente/Koalitionsvertrag_2016.pdf [retrieved 5/11/13 ].
9. Flohr, S. [2012]: Transfer als Bestandteil der Innovationspolitik in Sachsen- Anhalt; Dr. Sieghard Flohr Referatsleiter „Innovations- und Transferpolitik, Clusterthemen“; Transfer-Workshop 17. April 2012 in Halle/Saale 10. Grusevaja, M./Heimpold, G./Schwab, O./Schwarze, K. (2013): Case Study Sachsen-Anhalt. Part of the Study 'Evaluation of the Main Achievements of Cohesion Policy Programmes over the Longer Term in 15 Selected Regions (from 1989-1993 Programming Period to the Present'), managed by the European Policies Research Centre and London School of Economics. Halle, Berlin: IWH Institut für Wirtschaftsforschung Halle, IfS Institut für Stadtforschung und Strukturpolitik GmbH.
11. Hochschule Anhalt/Hochschule Harz/Hochschule Magdeburg- Stendal/Hochschule Merseburg/Martin-Luther-Universität Halle- Wittenberg/Otto-von-Guericke-Universität Magdeburg (2012): Forschung für die regionale Wirtschaft. Bericht des Kompetenznetzwerks für Angewandte und
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Transferorientierte Forschung (KAT) 2012, Schriftenreihe des WZW. Lutherstadt Wittenberg: wzw wissenschaftszentrum sachsen-anhalt lutherstadt wittenberg.
12. IFOK GmbH (2010): Kooperation von Wirtschaft und Wissenschaft in Sachsen- Anhalt 2010. Ergebnispapier. Studie im Auftrag des WZW, Schriftenreihe des WZW Nr. 01.
13. Investitionsbank Sachsen-Anhalt (2013): miteinander. Geschäftsbericht 2012. Magdeburg: Investitionsbank Sachsen-Anhalt, Anstalt der Norddeutschen Landesbank.
14. Investitionsbank Sachsen-Anhalt (IB) 2010: ‘Zukunftsservice’, Geschäftsbericht 2010. IB Sachsen-Anhalt: Magdeburg 15. Investitionsbank Sachsen-Anhalt (IB) 2011: ‘Perspektiven’, Geschäftsbericht 2011. IB Sachsen-Anhalt: Magdeburg 16. Investitionsbank Sachsen-Anhalt (IB) 2012: ‘Miteinander’, Geschäftsbericht 2012. IB Sachsen-Anhalt: Magdeburg 17. IMG – Investitions- und Marketinggesellschaft Sachsen-Anhalt mbH (2013): Der Hugo-Junkers-Preis für Forschung und Innovation aus Sachsen-Anhalt 2013. www.hugo-junkers-preis.de/fileadmin/user_upload/ hugojunkerspreis_flyer_final.pdf 18. isw Institut für Strukturpolitik und Wirtschaftsförderung gGmbH, Prognos AG, Landgesellschaft Sachsen-Anhalt mbH : Sozioökonomische Analyse inkl. SWOT für den EFRE, den ESF und den ELER, Sachsen-Anhalt 2014-2020, isw Institut: Halle. 19. IWH, Fraunhofer ISI, Euronorm (2013): Sächsischer Technologiebericht 2012 Hrsg.: Sächsisches Staatsministerium für Wissenschaft und Kunst. SMWK: Dresden. 20. Konferenz der Kultusminister der Länder in der Bundesrepublik Deutschland [2013]: Rahmenvereinbarung zwischen Bund und Ländern über die gemeinsame Förderung der Forschung nach Artikel 91b GG, www.kmk.org/fileadmin/pdf/foederalismus/Dok21.pdf [retrieved 27/11/13 ] 21. Kultusministerium Sachsen-Anhalt (2008): Richtlinie über die Gewährung von Zuwendungen zur Förderung von Wissenschaft und Forschung in Sachsen-Anhalt. Online: http://www.wzw- lsa.de/uploads/media/Richtlinie_Forschungsfoerderung_Nov_2008.pdf [retrieved 15/11/13 ].
22. Kultusministerium Sachsen-Anhalt (MK)/Wissenschaftszentrum Sachsen-Anhalt Lutherstadt Wittenberg (WZW) e.V. (2007): Grundsätze der Förderung von Forschungsschwerpunkten / Kompetenzzentren in Sachsen-Anhalt. Online: www.sachsen-anhalt.de/fileadmin/Elementbibliothek/ Bibliothek_Bildung_und_Wissenschaft/Wissenschaft/wissenschaftspolitik/0704 05-F__rdergrunds__tze-endg.pdf [retrieved 15/11/13 ].
23. Land Sachsen-Anhalt (2013): Haushaltsplan für das Haushaltsjahr 2014. Entwurf. Einzelplan 06, MInisterium für Wissenschaft und Wirtschaft. Wissenschaft und Forschung. Online: http://www.sachsen- anhalt.de/fileadmin/Elementbibliothek/Bibliothek_Politik_und_Verwaltung/Bib liothek_Ministerium_der_Finanzen/Dokumente/HPL_2014/HPE_2014_Einzelp lan_06.pdf [retrieved 15/11/13 ].
24. Landesregierung Sachsen-Anhalt Programmstruktur der EU-Fonds EFRE, ESF, ELER und EMFF in Sachsen-Anhalt für die Förderperiode 2014 - 2020. Online: www.sachsen-anhalt.de/fileadmin/Elementbibliothek/
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Bibliothek_Politik_und_Verwaltung/Bibliothek_Europa/Dokumente/Programm struktur_EU-Fonds.pdf [retrieved 15/11/13 ].
25. Landesregierung Sachsen-Anhalt [2013a]: Ministerium der Finanzen > Haushaltspolitik www.sachsen-anhalt.de/index.php?id=3814 [retrieved 15/11/13 ].
26. Landesregierung Sachsen-Anhalt [2013b]: www.sachsen-anhalt.de/ fileadmin/Elementbibliothek/Bibliothek_Politik_und_Verwaltung/Bibliothek_W irtschaftsministerium/Dokumente_MW/gruenden/TGZ-Liste_neu.pdf [retrieved 15/11/13 ].
27. Landesregierung Sachsen-Anhalt [2013a]: Ministerium der Finanzen > Haushaltspolitik www.sachsen-anhalt.de/index.php?id=42 [retrieved 15/11/13 ].
28. Landesregierung Sachsen-Anhalt [2013]: Programmstruktur der EU-Fonds EFRE, ESF, ELER und EMFF in Sachsen-Anhalt für die Förderperiode 2014 – 2020. www.sachsen-anhalt.de/index.php?id=31458 [retrieved 25/10/13 ] 29. Landesregierung Sachsen-Anhalt [2013]: Strategische Eckpunkte der Fonds EFRE, ESF und ELER in Sachsen-Anhalt für die Förderperiode 2014 – 2020. http://www.sachsen-anhalt.de/index.php?id=31458 [retrieved 25/10/13 ] 30. Landesregierung Sachsen-Anhalt/Hochschulen des Landes Sachsen-Anhalt (2007): Rahmenvertrag Forschung und Innovation zwischen der Landesregierung und den Hochschulen des Landes Sachsen-Anhalt 2007 - 2010. Exzellenzoffensive des Landes Sachsen-Anhalt. Online: www.sachsen-anhalt.de/fileadmin/ Elementbibliothek/Bibliothek_Bildung_und_Wissenschaft/Wissenschaft/wissens chaftspolitik/071119-Vertragstext-RV_Fo_Inno.pdf [retrieved 15/11/13 ].
31. Landesregierung Sachsen-Anhalt/Hochschulen des Landes Sachsen-Anhalt (2010): Rahmenvereinbarungen zu den Zielvereinbarungen 2011-2013 zwischen der Landesregierung und den Hochschulen des Landes Sachsen-Anhalt. Online: http://www.wzw-lsa.de/uploads/media/101221-Unterschr-RV-ZV.pdf [retrieved 15/11/13 ].
32. Ministerium für Finanzen Sachsen-Anhalt (MF) 2013a: Entwurf: Haushaltsplan für das Haushaltsjahr 2014, Einzelplan 06, Ministerium für Wissenschaft und Wirtschaft – Wissenschaft und Forschung -, MF Sachsen-Anhalt: Magdeburg 33. Ministerium für Finanzen Sachsen-Anhalt (MF) 2013b: Entwurf: Haushaltsplan für das Haushaltsjahr 2014, Einzelplan 08, Ministerium für Wissenschaft und Wirtschaft - Wirtschaft -, MF Sachsen-Anhalt: Magdeburg 34. Ministerium für Wirtschaft und Arbeit Sachsen-Anhalt Innovationsstrategie Sachsen-Anhalt 2013. Online: www.sachsen-anhalt.de/fileadmin/ Elementbibliothek/Bibliothek_Politik_und_Verwaltung/Bibliothek_Wirtschafts ministerium/Dokumente_MW/forschen_und_lernen/Innovat_strategie_S_A_2 013__2_.pdf [retrieved 25/11/13 ]
35. Ministerium für Wirtschaft und Arbeit Sachsen-Anhalt 2008: Innovationsstrategie Sachsen-Anhalt 2013. MW Sachsen-Anhalt: Magdeburg. 36. NORD/LB 2010: Wirtschaft Sachsen-Anhalt, Die 100 größten Unternehmen in Sachsen-Anhalt, Analysen und Kommentare Dezember 2010, NORD/LB Regionalwirtschaft: Hannover. 37. NORD/LB 2012: Sachsen-Anhalt Monitor, Ausgabe Dezember 2012, NORD/LB Regionalwirtschaft: Hannover.
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38. Ramboll Management (2011): Themenspezifische Evaluation der Forschungs-, Entwicklungs- und Innovationsförderung. Europäische Strukturfonds Sachsen- Anhalt 2007 - 2013. Report produced by Dr. Kirsti Dautzenberg and Guido Zinke.
39. Staatskanzlei Sachsen-Anhalt (2010): Sachsen-Anhalt - Hier ist Zukunft. Der Beitrag Sachsen-Anhalts zur neuen EU-Strategie EUROPA 2020. Magdeburg.
40. Staatskanzlei Sachsen-Anhalt, 2013: Der Beitrag Sachsen-Anhalts zur neuen EU- Strategie EUROPA 2020, Sachsen-Anhalt - Hier ist Zukunft, Staatskanzlei Sachsen-Anhalt: Magdeburg. 41. VDI Technologiezentrum GmbH, GIB Gesellschaft für Innovationsforschung und Beratung GmbH, 2013: Grundlagen einer Regionalen Innovationsstrategie Sachsen-Anhalt 2014 – 2020 - Kerninhalte - VDI Technologiezentrum: Düsseldorf. 42. VDI Technologiezentrum GmbH/GIB Gesellschaft für Innovationsforschung und Beratung GmbH (2013): Grundlagen einer Regionalen Innovationsstrategie Sachsen-Anhalt 2014 - 2020. Studie im Auftrag des Ministeriums für Wissenschaft und Wirtschaft des Landes Sachsen-Anhalt.
43. VDI Technologiezentrum GmbH/Technopolis Austria GmbH (2008): Clusterpotenzialanalyse in Sachsen-Anhalt im Auftrag des Ministeriums für Wirtschaft und Arbeit des Landes Sachsen-Anhalt. Magdeburg.
44. Wissenschaftsrat (2013): Empfehlungen zur Weiterentwicklung des Hochschulsystems des Landes Sachsen-Anhalt. Braunschweig. 45. WZW Sachsen-Anhalt, 2010: Kooperation von Wirtschaft und Wissenschaft in Sachsen-Anhalt 2010, Ergebnisbericht, Schriftenreihe des WZW, 01, WZW: Lutherstadt Wittenberg. 46. WZW Sachsen-Anhalt, 2011: Forschung für die Regionale Wirtschaft, Bericht des Kompetenznetzwerks für Angewandte und Transferorientierte Forschung (KAT) 2011, Schriftenreihe des WZW, 09, WZW: Lutherstadt Wittenberg.
All statistical figures taken from Eurostat or the German Statistical Office (DESTATIS) unless otherwise mentioned.
Appendix B Stakeholders consulted
1. Hans-Joachim Hennings, Director-General ‘Research, Innovation and Europe’, Ministry of Sciences and Economic Affairs Saxony-Anhalt (06 11 2013). 2. Dr. Gerhard Wünscher, Executive Director, WZW (07 11 2013). 3. Jörn-Heinrich Tobaben, Operative Business Director, Industrial Initiative for Central Germany (01 10 2013, 12 07 2012). 4. Reno Paul, Investment Promotion Bank Saxony-Anhalt (06 11 2013) 5. Gunnar Hammecke, Investment Promotion Bank Saxony-Anhalt (06 11 2013).
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Appendix C Statistical Data
SE23 Västsverige Country EU27 Year Performance Performance relative to relative to SE23 SE EU27 EU27 SE ECONOMIC INDICATORS GDP per capita (Euros) 35300 37300 24500 2010 144,1 94,6 GDP growth rate - (2000-2010) 2,61 2,69 2,93 2000-2010 89,2 96,9 Long term unemployment rate 1,31 1,36 4,14 2011 316,0 103,8 Labour productivity growth (%) 1,71 1,84 2,20 2000-2010 77,7 92,6 RCI 2013 0,59 0,44 0,00 2013 139,2 107,6 Share of employment in agriculture 0,02 0,02 0,05 2011 37,2 93,0 Share of employment in industry (including construction) 0,22 0,20 0,25 2011 89,1 112,3 Share of employment in business 0,27 0,28 0,30 2011 89,5 96,4 Share of employment in public sector 0,32 0,32 0,25 2011 129,3 99,4 Share of employment in S&T 0,12 0,12 0,09 2011 130,5 94,0
RESEARCH & TECHNOLOGY INDICATORS Employees with ISCED 5-6 (% all employees) 34,7 35,5 30,4 2011 113,9 97,7 Business R&D (% GDP) 990,8 873,6 304,3 2010 325,6 113,4 Government R&D (% GDP) 0,12 0,15 0,26 2010 46,2 80,0 Higher Education R&D (% GDP) 0,83 0,88 0,49 2010 169,4 94,3 EPO patent applications (per mln population) 271,87 294,51 114,99 2008 236,4 92,3 Employment in medium-high & high-tech manufacturing (% total employment) 6,51 5,17 6,39 2011 101,9 125,9 Employment in knowledge-intensive services (% total employment) 47,66 49,59 35,32 2011 134,9 96,1 Total R&D personnel (% active population) - numerator in head count - all sectors 2,49 2,34 1,53 2010 162,7 106,4 Structural funds on business innovations (Euros per mln population) 21,90 76,65 77,74 2007-2013 28,2 28,6
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SE23 Västsverige Country EU27 Year Performance Performance relative to relative to Structural funds on core RTDI (Euros per mln population) 12,99 49,44 63,01 2007-2013 20,6 26,3
LABOUR PRODUCTIVITY B-E - Industry (except construction) 85.730 92.864 71.853 2010 119,3 92,3 C - Manufacturing 75.987 78.973 56.378 2010 134,8 96,2 F - Construction 47.227 48.208 43.792 2010 107,8 98,0 G-I - Wholesale and retail trade, transport, accomodation and food service activities 55.073 55.027 37.843 2010 145,5 100,1 J - Information and communication 79.421 84.118 79.994 2010 99,3 94,4 L - Real estate activities 353.341 354.660 387.941 2010 91,1 99,6 M_N - Professional, scientific and technical activities; administrative and support service activities 53.911 56.422 39.717 2010 135,7 95,6
BUSINESS INNOVATION INDICATORS Technological (product or process) innovators (% of all SMEs) 0,57 0,39 0,40 2008 143,1 145,8 Non-technological (marketing or organisational) innovators (% of all SMEs) 0,43 0,32 0,38 2008 113,7 134,0 Innovative SMEs collaborating with others (% of all SMEs) 0,61 0,47 0,37 2008 164,3 130,6 SMEs innovating in-house (% of all SMEs) 0,62 0,45 0,39 2008 159,6 139,1
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technopolis |group| Belgium Avenue de Tervuren 12 B-1040 Brussels Belgium T +32 2 737 74 40 F +32 2 727 74 49 E [email protected] www.technopolis-group.com