Building an entrepreneurial university in Brazil

The role and potential of universityindustry linkages in promoting regional economic development
Marcelo Amaral, Andre Ferreira and Ptias Teodoro

Abstract: This study is part of a broader research project, conducted by the Triple Helix Research Group Brazil, focusing on universityindustry government linkages in the state of Rio de Janeiro. The case study reported here is that of the Regional University of Volta Redonda: the aim was to develop an understanding of how a regional university can be transformed into an entrepreneurial university, oriented towards assisting regional economic development. A theoretical framework was constructed using existing literature on regional development and the Triple Helix approach. The research objective was to determine the relevance and effects of universityindustry collaboration from the perspective of local players. Two surveys were conducted, one with faculty members at the university and the other with representatives of companies located in the region. No cultural barriers to collaboration were revealed on either side of the relationship; and opportunities to improve a relationship that, in the past, has had little inuence on economic development in the region were also identied. Keywords: innovation; universityindustrygovernment linkages; regional economic development; entrepreneurial university; Triple Helix; Brazil
Marcelo Amaral (corresponding author) and Andre Ferreira are with the Triple Helix Research Group Brazil and the Department of Business and Public Management, School of Human and Social Sciences, Regional University of Volta Redonda, Fluminense Federal University, Rua Desembargador Ellis Hermydio Figueira 783, Aterrado, Volta Redonda 27213415, Brazil. E-mail: mgamaral@gmail.com; andre.ferreira10@gmail.com. Ptias Teodoro is also with the Department of Business and Public Management at the Regional University of Volta Redonda, Fluminense Federal University, Brazil. Email: pitiasteodoro@yahoo.com.br.

In the last ten years Brazil has experienced an expansion in the number of public universities, mainly located outside metropolitan cities, which has provided a stimulus to regional economic development and dispersal of economic activities from the large conurbations (Ferreira et al, 2009). The emergence of a

knowledge-based society demands a new kind of university, with the objective not only to act as a provider of qualied personnel for business but also to promote innovation and consequent economic development (Etzkowitz, 2008). The challenge is how to transform universities which have few connections

INDUSTRY & HIGHER EDUCATION Vol 25, No 5, October 2011, pp 383395, doi: 10.5367/ihe.2011.0061

Building an entrepreneurial university in Brazil

with industry, and little knowledge of the needs of industry, into entrepreneurial establishments in which the mission to generate and disseminate knowledge is extended to include the application of knowledge for the benet of society at large (MCT, 2002; IBGE, 2005). The objective of this report is to present an understanding of, and discuss how to improve, the collaboration between players from academia and industry in a geographic region, outside a metropolitan area, of a country experiencing rapid rates of economic growth. The case study presented is that of the Regional University of Volta Redonda (PUVR, in Portuguese), an adjunct of Federal Fluminense University, situated in the Mid Valley of River Paraba, south of the State of Rio de Janeiro. The main issue considered was this: how to transform a new regional university such as PUVR into an entrepreneurial university aimed at supporting regional economic development by transferring knowledge created to products, processes and services for the benet of society at large. The resulting answer is based on the understanding of faculty staff and industry leaders of the purpose and effects of universityindustry collaboration. The theoretical framework adopted for the study was based on the current literature on regional economic development and the Triple Helix approach. Triple Helix focuses on the interaction between economic players in academia (the universities), industry and government. This approach was rst formalized by Etzkowitz and Leydesdorff (2000) to explain the relationship between the different participants. They modeled three spheres of inuence, representing knowledge creators, such as universities or academies, public and private research and development (R&D) centres, etc; knowledge users, such as companies using knowledge in producing goods and delivering services; and the government which, through its policies and agencies, imposes or inuences regulation and stimulation of entrepreneurial activity. In addition there are hybrid organizations which arise from Triple Helix interactions.1 Based on this, the research methodology adopted here, a case study, differs from that used for conventional analysis of innovation systems. The case study approach enables indicators of connections, relationships and collaboration to be identied, in addition to traditional input and output data of science and technology such as value of R&D expenditure, numbers of papers published or patents licensed. Two surveys were carried out, one in each sphere (academia and industry), to map knowledge creation, the types of interactions, barriers and opportunities, understanding and opinions of faculty staff and business people, and the role of the institutions in the innovation process. Reference was made to the traditional indicators; but the 384

primary objective was to understand the process dynamics and how to improve it.2

Linkages, the second academic revolution and emergence of an entrepreneurial university

Universities are undergoing a cultural transformation, playing a new role in the emergent knowledge-based society. This transition process is occurring worldwide and is the subject of study and analysis by many authors for example, Etzkowitz (1994, 2001), Castells (2000) and Tornatzky et al (2002). Etzkowitz (1994) called the process a second academic revolution, which added a third role, economic and social development, to those of teaching and research. In the industrial era, academia has hitherto played a largely secondary role by providing qualied staff and engaging in basic research. Currently, academia is becoming increasingly involved in supporting innovation and implementation of local policies and practices designed to foster a more entrepreneurial approach (Cooke et al, 2007; Etzkowitz and Zhou, 2009). However, academia needs to maintain its policy of accessibility and retain its long-term academic research programmes (Oliveira, 2008). A new social contract between academia and society has been introduced, in which government support is maintained such that research and innovation plays an important role in economic development (Brisola, 1998). This transition, experienced at the start of the 21st century, resembles the rst academic revolution that occurred 150 years ago at Humboldt University, in Germany, in which research was added to teaching (Teixeira, 1988). The Triple Helix thesis argues that as a result of the second academic revolution academia is capable of being, or must become, entrepreneurial and thus form the basis for regional economic development. According to Etzkowitz and Zhou (2009), the university should become: . . . a research base with commercial potential, a tradition of generating start-ups, an entrepreneurial ethos on campus, policies for dening ownership of intellectual property, sharing prots and regulating conicts of interest and participation in regional innovation strategy . . . Knowledge spillover from universities promotes regional development, through commercialization of research and provision of new rms, human resources and new ideas. (Etzkowitz and Zhou, 2009, p 2) An entrepreneurial university encompasses teaching, research and the service of society, by means of INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil

concurrent tripartite cooperation rather than linear processes. Academics play a new role, adding value in companies; and this learning process improves education and research. Equally, researchers ndings and new methodologies improve teaching practices. It is a continuous process of creating, acquiring, packaging and disseminating knowledge. Brazilian Public Research Universities, BPRUs, were established in the period extending from the 1920s to the 1960s and were based on existing schools and institutions having a mission to provide trained individuals to meet the increasing employment needs of industry. In the 1960s, the universities started to incorporate research activities into graduate (teaching) programmes; and from the 1990s economic development has emphasized the need for managerial efficiency and effectiveness and innovation to improve business competitiveness. As a consequence, starting in the 1980s, technology-based incubators, science and technology parks and technology transfer offices were created in the BPRUs to foster universityindustry collaboration (Etzkowitz et al, 2005). According to Maculan and Mello (2009), A set of interaction activities were established, as technological services (tests, measurements, consultancies, information services), education services, joint research projects with companies, projects carried out by incubated ventures and jointed-projects with junior companies. (Maculan and Mello, 2009, p, 3)3 In 2008 there were some 2,165 institutions of higher education in Brazil, of which 176 were classied as universities which together had more than four million enrolled students.4 There is a group of 53 universities, called federal universities, that are controlled and supported nancially, with public funds, by the Ministry of Education. These federal universities are attended by only 10% of those in the 1824 age-group but are responsible for more than 50% of research carried out in Brazil (Mello et al, 2008). There are also universities funded by the states, and private universities. But beyond BPRUs effort only three state universities (from the state of Sao Paulo) and some religious universities (Catholic and Lutheran) have some involvement with research (Maculan and Mello, 2009). The HE system developed in Brazil in the last 50 years is concentrated in SouthSoutheast regions of the country, is responsible for 1.1% of indexed publications worldwide and graduates around 10,000 PhDs each year. However, despite the substantial increase in graduate numbers that occurred, in 2006 Brazil was INDUSTRY & HIGHER EDUCATION October 2011

producing only ve PhD graduates per 100,000 inhabitants. Mello et al (2008) points out that: Brazil has arrived at the 21st century with a complex productive structure and a reasonable research system, either with regard to the number of Masters and PhD graduates or to its share in international scientic publications. However those two systems continue to be quite far apart from one another. Companies continue to describe themselves as having a poor capacity to absorb and to improve technology and develop innovations . . . The contribution of the university continues to be limited to technological training . . . (Mello et al, 2008, p 24) The BPRUs were organized in a tripod structure, with teaching, research and outreach extension activities representing the three legs. However, in general, the administrative support staff and processes were unable to accommodate the resultant operational demands, with a resulting negative impact on response times in addressing the different demands of society. Previous studies (Ferreira et al, 2009; Amaral and Wegermann, 2011) found that within the BPRUs these three activities follow different paths, each having autonomous structures and their own processes and characteristics. Such arrangements were adequate for dealing with the original, planned workloads, but were not able to deal satisfactorily with the process of technology transfer to industry. It became clear to both sides, academia and industry, that an intermediary, with the necessary relevant knowledge and experience, was needed to interpret the different requirements and manage individual interests. In the absence of such intermediaries, the result was a set of incomplete interactions with society, a potentially damaging situation with regard to recognition of academia as a key component of the knowledge-based society (Ferreira et al, 2009). However, the presence of such an intermediary in effect, a knowledge broker might be an impossible dream due to the complexity of knowledge ow and stakeholder interests being of such magnitude that one such person would not be capable of dealing satisfactorily with all aspects of the interactions. Perhaps the correct approach lies in dening a set of clear rules for steering universityindustry relationships. The creation of a technology transfer office, called the nucleus of technology innovation, a mandatory requirement imposed in 2004 by the enactment of the Brazilian Innovation Law, will not alone solve the problem.5 Academia must adopt a proactive role. Workshops, technical visits, trade fairs and technical conferences are examples of activities that are of limited practical value in fostering universityindustry 385

Building an entrepreneurial university in Brazil

interactions. A better way to develop collaboration is to attract companies to the university campus, not only in incubation facilities but also in activities that allow exchange of knowledge and experience and encourage common and combined efforts to nd solutions for problems. Such experience can also improve teaching standards, by making use of real examples from industry to reinforce taught theory. In summary, BPRUs are currently involved predominantly in teaching and self-oriented research activities (Ferreira et al, 2009) and data from the Brazilian innovation survey PINTEC shows, with some exceptions, similar behaviour occurring across the country (IBGE, 2005). The Brazilian experience in the last ten years has been one of combining the concept of the entrepreneurial university with the policy of regional economic development (Etzkowitz et al, 2005; Amaral et al, 2009). As a developing nation, where the rst and second academic revolutions are occurring simultaneously (Ferreira et al, 2009), the role of academia has an additional component, that of a tool to spread knowledge, research and economic development to society at large (Amaral and Silva Filho, 2008). Extensive literature on the role of innovation in regional economic development, presenting work such as that by Piore and Sabel (1984), Saxenian (1996; 2007), Storper (1997), Tornatzky et al (2002) and Cooke et al (2006; 2007), provides analyses of the types of interactions, incentives, barriers and recent performance. The concept of innovation as a driving force for regional economic development also lies at the core of the Triple Helix approach, originally developed with regard to high-tech technology transfer (Etzkowitz, 2008) but subsequently now applied to any type of innovation promoted by tripartite universityindustry government relationships. From the literature four relevant points were identied. The knowledge-based economy cannot be limited to high-tech sectors such as microelectronics, telecommunications, pharmaceutical and biotechnology and software. Learning and innovation processes are also signicant in the medium- and low-tech sectors such as food production and processing, raw materials and textiles; and sources of knowledge arise many times in the value chain (Cooke et al, 2007). The concept that universities can play a central role in economic development is also helpful in the context of the modernization of low-tech companies (Etzkowitz and Leydesdorff, 2000). The local and regional contexts are important with regard to the production, and reproduction, of a 386

collective identity, reinforcement of mutual trust and the establishment of effective and exible networks of economic and cognitive relationships which support the creation and dissemination of knowledge (Cooke et al, 2007; Saxenian, 2007). The Triple Helix of universityindustry linkages can be regarded as a metaphor with respect to the analysis of regional economic development (Etzkowitz and Leydesdorff, 1995). In the Brazilian economy a signicant part of innovation activities is the organization, interpretation and dissemination of knowledge with regard to the modernization of production in small and medium companies (IBGE, 2009). In low-tech sectors the universityindustry linkages occur less frequently and, in general, are established to solve current, specic problems and develop new products (Cooke et al, 2007). Companies involved with production in low-tech sectors do not generally need, or seek, state-of-the-art technologies. In many cases, access to information and knowledge to improve production standards is more important for sustaining competitiveness (Tigre, 2006; Yusuf, 2007). The Minister of Science and Technology recognizes that Brazil cannot afford to underestimate the impact of incremental innovation on national competitiveness (MCT, 2002). Often, in developing countries, capacities for science and technology are used to identify and select opportunities generated elsewhere. The role of a national innovation system then becomes one of following the international technological trends (Albuquerque, 2009). To avoid this, it is necessary to increase the complexity of the R&D infrastructure and, at the same time, to devolve power and authority from the national to the local level. This is manifested in the creation of new regional bodies: the transformation includes efforts to encourage universityindustrygovernment players to undertake joint innovation projects and encouraging industry to operate in larger clusters, industrial districts or localized production and innovation arrangements or systems. According to Etzkowitz et al (2005), Encouraging a meta-innovation process, activating areas of society that had been distant from innovation, allows the triple helix model to be realized in developing countries where it had been a normative rather than an analytic concept. The process is more complex than simple organization and technology transfer. The same organizational mechanism can play a completely different role in innovation, depending upon the actor(s) that promote its introduction and the context into which it is introduced. The incubator was adapted to Brazilian INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil

circumstances as new actors entered onto the incubator scene and adapted the mechanism to realize their objectives. (Etzkowitz et al, 2005, p 12)

Table 1. Proles of RMVP companies. Companies by sector (2007) Metallurgical Automotive Food Construction industry Others Chemical/pharmaceutical Ceramic Industrial assembly Textile/clothing Heavy construction industry Mechanical maintenance Cement Paper Computer components Nuclear fuel Public service Total 18 12 12 11 10 10 10 8 8 6 5 3 2 1 1 1 118 Direct employment by sector (2007) Metallurgical 16,404 Automotive 4,330 Industrial assembly 2,854 Food 2,706 Textile / Clothing 2,091 Others 1,951 Heavy construction 1,310 industry Chemical/ 1,047 Pharmaceutical Construction 978 industry Paper 750 Ceramic 604 Nuclear fuel 520 Mechanical 472 maintenance Public service 430 Cement 355 Computer 220 Components Total 37,022

Case study
The case study involved the Regional University of Volta Redonda (PUVR), an adjunct of Federal Fluminense University (UFF, in Portuguese), the third largest university in the Brazilian federal system. PUVR was created in May 2004 as an outcome of an expansion programme introduced and sponsored by the Ministry of Education. The university received about US$12 M of investment income from the Brazilian Federal Government between 2004 and 2010. Currently, PUVR has 200 members of faculty academic staff of which 83 (73%) hold PhDs. At the end of 2011 the university will have around 4,000 students in thirteen undergraduate courses across three schools Engineering, Basic Sciences and Human and Social Sciences with four graduate courses, Masters and PhD programmes in metallurgical engineering and MBAs, and three distance learning courses, in public-sector management. PUVR has 2 campuses in the city of Volta Redonda, the main city of the Mid Valley of River Paraba (RMVP), located in the southern part of the State of Rio de Janeiro, some 140 km from Niteri, where the UFFs headquarters and main campus are located. The RMVP is situated in a strategically important region, between the main economic centres of Brazil, that is, Rio de Janeiro and So Paulo. Comprising thirteen municipalities it has some 852,000 inhabitants and the highest gross domestic product (GDP) per capita of the State of Rio de Janeiro and one of the highest GDPs in the country. Several Brazilian and foreign companies have industrial plants there, such as Volkswagen/MAN (trucks), Peugeot-Citron (automotive), Saint-Gobain (metallurgy), Votorantim (cement and steel), CSN (National Steel Company), Du Pont (chemical), AMBEV (beverages), MRS (logistics), GEFCO (logistics) and Galvasud (metallurgy), among others. Moreover, the region hosts a large business park with small and medium enterprises in the metallurgical mechanical sectors. The principal city is Volta Redonda, a planned conurbation with strong connections to CSN (which is the largest steel company in Latin America). Based on the database of the Industrial Association of Rio de Janeiro (FIRJAN, 2007), Table 1 identies those of the 118 RMVP industrial companies employing at least 50 people and the numbers they do employ. The predominant sectors are metallurgy, automotive and food; also of importance are a nuclear fuel plant and INDUSTRY & HIGHER EDUCATION October 2011

three pharmaceutical companies. From the sample selected, 20 are multinational companies (12 from Europe, seven from the USA and one from Asia) and 31 companies are involved with exporting. With regard to industrial activity, the RMVP is typical of the general behaviour of developing nations: efficient but not dynamic. Companies have highly productive plants but use technologies sourced from outside Brazil: there is no autonomous capability for innovation. Process innovation occurs through the purchase of new machinery and product innovation follows international practice and market demands (IBGE, 2009).

The surveys
The present research was carried out in two stages. The rst stage was a survey involving PUVR faculty staff the university sphere. This was done, in 2009, to investigate the role of the university in regional economic development through the interaction of academic research groups and local industry (partially published in Ferreira et al, 2009). The survey was formally supported by PUVR and the three university schools. In the second stage, carried out in 2010, a survey was conducted with companies located in the region the industry sphere. Data were collected from interviews, involving one researcher and at least one company manager or a person with decision-making 387

Building an entrepreneurial university in Brazil

authority. The questions used in the surveys are presented in the Appendix as Tables A1 and A2. Survey 1: the academic viewpoint The objective of the investigation was to identify and dene, from the perspective of the academic body, the role of the university in the creation of technology and innovation for the promotion of regional economic development. Some primary information was collected from the National Council of Scientic and Technological Development (CNPq) database to identify established research groups, what type of data was available and then dene the format of the data to be collected. The survey questionnaire form was created to collect two sets of data: types of interaction, and barriers. The types of interaction between university and industry are training and technical consulting; development of prototypes, equipments, systems or software; basic or applied scientic research; and technology transfer. The barriers in universityindustry interactions were identied and grouped as: cultural differences and different goals; lack of incentives within the universities, administrative procedures and excessive bureaucracy; lack of experience in dealing with industry; and the rewards structure for and amount of time available to the researchers for interaction activities (Rapini, 2007). The data were collected using a printed form which was distributed to all faculty staff, and then collected, in February and March of 2009. Hence there was no statistical sample: the object was to consult the entire academic population. Some additional interviews were carried out to complement the information provided or improve understanding and interpretation of the data already collected. In the event, survey forms were received by 95 (85%) of the 111 professors in the faculty: 16 were not available to participate, for various reasons. From these 95, 80 forms were completed in full and returned and thus could be used for the analysis: this represents 72% of the possible total of 111 faculty staff members. Because the population was largely homogeneous, it is reasonable to assume that this 72% has provided valid information representative of all PUVR members. Of the respondents, 61 were male (76% of the total) and the average age was 42 years, although 59 (74%) of the respondents were below this average. Fifty eight (73%) had a PhD or other postdoctoral degree. On average, respondents had been working in the university for six years, although some had been with PUVR for less than three years. When asked about collaboration with companies, 37 professors (46%) stated that this had occurred. Whilst we regard this as a signicant number, it is the case that because commercial businesses are, for two of the three 388

PUVR schools, central elements in the study, the expectation of the research team, before the survey was done, was that the number would be higher. From the survey, it is important to emphasize that 73 (91%) of the 80 faculty staff members agreed that part of the workload in the BPRUs can be dedicated to activities with industry. They also agreed that themes related to the needs of local industry and society should be the focus of research. Such agreements are positive because they indicate that the cultural barrier is small and that cooperative working can increase. According to Ferreira et al (2009), and analysing the volume of interactions rather than their quality or impact, it is possible to conclude that PUVR experiences an intermediate level of interaction. Analyzing the type of interaction, the university industry linkage found in RMVP consists essentially of the transmission of existing knowledge through provision of training and consultancy services, involving some 53% of the activities. R&D is of less relevance, involving only 22% of activities and aimed predominantly at solving process problems, although some a small number were involved with the creation and dissemination of new knowledge. That the knowledge was for the most part not new is due to the historical evolution of the Engineering School which was created in the 1960s as a spin-off from the steel company (CSN) and intended primarily for training the companys workforce. Although the original vision changed, in practice its operation remained the same (Ferreira et al, 2009). There was insufficient information about the number of collaborative projects, the value of funding involved, numbers of patents submitted and granted, licensing contracts and the use of research outputs by industry to enable a proper analysis to be produced. As a result it was not possible to evaluate the associated impact of these factors: further research is needed, to collect more data and carry out case studies on the identied activities undertaken within the relationships. Some collaborative research activity was revealed but no results were forthcoming. It can be speculated that knowledge transfer occurred informally, for instance through access to academic papers and independent consultancy services action which, strictly and paradoxically, contravenes public service law and university rules in Brazil because in the BRPUs faculty staff are civil servants. Analysing the barriers to interaction of faculty staff with industry revealed that 38 (47%) of the researchers identied absence of incentives, and work conditions, as the key obstacles. The absence of clear rules, and ideological beliefs, were regarded as less important factors. The researchers highlighted their low level of INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil

Table 2. Proles of companies studied. Workforce Direct Indirect 550 588 294 933 78 1,005 1,261 8,467 102 220 405 180 670 90 1,363 29 830 1,658 18,723 102 2,536 67 400 15 500 9,220 1 80 37 80 100 791 21 60 50 14,060

Sector Paper Automotive Metallurgical Nuclear fuel Food Food Metallurgical Metallurgical Metallurgical Pharmaceutical Sanitation Automotive Automotive Computer components Metallurgical Cement Automotive Metallurgical

Capital source USA Europe Brazil Brazil Brazil Brazil Europe Brazil Brazil Europe Brazil Brazil Europe Brazil Brazil Brazil Europe Brazil

City Pira Resende Barra do Pira Resende Volta Redonda Porto Real Barra Mansa Volta Redonda Barra Mansa Resende Volta Redonda Resende Porto Real Pira Barra Mansa Volta Redonda Itatiaia Barra do Pira

Export company? Yes Yes Yes Yes No No Yes Yes Yes Yes No Yes Yes No Yes No Yes Yes

Type Private capital Private capital Private capital State-owned Private capital Private capital Private capital Private capital Private capital Private capital Public service Private capital Private capital Private capital Private capital Private capital Private capital Private capital Totals

Sales, 2009 (R$)* 129,600 5,800,000 396,653 292,976 NA** 260,000 NA 10,504,554 NA NA 33,519 NA NA NA NA NA NA NA 17,417,302

*US$ 1 = R$ 1.80; NA** = not advised

knowledge of universityindustry interaction mechanisms and agreed that more time should be dedicated to cooperative activities, with lack of time (to engage in such activities) not being regarded as a signicant barrier. With regard to the barriers faced by companies, the faculty staff responding appeared to presume that there was a low level of knowledge about the benets that could be derived from cooperative interactions. This low level is seemingly related directly to the lack of interest shown by companies and an absence of proactivity, on the part of the universities, to be recognized as a valuable source of knowledge. It could be a characteristic of the cultural distance between academia and industry. Another area identied in the survey, in which there is potential for improvement, was the lack of knowledge about legislation and mechanisms for funding innovation and universityindustry linkages in Brazil. Fifty seven (71%) of the academic staff were either not aware of the existence of such funding or they did not know how to exploit its availability. They knew about the Innovation Law (introduced in 2004) but did not exploit the possibilities it offered. In the case of the Good Law, a package of economic regulations to create subsidies and stimuli for companies investing in R&D, the situation was worse we presume because it is the most recent legislation, being enacted in 2006. In the case of SectorOriented Funds, a package of 15 governmental funds INDUSTRY & HIGHER EDUCATION October 2011

created from 1998 to nance R&D projects and infrastructure development, the situation is better: universities have submitted infrastructure and research projects for assessment with regard to these funds, but only some of the projects dealt with promotion of, or required collaboration with, industry. Survey two: the industry viewpoint The second survey comprised individual interviews with a sample of 18 RMVP companies selected on the basis of their economic status. The total revenue of these companies represented more than 75% of the total amount for industry in the region.6 The selection was thus a non-probabilistic sample, with the predominant sectors being metallurgical and automotive, although all sectors identied in the region did include at least one company: Table 2 summarizes the key details. A semi-structured guide, in three parts, was used in the interviews: General information sector of activity, gross and net revenues, employees, etc (already presented in the regional characterization); Innovation activities based on indicators from the Brazilian Survey of Innovation (PINTEC) led by the National Institute of Geography and Statistics, IBGE (IBGE, 2005); and Universityindustry linkages whether the company was involved with any type of cooperation with 389

Building an entrepreneurial university in Brazil

academia in the three years preceding the study and the perceptions of the difficulties and benets in using external sources of knowledge. The second part innovation activities is presented in detail here to facilitate understanding of the behaviour of industry. With regard to innovation, a new product can be considered to be one whose fundamental characteristics differ from all other, older products manufactured by the company. At this level innovation is intended primarily for the company and not necessarily for the market or the sector (OECD, 1997). Based on this concept of product innovation, the survey investigated which types of innovations were carried out by the RMVP companies. The responses from 18 companies revealed that 33 product innovations had been implemented in the three years prior to the study, as follows. Fifty incremental innovations in the product portfolio; Seven new products for the national market, also suitable for international markets; Six new products in the companys portfolio, suitable for national markets; Three new products aimed at the international market; and Two companies with two or more types of product innovation. Regarding responsibility for the development, 14 answers were submitted: % six companies stated that responsibility rested with themselves; % four companies stated that another company from the same group was involved; % two companies stated that it was themselves in cooperation with other companies or academia; and % two companies stated that it was other companies or universities. Regarding process innovation, 16 of the companies responding, listing 22 occurrences: % nine were related to innovations in equipment, software and techniques for supporting the manufacturing process such as performance measurement, quality control and certication and improvement of an enterprise resource planning (ERP) system; % eight were about innovation in fabrication or assembly methods, related in two companies to implementation of a lean manufacturing system; and % ve related to innovations in logistics systems. 390

In terms of relevance, only one company had implemented a process innovation worldwide: a further seven had implemented innovation processes new to their company but already in use elsewhere in the national market. For four companies, the innovation implemented was new in the national market but already existed and was in use elsewhere worldwide. These process innovations were carried out in collaboration with local players. Seven companies were responsible themselves for project execution, ve companies stated that the process innovation was achieved mainly by other companies or universities, and two companies implemented through cooperation with other companies or universities. No innovation developments arising from other companies within the same group were recorded. When asked about how innovation activities were nanced, it was found that the majority of the companies (11) funded at least 80% of the investment in innovation using their own resources. They advised that they did not have information about external funding opportunities, most of which were offered by the federal government. In the same way, the companies in the survey did not use legitimate benets such as tax exemptions to support R&D activities. In most cases, companies indicated that they knew about the possibilities of interaction with universities but did not know about the legal mechanisms involved in nancing this type of investment or how to obtain nancial help and subsidies. Table 3 summarizes the origins of research funds. Regarding universityindustry linkages, the survey results showed that 13 of the 18 companies carried out activities that were classied as universityindustry collaboration. These 13 companies registered 27 occurrences of such interaction, predominantly activities with low-tech content and demand such as tests and training (13 occurrences, 48% of the total). Activities with high-tech demand and content, for example R&D and product or process development, had eight occurrences (30%). Activities classied as middle level, such as technical and managerial consultancy services had ve occurrences (18%). There was only one case of interaction using nancing mechanisms to support R&D. The survey did not reveal signicant numbers of interactions such as development of companies and projects in incubators, equipment or software development, unpaid licenses for academics, or formal processes of technology transfer from academia to industry such as patent licensing. When asked about initiating an interaction, 14 (77%) of the companies stated that they regarded this as their responsibility; and the majority of these companies had internal R&D skills, knowledge and experience albeit INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil

Table 3. Funding sources for innovation. Funding sources Bank loans Private Number of companies 0 11 0 3

Own capital Venture capital Laws (incentives, Tax incentive Law of subsidies and grants) Informatics (Law 10.664, Law 11.077) Tax incentive to R&D and innovation (Law No 8.661 and Cap. III Law No 11.196) Finance for purchase of machinery and equipment in innovation projects. Finance for R&D projects in partnership with university or research institutes. Subvention for R&D and application of research (Law No 10.973 and Art. 21 Law No 11.196). Grants to researchers in companies. Total

These results conrm the need for urgent improvements to the capacity and ability of universities to express their views clearly and appropriately. Special attention should be given to relationships with industry, to disseminate university competencies and knowledge of how to access these assets, to enable the available knowledge to be used to contribute to the innovation process. Two surveys: confronting perspectives In the case of universityindustry collaboration involving PUVR and RMVP companies, the surveys revealed that the universities adopted a passive or reactive role in the interaction process. No initiative was found at PUVR for the creation of a bridge to industry and transfer of knowledge created. The behaviour of professors and research groups is seemingly contradictory in this context, when they state that they want to cooperate with industry but are not aware of mechanisms for collaboration. We would argue that if the desire to cooperate genuinely exists, those in academia are capable of nding and learning about these mechanisms. It could be the case that such behaviour reects the absence of a formal and official structure in PUVR for dealing with innovation management and industry cooperation. It could also be explained as being a cultural aspect of change at a time when academia was hiring new people with experience gained in industry. A fundamental change of outlook is needed and the research shows that achieving this is not a problem in this case (Ferreira et al, 2009). However, the key issues are the outdated and inadequate operating structures of the universities, and excessive bureaucracy. All agreements and nancial management must be administered in Niteri, UFFs headquarters, and the key managerial positions are reserved for staff at Niteri. Such a situation inhibits the development of a more entrepreneurial mindset in the faculty staff. The situation at PUVR is different from UFFs campuses at Niteri where there are two incubators, a technology transfer office and an Agency of Innovation to coordinate institutional policy (Amaral and Silva Filho, 2008). However, as already noted, the presence of facilities to manage the technology transfer process, such as a technology commercialization office or an external relations department, will not by itself solve all the problems. The lack of knowledge about legislation and mechanisms designed to promote universityindustry linkages was present to the same extent in both academia and industry. This is an indicator of low levels of interaction. Insufficient data were available to enable a meaningful analysis to be performed of the evolution over a period of time of the linkages. However, it is possible to infer, from the outcome of the interviews 391

0 18

not necessarily located in a separate R&D department. No examples were found of interactions initiated by a university. The companies interviewed in the survey cited 22 instances of collaboration with universities. Those most cited were the University of So Paulo (USP), the Pontical Catholic University of Rio de Janeiro (PUCRio) and the University of Campinas (Unicamp), with three cases each. The Federal University of Rio de Janeiro (UFRJ) and the Federal University of So Carlos (UFSCar) reported two occurrences each. PUVR was cited by two companies: the activities were laboratory-based tests. The interactions were managed by university foundations (eight instances) and through service contracts and formal agreements (three). In one case there was a formal agreement made directly with the professor concerned; and there were other instances which were not formalized. When asked to choose the three most important barriers, from a list of ten, those selected most often (six citations each) were lack of knowledge of possible contributions from academia, and the response time. The absence of an intermediary in the universities and the low level of application of R&D output to a companys activities were cited four times each. INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil

and the growth in the number of research projects and groups (four were created in three years prior to this study), an increasing trend of improvement in the levels of collaboration. Industry does not appear to interact with academia in several areas, such as development of incubated ventures or projects, software development, hiring researchers, development of equipment and technology transfer. These require special efforts from all players in the Triple Helix: policies arising from developed economies often cannot be used as exemplars or for inspiration. The trade-off between innovation and development of new products and services at a global level and modernization new products and services at a local level or manufacturing at a global level can be difficult to accommodate. Strengthening university industry linkages enables less demanding activities to be developed; but learning processes, such as learning by doing and learning by cooperating, can improve the competencies needed to establish high-tech and dynamic cooperation. In the few examples of universityindustry cooperation identied in the surveys, the universities cited based outside the RMVP were those most recognized and acknowledged in Brazil in terms of academic excellence and presence in a wide range of areas of academic knowledge. Such a concentration can result in a separation occurring between a small group of university leaders and a long list of universityfollowers, a situation which might have adverse effects on the development of new centres of excellence and extending the knowledge creation process beyond urban settings. This presents something of a dilemma to policymakers, in that they are faced with seeking to concentrate effort and resources into the best research groups whilst simultaneously disseminating the knowledge creation and transmission processes throughout the country. This also affects the university industry relationship because it will concentrate the potential for establishing linkages in a small number of universities. It also generates a key question for PUVR: how to migrate from the university-followers group to that of the university-leaders. Universityleaders need to have well-dened entrepreneurial attributes and to take the lead in cooperation with industry, with an awareness of the needs of the region. Accomplishing this would enable PUVR, as a regional university, to be transformed into an entrepreneurial establishment.

the State of Rio de Janeiro. From the case studied it is possible to conclude that PUVR has exerted little inuence over the economic development of its region, with no information being found about patent applications, knowledge or technology transfer to industry or process or product improvement achieved with other players. The results of in-depth research on training and service contracts indicated low levels of activity in these areas. At present it cannot be stated with certainty that PUVR already is, or is moving towards being, an entrepreneurial university. In contrast, this process is in progress in the main campus of UFF (Amaral and Silva Filho, 2008). If PUVR is to evolve into an entrepreneurial university it could become more involved in the activities developed at the headquarters of UFF and attempt to replicate them in the RMVP. However, such a strategy might not succeed and PUVR would then need to develop its own processes for interacting with local industry. According to the results of the surveys, neither the academic culture nor ideological barriers will affect this, probably because some of the faculty staff have had work experience in industry. The problem is probably related more to excessive bureaucracy and the quality of management leadership in PUVR. The expectation is that research groups in which entrepreneurial spirit exists will be consolidated the quasi-rms (Etzkowitz, 2008) leading to the second academic revolution at PUVR. New leaders are also taking up managerial positions; and ideas and strategies with the potential to support the contribution of the university to regional economic development are being developed and introduced, not only with regard to university programmes and project managers but also to the models of universityindustry relationships that have already been tested and proven at UFF and other Brazilian universities. The key question is how long this process of maturity will take. Any halt in progress could result in PUVR reverting to being mostly a teaching school with little or no relevant research activities and a decreasing ability to raise funds, as a consequence of its low level of interaction with industry and society.

Notes
The reference to UIG is a simplication of a complex and dynamic processes. More references about Triple Helix can be found in Etzkowitz (2008) and the websites: http:// www.triplehelixassociation.org and http://www.triple-helix.uff.br. 2 A methodological question to be noted with regard to the use of Triple Helix approach in this paper relates to the absence of government analyses. The research focused only on universityindustry linkages, on the assumption that the government had adopted a proactive stance to encourage interaction and provide funds and a stable environment. This is a
1

Concluding remarks
This report deals with part of a broader research project concerning universityindustrygovernment linkages in 392

INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil

different conguration of the Triple Helix: it is neither Mode I nor Mode III (Etzkowitz and Leydesdorff, 1995). Rather, it is more like U(+g) I(+g). 3 Junior companies are consulting rms organized by students, inside the university, with faculty staff providing coaching services. 4 Universities must have a regular offering of at least 12 undergraduate courses in at least three different elds of knowledge. Graduate programmes must have at least three elds of study at Masters level and one eld at for PhD level. All levels are constantly evaluated by the Ministry of Education. At least 33% of the faculty staff work full-time and 50% have a Masters or PhD degree (Mello et al, 2008). 5 For details of the Innovation Law see, for example: http://www.wipo.int/sme/en/documents/brazil_innovation.htm. 6 This information is not precise because some companies do not provide exact details of gross revenues. In addition, in many cases the information is not publicly available because the companies are limited societies. See also Table 1. Etzkowitz, H., and Leydesdorff, L. (2000), The dynamics of innovation: from national systems and Mode 2 to a Triple Helix of universityindustrygovernment relations, Research Policy, Vol 29, pp 109123. Etzkowitz, H., and Leydesdorff. L. (1995), The Triple Helix: universityindustrygovernment relations, EASST Review, Vol 14, No 1, pp 1419. Ferreira, J., Amaral, M., Teodoro, P., and Souza, S. (2009), The insertion of the public university in the process of innovation and regional development a case study in Brazil, Proceedings of VII Triple Helix Conference, June 1619, Glasgow. FIRJAN (2007), Catalog of Industries of the State of Rio de Janeiro, CDROM, FIRJAN, Rio de Janeiro. IBGE (2005), Pesquisa Industrial de Inovao Tecnolgica 2005, Ministrio do Planejamento, Oramento e Gesto, Instituto Brasileiro de Geograa e Estatstica IBGE (in Portuguese), http://www.pintec.ibge.gov.br/, last accessed September 2009. Maculan, A., and Mello, J.M.C. (2009), University start-ups for breaking lock-ins of the Brazilian economy, Science and Public Policy, Vol 36, pp 109114. Mello, J.M.C., Maculan, A., and Renault, T. (2008), Brazilian universities and their contribution to innovation and development, UniDev Discussion Paper Series, Paper No 6, published online at:http://developinguniversities.blogsome. com/. MCT Ministrio da Cincia e Tecnologia (2002), Livro Branco Cincia, Tecnologia e Inovao, MCT, Braslia, (in Portuguese). OECD (1997), Oslo Manual Proposed Guidelines for Collecting and Interpreting Technological Innovation Data, 2nd ed, OECD Publishing, Brussels. Oliveira, S.C. (2008), Sobre a Interao UniversidadeEmpresa no Desenvolvimento de Software: Um Estudo de Caso no Recife, PhD Thesis, Federal University of Rio de Janeiro UFRJ, Rio de Janeiro (in Portuguese). Piore, M.J., and Sabel, C.F. (1984), The Second Industrial Divide: Possibilities for Prosperity, Basic Books, New York. Rapini, M.S. (2007), Interao UniversidadeEmpresa no Brasil: Evidncias do Diretrio dos Grupos de Pesquisa do CNPq, Estudos Econmicos, Vol 37, pp 211233 (in Portuguese). Saxenian, A. (2007), The New Argonauts: Regional Advantage in a Global Economy, Harvard University Press, Cambridge, MA. Saxenian, A. (1996), Regional Advantage: Culture and Competition in Silicon Valley and Route 128, Harvard University Press, Cambridge, MA. Storper, M. (1997), The Regional World Territorial Development in a Global Economy, Guilford Press, New York. Teixeira, A. (1998), Educao e Universidade, Editora UFRJ, Rio de Janeiro (in Portuguese). Tigre, P.B. (2006), Gesto da Inovao: A Economia da Tecnologia no Brasil, Campus, Rio de Janeiro (in Portuguese). Tornatzky, L.G., Waugaman, P.G., and Gray, D.O. (2002), Innovation U New University Roles In A Knowledge Economy, Southern Growth Policies Board, Research Triangle Park, NC. Yusuf, S. (2007), Universityindustry links policy dimensions, in Yusuf, S. and Nabeshima, K., eds., How Universities Promote Economic Growth, World Bank, Washington DC.

References
Albuquerque, E. da M. (2001), Scientic infrastructure and catching-up process: notes about a relationship illustrated by science and technology statistics, Revista Brasileira de Economia, Vol 55, September/December, pp 545566. Amaral, M., and Wegermann, Q. (2011), How to evaluate business incubators and sciencetechnologyinnovation parks, Proceedings of 22nd ISPIM Conference, Hamburg. Amaral, M., and Silva Filho, S.M.da S. (2008), An entrepreneurship university under open innovation and Triple Helix inuences the design of a technology transfer model and the search for a useful and sustainable innovation framework for universities in underdeveloped and developing countries: a Brazilian study, Proceedings of 19th ISPIM Conference, June 1518, Tours. Brisola, S.N. (1998), Relao UniversidadeEmpresa: Como Seria se Fosse, Interao UniversidadeEmpresa, edited by Instituto Brasileiro Informao em Cincia e Tecnologia, Bras lia: IBICT (in Portuguese). Castells, M. (2000), The Rise of the Network Society, 2nd edition, Wiley-Blackwell, Chichester. Cooke, P., De Laurentis, C., Tdtling, F., and Trippl, M. (2007), Regional Knowledge Economies: Markets, Clusters and Innovation, Edward Elgar, Cheltenham. Cooke, P. et al (2006), Constructing Regional Advantage, Principles, Perspectives, Policies, European Commission, Brussels. Etzkowitz, H. (2008), The Triple Helix: UniversityIndustry Government Innovation in Action, Routledge, New York. Etzkowitz, H. (2001), The second academic revolution and the rise of the entrepreneurial university, IEEE Technology and Society Magazine, Summer, pp 1829. Etzkowitz, H. (1994), Academicindustry relations: a sociological paradigm for economic development, in Leydesdorff, L., and Besselaar, V., eds., Evolutionary Economics and Chaos Theory, Pinter, London. Etzkowitz, H., and Zhou, C. (2009), Regional innovation initiator: the entrepreneurial university, theme paper of 6th Triple Helix Conference, http://www.nus.edu.sg/nec/ TripleHelix6/, last accessed September 2009. Etzkowitz, H., Mello, J.M.C., and Almeida, M. (2005), Towards meta-innovation in Brazil: the evolution of the incubator and the emergence of a Triple Helix, Research Policy, Vol 34, pp 411424.

INDUSTRY & HIGHER EDUCATION October 2011

393

Building an entrepreneurial university in Brazil

Appendix
Table A1. Survey questions for UFF faculty members. Information about, for example, position, education level, years in the university and gender. In the last three years were you involved in one or more projects with companies? What kind? Who started the initiative? What was the size of the company(ies)? Where were the companies located? How did the relationship come about? What is the main barrier in the universityindustry collaboration from the university perspective? What is the main barrier from the researcher perspective? What do you think is the main barrier in universityindustry collaboration from a companys perspective? What kind of actions can facilitate universityindustry relationships? What is your degree of knowledge about intellectual property, innovation incentives and subsidies? Do you agree that part of a researchers work and/or activities can be done in or for companies?

Table A2. Survey questions for industry. General information from the company and interviewee (such as address, year of foundation, capitalization, revenue, products, main market, number of employees). Part In 1 Innovation effort 200709 did your company introduce a new product or service? What kind of innovation was it? Who developed the knowledge needed for the innovation?

In 200709 did your company introduce a new production process or any process improvement? What kind of innovation was it? Who developed the knowledge needed for the innovation? What R&D activities are done by the company? Who nances these activities? In 200709 was the company involved in any project or collaborative activity to develop new knowledge and innovation? Who were the partners and what were the activities? In 200709 did the company receive any incentive or subsidy from the government? Please describe. How did the company protect knowledge generated in R&D activities? Were any patents applied for in 200709? If the company was not engaged in innovative activities during 200709, please give the reasons and note any problems or obstacles encountered. What kind of contribution can the university make to a companys innovation processes? Which organizations are playing a signicant role in promoting innovation in the region? Can you cite specic actions? Part 2 Universityindustry relationship In 200709 did your company participate in projects with universities or research institutes? Did these relationships create any tangible output? If so, what? Did the output meet company needs (was the company satised)?

394

INDUSTRY & HIGHER EDUCATION October 2011

Building an entrepreneurial university in Brazil Table A2. Continued. Detail the kind of collaboration. Who took the initiative? Which universities or research institutes were involved? How did the interaction occur? What are the barriers in universityindustry collaboration from the companys perspective? What kind of actions could facilitate or promote the relationship?

INDUSTRY & HIGHER EDUCATION October 2011

395