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Breaking Through in the Global Innovative World

January 17, 2013

Guest post by Piotr Moncarz, Consulting Professor at Stanford University, Director and Chairman of the US-Polish Trade Council

With five technology teams located in CEE GE has made a statement about the capacity of the engineers in the region. How can the region move up on the innovation ladder? Our guest blogger Piotr Moncarz, Consulting Professor at Stanford University, Director and Chairman of the US-Polish Trade Council, shares his views on survival and success:

Without innovation no one will notice the Central and Eastern European countries in the global economy. Those countries bear one significant advantage – relatively young, highly educated staff. We should, therefore, establish in what field we are going to win the global markets and support that field with consistency. And – obviously – change the mentality from “defence” to “attack”.

Highly educated, relatively young society constitutes an undeniable asset of Central and Eastern Europe and Poland in particular. The people are the best potential for activity in modern technology areas. They can work at research institutes, they can develop new solutions and new technologies and on the other hand – they can pursue career at companies based on those technologies (materials, IT) and innovative solutions. Nevertheless, human capital is insufficient for global market success.

It is the risk averse attitude that needs to change first. Currently Poland is a country where conservative approach is predominant: act without making any mistakes. It means – no risk, no extending beyond convenient, well-trodden paths. With such thinking any innovative effort is bound to fail. A principle of how to act to be successful requires to be instilled. In Western countries such approach is the driving force of development, a source of risk taking, pursuit of innovation.

Central and Eastern European governments, with the Polish government in the lead, may and should not only initiate but also force such change in mentality. Starting with public administration would be sufficient. They could introduce a clear principle: if you fail to score 3 successes annually, you cease to be an office clerk. Today’s principle states: if you make a mistake, you will suffer the consequences. And there is no innovation without risk, experiments and related mistakes – nothing ventured, nothing gained.

Secondly, the governments need to make an initial, serious, non-bias investment into determining which science/technology fields have the highest potential for the countries success. Than, with the consensus of R&D and economist communities assign strategic directions, which will become long-term goal of the country. No country can be the best at everything, the condition for success is precisely defined specialisation. Here is an example: great IT engineers, who deal with games creation so far. It is not an economy-driving branch. How can this potential be directed so the countries of our region become important players in the IT area? What help may be offered to companies in undertaking risky decisions which will let Poland become an innovative IT tycoon? Those long-term strategic goals cannot be left entirely on the shoulders of individual entrepreneurs – they are the tasks for the government as well. However, one must avoid emulating what others are already doing or, even less so, in which others are already declared world-leaders. Incremental improvement whether in technology, efficiency or price of existing solution/product under no circumstances should be viewed as a strategic step. We should focus our effort on what is going to happen in 5 – 10 years. CEE businesses have the potential not only to react to trends, they can also create them.

Thirdly, Central and Eastern European businesses need help to enter the global market. Currently, majority of them are not ready for it, and when they undertake such risk, they often return quickly. And the potential followers receive negative signals and become discouraged. Why does it happen? Because before a company throws itself into the deep waters of global economy, it needs to address a few key questions: Why do you think your business should be a global one? Why do you think the world should be interested in you? Where is your competition? Why do you think that what you do is better than what others do? A well-defined strategy and plan, thorough preparation and in-depth knowledge of the culture and business-specifics of the chosen market is indispensable and must precede any company’s going-global action.

Enterprises should be made aware of the necessity of such self-assessment. They should receive help with conducting a reliable analysis. Only those will survive in the global market, who not only want take a risk, but also know that apart from being innovative they are – most of all – unique.

Read more from the GE for CEE blog here.