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Expert article 893 Baltic Rim Economies, 21.12.2011 Quarterly Review 5�2011
Heterogeneity of innovation strategies of Poland’s firms
By Anna Wzi�tek-Kubiak
Innovation plays a critical role in economic growth and
competitiveness. However in respect to intensity of innovation
the New Member States lag behind the incumbent EU
countries. As the NMS firms share characteristics of followers,
imitators, or non-cumulative firms, it is commonly recognised
that their innovation strategies are based on learning coming
from external sources and differ considerably from their
incumbent EU counterparts.
In respect to innovation performance Poland does not differ
from other NMS. In 2008 only 27.9% of Polish enterprises in
industry and services reported innovation activities. This was
almost two times less than the EU-27 average. R&D intensity
(R&D expenditure as % of GDP) of Poland’s economy was
almost three times smaller than the EU-27 average. Only 31 %
of R&D expenditure was financed by the business enterprise,
i.e. much less than the EU-27 average.
On the other hand, Polish innovating enterprises are a
dynamic part of an economy. In last 5 years, the average
dynamics of growth of employment and turnover in Polish
innovation enterprises was one of the highest in the EU-27.
Dynamics of growth of turnover of innovative firms was much
higher than that of employment and both rates were higher
than that of Poland’s economy average. Innovative enterprises
in Poland have increased their productivity to higher degree
than economy average.
As in the case of the incumbent EU countries, Poland’s
innovating enterprises are heterogeneous in respect to
sources of innovation. Introducing cluster analysis which is
based on a wide range of internal and external factors of
innovation that are introduced in Oslo Manual, we select five
types of innovation strategies introduced by Polish innovating
enterprises. These strategies show different ways of
accumulation of knowledge which is used in competition.
Surprisingly, most of these strategies are common to the
incumbent EU countries.
Types of innovation strategies introduces by Polish
innovating firms
R&D based strategy
This is a kind of closed innovation strategy. It is characterised
by a very high R&D intensity, a large share of R&D staff
employed and strong cooperation with R&D organisations.
However, although these firms invest in in-house R&D, they do
not manage to improve the ability to identify, value and apply
other sources of external knowledge coming from suppliers,
customers and competitors. In effect they do not gain benefits
from these cooperation.
Firms on this path to innovation tend to focus on product
innovation. New products are strongly competitive on the
domestic market. However focusing on R&D and neglecting
the role of cooperation with non research partners does not
allow them to gain a strong international competitiveness.
Strategy of open innovation
Firms who pursue this strategy not only do in-house R&D.
They also extensively exploit knowledge from other
organizations. They cooperate in R&D activities with domestic
and foreign research organizations, independent researchers
and with suppliers, customers and competitors. Developing inhouse
innovation capabilities allows these firms to accumulate
and make use of external knowledge extracted from different
innovation partners.
This strategy confirms that external knowledge benefits the
firms that posses innovation potential. Innovation linkages
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transfer into beneficial ones when they are supported by inhouse
R&D activities.
The share of new products in sales is one of the highest.
The international competitiveness of products and production
technology is also high. Open innovation strategy significantly
enhances firms’ competitiveness.
Users of innovation
This strategy is geared toward process, technology effects. It
involves innovation activities aimed at improving a low level of
technology, i.e. elimination of the main weaknesses of the
firms.
Subcontracting of R&D substitutes in-house R&D which is
low. It is accompanied by intensive cooperation with R&D
organisation. This collaboration is very beneficial and results in
high share of newly introduced products in sales. However
their strong competitiveness on domestic market accompanies
low level of international competitiveness. Comparison of this
strategy with that of open innovation leads to conclusion that
in-house innovation activity serving beneficiary absorption of
external knowledge supports the improvement of international
competitiveness of products.
High profile strategy
Most firms consistently run internal R&D activities and
cooperate with external research organizations, including both
domestic, foreign and independent scientists. These firms
were supported by intensive subcontracting and cooperation.
Such an approach resulted in high benefits that they took from
cooperation with business partners and resulted in high
innovation output and international competitiveness.
Low profile strategy
These firms have very low in-house innovation resources and
activities and cooperation in R&D activities. They still focus on
defensive restructuring. As they benefit from cooperation in
terms of product quality and marketing, the role of diffusion of
external knowledge is very important. However this diffusion
does not translate into international competitiveness of their
products which is weak. They operate in the lower quality
segment of the domestic market where competitiveness of
their products and technology is moderate.
Concluding remarks
Although intensity of innovation and innovation performance of
Polish firms are much lower than that of the incumbent EU
counterparts, there are no large differences in innovation
behaviour and strategies of innovation between Polish
innovating firms and their incumbent EU counterparts. It
suggests that firstly, catching up process is the most dynamic
in the case of Polish innovative firms. Secondly, there is a shift
in competitive pressure of Polish firms form low-quality to
higher quality, innovative products.
Anna Wzi�tek-Kubiak
Professor
Head of Department
Institute of Economics Polish Academy of Science
Poland
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