Report: Innovation and Competitiveness for SMEs Study Mission, 12-15 June 2012, Seoul, Republic of Korea

Group Photo of Participants

ABOUT THE PROJECT

Innovation is a process by which an idea or invention is translated into a product or service for which people will pay, or something that results from this process. To be called an innovation, an idea must be replicable at an economical cost and must satisfy a specific need. Innovation involves deliberate application of information, imagination, and initiative in deriving greater or different value from resources and encompasses all processes by which new ideas are generated and converted into useful products. In business, innovation often results from the application of a scientific or technical idea in decreasing the gap between the needs or expectations of customers and the performance of a company’s products. Nowadays, the increasing technological complexity required for making new products, short product life cycles, and unceasing competition have forced SMEs to move beyond the change philosophy of continuous improvement to more innovative, radical ideas that will enhance their competitiveness. In addition, fluctuating customer needs and increasing competitive pressure are the main reasons why innovative power is becoming one of the strongest deciding factors in the commercial success or failure of an SME or any business. SMEs often confront barriers to innovation, e.g., resource constraints, which hinder their capacity to invent and commercialize new products, services, or process.

Realizing the importance of innovation to the success of SMEs, the APO organized this study mission especially for SMEs to share and grasp new ideas for promoting and creating innovation in their products, services, processes, and policies. It is also a platform for SMEs to share views and concerns on issues related to innovation so that they can enhance their competitiveness in the market. At the end of this mission, the participants are expected to prepare action plans based on what they learned. The plans will be shared with NPOs and heads of participants’ organizations. Participants will be requested to submit progress reports on action plan implementation six months after completion of this mission. The objectives of this program is to learn, share and observe the current mechanisms and experience in promoting innovation in SMEs to enhance their competitiveness. DTI was invited to nominate a participant to this training and said participant was accepted.

OBJECTIVES FOR PARTICIPATION

1. To regularly update/enhance my consultancy skills and expertise through participation in short term programs such as familiarization visits and other continuing education activities.

2. To be abreast with technology breakthroughs which I can share with the region I am assigned to and the MSMEs I am counseling.

My learning from this program will translate to a more efficient and improved delivery of services of the Bureau to the MSMEs. Likewise, I will be able to share my newly-acquired knowledge on innovation to other technical staff who are involved in various projects/programs of the Bureau towards innovation and competitiveness of MSMEs.

PROFILE OF PARTICIPANTS

The training was participated in by 18 representatives from the 13 member countries of the Asian Productivity Organization. These participants came from government agencies, academe and SMEs. Two (2) Filipino participants joined this program: Mr. Carlos A. Sayco, Jr., VP/Managing Director for International Relations, Innovation, Strategic Convergence Initiatives and Partnerships, Development Academy of the Philippines and myself, Trade and Industry Development Specialist from the Department of Trade and Industry-Bureau of Micro, Small and Medium Enterprise Development.

SCOPE, METHODOLOGY AND CONTENT

The study mission covers 5 modules on innovation and competitiveness as follows:

Module 1:  Creativity and Innovation for Competitiveness- Ideas, Thinking and Techniques
Module 2:  Entrepreneurship and Innovation for SMEs-Using Business Models Effectively
Module 3:  Innovation in SMEs: Korean Experience
Module 4:  Experience Sharing on Entrepreneurship and Innovation
Module 5:  Innovation in SMEs: Learning from Japan Quality Award (JQA) Winner

Lectures, site visits, presentations, interactive discussions, and sharing were the methods used in conducting the program.  Company visits were conducted in three SMEs in Korea to learn the innovation practiced in their businesses.  Each enterprise made a presentation to the participants and a walk through to the site to observe the processes followed.  On the last day of the program, there were panel discussions to share participants’ learnings from lectures and site visits. The group was divided into four and was given instruction on how to prepare and develop an action plan based on the issues and challenges faced by the respective country. The action plan was prepared using the Brain Writing or 635 method/technique wherein 6 participants will contribute 3 ideas each on each issue in 5 minutes. After the discussion and group work, presentation on the suggested solutions were presented by each group to the class. The activity was moderated by Mr. Ab Rahim Yusoff, Senior Director of Malaysia Productivity Corporation. I recommend that more SME resource persons be invited to share their success stories so we can learn from their experiences.

OUTCOMES AND EVALUATION

Participants gained some insights on what tools and techniques are required or needed on how SMEs innovate to be competitive. The site visits were very helpful as it provided each participant an idea or knowledge on how those companies applied innovation in their processes. The sharing of Mr Yap Kim Lee was very inspiring as he shared his company’s success story – that it was all hard work, determination and discipline that contributed to the success of his business. The lectures were very relevant and helpful especially in providing advisory assistance to would be and existing entrepreneurs. There was good camaraderie and team work amongst participants from different countries. It was a very good experience interacting with fellow participants of different background.

As regards the resource persons, they were all very generous of their time in sharing their knowledge and experiences to all the participants. We learned so many tools and techniques on innovation. The speakers were all competent in their respective fields. The use of business models is a valuable input as it will be a useful tool for a company to be competitive.

It is also interesting to note the innovation culture employed by the companies we visited. Rewards system was in place and the welfare of the employees was considered through the provision of recreational or entertainment facilities where one can enjoy and relax before and after work. This resulted to a motivated, efficient and more productive workforce. I observed that the companies we visited exhibited the values of quality commitment, customer responsiveness and cost consciousness.

Innovative countries like Korea, Singapore and Japan put premium on awards as these are considered to be one of the very effective tools to be competitive. There are a lot of award giving bodies in these countries as mentioned during the company visits and these were run by private organizations.

RECOMMENDATION AND ACTION STEPS

Participation in similar study mission is recommended. This will benefit us DTI staff involved in MSME development equipped with  knowledge and skills of the latest technology innovation of SMEs to effectively impart advice and information to the Bureau’s clientele, the MSMEs and the MSME stakeholders and enablers.

The newly acquired knowledge will be shared to other technical staff who are involved in various projects/programs of the Bureau towards innovation and competitiveness of SMEs.

SUBMITTED BY:

MARY JEAN GELLOR
Trade and Industry Development Specialist
Bureau of Micro, Small and Medium Enterprise Development
Department of Trade and Industry

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