«Benchlearning is the best approach for IC policies»

Advice: Not "copying " Nordic countries, but building a cross-learning dynamic with them, and taking their level of performance as a starting point.

Interview by Jorge Nascimento Rodrigues, editor of Gurusonline.tv, February 2005, about the book just published titled "Intellectual Capital for Communities", edited by Bounfour and Leif Edvinsson

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For the first time an Intellectual Capital Index was published for the European Union. It is based in 23 metrics used as proxies for a Nation's IC. The result of this set of metrics is a final performance Index that gives us a "ranking". As in another European "rankings", five countries dominate the IC index: the Nordics plus Holland. UK and Ireland are nearby the leaders. The least "IC" countries are Spain, Italy, Portugal and Greece, the so-called "South".

The author, Ahmed Bounfour, a professor at Université Marne-La-Vallé in France, just published the results of his metrics in a contribution for a new book titled "Intellectual Capital for Communities: nations, regions and cities", edited by Butterworth-Heinemann. In chapter 7, Bonfour explains his IC-dVAL approach, based in four important dimensions of competitiveness - resources (inputs); intangible assets; processes; and outputs.

The advice of Bounfour is "benchlearning" with the best in class, not the trivial benchmarking.

INTERVIEW

How you develop the IC-dVAL® approach and tool?

The development the IC-dVAL® approach has been initiated some ten years ago. The approach builds on the main lessons and arguments developed in economics of innovation and the strategic management literature about the importance of intangible resources for competitiveness in the knowledge economy. At the macroeconomic level, the philosophy of the approach is fully consistent with the Lisbon Agenda, especially regarding the objective of making the European knowledge economy - the most competitive worldwide by 2010 and also, the social cohesion as a policy objective. The approach has been implemented with success in different contexts: RTD programmes, IPRs and innovation and also IT value creation among others. The four dimensions of the method -Resources, Processes, Outputs and Intangibles Assets, have to be considered in a dynamic way, hence the acronym of the method: Intellectual Capital dynamic Value.

What is missing in Portugal and Spain to "converge" for the "middle" of the performances indexes?

Developing a dynamic view of their intellectual capital performance! To be more concrete, this necessitates a more in-depth analysis and contextualising of policy making, institutional frameworks and socio-economic context in these two countries. For Portugal specifically, recent reports brought to the fore important initiatives taken recently towards fostering innovation in this country.

For small countries (less than 15 million people, like Portugal), the "Nordic" model is interesting because those are also small countries. But is it possible to "copy" and "catch up" those countries?

As a member of several European working groups dealing with innovation and intangible assets, I had to discuss the issue of benchmarking innovation systems. Within one of these groups, one of our colleagues developed the idea of an "intelligent benchmarking" among national innovation systems in Europe (this is in opposition to the "naïve" benchmarking often implemented by organisations). Taking this as an interesting perspective, a benchlearning perspective is certainly an interesting one for Portugal and other countries: Not "copying " Nordic countries, but building a cross-learning dynamic with them, and taking their level of performance as a starting point.

What do you consider the "secret" of the "Nordic" model? From its emergent strategy in the last 15 years, what can be "generalized" and what is very specific?

I have a hypothesis: these countries are endowed with intangible resources in full consistency with those necessary for a success in the knowledge economy- horizontal organisations, rather than vertical, more social cohesion (the Lisbon agenda!), and more "feminity" (using Geert Hofstede terminology), … and sometimes luck (Nokia for Finland).

Is this Nordic model sustainable? All these "success models" has specificities and the question of sustainability is not solved, as Jean-Eric Aubert asks in his article in your book.

Yes, so far. But success is contingent and therefore path-dependent. If we take the case of Finland, this country is actively searching for a new path, after-and beyond- the Nokia success. And performance of nations might be outstanding in a very short period: look at Finland, again, this country achieved a remarkable transformation and results from the early 1990s. At that time, Finland was mainly dependent on the Soviet Union market and registered a deep economic crisis after the fall of the communist system in Eastern Europe.

This internal gap in Europe between the Nordic leaders and the others, including the core of EU (like Germany and France), is a true barrier in the benchmarking of Europe with the US?

This is an important question. Two points have to be considered further. First of all the size of country, and, secondly and more importantly, the fundamental nature of these countries economic models: Germany is basically a manufacturer-oriented country, and its transition towards the knowledge-economy is not achieved so far, especially with regards the service dimension. For France, there is an ongoing debate on its scientific and knowledge capabilities dynamics, especially in the high education and research area.

In what sense do we must "revise" the Michael Porter's approach for national competitiveness?

The Michael Porter approach is basically industrial oriented, whereas the knowledge economy needs a deep transformation in our paradigms and tools for modelling and reporting on performance of companies, nations, regions and cities. This is the reason for which we edited the book: "Intellectual capital for Communities" as a platform for prototyping and dialogue among different stakeholders (researchers, policy makers,) all over the World.

How can we develop the "dialogue" between the different models of IC development in Europe?

By implementing a cross-learning dynamics in a very systemic perspective. To certain extent, this might usefully complement what the European Union official documents named the "Open method of Coordination", the "European Research Area".

THE BEST IN CLASS
In 18 metrics

INVESTMENT IN RESOURCES
. Public expenditure in R&D as % of GDP - Finland, Sweden and Holland
. Company R&D budget as % of GDP - Sweden and Finland
. Venture capital as % of GDP - UK and Sweden
. Generation of new capital as % of GDP - Finland, Holland, Denmark and Spain

PROCESSES PERFORMANCE
. % of SME's innovative in-house - Ireland, Germany, Austria and Denmark
. % of SME's innovating in cooperation - Denmark
. % of ICT Markets in GDP - Finland
. % of hi tech value added - Finland
. % of home Internet access - Holland, Denmark, Sweden

PERFORMANCE OF OUTPUTS
. % of innovative exports in total sales - Sweden
. % of new-to-market products - Finland

ASSETS
. Number of scientific papers published per million of inhabitants - Sweden, Denmark, Finland, UK
. Hi tech European patents per capita - Finland and Holland
. % of science and engineering graduates at the age 20-29 - UK, Ireland and France
. % of population with 3rd level of education - Sweden, UK and Denmark
. Life-long learning - Sweden, UK, Denmark
. % employ-tech - Germany
. % employ hi tech in services - Sweden, Denmark and UK

CONTACTS:
Ahmed Bounfour E-mail: bounfour@univ-mlv.fr
Webpage at Université Marne-La-Vallé (in french):
www.univ-mlv.fr/recherche/annuaire_recherche/annuaire/annuaire.php?clelabo=18&cleperso=116