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High hopes but low spending when it comes to innovation: survey

Thai enterprises have given themselves 68.2 points out of 100 for their capability to create innovations, according to a new survey.

Published on October 5, 2007



Of the 1,000 companies involved in the survey, 71.7 per cent said they planned to develop innovations to help improve their products and services. They expect to produce about 2.2 innovative products every year, on average.

Companies taking part in the survey were highly competitive enterprises for which innovation development should be a common goal. They include the Siam Cement and Charoen Pokphand groups, PTT and member companies of the Federation of Thai Industries (FTI) and the Association of Thai Software Industry.

The survey - part of the Thailand Innovation Capability Index 2007 - was conducted by the National Innovation Agency (NIA) together with the FTI, Chulalongkorn University and Microsoft Thailand.

Although it showed a wide expectation of innovation development, the survey also showed that Thai enterprises were not fully confident of their capability when it comes to competing with others on the world stage.

The survey was conducted from March to September this year. It questioned 100 chief executives and 1,000 enterprises on innovation development during the past year. It covered seven key industries - biotechnology,

medical and healthcare, environment, branding and design, nanotechnology, software and agricultural electronics.

The survey found that executives had 68.2-per-cent confidence in their innovative capability, showing a fair rate of innovation development among Thai enterprises.

However, it found that the surveyed companies were still putting only about 0.5 per cent of total income into research and development. It is commonly believed that full benefits from R&D will be realised only when spending amounts to at least 5 per cent of income.

NIA director Supachai Lorlowhakarn said that in terms of policy, the government should consider means of increasing expenditure on R&D to reach at least 5 per cent of income, so that innovation development can offer real benefits to the country.

However, he admitted it was very difficult for the country to increase its R&D spending from the current national level of 0.26 per cent of total income to 5 per cent in the short term.

He said that to help increase competitiveness, the government should consider licensing technology to help local enterprises develop innovations, along with a gradual increase in R&D expenditure. This would push more local innovation development.

"The government should create networks with research institutes, both inside and outside the country, to find proper technologies and licence them to help local business develop new innovations," he said.

Licensing technology, Supachai said, was a short cut to transfer know-how to local people, especially at a time when the country's R&D spending was inadequate.

He also urged the government to develop a national innovation plan as a guideline for further innovative development.

The NIA's survey was the first investigation of innovation development in Thailand's private sector. The agency plans to conduct a similar survey every year to keep abreast of the country's overall innovation development capability.

"We hope to use it as a baseline to compare Thailand's innovation capability with that of other countries. This will show us how to develop innovations to increase our competitiveness in the future," Supachai said.

Pongpen Sutharoj, The Nation


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