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SMEs are the pillar of APO member economies, accounting for more than 95% of all enterprises and more than 60% of employment. Facing increasing challenges from globalization, the Internet, and digital revolution, all economies must find new ways to help their SMEs survive global competition and enhance productivity through innovation. In addition to the conventional need for continuous improvement, the current major focus is on identifying strategies to help enterprises become sustainable in the ever-changing business environment.
Topping the list in the 2017 Bloomberg Innovation Index, the ROK’s continuous efforts for innovation have made it the most globally competitive in R&D intensity, value-added manufacturing, and patent activity while remaining in the top five in global comparisons of high-tech density, higher education completion rates, and researcher concentration.
Eyeing more balanced socioeconomic development and sustainable growth, the ROK has also modified its national strategy to give greater encouragement to SME startups and entrepreneurs, providing an inspiring example for APO members to learn from and benchmark against. An observational study mission on Innovation and Competitiveness in SMEs was therefore organized from 19 to 23 June 2017 in Seoul, where 16 participants from 13 APO member economies gathered to observe good practices, policy initiatives, and institutional factors driving Korean SMEs to innovate and stay competitive.
The mission is covering topics related to innovation, national strategies, and enablers, including the direct relationship between productivity and SME innovation; importance of innovation, invention, and entrepreneurship; infrastructure and environment fostering innovation; and experiences and strategies from the ROC, ROK, and Singapore. The participants visited the Small and Medium Business Corporation, which plays a pivotal role in promoting SME development and hosts the Asia-Pacific Economic Cooperation SME Innovation Center. The Gyeonggi Center for Creative Economy and Innovation (GCCEI) and Ulala Lab, an SME originally incubated by the GCCEI which now provides Internet of Things and smart factory solutions to other SMEs, demonstrated to mission participants how collaboration among government, industries, academia, and entrepreneurs can nurture innovation and entrepreneurship and help identify market niches. Participants also learned about the development of Korean innovation at the Samsung Innovation Museum, the country’s first museum of technology and innovation, which showcases the history and strategies of global business giant Samsung.
The study mission was conducted by Professor of Management of Technology Benjamin Yuan, National Chiao Tung University, ROC, and former President of the Asian Association of Business Incubation; former Administrator Dong-Sun Kim, Small and Medium Business Administration; Chief of International Affairs, Corporate and Public Relations David Sehyeon Baek, GCCEI; and Managing Director Foo Kim Peng, Kerydh Private Limited, Singapore.
After serving as a core technocrat in formulating and implementing the ROK’s economic development strategy over the past 30 years, Kim told participants that, “Education, entrepreneurship, and the proactive role and commitment of the public sector were the key factors that led the ROK to its continuous innovation and economic miracle,” which shed light on the country’s “secret” to becoming a global champion of innovation and provided a good reference for other APO members to develop their own SME and innovation strategies.