Studies Eastern European Markets

Eastern European Markets


Peter Zashev & Irina Dezhina
Internationalisation of Russian small innovation companies: motives and limitations

Electronic Publications of Pan-European Institute 8/2010

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During the transition period the Russian government pursued a number of initiatives aimed at creation of market-oriented innovation system. Big attention was given, especially in recent years, to support of linkages among major actors of innovation system. A number of successful schemes were found, and some were effectively adopted from the foreign experience. At the same time the average picture continues to be very uneven and less prominent then it was expected. The major flaws in government regulations of R&D and innovation activity are: absence of systemic and consistent approach, of regular evaluation and correction, if necessary, of the government initiatives. Furthermore the dominant role of the government seriously hinders the development of entrepreneurial spirit within the innovation system.

Thus for many Russian innovation SMEs the support measures offered by the government are i) insufficient in volume, ii) instable due to abundance of new governmental initiatives and lack of patience testing and seeing the results of previous ones and finally iii) with somewhat unfocused set of performance criteria. In the absence of coherent policies and support measures it will be natural to assume that foreign partners will be quite welcomed for both the authorities and innovation companies.

However the findings of this article indicate that neither is the case. There are no governmental programs targeted to encourage international cooperation of innovation companies. Furthermore the governmental incentives do not see any special role for the international dimension and somehow treat the Russian innovation system as an isolated object.

In the absence of adequate support by the government it will be natural to expect that Russian small innovation companies will seek their own ways of establishing international linkages. Indeed the findings of this article confirm that such companies are actively searching for foreign partners. Still while language proves not to be seemingly an obstacle the companies appear to be unprepared and inexperienced for international markets. The main problems identified are lack of elementary international marketing skills (visibility) and somewhat isolation from the international developments in their field that further exacerbates the creation of competitive and appealing message to foreign funders or partners.

Thus while Russian small innovation companies do recognize the existence of international business opportunities the majority of them are neither sufficiently linked nor sufficiently prepared to utilize them. That calls for support measures by various policy makers and support organizations (business incubators, technology parks, special economic zones etc.). Such support measures need not be sophisticated: subscription for specialized international journals, assistance in attending international conferences, training managers in international marketing and entrepreneurship etc. are only part of the perhaps small but concrete steps needed.

International entrepreneurship is a process often triggered by the natural curiosity in a combination with growing international knowledge, skills and experience of entrepreneurs (also scientists). These are too difficult to be developed in the conditions of a relatively isolated domestic innovation system. Unless more entrepreneurship is inserted in the system and more emphasis is put on developing and nourishing international links the attempts to modernize the Russian innovation system will remain patchy at best. Unless Russian innovation SMEs are not given more tangible and focused assistance in their internationalisation attempts their abilities to do it with own means will remain quite modest.

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