Identification of effective factors on knowledge commercialization: a case study of Mashhad city universities

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1 International Research Journal of Applied and Basic Sciences 2013 Available online at ISSN X / Vol, 7 (14): Science Explorer Publications Identification of effective factors on knowledge commercialization: a case study of Mashhad city universities Feryal Farmani PhD. student, Ferdowsi University of Mashhad, International Campus., Mashhad, Iran Corresponding Author fer.farmani@yahoo.com ABSTRACT:Research commercialization is a process which changes the produced knowledge at universities and research centers to products which can be supplied in the market or industrial processes. The importance of knowledge as the impetus of economic growth and the cause of productivity increase have been noted by most of the universities and government all over the world. in the present research, regarding the importance of knowledge commercialization at universities and based on previous research and opinions of professors of organizational culture factors, internal and organizational management, intellectual property rights, entrepreneurship and making businesses, private sector investment was considered as the important factor in knowledge commercialization and the relationship of this factor with knowledge commercialization was investigated. The participants included 300 of the experts, professors and authorities of knowledge management at universities of Mashhad. The data collected by a researcher-made questionnaire. LISEREL software was sued to analyze data. The results showed that except for organizational culture and intellectual property management variables, all othervariables had positive effect. Key words: knowledge commercialization, effective factors on knowledge commercialization, Mashhad universities. INTRODUCTION Comparing today s universities with the past decades noes, it can be understood that significant changes have been made in their programs, method and approaches and expectations have been transformed. Many years ago universities had the role of education only but research was added to their application at the end of 19 th century with the change of university system ( OECD"Turning science into business, 2003). In fact the emergence of new economy in 1990 changed the relationship between science, technology, innovation and function of economy so that knowledge-based and learner economies, such interactions among different operators in the course of technology of production necessitates the accumulation of knowledge to increase the competition through technology-based changes and innovations (AllenConsulting Group, 2004). Certainty of knowledge function so that society can use the profits of investment in research is one of the main goals of university research. generally the society doesn t use directly the profits of university research unless strategies be designed to take over the research results to companies and public sector factories which are economy operators specialized at commercial investment providing the profits of university. With completed predictions in the fourth program of social-economic development regarding providing the needed conditions for commercialization of research results of universities and research centers in Iran, it is expected that regarding the importance of the issue, beside the promulgation of awareness about this topic at universities and research centers through media, workshops and conferences, the needed infrastructures like rules and regulations on intellectual property management resulted from universities and research centers and also commercialization activities such as licensing and formation of university companies be provided.

2 Literature review In the study of advisory board of science and technology of Canada (1991) about the state of commercialization of research at university sector, the followings were recognized as the mainlimitations and barriers of research commercialization in Canada: The lack of investment in fundamental research The absence of research results commercialization in the mission of university sector aiming at producing economic resources for Canada The lack of culture associated with commercialization at university sector and commercialization dissuasive policies The lack of humane and financial resources in the institutes of university technology transfer Difference of industry view and investors with university sector Lack of budget for sample making stage and scaling and the lack of risk taking investment to establish nascent companies The lack of mutual trust among university sector, industry and investors Not taking serious the effects of commercialization of university research on behalf of the government, industry and investors adequately Not considering the small and mean industries of university sector as sources of innovation This study regarded the challenges and barriers of commercialization systematically. Hawlsok Mc. Kinley (1999) studying the commercialization of university research at European universities mentioned the following point as the conclusion of the study: There is the lack of financial resources in relation to commercialization in most of European universities. This limitation is equivalent to technology transfer and budget institutes that they consider for maintenance and usage. M. Brown et al (2000) in a study done for European commission about big and important research centers in Europe to find the best ways of functioning of technology transfer of big research institutes, the key factor was recognized as: Focusing on the market-culturing, internal management of research center and intellectual property management, entrepreneurship and making businesses and new work (spine off companies or slit companies) and networking (Braun,2000 ) It is observed that the above cases show the effective factors of organizational functioning of research centers. Another study in Australia (2004) titled making effective system s for commercialization of university research on behalf of Allen advisory group identified the main propellers of research commercialization as: Legal framework of intellectual property- structures and management systems of commercialization at universities The quality of university research and accessibility of risk taking financial resources for beginning stages of technology advancement, local businesses with great capacity to receive technology Participants behavior in research commercialization system (AllenConsulting Group, 2004). In a study titled acceleration of economic development through transferring university technology done by Innovation Institute (2005) on 9 famous and successful American universities such as Stanford and M.I.T to evaluate the best methods of functioning and find executive suggestions, the followings were presented as a part of the conclusion: governmental investment provides an important condition for technology transfer and commercialization private companies and institutes can have an important role in technology transfer ( Innovation Associates Inc, 2005). strong research foundation has nourishing role for technology transfer. The results of the study show that universities should look at technology transfer from a strategic approach and consider some of its necessities like change of human source management, compilation of goals and institutional priorities to transfer technology and deciding about allocated sources to fulfill and promote its efficiency(cosh,a, 2003). The necessities of commercialization of university research can be divided to cultural, structural and political categories. The culture of every organization is one of the effective factors on its functioning; so development of commercialization should be supported. The results of the studies emphasize the necessity of infrastructural reforms and institutional innovations to make and promote supportive and entrepreneurship culture at universities (Gitelman, 2005). 1073

3 The existence of different organizational structures at universities has led to development of various commercial approaches; for example, professional bureaucratic structure with its traditional organizational borders may decrease commercial approaches of the universities ( Cosh, 2003). Universities going toward becoming entrepreneurship have to revise the shape and size of their structures to increase their efficiency, effectiveness and competitiveness. With close ties between innovation and research, traditional borders of industry and university is fading and the increase of emphasis on knowledge and technology transfer between university and industry has caused creation and application of different transfer strategies(allenconsulting Group, 2004). In practice, establishing technology transfer in many universities has increased the relation between industry and university (Braun, 2000). Some of the commercialization policies are inserted from top down on behalf of government and its operators and some other from bottom up on behalf of the individuals and existence inside the universities (Fakour,2008). Development and cooperation institution (2000) reported that most of the countries are inserting reforms at universities by moving toward more independence, more competitive and performance-based budgeting. Also supports on behalf of the universities for commercialization have increased significantly ( Musaei, 2008). In 1980 American congress tries to obviate potential barriers of technology transfer from universities to industry though legislation of a law called Dahl-Valle. Based on this law, the possession of the research done by public budget belonged to research institutes which made a great motivation to find ways for commercially utilizing intellectual properties at universities(cosh, 2003). The effect of this law was so high that nearly all research on university entrepreneurship and knowledge commercialization has mentioned it as the most important factor on development of university entrepreneurship in America. By making economic motivations for universities, this law allows them to experience different ways to find the economic development ways. Not any coercion or even suggestion on reacting properly to commercial opportunities has been presented while in most of the countries of Europe Union the governments directly dictate some policies for promotion and convenient transfer of intellectual properties to universities and research institutes. Recently some of European countries like Denmark and Germany, Austria and Norway have revised their intellectual property law giving the right of intellectual property to universities(oecd"turning science into business, 2003). Regarding the important role of knowledge-based entrepreneurship in the process of economic development, the policy maker s can encourage the transformation of new knowledge to applicable technologies and productions through emphasizing on entrepreneurship policies. Bandarian and Qabezi (2009) in a study titled the challenges and advantages of commercialization of the research results in the existing industries stated that the results of research can t be a source of public welfare and human wealth as far as they are not established in practice not giving the advantages to the society. This issue is fulfilled by commercialization which is one of the most complicated stages of and there isn t any definite model for it (Bandarian, 2009). Pouezzat et al (2010) in a study titled identification and prioritization of effectiv e factors on knowledge commercialization at universities (five celebrated universities) stated that: regarding the vital role of knowledge as the main competitive advantage in world economy and the necessity of university participation as the main institute of knowledge production in development of national and regional economy and universities needs to make money and knowledge commercialization for maintenance, compilation of a proper model for university entrepreneurship and transfer of knowledge experience is necessary(pourezzat, 2010). Bandarian et al (2010) explained the barriers of university entrepreneurship and knowledge commercialization at university of Tehran stated that: regarding the published research on university entrepreneurship, nowadays knowledge commercialization is necessary for maintenance of the universities. Also there are some barriers and problems in the way to p roperly utilize the produced intellectual properties at universities to develop knowledge commercialization and university entrepreneurship which their identification and obviation is inevitable (Musaei, 2010). Hatami et al (2008) in a study titled technology and competitiveness stated two of the main bases of research commercialization in Iran including: commercialization and research achievements is one the most important issues in the process of changing ideal to final product. Competition is a dynamic concept which has changed from the category of physical identity issues to intangible issues. In such a structures, the competitors are compared in knowledge-based economy. The research and development is the main index of economic dynamism and basic factor on the continuance of the maintenance in the course of competition. Badri et al (2009) studied the opportunities and challenges of knowledge commercialization stated that: in recent decades, research n investigation section has been noted significantly due to causing competitive advantage for producers so that a great part of big industries and companies has been allocated to it. as far as these researches are not used in practice in commercialization process, they won t have any effect on the quality and quantity of productions not changing the society s welfare. 1074

4 So to use the profits of this process, the collaboration of research institutes and knowledge producer with industries, investors and entrepreneurships is necessary. Research hypotheses Organizational culture has effects on knowledge commercialization. Internal and organizational management has effect on knowledge commercialization. Intellectual property right management has effect on knowledge management. Entrepreneurship and making business has effect on knowledge commercialization. Private sector investment has effect on knowledge commercialization. RESEARCH METHODOLOGY The present research is survey descriptive and causal kind of research. Regarding the results which can be used in practice, this research is also an applied research. Participants and the sample. The participants include universities of Mashhad city. Cochran formula was used to determine the sample volume (Azar, 2003, 71) n N z 2 Z p (1 :participants p ) :confidence coefficient to sample results P :Ration of the trait in sample which is considered 0.5 ( 1 P) :Ration of the absence of trait in sample which is considered 0.5 :estimation accuracy(maximum acceptable error) which is considered 0.06 Regarding that the sample is universities of Mashhad city, the sample was considered 300. Instruments Binam questionnaire was used to collect data filling by managers and research experts and professors of universities of Mashhad. Ordinal scale based on Likert is used in this study. Firstly distributing 30 questionnaires (15 questions),the reliability came Regarding the least reliability is 0.70, this amount of Cronbach alpha reliability is high and proper. Then distributing all the questionnaires, the reliability came Data analysis The present study used structural equation modeling for testing the hypotheses. It is a multi-variable and strong technique from multi-regression family and general linear model providing the researchers with testing simultaneously a set of regression equations. First demographic information of the participants is considered. In the present study 73.3% of the subjects were men and 26.7% were women (table 1) percent Table 1. Participants gender distribution Frequency Gender 80 Woman 220 Man 300 Total Most of them were years old (table 2). Nearly 30% of the subjects had M.A and 70% had Ph.D. degrees(table 3). percent Table 2. Participants age distribution Frequency Age years years 1075

5 years More than 50 years Total Percent Table3. Participants education distribution Frequency Education 90 M.A 210 Ph.D. 300 Total There are 31 questions in the questionnaire. Table 4 shows mean and standard deviation. SD Mean Table 4. Mean and standard deviation of the questions Question SD Mean question Q17 Q16 Q18 Q19 Q20 Q21 Q22 Q23 Q24 Q25 Entrepreneurship and causing business Intellectual property right management Organizational culture Q 1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 Q13 Q14 Q15 Knowledge commercialization Private sector investment Internal and organizational management The notable point in fitting the data in this method is that while structural model fitting is approved, it never is approved that this model is the only variable model. Table 5. Fitting indices of the research model Fitting indices Value Degrees of Freedom 418 Chi-Square SRMR NNFI 0.94 GFI 0.81 AGFI 0.78 IFI 0.97 Total fitting indices of the model show a god condition. Chi-squire value shows that the difference between observed and reproduced matrix of co-variances can t be considered meaningful. Comparative indices show a value close to 0.90 which is as the model s ability to recede from an independence model and getting close to saturated model based on defined indices. RMSEA fitting index and confidence interval of 0.90 are in acceptable range. This index calculated by a mixture of absolute features, degree of freedom-based index and sample volume is considered as one of the most important indices of model fitting. In the present study after drawing the model based on the data, the size of model s parameters was calculated by LISEREL software. So using Gamma factor ( were tested. The results are shown in Figure 1,2 and table (6). Standard estimated coefficient of structural model ) and t-test the hypotheses 1076

6 Figure1. T-test Figure2. In this part the meaningfulness of the results are considered. It should be said that since we are following to test the hypotheses based on 95% confidence interval and 5% error level, the numbers bigger than and are meaningful for t denoting that if a number is between and +1.69, it won t be meaningful. Considering the causal relations and the effects, the model is in a good condition. Result Statistics t Standard coefficient Table 6. The summary of the hypotheses results Hypotheses 1.organizational culture has effect on knowledge commercialization 2. organizational and internal management has effect on knowledge commercialization.3. intellectual property right management has effect on knowledge commercialization 4. Entrepreneurship and making businesses has effect on knowledge commercialization..5.private sector investment has effect on knowledge commercialization CONCLUSION AND DISCUSSION Regarding the importance of knowledge commercialization, the success factors of universities in knowledge management and financial independence were considered in the present study. Based on the previous research and professors opinions, organizational culture, organizational and internal management, intellectual property right management, entrepreneurship and making businesses and private sector investment were considered as effective factors on knowledge management and their relationship with knowledge management were investigated. 1077

7 The coefficient tof the relationship between organizational culture and knowledge commercialization is 0.12 which is not meaningful at 0.05 level with 1.67 t value. So organizational culture has no effect on knowledge commercialization. Also the coefficient of the relationship between organizational and internal management and knowledge commercialization is 0.27 which is meaningful at 0.05 level with 2.30 t value. So organizational and internal management has effect on knowledge commercialization. The coefficient of the relationship between intellectual property right management and knowledge commercialization is 0.09 which is not meaningful 0.05 level with 1.07 t value. So intellectual property right management has no effect on knowledge commercialization. The coefficient of the relationship between entrepreneurship and making businesses with knowledge commercialization came 0.35 which is meaningful at 0.05 level with 4.23 t value. So entrepreneurship and making businesses has effect on knowledge commercialization. The coefficient of the relationship between p-private sector investment with knowledge commercialization came 0.27 which is meaningful at 0.05 level with 3.75 t value. So private sector investment has effect on knowledge commercialization. The results of the present study are in line with Canadian advisory board of science and technology (1999). M.Brown et al (2000) in a study done for big and important research centers of Europe committee to find the best way of technology transferring considered the following factors as effective ones: focusing on market, organizational culture, organization and its internal management, intellectual property right management, entrepreneurship and making new businesses and networking. The research on internal management of the organization, intellectual property right, entrepreneurship and making new businesses are in line with the present study. A study titled "making effective systems of knowledge commercialization for university research (2004) in Australia found the main propellers of research commercialization as: Legal framework of intellectual property- structures and management systems of commercialization at universities, the quality of university research and accessibility of risk taking financial resources for beginning stages of technology advancement and local businesses with great capacity to receive technology which are in line with the results of the present research except for intellectual property issue. Since it is possible that factors other than those mentioned in the study be effective on knowledge commercialization achievement, it is suggested that other researchers consider other factors. It is worthwhile to train the conceptual basics of knowledge management in its most pervasive form to education authorities at universities. Regarding the general policies of the government on establishing sustainable development, the comparative advantages of the universities should be determined to produce scientific productions. Through establishing electronic business infrastructures and culturing the society we can have the profits of the speed of electronic business in knowledge commercialization and knowledge transfer at international levels. REFERENCES Advisory Council on Science and Technology "Issues with Respect to Commercializing Canadian University Research."Project Number 98848,Final Report. 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