Workshop: IT for SMEs in CEE

Within the framework of the E4 research project, the Lviv Chamber of Industry and Commerce organized in October 2006 a seminar “Advanced IT Solutions and Competitiveness of SMEs in CEE” in Lviv, Ukraine. This event has brought together IT managers from small enterprises from Western Ukraine, representatives of IT companies, consultants and researchers working on innovative IT solutions from the region and beyond. It is still a rare ocasion in the region to mix these different yet overlapping groups. This first humble attempt led to many interesting results and recommendations:

• SMEs in CEE are not innovation-averse or slow adopters. They are willing and keen to try new solutions, even the most advanced ones (using GPRS, PDAs, etc.), and are openly voicing their needs for solutions or readily serve as testing ground for totally new solutions
• Major obstacles to IT solutions’ adoption in SMEs include lack of vision at the top management level and skilled managers at the lower levels of organizational hierarchies, damaged comfort zones of employees during IT tools implementation, image of IT solutions as a mere extensions of the state taxation system etc.
• Extreme rates of growth where businesses are growing quickly with the organizational maturity lacking behind is something not taken into account by IT developers
• Destroyed and neglected system of technology transfer from Universities, research institutes and SMEs in the region hinders development of innovative IT solutions based on the needs of the companies from the region. Lack of technology transfer culture also hinders transfer of European projects’ results.

You can read the full report from the seminar here. Videos from the event are available at the http://videolectures.net/e4ws06_lviv/. If you are interested in more information do not hesitate to contact us. We are considering running a bigger seminar on the same topic in October 2007 and are open for suggestions.

An-148 – Retaining Industrial Capacity

Ukrainian company Antonov, formerly a powerhouse of Soviet aviation industry, has recently launched its new An-148 regional passenger jet model. The technical details of the jet should be better left to specialists, while the aspects of the industrial cluster management are of interest from a knowledge-management prospective.

During the planning, development and production of An-148 many problems emerged with the broken links in supply chain stemming from Soviet times. Many enterprises were not operational anymore, most have long been privatised, Russian companies are now abroad etc. Some of the lost ground was regained, and as a result a new model An-148 emerged. But just a quick look on the site of Antonov gives a fairly good idea that the production methods are quite old and there is not a single sight of any online platforms for suppliers unlike what Airbus provides at its site. It leads to certain observations:

1. Rebuilding and creating supply chains on new terms - ability to forge back together broken supply chains to build an odd couple of jets is commendable but it will bring better results if new innovative methods of managing suppliers will be introduced, with locally developed IT solutions.
2. Antonov could and should rally suppliers, individual specialists and those interested in aviation technologies around its web site. Developing communities of practice, knowledge databanks, conducting competitions and engaging in constant exchange of information, at least in Russian speaking Internet audience, could strengthen role of the company as an emerging pole of reference in aviation industry.
3. Using knowledge as a competitive advantage – Airbus and Boing, two giants of the worlds aviation industry, are making inroads in the former USSR aviation industry with the strategic alliances and subcontracting (Russia recently courting for EADS stake). Keeping focus on knowledge gained during exploitation of new An models in countries of former USSR could slowly strengthen position of Antonov as a company. Ukraine, as any CEE country outside Russia, is in desperate need of national champions. Only by utilizing exclusive knowledge smartly, Antonov stands a chance to transform itself to such a champion on the back of the strongest growth in the region in years.

Ingenuity within lack of sophistication

One of the main differences between the former USSR and its former rivals, mainly USA and Western Europe, was the consumer abundace in the later and total scarcity of anything that makes life more comforable in the later (so called defitsyty). The brainless experiments of bolsheviks on erasing culture from public life and disfigured appreciation of beauty have depressed the natural zeast of humans for beauty in the things surrounding them (what Western Europe have developed and preserved). The consumeristic society’s lavish abundance was a distant dream (what States have elevated to such a high level).

Under such conditions, the process of inventing things and creating knowledge differed significantly. I am not aware of any research on the subject (please suggest if you know). But identifying this process and defining how people were able to come up with great things in USSR is something worth puzzling about:

• Firstly, in the former Soviet Union there is something about the cult of suffering, – what many people in the West would consider as a suffering and torture, people in the East of Europe are actually find interesting pasture times. Take mushroom hunting or berry picking – favourite weekend activity of many people. These are quite physcially demanding activities, with a stint of extreme sports (eg being lost in the forest). But solitude brings great ideas forward, and one gets all the time of the day to talk to friends who went along to the forest. Can it be that physical hardship make you long for better and inevitably come up with great inventions?
• Secondly, the apprehension of inevitable lack of things push humans to invent things to fill in the void. For instance, if you know that you will not be able to get new car in the next 10 years, you will have to invent things to make the one you have last for next 10 years at least. No wonders half of cars in early 90-ties in former USSR looked like coming straight from the shelves of the DIY shop. For Westerns it is an object of jokes, for myself – an object of marvel for engineering skills of ordinary people.
• Thirdly, the unavoidable honor of being a part of the group – in Soviet time, one would get an assignment to work for a plant or a research institute and that would be pretty much your life path and life assignment. People had to learn how to create groups, to tresure them and how to hate-and-love your colleagues. Combinations of most unmatchable types often prove to bring best sparkles of ideas. And group was a confinement for grievances, expressing disagreements for small societal tresons of social order. There was pretty much no way to move on or to compete with someone openly in scientific excellence. The group defined options.

Could there be lessons learned? Could there possible be a Soviet-style innovation sessions – with 2-months pasture time, in groups of very different people working with LADA-like toolkit to create its hydrogen equivalent? It feels that with the onslaught of typical consumeristic society on post-USSR terrain, the initial romance of invention is disappearing. The specific combination of time, space, people and minimum resources, – could this be a Soviet innovation model? Or am I trying to coin an oxymoron?

Innovation from the military

It might be of interest to non-Slavic speaking readers to know about the slow but steady revival of the military complex innovation in post-Soviet countries. Why does it matter for knowledge economy, you may ask. For decades, the so called military complex was the vehicle behind the innovation in this part of the world. Often, under the disguise of the military equipment, the researchers were carrying their fundamental or applied research activities, not quite directly related to the needs of the army. The USSR collapsed and a lot of innovation processes and systems collapsed with it.

Just yesterday, the Ukrainian Ministry of Defense announced the upgrade and enlisting of the AN-26 based air-born command center. Anotonov-26 used to be a mainstream of the military aviation of the Socialist block. Now Antonov and Aviant have installed equipment able to support communication between different army units, fully integrated into the existing communication platform of all units and kinds and capable of resisting any kind of modern communication supression technologies. If this kind of technology could also be adapted to ensure communication during the natural and athropogenic disasters – this could be of help to all CEE countries – AN-26 are ubiquous and could be re-fitted for this purpose. Something for Science and Techonology Center to explore?

By any means new innovative products coming from the military are only welcome – it means people working for those enterprises are slowly start to acquire back lost lust for innovation.

Non-fiction Publishing in CEE

If anyone tries to find articles on management, culture, physics or anything scholar and written by authors from CEE, he will be up for a major disappointment. Not only there is not much published but it is impossible to find those bits that are getting published. Sites of scientific journals are not designed appropriately and are not user-friendly.

Recent article “Publishers and librarians in Central and Eastern Europe – love or hatred?” by Srecko Jelusic have identified some reasons for this problem:

• Lack of highly skilled personnel within the document production and access chain
• Language barriers
• Lack of cooperation among non-fiction writers, universities, publishers and libraries

Elsewhere, commercial publishers are moving into new field of collaborating authoring and wiki-publishing (A Business Book, Wiki-Style):

Pearson PLC, the publishing firm, is putting together We Are Smarter Than Me, a new book that tries to help businessmen make sense of blogs, online communities, and other interactive Web media. Professors at Penn and MIT have already written the volume’s chapter titles. But otherwise anyone can edit the text at http://www.wearesmarter.org/. Pearson expects to leave the wiki running until early next year, when ghostwriters will take over and mold the text into a publishable book.

With self-publishing growing (e.g. www.lulu.com), collaborative authoring made easy with wiki and an empty niche of scolarly publishing in CEE, could it be another niche for creation of knowledge economy by young entrepreneurs in the region?

Generational amputation

At least half of numbers of new generation in CEE region are well connected, well skilled in using new technologies and well networked among their peers, at least in their hood. And there is another group on the other side of the spectrum – those above 45 who are desperately loosing it in terms of new technologies and abilities to cope with the inflow of information society and other buzz words. This generetional gap is well recorded and well utilized – with first group staffing high-end outsourcing and emerging new companies down the supply chain and the second providing ample supply of employees for the first-wave outsroucing factories that have re-located to the region in 90-ties.

Both groups inhabit the same world; operate within same societies that designed certain social nets, social systems etc. Such societal mechanisms are meant to protect but often estrangle one or another group. General disaffection with politics means that new generation is less affecting changes in the existing systems. At the same time the changes or lack of those will directly affect this new breed of economically effective generation within next 20 years. Call it generational amputation – people in power operate in terms and discuss things of direct interest to the less-effective older, less-off and dissatisfied group of voters while new post-socialism generation is either ignoring the debates or too busy doing business and enjoying good life (which means effectively ignorance too). Older generation does not care to retrieve opinion of the younger and younger generation does not bother to listen to the debate of the older, – they both severed the links.

The ability to diminish such generational amputation would define how coherently will develop post-socialistic societies in the future. How to smoothen the dialogue and transfer of generational wisdom? How to make boring political things look cool and attractive for young people and how to explain older generation that their lives could be better, shall they listen carefully to the technological cum lifestyle bruhaha of modern media? Only by re-dressing the conventional wisdom and by having “dressing rooms operators” in place could be get rid of generational amputation. Operators will explain novelties to older generation in their language, in their way, when it fits to explain. And the other way around – they will make boring discussions about social secutiry contributions, subventions, subsidies and social nets look cool and fascinating.

Recipe for capturing lessons of growth

Companies are in the rush. Market is growing around them; they double in size every year. There are problems is getting young talented people to work for them. IPO vs. a sale to private equity. Getting permissions from the messed-up government. Foids among ueber-hyped young managers who are getting carried away with cash floating their way.

Any company operating in developing world, and especially in former USSR is either going through these questions or will soon be. In the rush of such transition and development and weak government it is easy to oversee the need to capture the lessons, esp about mistakes to be avoided. And the capturing should be happening locally by locals, if jobs are to be created n the region. The job currently done by World Bank, EBRD and alike should be outsourced (or returned?) locally.

There is quite a market at stake. CEE has been moving from socialism and even communism into full-blown capitalism. Asia is emerging with socialism still alive. With millions of people going through grossly similar transition, CEE could forge a link between two processes of transformation. Boutique consultancies, professional associations, research entitites, writers and trainers could discover a way into the East on the back on CEE experience. But they need content to deal with, cases to showcase etc.

Just this week Financial Times published an interesting article in their Education section on work done by CEEMAN, Central and East European Management Development Association, – Common ground across continents – showcasing how regional network could open up to the world and start attracting Asian interest on the back of the experience of the transition. Indian schools are starting to join CEEMAN members and even Western European ones are now paying membership fees. There is a need for more of such examples.

Emerging Virtual Worlds and Emerging Market Niches

The emergence of Second Life have created a splash in the media recently – companies are exploring ways to promote their products in virtual worlds or to research tastes of the consumers, ordinary people explore ways to find avenues for their creativity (e.g. recent article in BBC, the American Cancer Society’s virtual Relay 4 Life just raised $40,000 auctioning off virtual goods, nonprofits in SecondLife). SecondLife is one of the first serious virtual worlds, i.e. not linked to any kind of virtual gaming and not being geeks-only place.

As in virtual gaming, there always will be smart youngsters who will work instead of real users to sell ready-made avatars for those bored to spend hours in the in-game worlds building their virtual incarnations. Such business models look even more compeling for the serious creative virtual worlds such as Second Life. And here comes an interesting thought – such worlds will provide a unique opportunity for Eastern European creative minds to set boutiques there. Being far more agile than their more entrenched Western European counterparts, with similarly good Internet access, small creative companies from Eastern Europe could be a driver behind inhabitation and humanization of virtual worlds. This will not only boost their incomes, but will also help companies owning such virtual worlds to leap frog from the unsettling initial phase of world’s development. Market niche? Potential for partnership? Opportunity?

Virtual Worlds and Online Collaboration

I have stumbled upon an excellent research of Edward Catronova of Virtual Economies. Though it is an emerging topic, there is still not thought put into the Virtual Worlds emerging and Virtual Economies linked to them. Below are some thoughts of mine on Virtual Worlds and Online Collaboration. They are far shot from being a scientific research but somehoe it feels like talking about 22 century.

Real-life questions:

- How to combine the power of attachment that online gamers have to the VWs and power of creating knowledge in a knowledge economy?
- Can we make professional online communities as fun place to be as VWs in games?
- Social aspect of this phenomenon – current gamers are growing from their teens and moving to the real world environment where they are either bored because it is too slow or they create their “avatar” substitute industries, – look who is working for companies creating games, or all those IT companies providing bits and pieces of software to make it run?
- There are obviously many points of overlap between the VWs and real world. Take for example biots in the VWs, – this is exactly what is happening in almost all Intranets, – there is always a standard greeting sent of behalf of the Intranet Manager, thanking for registering of reminding about something. Right now normally there is a person linked to all those messages, – could it become a biot and the Intranet Manager instead will take an avatar to guide users of corporate Intranet around the system? Is this a point where VWs could “sneak” into the back door of the real commercial online communities of practice?
- Skills gained in playing multi-player online games (I used to know acronym for this) are gradually being recognized, at least in some sectors of teh economy. Could playing in oline games become a part of curriculum to make sure that students are aware about the VWs? Can this be part of a training programmes, for, say leadership MBA or an executive trainine course? I bet it is not what executives are doing and it probably good to let them fell what does it mean to start from scratch, to build av avatar of being slottered for a minor mistake – potential for fast-track learning are enormous.

Futuristic musings:

- Countries will start paying attention towards carving a strategic piece of virtual worlds. Political squablings about status of Antarctica will be transformed into UN-guided piece conferences on the borders and regulations in Virtual Worlds. Developing countries will have an advantages over developed countries by having by far more young people actively engaged in populating and gaining status in Virtual World while developed world with its aging population will have slim chances.

- Avatars will become economic agents of their owners creating direct value for them. For example, a market research company paying a number of avatars for evaluating certain social aspects of the Virtual World while playing in the game. The research company will provide a survey they will have to feel in after every session or there will be a piece of software looking at the avatars activities. The research company could sell the report to potential members of the Virtual World or those willing to increase their value (exactly what London City financial analists and herds of consulting companies are doing). Taking into consideration there are more Virtual Worlds than the countries and industries, it has huge economic potential.

- People will treat avatars as children, caring for them (tamagochi principle) and puting them into their will for inheritance for their real children. Such avagochi have economic value for their owners, a historical value which will keep staying important and at the same time avagochi will require constant attention to stay relevant economic actors of the VWs.

- eIdentity discussions will move from the identification of physical persons to the Internet-based avatar environments, – repositories of avatars information and test beds for creating, nurturing and emercing of newly created avatars into the selected VWs. Economic blocks, esp. EU and US will play a game on bar with Galileo vs. GPRS regarding the first truly global reference point in avatars repositories. Moreover, lobbying technologies from the real world will split over to the VWs with the delegations of avatars from one VW negotiating mergers and acquisitions of other VWs. Blocks of VWs will emerge.

to be continued …

Knowledge Management in Russian-speaking countries

Recently I have been trying to spot any information online on Knowledge Management in Russia or Ukraine. Unfortunately, I was not able to find anything solid. There are many disperse resources, esp. from private companies but no unified point of reference. Perhaps, the search should go on.

Reason for the search. I am trying to identify the peculiarities of the online collaboration in Russian-speaking domain. There are some features, which in my opinion are unique for the region:

• Big gap between those with extensive Internet usage skills and those without any or very limited ability to use Internet and, as a result, online systems. This gap is cross-generational, i.e. present in all generations
• Vibrant and high-skilled community of young Internet users with clear 2 layers: professional and fun-oriented. It is quite common to find lively discussions online of one of the above-mentioned natures.
• Lively community of Russian-speaking bloggers at www.livejournal.com or in some forums shows that people are generally not afraid to express their opinion online, though it might be easy to identify their physical identities. Over years I have noticed that people are much more inclined to refer to their networks and online resources to find answers (even for really small one) than here in Western Europe.

It is interesting if these observations actually have justification or merely reflect my area of contacts and knowledge? Interestinly, maybe there are already some research done on this topic.

Practical interest of this question – possibility to identify where peculiarities of Russian-speaking online community could make a contribution on international level, what could be explored for economical benefits, esp. to the economical development of Ukraine and other Russian-speaking countries, any know-hows to extract from this?

Some articles of interest:
UNDP’s ICT-for-Development (ICTD) Focus Area Holds a Knowledge Management Training in Kiev, November 2004
Корпорация Атлас. Управление знаниями.
Center of Community Networking and Information Policy Studies, St. Petersburg, Russian Federation