“ProBaltic Consulting” under an agreement with the Ministry of Economy of the Republic of Lithuania prepared a methodology and carried out an interim evaluation of the implementation of research and experimental development and innovation development (Smart specialization) priorities for the financial perspective of 2014-2020 (>700 million euros), involving over 130 selected leading experts representing different sectors of the economy, science, and related state institutions (Figure 1).
Figure 1 Map of priorities for smart specialization
Source: Compiled by ProBaltic Consulting
Taking into account the need for the update (expert review) of the priorities of Smart Specialization in Lithuania, in order to recommend specific changes to the interested institutions, while maintaining the methodological integrity and continuity (Figure 2), this evaluation included the first of the three steps of the interim evaluation of the implementation of the Smart Specialization Strategy, which consists of 1) the results and recommendations of the smart specialization review process (entrepreneric search), 2) the Monitoring of Smart Specialization (Progress Reports) carried out by the Ministry of Economy of the Republic of Lithuania and MOSTA, and 3) the insights of foreign experts about the compliance of Lithuania’s Smart Specialization with global trends and their recommendations. The evaluation carried out supplemented, but did not replace, the progress assessment reports of the first and second Smart Specialisation Programme, in particular reflecting the expert opinions of the entities involved in the implementation of the individual measures.
Figure 2 The process of smart specialization
Source: Compiled by ProBaltic Consulting
This evaluation process, the so-called entrepreneric search (EDP), is an inclusive and interactive bottom-up process in which participants from different backgrounds (politics, business, academia, etc.) discover and present expert knowledge of possible new activities, identifying potential opportunities that arise through this interaction, while policymakers evaluate results and look for ways to facilitate the realization of this potential. [1] In total, there have been over 40 methodologically defined expert meetings moderated by 6 key Directional Experts (Figure 3).
Figure 3 Stages of the entreprener search for smart specialisation priority reviews
Source: Compiled by ProBaltic Consulting
As part of the EDP, the assessment of the relevance of the priorities and technologies of the Smart Specialisation Programme already identified was carried out by assessing external and internal developments, conducting SWOT analysis, ranking existing and proposed priorities/technologies according to the criteria of capacity and expected or perceived impact (Figure 4).
Figure 4 Criteria for analysing/estimating capacity to implement a priority
Source: Compiled by ProBaltic Consulting
The relevance of priorities and technologies in this review process was understood as a response to the main global and European trends and challenges, especially in the field of market or technology, which increase the demand for a product or service, and which can be successfully used by Lithuanian organizations operating in the priority area by using their capabilities (competitive advantage), thus contributing to the achievement of the cumulative goals of Smart Specialization.
Main conclusions and recommendations
In the light of the results of the ongoing expert meetings, all the experts agreed on the existing overly detailed regulation of the Smart Specialisation Programme, which limits the effective implementation process and possible impact, in particular by applying the criterion of “thematic specificity” in the project selection process. In the documents of the program of Smart Specialization, it would be more correct to formulate the tasks to be solved, but not to name the specific technology. It should be declared and evaluated by the applicant in the selection of applications to be financed. The technological diversity of the possibilities of solving the challenge, the dynamics of innovation and the possibilities of integrated solutions in advance, by documenting technologies, constrain innovation and rational competition for applications (Figure 5).
Figure 5 Limitations of the Smart Specialization Program
Source: Compiled by ProBaltic Consulting
The aim of the proposals for the integration of priorities should not be an end in itself. The move must take place in both directions, using a systematic approach and discerning the features.
Having directions, following the actual formulations already in the directions, what is the main focus of the direction, it remains to abandon the description of the trivial technologies in the measures, but to invite applicants to compete to seek funding for activities, a solution based on the specific challenge, scope and expected impact (Expected Impact).
To this end, based on the results of the expert meetings, it was proposed to formulate in the Action Plans the transformations of the priority directions and priorities of smart specialization, ensuring the focus of funding in the most promising directions with business and scientific potential in Lithuania, performing the following actions:
- prioritisation in order to mobilise forces in the directions of previous priorities with the greatest potential and output in the first phase of funding;
- abandoning non-viable technologies and adjusting previous priorities;
- deepening compliance with the priority by replacing the fragmented criteria of technological specificities with an assessment of theme, coverage and impact as a whole.
It was proposed to transform the Direction into Priorities, clarify challenges, define topics (previous priorities), scope (by transforming previous descriptions of technology) and name measurable impacts related to the topics. The following sequence is proposed – an updated challenge – a theme with its scope – an impact that identifies how realistically the challenge is met by creating specific models/solutions/technologies in the thematic field that create economic and social impacts. The final updated descriptions of the priorities were submitted to the the Ministry of Economy of the Republic of Lithuania.
In 2019, based on a) results of the entrepreneurial development process, carried out on the basis of ProBaltic Consulting methodological support, providing the recommendations of experts, b) results of the monitoring of the implementation of the smart specialisation programme and the action plan of this programme undertaken by the Ministry of Economy and Innovation together with the Government Strategic Analysis Center, and c) taking into account the conclusions of the independent expert working group set up on the initiative of the Ministry of Education, Science and Sport of the Republic of Lithuania, the Coordination Group for the Implementation of Research and Experimental Development and Innovation Priorities, which is the advisory body for the coordination of smart specialization, it was proposed to further consolidate the priorities of R&D&I.
This recommendation was also made in the Country Report “Lithuania 2019” prepared by the European Commission, which states that “Public investment is mainly focused on the strategy of smart specialization, and it is quite extensive and covers most sectors of the economy, partly as a result of which limited funding is distributed in small portions”. At the Coordination Group meeting on 11 June 2020, it was decided to concentrate resources on the R&D&I priorities for 2014-2020 on those that generate the greatest added value and have the greatest potential. After evaluating the existing and potential competitive advantages of the national economy, 3 R&D&I priorities were identified: “New production processes, materials and technologies”, “Health technologies and biotechnologies” and “Information and communication technologies” by integrating into them in the next financial perspective (this decision is enshrined in the minutes of the coordination group meeting no. TIS-2 of 11 June 2020).
[1] More information on the EDP can be found in the S3 platform: http://s3platform.jrc.ec.europa.eu/entrepreneurial-discovery-edp