Home > Topics > Establishing and Operating Technology Transfer Offices > How to Set Up a Technology Transfer System in a Developing Country > Editor's Summary, Implications and Best Practices

This chapter develops a specific, yet potentially powerful model for establishing or improving technology transfer operations for universities and research institutes within developing countries. The model takes into account several key insights about technology transfer:

1. There is a certain critical mass of R&D activity necessary to justify the costs of a fully functioning technology transfer office. Some estimates would put this figure in the range of US$100 to 500 million in research expenditures annually.
2. While it is uncommon for a single university within a developing country to attain this critical mass, a group of universities together can attain it.
3. Some of the typical functions of technology transfer are more easily scalable than others, and are thus more easily shared among a group of universities.
4. It takes a number of years for university technology transfer operations to mature and become financially self-supporting. This is largely because it takes a number of years for technology transfer professionals to develop the expertise and network of relationships necessary to be fully effective, but also because individual technologies within a portfolio require a number of years to be developed and commercialized and thus to begin paying back revenues. This means that sustained support is needed over a number of years.

The model developed in this chapter essentially requires sharing the costs of technology transfer services among a consortium of universities, with an additional start-up subsidy provided by government. A “hub-and-spokes” structure is proposed, which allows essential policy decisions and scalable functions to be moved to the center, and keeps essential context-specific and un-scalable functions on campus at the universities. This hub-and-spokes structure also allows for a more efficient distribution of scarce resources and of key personnel who have the necessary skills, allowing a few experienced professionals to selectively yet effectively manage and mentor technology transfer staff across a range of institutions.

The chapter rightly points out the challenges of implementing such a model, emphasizing the need for clearly articulated policies to be shared by all consortium members in at least three areas. These areas each constitute potential points of real conflict within such multi-institutional system. The first is the need for clear policy on ownership, so that everyone in the system knows who bears ultimate responsibility and who deserves ultimate rewards for a given technology. The second is the need for clear policy on the distribution of income from commercialized technology. This is important so that incentives are in place to elicit the cooperation and support needed from multiple players who all play a role in the technology transfer process. A clear income distribution policy is also important so that realistic financial expectations are established, which helps to avoid disputes that could threaten the viability of the larger system. The third area where there is a real need for clear policy regards the prevention and resolution of conflicts of interest. This is important to maintaining the integrity of the universities’ main educational and research functions amidst increased commercial opportunities, and so that any disputes that do arise can be resolved in a systematic and fair manner, again maintaining the viability of the larger system.

An important feature of this model is that it does not lock in its participating member institutions and it is open to competition. As the economy grows and member universities’ R&D activities increase, their local technology transfer offices can take on more and more of the functions that had been delegated to the central office. A university would thus be able to “graduate” from the system as its own technology transfer office becomes self-sustaining. Even prior to that, the central technology transfer office is relied upon only in-so-far as it provides effective management of technology transfer projects that member institution cannot replicate themselves or obtain elsewhere cost-effectively. If the centralized system fails to be competitive, the member institutions can simply elect to manage the commercialization of technologies in their own offices or through other, more competitive channels.

A foundation of innovative technology companies and the development of an entrepreneurial culture will drive the development of new industry and enhance the global competitiveness of Chile’s economy. The author believes these goals can be best achieved through a TTO system such as the one proposed in this chapter. Such a system could provide a full range of technology transfer functions for the main universities and research institutes in Chile in the most economically efficient manner.

Key Implications and Best Practices

Given that IP management is heavily context specific, these Key Implications and Best Practices are intended as starting points to be adapted to specific needs and circumstances.

For Government Policymakers

• Reform and improvement of technology transfer can be contemplated even in countries where the basic capacity is already developed. Finding newer and better ways to manage the intellectual property coming from a country’s public investment in R&D can be a valuable advantage for a country, enhancing economic development and competitiveness in the long run.
• Reform and improvement of technology transfer needs to be based on a sound assessment of the current reality within the country’s universities, plus a good understanding of the experiences and experiments in technology transfer in other countries.
• One useful model is the “hub-and-spokes” model, which shares the costs of technology transfer services within a coalition of major universities and research institutes. The central office (the “hub”) takes care of scalable technology transfer functions, such as policy, patent filing, legal services, data management, marketing, and international relationships. The local offices at each university (the “spokes”) take care of the essential technology transfer functions that are not scalable, such as working directly with university researchers and facilitating campus relationships. This model is particularly attractive for smaller countries.

For Senior Management (university president, R&D manager, etc)

• It may not be necessary or economically efficient for your institution to build full technology transfer capacity in-house, particularly if your institution’s annual research budget is less than about US$100 million. A viable alternative may be to enter into a coalition with your peer institutions, and to create an external centralized service that provides many of the services your institution will need, complementing those functions you do have in-house, and at a lower total cost to your institution.
• In order to succeed in sharing a central technology transfer office with a coalition of other institutions, it is crucial that your institution adopt clear policies about ownership of intellectual property, distribution of income between inventors and the institution, and conflicts of interest. It is also crucial that your policies are harmonious with those of the other coalition members.

For Scientists

• A national or regional consortium of universities to develop a technology transfer system could be more beneficial to you and your colleagues by promoting a higher level policy dialogue and a broader consensus within the academic community on issues of technology transfer and commercialization.
• A national or regional consortium of universities to develop a technology transfer system could be more beneficial to you and your colleagues because it would be more cost effective and would have greater latitude and leverage in exploiting commercialization opportunities than would a single campus office.

For Technology Transfer Officers

• There may be certain functions for which you are currently responsible that would be easier to handle if outsourced to a central office for your region or country. There may be other functions which you could serve for other institutions. Gains could be realized by specializing to some extent and reallocating your work flow.