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Conclusions of the Hellenic Innovation

Forum 1st Conference: Shaping an

Innovation Policy for Greece

Greece is in a prolonged economic downturn facing extreme austerity measures. Most enterprises
are still oriented towards low added-value activities and state support. Developing a knowledgebased economy that will enhance competitiveness and create sustainable growth and jobs is an
option that needs to be seriously considered. The objective of the Hellenic Innovation Forum 1st
Conference was to envision such an ambitious, innovative future for Greece and identify the steps
needed in that direction.
Greece has a number of assets: (i) skilled work force, (ii) significant national research activity, (iii) a
number of excellent researchers and (iv) distinguished Diaspora. Also there are niches of successful
high-tech business initiatives from the private sector, as well as clear indications of a more general
shift towards innovative entrepreneurship.
he current European policy framework creates extremely favourable conditions, as well as
opportunities to further improve scientific and innovation performance. The Greek authorities
maintain that they are well aware of these opportunities and are committed to exploit them. Still,
the main challenge for Greece is to develop an effective national strategy for innovation, building on
the countrys strengths and implementing the necessary structural reforms and changes based on
international best practices. Key steps in this direction are:

the creation of an appropriate structure that raises the institutional profile of Research and
Innovation, following the example of most developed countries, placing innovation at the
highest level of governance;
the reorganization of the currently fragmented research system, with the objective of
developing Innovation Ecosystems, where the three key components - industry, competence
and research centres and dynamic SMEs - work closely together to develop high tech
products addressing the world market;
the development of an independent, excellency and meritocracy driven national research
and education system, with adequate monitoring and evaluation mechanisms that rewards
exceptional performance.

Innovation and entrepreneurship should receive a prominent position at all levels of education,
enhanced with technology literacy and vocational training. The Greek academic institutions should
follow the successful examples of high-ranking Universities abroad, where professors and
researchers are given incentives to found/join high-tech start-ups and students are actively involved
in the development of new technologies and applications.
Following the example of leading innovation economies, the Greek government needs to pursue a
long-term innovation strategy. This strategy will require sustained attention, regular evaluation and
appropriate funding, subject to the present financial circumstances and opportunities from the
European Commission. Efficient financial support in selected areas of national importance is a precondition for dynamic ecosystems to effectively become the drivers of the new innovation-driven
growth model.
It is also crucial for Greece to pursue reforms to improve substantially the business environment,
which will increase the countrys attractiveness to foreign investment. A short term key priority
should be to drastically decrease the administrative burden and introduce measures that will
effectively encourage entrepreneurial innovation. Building an innovation-driven economy is a long
process, requiring significant and continuous effort by all stakeholders involved. The results will be
beyond expectations if the challenge of building a thriving high-tech ecosystem is widely understood
as the means to achieve growth and long-term prosperity.

Table of Contents
Introduction ..................................................................................................................... 1
The current picture of the Greek Innovation System .......................................................... 1
Greek enterprises are mostly oriented towards low added-value business sectors ....................... 2
Public research has strong international presence but limited links with national economy ......... 2
Top Greek researchers and skilled personnel are more likely to exploit their skills abroad ........... 2
A new approach to innovative entrepreneurship is emerging ........................................................ 3
Conditions for innovation funding are improving............................................................................ 4
Efforts to remove barriers to innovation-based entrepreneurship should continue ...................... 5

Creating innovative economies: ingredients and best practices ......................................... 5

Innovation ecosystems constitute the key driving force ................................................................. 5
Innovation strategy receives high priority and is based on national/regional priorities ................. 7
Attention has shifted from inputs to outputs of the innovation system ......................................... 7
Innovation goes hand in hand with entrepreneurship .................................................................... 8
Innovation is strongly linked to excellence and meritocracy........................................................... 8

The broader policy context ............................................................................................... 9

The European innovation policy framework and objectives ........................................................... 9
The Greek strategic priorities for research and innovation ........................................................... 10
International cooperation perspectives......................................................................................... 11

The vision and the way forward ...................................................................................... 11

Annex: Speakers and topics ............................................................................................ 14

Designed to facilitate the productive exchange of views between government officials, experts and
innovation stakeholders from Greece and abroad, the Conference focused on Greeces innovation
driven future. The event was organized in Athens by the Institute for the Study of Labour (IZA) of
Bonn and the Eugenides Foundation. It was supported by the Bodossakis Foundation, Eurobank, the
EU Task Force for Greece and the German Embassy in Athens.1,2
As Greece moves into the fifth year of austerity, it becomes ever more clear that unless reforms are
implemented the economy will not start to grow again. Just cutting costs is not enough. Developing a
knowledge-based economy, that will create sustainable growth and jobs through added-value
products and services, is an option that needs to be seriously considered as was emphasized by
Alexander Kritikos in his opening speech. This was the main theme around which the Conference
coordinators, Professor Alexander Kritikos of IZA and Professor Georges Siotis of the Task Force,
developed the programme. Further, as stressed in the opening speech of Leonidas Demetriades
Eugenides, Greece will emerge from the crisis only if due attention is paid to the basic ingredients of
an innovation-based entrepreneurship, namely: (a) creating conditions to attract and retain the best
scientists; (b) introducing a stable institutional framework; (c) organising public and private sector
research in a rational way; (d) promoting a competitive environment with clear financial rules; and
(e) increasing the quality and level of education and professional training.
The Conference aimed at identifying Greeces hidden assets on its way to become a knowledgebased economy and the obstacles that prevent the country from leveraging these assets. Other
major topics included drawing lessons from best practices in innovation policy from other countries,
as well as exploiting opportunities in the context of broader development strategies of the European
Union. Further it aimed at identifying potential areas to initiate or further enhance cooperation
among Greeks living in Greece or abroad and European or non-European innovation stakeholders.
The main objective was to envision an ambitious, innovative future for Greece, followed by
recommendations on the way forward.
This document brings together the main conclusions drawn from both presentations and discussions
in the course of the Conference and aims to present them in a structured way. It starts with an
account of the main elements that characterise the Greek innovation system today. Then it discuses
key characteristics of innovation-based growth, strategies and support schemes towards innovation,
associated best practices and recent developments in the European and national policy context. It
concludes with some realistic targets that could be set in the short to medium term, as well as the
key steps that may lead to their accomplishment.

The current picture of the Greek Innovation System

A comparison between Greece and other European partners reveals that the country lacks a
functioning Innovation System, as demonstrated for example by its ranking in the 19th place out of
the 27 Member States of the European Union in the innovation performance index of the
European Commission, far below any other Euro-zone country (Kritikos, 2). A closer examination of
the main components of the Greek Innovation system is needed in order to understand what really

The list of speakers and topics of presentations are given in the Annex. The numbering corresponds to the chronological
order in the Conference programme and is used in the text as a reference to key points made by the speakers.
The event was attended by around 500 participants.

happens and draw evidence-based conclusions. It is in this way that overall performance scoreboards
and benchmarking can lead into sound policy making.
Greek enterprises are mostly oriented towards low added-value business sectors
Starting with the Greek business sector, different speakers pointed out that the large majority of
Greek enterprises are oriented towards low added value activities, with very limited demand for new
knowledge. Minister of Administrative Reform Mitsotakis (3) pointed out that while Greeks have
always been quite entrepreneurial they dont necessarily have been innovative at the same time. A
study conducted in 2008 showed that the five sectors with the highest numbers of new businesses
were: (a) construction; (b) clothes retail; (c) real estate; (d) accounting; and (e) restaurant & food
retail. Also, the size of enterprises is much smaller compared to other European economies, with
most of them being personally owned or family businesses (Gianousis, 25). Larger enterprises have
counted for many years on public sector procurements, quite often awarded through unclear
procedures and subsidisation. In their large majority, Greek companies have limited, if any, strategic
planning capacities, which, in most cases, can be coupled with an absence of long-term ambitions.
Public research has strong international presence but limited links with national economy
The national research system focuses on basic research and has earned scientific recognition at the
international level on different occasions (Kritikos, 2). Common themes in the presentations made by
the heads of the Greek research centres FORTH (Fotakis, 17), Demokritos (Kanellopoulos, 18) CERTH
(Konstandopoulos, 19) and MAICh (Baourakis, 20) are the following: (a) a very significant production
of peer-reviewed publications in prestigious scientific journals; (b) participation, often in leading
positions, in pan-European and international scientific networks; (c) success rates in obtaining
funding from the European Commission Framework Programmes for Research and Technological
Development that are well above average across Europe. At the same time, effort is placed on
exploiting the outcomes of basic research, with research centres having set up various forms of
technology transfer structures and incubators and signed many research contracts with industry,
including large international enterprises that are active in competitive high-tech fields.
A key observation is that despite the economic downturn, the Greek research centres manage to
survive essentially through competitive funding from the European Commission and private sources.
For some of them, state funding is a fraction of their turnover, as in the case of CERTH, which
receives only 10% of its annual income from the Greek government.
However, the heads of the research centres argued for more consistency and continuity in the
national research policy and more active support. This is because relying mostly on competitive
funding may have long-term negative impact on the ability to produce new knowledge. A
coordinated research approach would also strengthen cooperation among the research centres
around strategic areas. It would also enhance their admittedly low interaction with other regional
and national innovation stakeholders, increasing the beneficial impact that public research should
have on the Greek economy and society.
Top Greek researchers and skilled personnel are more likely to exploit their skills abroad
Evidence of the excellent performance of Greek researchers comes from the number of grants
awarded from the European Research Council (ERC).3 In absolute numbers, ERC grantees with Greek

ERC grants are highly competitive, as shown by the very low success rates typically 10 to 11%, providing generous
funding for ambitious projects submitted by young or established researchers that are awarded on the basis of scientific

nationality show a fair performance compared to their European colleagues (Papazoglou, 35). When,
however, numbers of awards are averaged over populations, Greek ERC grantees do better than
nationals coming from countries such as Germany, France, Italy or Finland and are only slightly
surpassed by British researchers.4 Nevertheless, Greece is singled out as the country exporting more
excellent scientists than is able to keep at home, which, while showing the large potential role of the
Greek Diaspora in strengthening the countrys innovation capacity (Zimmermann, 33), it also leads
into the broader topic of human resources and the related brain drain.
Even though Greece has a very qualified human capital, it ranks first among the European countries
in terms of unemployment of tertiary education graduates (Labrianidis, 34). Moreover, contrary to
most European countries, the unemployment in Greece increases for graduates that have reached
higher levels of education compared to the European average.
These observations suggest a discrepancy between supply and demand for graduates in Greece. The
low demand for graduates is mainly coming from the private sector5, as a result of the limited
interest of Greek companies in knowledge and technology intensive products and services, as already
A further weakness is the low interest paid so far to technical education and vocational training. One
notable exception is the dual system of training for the Merchant Marine Officers, which could serve
as an example for other sectors. The Eugenides Foundation is actively engaged in this area (i) offers
scholarships to graduates of technical schools to pursue technical training in top industries and (ii)
has a very substantial activity in publishing practical training educational material. Also it has carried
out different studies on vocational training needs and the ways these could be better satisfied,
including proposals for new approaches and innovative training methods (Eugenides, 12).
Prospects are not better in the public sector, primarily because of the recent austerity measures
aiming to reduce its size in terms of employment. Over the course of many years there has been
limited support for skilled young talents, as well as lack of incentives for successful careers in the
public sector in general and research in particular. Greece also ranks 19th among the European
Member States in terms of remuneration to tertiary education graduates, with salary levels that are
well below the European average.
To summarise, exceptionally high unemployment rates, unclear career perspectives and low
remuneration are the major reasons why highly specialised human resources leave the country.
A new approach to innovative entrepreneurship is emerging
Developing an ecosystem where high-tech companies could grow is at the heart of the debate
regarding innovation. Greece has a limited tradition, but a huge potential in clustering and other
forms of innovation-inducing networks.
Different recent initiatives are observed in this domain, where the research actors from the private
and public sector have joined forces to develop new collaborative schemes. One example is the
Corallia cluster in the ICT sector, bringing together 120 members, of which 80 companies show a
remarkable exporting activity, very often having global players as shareholders and investors
(Sanchez, 36). Another initiative intends to organise the very active Greek society of biotechnology
and biosciences under the Bionian Cluster, which has set out high performance standards for

The per capita ERC data are provided in Herrmann and Kritikos (2013): Growing out of the crisis: Hidden assets to Greeces
transition to an innovation economy, IZA Journal of European Labor Studies 2: 14.
Greece is 26 among the 27 European Member States in terms of employment share in high tech sectors.

participating organisations and will be further strengthened through international industrial and
academic collaborations (Chrousos, 39).
There are, also, examples of high-tech companies that grew out of academic laboratories and now
compete at an international level, thanks to very important investments in Research and
Development and skilled human resources. Notable examples are VIORYL, a chemical and
biotechnological company, and Fasmatech, a start-up focusing on Mass Spectrometry and Ion
Mobility Instrumentation, as well as on Research and Development services (Demetriades-Eugenides,
On the topic of innovative venturing, it is important to mention the establishment of a large number
of co-working facilities, in which young engineers and researchers can use existing infrastructure to
jump-start their own businesses. Such infrastructure is provided by the national research centres6
mentioned above and by other public or private institutions. There are currently 55 organisations in
total that support innovation and entrepreneurship (Mitsotakis, 3), including EGG of Eurobank
(Vousvounis, 23) and TEDx Academy (Siropoulou, 21) that offer space, business advice and support
through networks of very experienced managers and consultants.
Also, a number of competitions have been launched to support entrepreneurship, such as Greece
innovates, where out of the 21 shortlisted proposals in 2011, 7 teams have already launched their
products in domestic and international markets and 8 teams have signed business deals (Vousvounis,
23). These are clear indications of a shift towards innovation-based entrepreneurship. It is mostly
driven by the very limited employment opportunities offered to skilled young graduates at present
and serves as the basis for spreading out a new culture, paving the way to a larger-scale adoption of
this new business paradigm.

Conditions for innovation funding are improving

Efforts have been made in recent years to improve access to financing for innovative firms. Banks
were not used to provide debt financing to innovative entrepreneurial companies without significant
collateral. This approach is now changing, as the Greek financial institutions have a better
understanding of the way high-tech companies operate and of their needs in their different stages of
development. The banks are now cooperating more closely with innovative entrepreneurs, by
developing customised services including business advice and support to open their networks and
markets (Koulis, 42).
New Venture Capital (VC) funds have been created for early stage innovative companies, making use
of mechanisms and funding under the JEREMIE 7 instrument of the European Commission in
cooperation with the European Investment Bank. Main challenges are to (a) further increase the
available funding, which seems to be an option that Greek banks are willing to consider; (b) invest in
other high-tech sectors in addition to ICT where most of the activity has been concentrated so far;
but also to (c) apply the best international standards in innovation funding; and (d) create close
cooperation among the stakeholders, including banks, VCs, managers that will run the new
companies, as well as sector experts (Tzortzakis, 40 - Trachanis, 43 - Pilitsis, 44).

A plan to develop a low-cost Metropolitan Innovation Campus in the Athens region was presented by Demokritos
(Kanellopoulos, 18).
JEREMIE stands for Joint European Resources for Micro and Medium Enterprises.

The new paradigm for the investor is not just to provide financing, but also access to markets. Taking
into account that innovation has no frontiers; the key challenge for Greek entrepreneurs and
investors is to find ways to promote innovative products and services at a global scale.
Efforts to remove barriers to innovation-based entrepreneurship should continue
However, the rate of change is still slow and the number of success stories will not be multiplied,
unless measures are taken to create a more innovation-friendly business environment. According to
the World Bank, Greece in 2012 was at the 80th place in the ease of doing business, where many
other Members of the Eurozone were ranked well above, among the first 40 world economies
(Reichenbach, 5).
A major obstacle in Greece comes from a very complicated, often conflicting, legislation that leads
into interminable bureaucracy. Despite continuous policy efforts, a new company in Greece still
needs more than a month to be incorporated, instead of spending only two hours online, as in the
case of some countries, which have adopted clear and fast procedures in this respect (Kritikos, 2).
Further obstacles come from the Greek bankruptcy law, which punishes business failure to the
extent that it will follow the entrepreneur for the rest of his/her life. Allowing for exceptions to this
law for innovative companies, introducing tax incentives and reducing the severe requirements for
financial reporting to the tax authorities during the first few years of operation will largely encourage
and support the development of innovative entrepreneurship in Greece (Tamvakakis, 21).

Creating innovative economies: ingredients and best practices

Innovation is a continuous and lengthy process. Although, as pointed out by different speakers, no
universal pattern exists, successful innovation models arise from the combination of certain key
factors that are shared across countries and regions. These are discussed below.
Innovation ecosystems constitute the key driving force
An overview of historical conditions and processes, which made innovation the engine of modern
economies around the world, was provided by Professor Sifakis (8). The model that prevailed
following World War II was based on a clear separation between academia that focused on basic
research and corporate R&D research that was meant to cover all the needs of big companies from
basic research to applied research and commercialisation. This model progressively collapsed with
the appearance of new dynamic actors (Gianellis, 15), with less integrated vertical structures that
introduced new approaches to innovation, enabling to shorten the time needed from a new idea to
its commercial exploitation. The fierce competition in the technology field created new forms of
cooperation, ways to share risk and innovation financing. The latter was largely facilitated with the
advent of venture capital.
Nowadays, the distance between basic research, applied research and application is diminishing. The
division of work that existed between academic research and corporate R&D disappeared during the
1980s, leading to the emergence of Innovation Ecosystems. These Ecosystems are built around three
main components: (a) Centres of Excellence (CoE) that bring skills, knowledge and prototypes; (b)
large companies that bring investments, new challenges and knowhow; and, of course, (c) dynamic
start-ups that drive commercial exploitation. The convergence of these three players is characterised
by a creative culture and is supported by strong human capital resources, creating the so-called
virtuous innovation cycle that ensures sustainable development through the tight collaboration

between basic and applied research. The outcome is competitive knowhow and high added value
products and services addressing domestic and global markets.
Most such ecosystems have been created with government support, which was very often
materialised through the provision of adequate tax policy, IP protection, initial investments and
public infrastructure. The quality of life was also considered as an important element, which had its
own importance in choosing the locations where such ecosystems were to be developed.
One illustrative example is the one developed in Grenoble, at a time when the team of Professor
Sifakis had produced cutting edge results in the field of software systems verification. At that period
Airbus was envisioning that the use of the fly-by-wire technology would change the aircraft control
system from manual to computerised. The challenge was to prove to the certification authorities that
this system had no flaws. This was a very successful operation between three partners, a start-up, a
university laboratory and Airbus, which gave the latter a competitive advantage of more than ten
years against its competitors.
Professor Baras (37) mentioned that in many countries, including the USA, France, Austria and
Sweden, the development of innovation ecosystems was based around different forms of Centres of
Excellence. Very often, whether called Centres of Excellence, or Competence Centres, these
structures were created around engineering schools and universities that focused on applied
research and created conditions to further strengthen links with industry, through organisational
changes and/or targeted policy support measures.
Swedish Universities, for instance, created a matrix structure, the columns of the matrix being the
university departments and the rows corresponding to cross-disciplinary units. A major structural
change, albeit of a rather cultural nature, was to allow university professors engage into
entrepreneurial activities in addition to their academic duties.
In Austria, Competence Centres have been created and were able to grow in terms of size and
resources, by attracting international investments and knowhow. An efficient policy measure in this
direction was the rule stipulating that participation in the Centres activities would have to be
combined with a physical presence of foreign enterprises next to the Centres premises.
But in most cases, success of such Centres was directly related to their ability to develop close links
with: (a) the regional authorities that can provide support through funding for infrastructure; and (b)
the main economic players in their region that are the primary recipients of the positive impact in
terms of increased technological competitiveness, growth and jobs arising from the Centres
The innovation ecosystems grow through complex processes that drive collaboration patterns of the
three main constituents mentioned above at a regional, national and international level. At the
outset of such efforts lies the realization of large global players that they dont know everything that
drives them to collaborate with public research laboratories and Small Medium Enterprises (SMEs) in
a framework of open innovation. The organizational models change in a way that follows
technological evolution and global market trends. New academic methods and tools based on the
theory of Social Networks are currently being developed in order to better understand these
processes and identify the factors that lead to optimal choices and cooperation strategies
(Assimakopoulos, 38).

Innovation strategy receives high priority and is based on national/regional priorities

In order to face the challenges arising from the global competition in technology, advanced
economies pay particular attention to innovation, by developing strategies that will enable new ideas
to be quickly turned into new innovations and products in the global market. Such strategies are
articulated around priorities of high national significance and address specific economic and social
challenges associated with these priorities. As stressed by Charles Wessner (9), innovation should be
a key policy focus for governments, requiring sustained attention by national leadership, appropriate
funding and regular evaluation.
State Secretary Rachel (4) gave an account of the German approach, stressing that during the recent
years of economic difficulties, Germany decided in favour of an active innovation policy, launching in
2006 its high-tech strategy that formulated an all-round approach to innovation.
Adequate funding was foreseen for the implementation of the strategy, by increasing R&D
expenditure from 9 to 13 billion euro between 2005 and 2012. Special attention was also given to
enhance the national science and education systems with increased focus on strengthening
vocational training, and its links to subsequent employment of trainees. Studies have shown that
Germanys innovation throughput has increased since the introduction of this high tech strategy.
As observed in other EU countries, similar strategies had also a clear focus, with the aim to
concentrate on regional strengths with an international appeal and potential to have a significant
economic impact. Important policy measures in this respect were the creation and support of
Centres of Excellence and Clusters, based on a critical analysis of the strengths and weaknesses of
each region. This regional focus has inspired the smart specialisation approach of the European
Commission, further discussed in the section describing the broader policy context below.
Attention has shifted from inputs to outputs of the innovation system
The development of a knowledge-based economy has marked a clear transition in the role of the
university, from an isolated environment servicing pure science to a central player in the model of
growth for developed economies. As Professor Audretsch (29) pointed out, a major reason for this
transition was that Governments and policy makers realised that investments in basic science an
input to the innovation system dont automatically translate into innovative activities driving
growth in competitiveness and jobs the expected output. The related debate gained momentum at
times of stagnant growth and high unemployment in large economies, including the USA and
European industrial countries in the 1970s and 1980s.
The term Swedish paradox was first used by Swedes to describe the situation where large
investments in science and research produced limited innovation benefits for Sweden in the 1980s.
The term was picked up by Brussels and was rephrased as European paradox to refer to similar
conditions surfacing in Europe shortly after. But it was the USA that was the first to address the
paradox situation, by passing the Bayh-Dole act8 that changed institutional policies so that the
universities had much more of a mandate for having an impact on the economy.
Still, creating new departments of applied interdisciplinary fields, business schools, or policy schools,
was not enough for the universities to really have a concrete impact. Therefore the next step was to
develop mechanisms to facilitate knowledge spill-over into innovation, in the form of technology
transfer offices, incubators, science parks and other structures whose aim was to absorb the new

Voted by the US Congress in 1980, the BayhDole Act or Patent and Trademark Law Amendments Act permits a university
or a small business to elect to pursue ownership of an invention in preference to the government.

ideas. The entrepreneurial university of today not only generates knowledge for its own sake but
also becomes a solution provider, as an active partner in addressing problems of technological,
economic and societal relevance (Audretsch, 29).
Another innovation output that has its own significance is the protection of Intellectual Property (IP)
through its different forms, including patents. A very recent study showed that 90% of European
exports outside the European Union are coming from IP intensive industries, which underlines the
importance of patents for expanding business in an international scale (Kouzelis, 31). Knowledge
protection for advanced technologies was also stressed as a precondition to attract venture capital
(Harding, 11).
In this framework, it is productivity that really matters, removing the accent (a) from numbers of
scientific publications to citation indices and patents; and (b) from amounts of research funds
absorbed to actual economic and social results and impacts achieved (Tsipouri, 28). These are criteria
that public authorities in charge of innovation policies and measures should use when measuring
efficiency and effectiveness of actions launched and be ready to make decisions to adapt, modify or
even stop related innovation programmes on the grounds of the results of the assessment.
Innovation goes hand in hand with entrepreneurship
Increasing innovation outputs also necessitates encouraging and supporting the development of an
entrepreneurial culture. Key characteristics of entrepreneurship are vision that enables one to
identify opportunities and nerve that is needed to take risks, face competition and cope with
uncertainties. A key issue for the innovation ecosystem is that the role of entrepreneurship is
recognised by the other actors and especially government and academia (Harding, 11).
For government, recognition may mean incentives for attracting investment and policies that do not
excessively punish failure. The university is the place where innovative entrepreneurs will seek to
recruit, but also find new partners among the research staff for new joint ventures. Giving the
opportunity to entrepreneurs to teach undergraduates and graduates, in addition to any other form
of practical training in business environments, is a way to strengthen the link of academia with
These are distinctive features of the 21st Century University, which need to be understood and
incorporated in current academic structures, by giving incentives to research staff to collaborate with
industry and/or start their own businesses (Wessner, 9). At the same time, it is crucial to realise that
the inventor is not always the best person to drive the commercial exploitation of the new idea, so it
is necessary to form teams with the appropriate management skills and define clear roles and
Innovation is strongly linked to excellence and meritocracy
Innovation has to do with top performance in science and technology, so the human factor is of
paramount importance (Sifakis, 8). Put it differently, there is no way to get cutting-edge science and
high-tech innovations without outstanding talent, which means that special attention should be
given to the worlds best. It is them, who are most likely to make breakthrough discoveries and
inventions that can trigger new scientific and technological areas that will lead the industrial
activities of tomorrow. Their outstanding performance will attract talented young researchers with
strong motivations: the higher the reputation of top scientists, the stronger and more competitive
the research teams around them will be.

One of the reasons that Europe loses its best brains is that in most European countries recruitment
practices for researchers are not flexible, while research career paths are not clear (Cartalos, 27).
American universities offer more competitive working conditions. This is also the practice in
As further explained by Professor Chen (14), at ETH, the Engineering School of Zurich, the main idea
is that good scientists and researchers will not easily agree to become assistants to someone whose
credentials or research output are not as good as their own. Moreover, if the objective is to recruit
the best, the maximum benefit will come if they are given the freedom to pursue their own interests.
The high recruitment standards of academic staff at ETH have a high impact on the quality of both
training and research. Nearly a third of the business leaders in Switzerland were educated by ETH the fact that they were trained as scientists and engineers and not as economists or lawyers has its
own significance.
Professor Carrasco (30) gave another example of the positive effect a performance and excellence
mind-set has on human resources management. The economic departments of Universidad Pompeu
Fabra in Barcelona and Universidad Carlos III in Madrid have reached distinguished positions in
Europe in the last 15 to 20 years. This achievement is mostly due to their merit-based hiring policy,
which included an evaluation of research produced by academic staff members every two years and
a clear career path to the position of senior faculty member, within a maximum period of six to seven
years. Both universities have also internal systems of incentives to reward scientific excellence.
As far as the impact of merit-based recruitment to innovation is concerned, ETH professors interact
freely with the private sector and are encouraged by the institution to do so. As leading research
performers they are able to trigger private R&D activities and venture capital around them. The
reason why many private companies make costly investments to launch R&D structures around ETH
is to get access to skilled human capital and advanced scientific results. This is the same model that
led to the creation of innovation ecosystems around other prestigious universities such as Stanford,
Harvard and MIT. A key message from these examples is that the raw material of technology transfer
is excellent research (Chen, 14).

The broader policy context

The European policy environment, as well as commitments and initiatives undertaken by the Greek
government that are presented below, set out a framework for designing the innovation future of
The European innovation policy framework and objectives
From the very start, the competitiveness of the European Union was built on knowledge, as a means
to attain sustainable growth and employment. This is the reason why innovation was placed at the
heart of the European development strategy following the 2008 crisis. For the new programming
period 2014 - 2020, Brussels encourage Member States to concentrate on their strengths and
innovation capacities and develop, on this basis, smart specialization strategies. Therefore
structural funding will only support programmes that are in line with such strategies.


Switzerland occupies the 1 place in the innovation performance index of the European Commission.

In parallel, Horizon 2020, the new programme for research and innovation, has been reshaped to
further strengthen European and national research potential. The best collaborative teams in Europe
will be supported to work together to tackle the major social challenges and/or to solve current
fundamental scientific questions. A new element is a dedicated instrument for research and
innovation actions by small and medium-sized enterprises. Moreover, increased coordination
between Horizon 2020 and the so-called Joint Programming Initiatives (JPIs) aims to create more
synergies between European industry and academia with a bottom-up approach that focuses on
strategic industrial topics and uses available resources more efficiently (Rachel, 4).
Another novelty of Horizon 2020 is the teaming for excellence initiative. This scheme will offer
substantial funding on a competitive basis for projects aiming to develop cutting-edge research
centres in less advanced European regions. The proposals are to be submitted by teams comprising
of: (a) an internationally recognised European research centre; and (b) the hosting region. In the
bidding process the teams will have to convince about their potential to create an innovationconducive environment with significant impact at a regional/national/European level.
Teaming for excellence is very well adapted to the needs of southern European countries like Greece
as it may boost significantly the various high-tech business activities (Reichenbach, 5). Moreover, it
can be seen as a means to attract top innovation performers by setting out ambitious objectives of
excellent research for the new centres, an approach that would maximise expected impacts,
following the example of countries such as Switzerland mentioned above (Cartalos, 27).10
The underlying objective of the current European policy guidelines to Member States is to ensure a
more effective use of public funds by concentrating resources and innovation efforts on selected few
key priorities rather than spreading investment thinly across many areas. The aim is to create
synergies from different sources of public funding, especially those from Structural funds and
Horizon 2020, while at the same time stimulating private investment.
The Greek strategic priorities for research and innovation
The General Secretary for Research Science and Technology Vassilakos (6, 22) stressed his
commitment to promote the role of research and innovation, as well as their impact on the Greek
society. The national strategic framework for research and innovation for the period 2014-2020,
currently under preparation, will introduce a novel long-term approach for the development of the
Greek innovation system, drawing lessons from Horizon 2020 and adapting its best practices to the
Greek environment.
A key objective is to increase research and development expenditure from 0.67% of the Gross
Domestic Product (GDP) in 2011 to 1.5% in 2020. Strong incentives will be provided and simplified
procedures will be used in order to increase involvement of the private sector, the target being to
raise business expenditure in research and development from 0.23% of the GDP in 2011 to 0.47% in
Basic ingredients of the research strategy include: (a) strengthening the public-private research
partnerships; (b) promoting the creation of spin-off companies; (c) developing competence centres;
(d) supporting existing and new clusters in line with regional priorities; and (e) introducing or
facilitating new innovation financial mechanisms based on good practices of risk-sharing financing.


Further information on participation rules was provided in November 2013, shortly after the Conference, according to
which Greek regions were not included among the eligible hosting regions.


The General Secretariat for Research Science and Technology (GSRT) develops the smart
specialisation strategy in close cooperation with the Ministry of Development, the regions and the
private sector. Particular emphasis will be placed on creating synergies with Horizon 2020, especially
in areas of strategic relevance, where Greece shows excellent scientific performance. At this stage,
an initial set of national priority areas have been defined, comprising of: (a) the agro-bio food sector;
(b) activities related to the sea and the blue growth; (c) health care and pharmaceuticals; (d)
information and communication technologies; (e) energy; and (f) environment and sustainable
development. The next steps will be to further specialise these priority areas and link them to
development strategies at the national and regional level, in order to define a coherent policy and
associated action plans (Sofouli, 26). The process will be concluded in the first months of 2014.
International cooperation perspectives
As pointed out by Professor Haliasos (7), the current situation in Greece has stimulated the strong
interest of the international scientific community, as evident by the increased number of studies and
publications on the reasons that led to the current crisis and on the ways to move forward. Greece
can certainly count on the active support from distinguished members of its diaspora. Such support
may range from enhancing/strengthening cooperation in international scientific and innovation
networks to advice and hands-on assistance in implementing international best practices under the
specific country conditions.
In this context, it is, also, important to mention two initiatives in the framework of the bilateral
cooperation between Greece and Germany. One initiative is the Greek-German programme for
research and development in specific areas of high-tech industrial sectors which resulted in the
submission of 400 very competitive proposals by joint research teams of experts from both countries
The other initiative is in the area of vocational education and training and aims at: (a) policy advice
for creating dual training structures in the Greek education system; (b) the creation of regional
vocational education-and-training networks; and (c) the expansion of training mobility practices in
Greece (Rachel, 4). This second initiative is particularly relevant for Greece, where vocational training
has not received due attention so far, as already mentioned.

The vision and the way forward

The future of Greece will depend upon its ability to establish a new model of sustainable growth to
create new jobs and reduce unemployment. As a European country, partner to one of the worlds
strongest economies, Greece cannot expect much from low-cost productivity strategies. Instead,
Greece should focus on entrepreneurship and international competitiveness, driven by innovative
enterprises producing high added value products and services. The list of the world innovation
champions comprises a number of small countries, showing that the innovation option is realistic for
countries of the size of Greece.
Looking into the current situation, as many speakers pointed out, Greece has a number of assets, in
the form of a skilled work force, a very significant national research activity and many examples of
excellent researchers. One also observes niches of successful high-tech business initiatives from the
private sector, emerging patterns of public-private cooperation for the exploitation of research and
clear indications of a more general shift towards innovative entrepreneurship.
In parallel, the current European policy framework creates extremely favourable conditions for
building on national and regional strengths through the smart specialisation approach, as well as


opportunities to further increase scientific and innovation performance through Horizon 2020. There
is a clear commitment for the new national research and innovation framework to support national
and regional smart specialisation strategies and to exploit opportunities from Horizon 2020
(Vassilakos, 6 - Gianousis, 25).
The challenge is to develop an efficient national strategy for innovation, building on the countrys
strengths and implementing the necessary structural reforms and changes. But an important first
step is to have an in-depth understanding of innovation in all its dimensions, drawing lessons from
the international experience. Only then Greece will be able to establish a clear roadmap with
priorities and milestones and a programme that specifies the roles of the key players and
orchestrates these roles to achieve a common objective (Sifakis 8).
Key steps in this direction are:

the creation of an appropriate structure that raises the institutional profile of Research and
Innovation. In most developed countries, innovation governance is the responsibility of an
independent Ministry. In Greece, innovation issues fall under the responsibility of 3 separate
Ministries and the General Secretariat for Research and Technology is under the Ministry of
Education. This situation should change, in order to convey the clear message that
innovation is a key policy focus;
the setup of an authority in the pattern of a National Science Foundation that will develop
and implement the instruments for evaluating and monitoring research and innovation;
the reorganisation of the currently fragmented research system, with the objective of
developing critical mass which is needed to create technology and sophisticated products in
the few strategic priorities coming out from the smart specialisation approach. Research
should focus more on application, making sure that it is fully aligned with the development
priorities of the country;
in this respect, special attention should be given to developing Centres of Excellence out of
existing or new research centres, with strong governance mandates and focus on building
Innovation Ecosystems and supporting spin-off companies and clusters;
the adoption of criteria of excellence in the national research system. The revised system
should include regular evaluation of research, taking also into account effectiveness of
technology transfer and should raise the profile of the research profession with adequate
remuneration, career paths and performance incentives;
last, but not least, innovation and entrepreneurship should receive a more prominent
position in the education system. An increased focus should be placed on complementing
the theoretical background of students and graduates with professional practice and raising
the profile of vocational training. The academic institutions should move to the new model
of the university of the 21st century, where professors are given incentives for high-tech
ventures and students are actively involved in the development of new technologies and
their application.

However, while Greece is in principle very attractive for investors as it offers qualified and
inexpensive workforce and quality of life, major obstacles for foreign or Greek financiers are the
limited guarantees of proper functioning of the administration and of the market. The Greek
government needs to pursue its reform effort to substantially improve the business environment.


A short term key priority should be to drastically decrease the administrative burden for start-up
activities, by reducing the number of days needed to register a business, the number of bureaucratic
steps, as well as the number of regulations, fees and reporting duties. For example, innovative
entrepreneurship could be efficiently supported if severe requirements for financial reporting to the
tax authorities could be relaxed during the first few years of operation of new high-tech companies
and/or if such companies were allowed to employ managers, engineers and other skilled
professionals without having to pay their social security costs for a certain period of time.
Building an innovation-based economy is a long process requiring significant and continuous effort
by all stakeholders involved. But it should be realised that since the beginning of the crisis
considerable time has passed with very little progress so far in this direction.
The message should be spread across the public sector that, as a large buyer of services and goods, it
can create demand for innovation through new approaches to public procurement, especially in
strategic areas such as Health, Agro-industry and Defence (Sifakis, 8).11 Moreover, the national,
regional and local authorities would need to adopt the innovation option and play their role in
attracting foreign and Greek top innovation performers and entrepreneurs, with special attention to
the Diaspora.
But a crucial policy step is to create awareness, acceptance and support in the Greek society for the
targets to be achieved. The Greek human potential is capable to create high value jobs and compete
in equal terms with their counterparts globally. The results will be beyond expectations if the
challenge of building thriving high-tech ecosystems is widely understood as the means to achieve
growth and long-term prosperity. To achieve this goal there is a strong need for the actors in the
political arena to create a vision for the country given its strengths and weaknesses. Greece should
embrace the challenge of moving up on the innovation ladder towards the other core members of
the Euro.

The conclusions were prepared by the Eugenides Foundation with the cooperation of Dr.
Odysseas Cartalos, serving as its scientific advisor, based on the analysis of the detailed
conference minutes.


A best practice example of an innovation demand-side measure is the Small Business Innovation Research (SBIR) of the
USA (Wessner, 9) that served as a model for the specific programme for the small and medium-sized enterprise under
Horizon 2020.


Annex: Speakers and topics

Welcome Address (Day 1 7 October 2013)
1. Leonidas Demetriades-Eugenides (Eugenides Foundation, Athens)
2. Alexander S. Kritikos (DIW Berlin, University of Potsdam and IZA)
Policy Perspectives for Innovation Systems
3. Kyriakos Mitsotakis (Minister of Administrative Reform, Greece) Fostering Innovation in Greece:
Public and Private Sector Initiatives
4. Thomas Rachel (State Secretary, Germany) German-Greek Cooperation in Research and
5. Horst Reichenbach (European Commission, Task Force for Greece)
6. Christos Vassilakos (General Secretary of Research & Technology, Greece)
Session A: Innovation Policy: Conditions for a Well-functioning Innovation System in Greece
7. Chair: Michalis Haliassos (Goethe Un Frankfurt, Member of ESET)
8. Joseph Sifakis (EPFL, Lausanne) Facing the Innovation Challenge in Greece
9. Charles Wessner (National Academy of Sciences, Washington)
Session B: Innovating in Greece and elsewhere: The Business Perspective
10. Chair: Yannis Caloghirou (National Technical University of Athens)
11 Jack Harding (eSilicon) Vision, Nerve and Other Peoples Money: Succeeding as an Entrepreneur
12. Leonidas Demetriades-Eugenides (Eugenides Foundation, Athens)
and future

Paradigms: Past, present

Session C: Innovation Hubs: What Can Be Learned from Abroad?

13. Chair: Aristos Doxiades (Openfund)
14. Peter Chen (ETH Zurich) The Swiss Case
15. Emmanuel Giannelis (Cornell University) Innovation: From Inventions to Economic Growth
Session D: Science and Innovation Parks for Greece: A Vision for 2020
16. Chair: Georges Siotis (European Commission, Task Force for Greece)
17. Costas Fotakis (Foundation for Research and Technology - FORTH)
18. Nikos Kanellopoulos (National Centre for Scientific Research Demokritos)
19. Athanasios Konstandopoulos (Centre for Research & Technology Hellas -CERTH)
20. George Baourakis (Mediterranean Agronomic Institute of Chania - MAICh)
Panel: The Business Perspective on Innovation: What Needs to Happen
21. Moderated by Anna Grimani, participants: Niki Siropoulou (Curator, Tedx Academy), Sotiris
Bantas (CTO, Helic), Apostolos Lerios (CTO, Metanautix), Phaidon Tamvakakis (Alpha Trust)


Concluding Round Table

22. Moderated by Joseph Sifakis (EPFL, Lausanne), with Christos Vassilakos (General Secretary of
Research & Technology, Greece) and Giorgos Stergiou (General Secretary for Industry, Greece)

Welcome Address (Day 2 8 October 2013)

23. Constantine Vousvounis (General Manager, Eurobank)
24. Klaus F. Zimmermann (Director, IZA and University of Bonn)
Session E: The Next Programming Period: Suggestions for an Integrated Greek Innovation Policy
25. Chair: Giorgos Giannousis (General Secretary for Investment (NSRF), Greece)
26. Evaggelia Sofouli (General Secretariat, Research & Technology)
27. Odysseas Cartalos (Logotech) Teaming Competition for Excellence Issues and opportunities for
a Greek project
Session F: Knowledge Creation, Protection and Transfer: Perspectives for Greece
28. Chair: Lena Tsipouri (University of Athens)
29. David Audretsch (Indiana University) The Entrepreneurial University as a Source of Knowledge
Creation and Conduit of Knowledge Spillovers
30. Raquel Carrasco (Universidad Carlos III de Madrid) The Skewness of the Science and the Design
of Research Institutions
31. Dimitris Kouzelis (European Patent Office) "Intellectual Property and an Introduction to a Patent
Strategy for SMEs and Research Institutions"
Session G: Tapping the Diaspora's Potential
32. Chair: Konstantinos-Dionysios Bouzakis (Aristoteles University of Thessaloniki)
33. Klaus F. Zimmermann (Director, IZA and University of Bonn) "Diaspora Economics and the Greek
34. Lois Labrianidis (University of Macedonia) How to Create a Knowledge Economy when the
Brains are Flying Away
35. Theodore Papazoglou (European Research Council) Retain-Recruit-Repatriate: Preliminary
Findings from the First 7 Years of the European Research Councils Pan-European Competitive Calls
Session H: Networks, Clusters and Supporting Services for Innovation
36. Chair: Jorge Sanchez (Corallia)
37. John Baras (University of Maryland)
38. Dimitris Assimakopoulos (Grenoble Ecole de Management)
39. George Chrousos (Bionian Cluster)
Session I: Financing Innovation
40. Chair: Pandelis Tzortzakis (QUEST)
41. Reinhilde Veugelers (K.U. Leuven)


42. Nikos Koulis (Eurobank)

43. Spyros Trachanis (Odyssey Venture Partners)
44. Loukas Pilitsis (Piraeus Bank)