The research has been carried out since 2006.
The empirical study of KIBS in Russia was pioneered by the Institute of Statistical Studies and Economics of Knowledge (ISSEK) of National Research University Higher School of Economics. In 2011 we continued In we conducted the series of surveys that are conducted on annual basis since 2007. Our mail purpose was to develop the empirical data sets and to use them for theoretical an applied researches. Empirical studies precedes conceptual studies as a source for guesswork, and follows them as a source of data for their verification.
Empirical data in 2011 were obtained via mass surveys of 607 leading KIBS providers from 10 major KIBS sectors (marketing, advertising, auditing. IT-consultancy, engineering, recruitment, business design, property development, financial and legal advice) and of 624 KIBS consuming firms. Respondents were directors, deputy directors, and heads of profile departments. We adopted stratified sampling approach to obtain the samples that are representative of size, age and geographical location.
We used structured survey instruments where most questions were of multiple-choice type, but there were open questions as well. Generally the questions for providers and for consumers are symmetric.
Some topics cover more or less traditional business variables characterising turnover and its dynamics, employment profile, customer base, share of innovative output etc. But most questions aim to generate original variables. These variables supply us with quantitative measures of personality intensity, level of customer involvement, customer expertise, absorptive capacity, outsourcing activities, the impact of KIBS on innovation activities etc. We elaborated these variables especially for our monitoring because they represent core service characteristics, but are omitted by current statistics.
In 2011 the monitoring shows moderate post-crisis recovery in terms of turnover and number of customers. The qualitative shifts in consumer demand are nevertheless less optimistic. Before the crisis the KIBS sector was a remarkable domain where customised production generated half of the output and two thirds of revenues. The users of bespoke services are mostly practised customers who have experience in consumption of different KIBS from different providers. The crisis removed many of them from the market, and the current recovery attracted inexperienced newcomers who failed to recognise the heterogeneity of KIBS and demanded them as ordinary standard goods. The difference between experienced and inexperienced customer is our basic conceptual hypothesis.
The homogenisation of demand implied the simplification of supply. The share of personalised services reduced dramatically, the number of services provided to an average customer declined, the price competition crowded out the competition of quality.
We expect our further research to show whether the changes are temporary or permanent. Today the future trend is not yet obvious because the perspectives of general post-crisis development are vague. Within the KIBS sector we identified at least three groups of providers with different economic sentiments and different crisis expectations. We labeled them “optimists” (those who reported positive dynamics of post-crisis recovery), “realists” (those who report that the market has stabilised, but not yet started the recovery) and “pessimists” (those who believe the crisis to continue or to come back soon).
The analytical study revealed close relation of entrepreneur sentiments with variables describing KIBS segment; company and market revenue flows; innovativeness of KIBS providers and customers; dynamics of the client base. Here are the sources of significant differences between optimists, realists and pessimists. These variables may further be used for market forecasts because entrepreneurial expectations are often treated as a good forward-looking indicator of market developments.
Pessimistic expectations of some service providers kept them away from innovations, and the share of innovative output at the whole market declined. The pessimism is not however shared by KIBS consumers who report strong external benefits from their participation in co-production of services. By generating the reciprocal knowledge flows co-production improves customers’ expertise and makes them more innovative. KIBS consumers estimate the impact of their experience with service co-production and use on their innovation activities as strongly positive. Though perfect co-production is never achieved, it upgrades customers’ abilities to deal with all types of innovations.
In 2011 we launched two new topics them seem promising from both theoretical and practical points of view. The first one is the study of spatial dimension of the KIBS sector. The current allocation of KIBS is uneven; they are concentrated in few Russian regions who are hardly exchanging KIBS with each other. Despite all new communication technologies, spatial proximity remains one of the strongest determinants of demand for KIBS in Russia. Meanwhile European experience shows that interregional flows of KIBS improve the surrounding business environment, thus providing external benefits for the whole regions. We identified basic factors of distant demand for KIBS, and expect that out future research will find out how to use these factors as incentives for interregional KIBS exchanges.
Finally, we passed to another new topic which is the government regulation of he KIBS sector. Having in mind numerous strategic documents issued by both federal and regional authorities that aim at post-industrial progress along with the industrial one, the government incentives to the development of service sector are most welcome. The nature of KIBS however makes them hardly sensitive to direct government interference. We expect better results from indirect stimulus of Keynesian type, among them public purchases are the most powerful. Unfortunately the current public procurement legislation is incongruent to the specifics of the KIBS sector. We used our empirical studies to identify basic mismatches and proposed a number of measures for their elimination.