Francois-Xavier Meunier - Dual Innovation Systems

Duality no longer involves the organization of transfers, but the use of possible synergies between civilian and defense sectors during the innovation process. It is perceived as a window of opportunities. Such a network is a set of social interactions, whose stability generates high resilience. Therefore, the nature of these relations is essential for maintaining success; this relies particularly on the involvement of actors dedicated to the construction of the dual network, whose role is particularly pointed out. Furthermore, Kulve and Smit mention the set of other factors leading to the success or failure of such a network ( Table 1.2). They point out the policies aiming to develop certain competences associated with the construction of such networks as key factor of the successful integration of civilian and military industrial and technological bases (Kulve and Smit 2003).

Table 1.2. Success or failure factors of duality (source: Guichard and Heisbourg 2004, p. 102)

Moreover, many authors underline the fact that the elaboration of complex systems (also referred to as CoPS) involves mastering wider knowledge. Such knowledge is rarely concentrated within a single actor, consequently mechanisms for knowledge management throughout networks are required. New possibilities of interactions between actors emerged in order to create fully or partially dual technologies. In this context, the protection of innovations and their valorization are essential. New practices are established in the defense industry and they modify the organization of companies given the fact that the management of intellectual property rights (IPR) requires new competences (Ayerbe et al. 2012, 2014).

Innovation networks are particularly dense (Cantner and Pyka 2001; Kuhlmann 2001). Duality led to the emergence of new actors within the innovation networks of the defense world. The complexity of knowledge management increased (Mérindol 2004). In the 1990s, the emergence of “systems of systems” (systems interconnected through information and communication systems) facilitated technology transfers between defense and civilian sectors. This was done jointly with the emergence of LSI, characterized by the role of evaluator, manager and architect of programs that certain companies had to assume (Lazaric et al. 2011). Consequently, LSI is a key actor of dual innovation network, as it is the one that, mastering the system architecture, is able to integrate knowledge coming from both civilian and military sector. Besides mastering the system-related knowledge architecture, integrating such a system requires knowledge associated with subsystems or other components (Prencipe 1997; Hobday et al. 2005).

In the case of a dual innovation network, LSI draws its knowledge from both civilian and defense worlds (which makes it a bridge between these two worlds) and develops organizational competences that cannot be dissociated from this activity in order to achieve it. Therefore, it plays a role in what some refer to as “coopetition” between the actors of a network (Depeyre and Dumez 2010).

Nevertheless, the consideration of duality through a network is not always satisfactory, as it focuses on coordination between actors. If systemic approaches are used, the analysis can include structural and institutional components, whose evolution can be assessed. This type of analysis relates to both defense and civilian sectors and stresses the governance problems in the implementation of duality.

Understanding duality from the systemic perspective amounts to studying the institutional, organizational, legal and financial arrangements. The problems raised vary in nature and often highlight the intangible aspect of the notion (knowledge, competences, informational proximities, etc.). This also points out the system governance problems and, consequently, the public policies associated with this form of coordination between civilian and military sectors. This is how the concept of “dual policy” or “duality policy” emerges. “It corresponds to the search for an organization of knowledge and information exchange in which the State is the facilitator. Public authorities must define the common research themes and initiate knowledge and information exchanges between the civilian and military research sectors” (Mérindol 2004, p. 102).

Although duality is not at the core of their analysis, Uzunidis and Bailly (2005) deal with the relation between military innovation and civilian innovation. They developed a framework of analysis as a system of systems at the national scale: “the organic square of the valorization or military research”. This enables the system to be pure, easily regulated by mechanisms that control technology and information flows between countries in the military field and the application of Buy American, Buy French or Buy British principles. This valorization system relies on the interaction between regulation, technical progress, system strategy and economic environment. The American model serves as an example of application of this system that is “essentially characterized by massive financing of military technologies, which will later on (over an unpredictable time horizon) yield results in the civilian sector” (Uzunidis and Bailly 2005, p. 68).

From this perspective, technological duality is a potential that the system as a whole tends to valorize. This transversality of technologies between various products is essential in this model. Generic technologies must be rapidly disseminated within companies and knowledge sharing is consequently a key factor for system success. According to some authors, it may be interesting to shift from a market-based Smithian model, to a Schumpeterian model of “cognitive capitalism”, based on a network organization facilitating “permanent innovation”.

Serfati (2008) introduced the expression “French meso-system of armament” (FMSA) to study the specific case of France. This approach between the microeconomic and macroeconomic levels points out the interactions between three main actors: the General Directorate for Armament (Direction générale pour l’armement (DGA)), large contractors and technological agencies such as the French National Aerospace Research Center or the Atomic Energy Commission (Commissariat à l’énergie atomique (CEA)). It is possible to study the commercial and non-commercial interactions within FMSA and the rest of SNI. As far as duality is concerned, this approach enables an analysis of relations in the design of technologies, such as the relations between technology, economy and society. Due to the influence exerted by a country’s history, its international relations, industrial sectors and technologies, entrepreneurial culture and the history of techniques, it is unlikely that a single optimal model for organizing technology transfers will be defined.

Moreover, the analysis made by Serfati (2008) notes that, despite the transferability of certain technologies between defense and civilian sectors, military innovation did not always play by the rules of duality. The case considered, commonly quoted as an example, is that of the development of the Internet in the United States, where the actors in the defense sectors did not support knowledge dissemination in the civilian sector. To deal with this type of behavior, she pointed out the positive role that IPR can play in an innovation system, particularly in the case of duality.