High-Employment-Growth Firms

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High-Employment-Growth Firms in Poland
Determinants and policies
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• Key points
• High-growth firms in Poland
• Local determinants operation conditions,
  expectations, competitiveness and innovations
• National and local policies
• Policies vs. determinants

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High-growth firms in Poland

• Statistical definitions
• firms which achieved average annual increase in
  the revenues of 20 or more in the period of 3
  years (CSO)
• enterprises with average annualised growth
  greater than 20 per annum, over a three year
  period ? growth can be measured by the number of
  employees or by turnover (EUROSTAT)

share in total number of firms
Source own work based on CSO 2011

• Definitions do not fully embrace the employment
  aspect and innovativeness
• Too rigid to provide more detailed data or to
  analyse the determinants for their creation and
  operation

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Local operation conditions for enterprises
Encountered difficulties (enterprises functioning
between 2005-2010)
Demand difficulties ( of enterprises)
DETERMINANTS
Supply difficulties ( of enterprises)
Factors to be influenced by local public policy
Source own work based on Creation and operation
conditions, development prospects of Polish
enterprises established in the years 20052009,
CSO 2011
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Companies expectations towards public
policyTypes of services which the companies need
(survey)
DETERMINANTS
A study of services and clients of Consulting
Centers, PARP, 2010
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Local determinants in PLChallenges to policy
makers

• Spatial variations in SMEs, entrepreneurship
  activity, business climates and business
  performance among 16 regions in PL (not to
  mention the local level)
• Some factors not embedded in local context
• Need to adjust local policies to diverse and
  varying needs
• Finding the proper balance in national-regional-lo
  cal delivery of entrepreneurship/ SMEs
  development policies
• Urban-rural contrasts pertaining rural area 90
  of the country with 40 of population, 16
  employed in agriculture
• Crucial role of foreign direct investments at
  local level

DETERMINANTS
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Innovative enterprises barriers or determinants

• Economic
• Insufficient own financial resources (industry
  31,8 services 24,1)
• Insufficient external financial resources
  (industry 26,9 services 21,3)
• Innovation costs perceived as too high (industry
  34,2 services 27,4)
• Knowledge-related
• Lack of qualified HR (industry 14,6 services
  13,2)
• Insufficient information on technology (industry
  12,4 services 12,3)
• Lack of information on the markets (industry
  11,8 services 11,4)
• Difficulties in finding partners for innovative
  cooperation (I 16,7 S 14,5)
• Market-related
• Market controlled by dominating companies
  (industry 21,1 services 19)
• Unsure demand for innovative products (industry
  21,7 services 18,4)
• Other
• Innovation implemented in previous years
  (industry 14,4 services 14)
• Lack of demand on innovation (industry 14,8
  services 15,1)

DETERMINANTS
Source Innovation activities of enterprises,
CSO, 2011
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Innovative and competitive enterprises Social
determinants

• Personnel policy and HR management in the company
  
• Expectations from employees stereotypes,
  attitudes
• Organizational culture flexicurity, pro-family
  policy, external expertise, talent and competence
  management
• Leadership
• Motivating for ideas and innovations
• Attitudes - conditions, possibility to develop,
  remuneration, free flow of information,
  appreciation
• Employees qualifications and skills qualified
  managers, approach to training, (low)
  participation in ET, empowerment

DETERMINANTS
CONCLUSION significant part of these social
determinants might be (and are) shaped by public
policies e.g. ESF measures
Social determinants of the innovative character
of the enterprises, Pentor Reasearch Intl, 2008
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Innovative and competitive enterprises
Employees qualifications
Competitive advantage on the local market and
competences of employees (results of the survey)
DETERMINANTS
Education of employees and the competitive
position of enterprises, PSDB, 2010
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Polycentric development model policy approach

• Polycentric urban framework metropolies being
  the driving force of national, regional and local
  development
• PL strategic approach to regional/ local
  development - defined in the National Strategy of
  Regional Development new paradigm of regional
  policy

• The best use of development potential (esp.
  endogenous) of the cities as sub-regional centres
• Intervention accompanied by with measures
  consisting in the dissemination / diffusion of
  development process to the less developed centres
  and establishment of absorption potential
• Establishing competitive advantage of less
  developed areas

NATIONAL AND LOCAL POLICIES
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National and local policies supporting HGF
NATIONAL AND LOCAL POLICIES
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Challenges for national and local policies in PL

• Effective coordination essential if policies are
  to be efficient in achieving given objectives and
  addressing the right target groups
• Providing coordination mechanisms for
• National and regional OPs
• KSU network
• National and regional innovation policies
• Loan funds and loan guarantee funds
• Cluster policy
• Social enterprises
• Need for a more active role of business support
  institutions and a more coordinated partnership
  of public, private and third sector organisations
  supporting the enterprises (learning ecosystem)

NATIONAL AND LOCAL POLICIES
Source Poland Key issues and policies, SMEs and
entrepreneurship in PL, 2010, OECD
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Developing innovation potential and
competitiveness
Determinants influenced at local level by
instruments provided by national authorities
financed by national or EU funds
NATIONAL AND LOCAL POLICIES
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Local determinants The role of foreign capital
and business environment in PL economy

• PL regions and cities economically attractive,
  esp. in the period of economic slowdown and
  financial crisis
• Poland indicated as top potential investment
  destination for FDI projects in Europe (2010
  Ernst Young European Attractiveness Survey)
• Financial resources having crucial impact on
  companies growth the main determinant and
  barrier in launching economic activity
• Local authorities focussed on attracting and
  embedding foreign investments and supporting
  entrepreneurship
• FDI perceived in local societies as the key to
  improving the situation of local labour markets
  and economic development

POLICIES vs. DETERMINANTS
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Local determinants case studyThe role of
foreign capital and business environment in PL
economy
Entrepreneurship
Distribution of foreign investments
POLICIES vs. DETERMINANTS
Economic growth
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Local determinants case studyThe role of
foreign capital and business environment in PL
economy
Niepolomice strategic approach to
entrepreneurship
POLICIES vs. DETERMINANTS
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Local determinants case studyHigh importance
of foreign capital in PL economy - example
Niepolomice Investment Area (NIA)

• NIA attracting the highest volume of foreign
  investments in PL and in Malopolska 2,3 of all
  Polish investments in 2009-2010
• USD 283 mio invested in 1989-2010, incl. USD 45,8
  mio in 2009-2010
• Investors Coca-Cola, Woodward Governor,
  Kreisler, Staco, Silgan White Cap, Royal Canin,
  MAN, Nidec
• Investors from the USA, Japan, Netherlands,
  Germany from different sectors
• High impact of FDI on local economy - employment
  rate (45 increase in the no. of job places),
  unenployment (decreased by 19) and local
  entrepreneurship (33 increase of the no. of
  enterprises)

POLICIES vs. DETERMINANTS
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Thank you for your attention!
Ministry of Regional Development Department for
ESF Management