The Secret Sauce

When you are competing with the international elite, you’d better be good. Very good. Germany’s Leibniz Association is such an elite. One of Europe’s most renowned research organisations, it groups a number of research institutions in various fields. The Ifo Institute is one such institution.

In ten years, the Ifo Institute went from a near-death experience to the undisputable pinnacle as the most successful and influential economics research outfit in Germany and amongst the best in Europe. How did it do it?

Meinhard Knoche, member of the Ifo Executive Board and, together with Hans-Werner Sinn, one of the brains behind Ifo’s renaissance, has just written a tight review of all the things that Ifo got right to emerge from the doldrums.

As he points out, striving for top performance is an absolute necessity for the institutes in the Leibniz Association, as only excellence can secure their funding. And top performance in research can only be based on international competition. The Association keeps the institutes on their toes by conducting regular reviews of whether they still make the cut.

One of the factors Ifo paid close attention to was employer branding. This is nothing else than turning the institute into a magnet for the best talent. Money alone does not suffice. It is necessary to create an environment that is attractive to top performers and, particularly, young researchers. One of the ways to do this is to harmonise the institute’s goals and activities with the personal goals and expectations of its researchers, and to establish a reputation as a place where first-class research is conducted and academic and non-academic careers are rigorously supported.

This is complemented by employee branding. As researchers establish their reputation through publications and lectures, they also contribute to the reputation of their research institute. They become, in effect, “branding ambassadors”.

To attain this, the expectations of researchers must be well identified and catered to. For doctoral candidates, this would be a speedy completion of their doctorate, participation in high-quality courses, institutional support for presenting their research results internationally, and hands-on experience in policy-oriented and empirical projects.

For post-docs, the lure comes from further qualification, time for own research and for international presentation of their research results, the possibility of conducting research abroad and cooperating with visiting scholars, gaining experience in policy advice and debate, and in media work and leadership.

Further up the ladder, potential department heads look for institutions that will increase their own market value in the scientific community and thus promote their career. One very good way to achieve this is to institute joint professorships with an internationally recognised university, as this makes it possible not only to compete with the best as a non-academic research institution, but also to offer potential candidates an active role at the university and the opportunity to use the university contacts for research and teaching. In addition, the institution must provide an international scope for their research, freedom to explore new avenues, and the possibility of playing an influential role in shaping economic policy. Needless to say, the perceived excellence of the heads of department is also one of the magnets for attracting talented junior researchers.

As stated earlier, to be a top research institution, internationalisation is mandatory, as it provides a tremendous competitive advantage. Economists are a very movable lot, so it is difficult to find the required talent only in the domestic market. But if you want to attract international talent, your institute must have an international atmosphere that pervades its organisational structure and working environment. This usually results from a long-term strategy that may entail focusing the subject matter of the institute on the expertise of its international researchers and providing special integration measures for foreign researchers.

One of the most effective ways to achieve this international orientation is the establishment of a global research network, supporting its members in their activities by, for instance, organising conferences and providing publication venues for their research findings. This not only strengthens the international reputation of the institute but also involves the institute’s researchers with the international research community. Just think of the CESifo Research Network.

But attracting the talent is not enough. You then have to nourish it, to enhance its scientific profile. A key element is the trust that the institute’s management puts in the research competence and responsibility of its researchers. This enables the institute to offer them free space for research, supported by an efficient infrastructure and service apparatus, including optimal technical support such as state-of-the-art information and communication systems.

And you have to give them wings. The institute’s researchers must be encouraged to present their work at international conferences, spend some time as visiting researchers at well-known universities or research institutions, especially abroad, and have the opportunity of organising conferences or workshops with international participants as well as to extend invitations to co-authors and visiting scholars.

If the institution also offers good opportunities for gaining practical experience in policy advice and participating in policy debate, its attractiveness will be enhanced to the point where talent comes to the institute on its own.

But the one crucial factor in putting of all this together, including attracting the right talent, is the choice of institute’s leadership. As Mr Knoche puts it, “it is one of the most important and difficult decisions for the future of any institute”.

All of this, as Mr Knoche stresses, is not pure theory. It has been proven in practice. The Ifo Institute applied every one of the measures described. It surely paid off. When the Leibniz Senate issued its updated assessment close to the end of the decade, it rated Ifo’s research output as “excellent”. Ifo had finally risen from near oblivion to its privileged position today.

Meinhard Knoche: In Search of Excellence in Research and Policy Advice: Success Factors for International Competitiveness, CESifo Forum Summer 2011

• CESifo Working Papers published in the past three months