Knowledge and innovation in the Lebanese software industry

Abstract

The software industry is strongly influenced by knowledge and innovation. The ability to develop new solutions and services is considered essential to firm survival and growth. The innovation process, being long and costly, relies heavily on interorganizational relations and the interaction between different types of actors (e.g., intermediary support organizations, universities, R&D centers) that can advance knowledge transfer and innovation. Consequently, innovation is seen as an open and interactive process. Many researches related to economic geography have demonstrated that the different types of proximity can be an important tool to facilitate interactions and knowledge exchange. The Information and communication technology (ICT) sector is recognized as a key driving force for Lebanon’s economy. It is a fast growing sector with an estimated market size of USD 436.2 million in 2016. Furthermore, Lebanon is emerging as a leading exporter of software development and services in the region. The methodology of this paper is mainly based on a literature review and interviews based on semi-structured interviews, which were conducted face to face, or by phone. The first objective of this paper is to analyze the characteristics and dynamics of innovation within the Lebanese software industry. The second objective is to provide a framework to analyze how the different types of proximity affect the innovation and the interactions inter-actors within this industry. The paper demonstrates that innovation in the Lebanese software sector is often driven by the demand and the client’s needs and request. In addition, we noticed that in Lebanon, the local R&D structures or the universities do not support this sector. Furthermore, the support offered by the Lebanese government is still weak and this is manly related to the complexity of the political and social system in Lebanon. © 2018, © 2018 The Author(s). This open access article is distributed under a Creative Commons Attribution (CC-BY) 4.0 license.