Proceedings of Engineering and Technology Innovation, vol. 12, 2019, pp. 35-38 Time Series Analysis of Outcomes for Small and Medium Enterprises’ Support of Regional Industry Dong-Gu Lee, Je-Doo Ryu, Keon-Seok Nam, Kyoung-Nam Ha * Korea Institute of Industrial Technology, Busan, Korea Received 14 May 2018; received in revised form 26 June 2018; accepted 26 July 2018 Abstract Continued investment in Research and Development (R&D) by the government and corporate support played a major role in the rapid growth of the Republic of Korea. In 2017, the amount of R&D investment by the government accounted for 19.7 trillion Won (KRW), which is 4.7 % of the government’s budget. The government’s R&D budget is increasing by 2.5 % each year. We analyzed the outcomes of the projects, supported by the Busan regional companies conducted in 2016 to 2017. For a time series analysis, we gathered companies support amount by year, sales after company support, and material for employment. We used IBM’s Statistical Package for the Social Sciences (SPSS) 18 for correlation analysis. We confirmed the relationship between employment and the sales of the annual company support program. Keywords: time series analysis, regional industry, support SMEs, SPSS statistics 1. Introduction The industrial technology is recognized as an important element of national competitiveness and the Korean government has implemented various policies for corporate support. In particular, it supports the growth of multidimensional companies through R&D and supports SMEs. Prior corporate support policies prioritized securing technology competitiveness of companies based on R&D. However, as a final goal of recent corporate support projects, commercialization support is expanding. The Republic of Korea started a regional industrial promotion policy in 1999 with the aim of revitalizing the regional economy. To nurture regional strategic industries, the government promoted "policies that intensively support SMEs belonging to regional strategic industries". Recently, it focused on policies that induce cooperation and competition among regions. The forms of corporate support for regional industry support projects are divided into infrastructure, technology, technology development (R&D), technical support, commercialization support, and human resources development (non-R&D). Results of R&D projects have clear technical development results, but it is difficult to evaluate the outcome of the company support project as employment and sales. In this paper, we analyzed the business support of Busan area specialized industry in 2015 and 2016, and try to analyze what correlation the enterprise support project has with increasing employment and sales of enterprise. 2. Previous Research Many researchers present the direction of desirable enterprise support projects through outcome analyses of existing enterprise support projects. [1] conducted an analysis of the efficiency of enterprise support projects for the whole southern * Corresponding author. E-mail address: 0vincent@kitech.re.kr Proceedings of Engineering and Technology Innovation, vol. 12, 2019, pp. 35-38 36 area’s specialized industry development business. [2] conducted an influential factor analysis on the outcome of the support of enterprises by industry of the regional industry promotion policy. [3] demonstrated that the effectiveness of the corporate support project is being implemented in results at a time lag through efficiency analysis of the government enterprise support project through DEA analysis. 3. Analysis of Correlation Pearson's correlation analyses were conducted on the results of the enterprise support project of the intelligent machine parts industry, which is a non-R&D business in the region's main industry development project that was conducted in 2015 and 2016. In 2015 support projects, there were multiple programs, such as prototype creation, product luxury, exhibition support, brand, bottleneck technology, and certification for package support. Support program in 2016 consisted of prototype creation, product upgrades, exhibition support, and marketing support. Using IBM SPSS 18, we analyzed the data of the two years and defined the variables shown in Table 1. Table 1 Definitions of variables Variable Definition of variable Unit Support project costs Through support projects, the supported amount Thousand won New employment New employment during the support period People Domestic sales in commercialization Domestic sales generated during the support period Thousand won Overseas sales in commercialization Overseas sales generated during the support period Thousand won Fig. 1 Frequency analysis of support project costs Table 2 New Employment New Employment 2015 2016 Frequency Percent Frequency Percent 0 117 84.8 48 53.53 1 9 6.5 22 24.4 2 8 5.8 12 13.3 3 2 1.4 2 2.2 4 1 0.7 2 2.2 5 1 0.7 1 1.1 6 0 0 3 3.3 Total 138 100 90 100 Proceedings of Engineering and Technology Innovation, vol. 12, 2019, pp. 35-38 37 First, we analyzed the frequency of the support project costs in each fiscal year. As a result of the frequency analysis, the support project cost was under 10 million Won because the exhibition and marketing supports were relatively frequent. Table 2 shows the results of frequency analysis of support projects. Table 2 shows the frequency analysis of new employment, 40 new employees were hired in 2015, and 83 new employees were hired in 2016. However, more than 50 % were not hired. Table 3 summarizes the average value of the support costs, new employment, domestic, and overseas sales in commercialization. The average cost of the support projects in 2015 was 8.3 million Won and the average domestic sales in commercialization were confirmed at 13 million Won. The average cost in 2016 was 9.9 million Won, and the average sales of commercialization were confirmed at 28 million Won. Table 3 Descriptive statistics 2015 2016 Total Average N Total Average N Support project costs (million Won) 1,145 8.3 138 891.3 9.9 90 New Employment 40 0.29 138 83 0.92 90 Domestic sales in commercialization 1,884 13.658 138 2,522 28 90 Overseas sales in commercialization 180 1.305 138 1,139 12.6 90 Tables 4-5 show the results of the correlation analysis. By correlation analysis, we analyzed the correlation between yearly support project cost and new employment, sales of domestic in commercialization, and commercialization of overseas. Table 4 2015 Correlation analysis Support project costs New employment Domestic sales in commercialization Overseas sales in commercialization Support project costs Pearson correlation coefficient 1 .416 .066 .016 Significant probability .000 .440 .849 N 138 138 138 138 New employment Pearson correlation coefficient .416** 1 .118 -.009 Significant probability .000 .168 .915 N 138 138 138 138 Domestic sales in commercialization Pearson correlation coefficient .066 .118 1 .453** Significant probability .440 .168 .000 N 138 138 138 138 Overseas sales in commercialization Pearson correlation coefficient .016 -.009 .453** 1 Significant probability .849 9.15 .000 N 138 138 138 138 ** Please note that the correlation coefficient is 0.01 level (both sides). Table 5 2016 Correlation analysis Support project costs New employment Domestic sales in commercialization Overseas sales in commercialization Support project costs Pearson correlation coefficient 1 .303** .068 -1.26 Significant probability 0.004 .524 .238 N 90 90 90 90 New employment Pearson correlation coefficient .303** 1 .092 .103 Significant probability .004 .389 .333 N 90 90 90 90 Domestic sales in commercialization Pearson correlation coefficient .068 .092 1 -0.56 Significant probability .524 .389 .602 N 90 90 90 90 Overseas sales in commercialization Pearson correlation coefficient -.126 .103 -.056 1 Significant probability .238 .333 .602 N 90 90 90 90 ** Please note that the correlation coefficient is 0.01 level (both sides). Proceedings of Engineering and Technology Innovation, vol. 12, 2019, pp. 35-38 38 In 2015, the support costs seemed to correlate positively (+) with new employment (r = 0.416). In addition, the domestic and overseas sales in commercialization showed a positive (+) correlation with quantity. In 2016, the support costs had a positive correlation (+) with new employment (r = 0.303), but the domestic and overseas sales in commercialization did not have significant correlations. 4. Conclusions In this paper, we analyzed the correlations between sales and employment of the support amount of the company support business for two years. The analysis of the outcome of the company support business for two years, the support costs of the company and new employment have a high correlation. It was confirmed that the direct and indirect employment of the company is done according to the company support amount. However, the frequency analysis of the overall employment shows that considerably lower employment was being conducted. We confirmed that it was still difficult to increase employment, just only by the supporting project costs. Generally, it was judged that there was a correlation between the support costs of a company and the domestic sales in commercialization. However, in 2015, it was confirmed that the 2016 data analysis results of the sales in commercialization were not strongly correlated with the support costs of the company. It is difficult for the actual results of the prototype production support to occur in that year. We analyzed the results of the same support project for two years. The results show that it is necessary to have a performance index that could grasp the substantial influence on the company's ability and productivity, rather than being evaluated on the basis on financial performance indicators, such as employment and sales. Conflicts of Interest The authors declare no conflict of interest. References [1] S. S. Lee and Y. E. Kim, “Efficiency analysis of enterprise support project for nurturing specialized industries in Jeonnam area,” 2016 Korean Institute of Industrial Engineers, Symposium, 2016, pp. 34-40. (In Korean) [2] G. H. Kim and Y. H. Won, “An analysis of performance influence factors of enterprise support based upon the local industrial development policy: focused on the industry types of region-specialized industries,” Korean Association for Policy Science, 2015. (In Korean) [3] Y. S. Kang, S, M, Sohn, S. J. Im, and B, Y, Cho, “A study with DEA analysis on the efficiency of the government support for small and medium enterprises,” Korea Academic Society of Business Administration, 2014, pp. 1891-1907. (In Korean) Copyright© by the authors. Licensee TAETI, Taiwan. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY-NC) license (https://creativecommons.org/licenses/by-nc/4.0/).