Applied SME Capability Building Center (Model Factory)

What is the Project About?

A Model Factory is defined as a tool (a capability center) to disseminate principles of operational excellence by using experiential learning techniques. Experiential learning principles, which combine theory and practice and thereby create lasting impact, set model factories apart from the similar centers that also aim at improving competitiveness and productivity of the enterprises.

The Project aiming at establishment and operationalization of Applied SMEs Capability Center (Model Factory) in Turkey is being implemented in cooperation with the Ministry of Science Industry and Technology General Directorate of Productivity and United Nations Development Programme (UNDP). It is planned to complete the studies and analysis which are necessary for identification of the appropriate models for establishment and operationalization of Model Factory in Turkey at the end of the project. Target group of the Model Factory in Turkey is planned to be manufacturer SMEs.

What has been the Situation?

National, regional and sectoral policy and strategy documents such as SME Strategy and Action Plan (2015-2018), Turkey’s Productivity Strategy and Action Plan (2015-2018) unequivocally and consistently indicate that improvement of productivity in manufacturing industries is a top priority for Turkey. The 10th National Development Plan, on the other hand, point to the wide productivity gaps between SMEs and large enterprises. Thus, increasing the productivities of the SMEs is not only an important means for enhancing economy-wide productivity, but also one of the primary objectives of the Plan. As such, manufacturing SMEs should be the priority target group of the Model Factory to be established in Turkey.

What is our Mission?

The purpose of the project is to identify an appropriate business model, complete with a business plan and cost estimates, for establishment of an Applied SME Capability Center (a.k.a. Model Factory) in Turkey, and improvement of the institutional capabilities of the Ministry of Science, Industry and Technology (DG for Productivity) for establishment and operationalization of such a center.

How are we doing this?

The project will achieve to build institutional Capabilities to Establish and Operationalize an Applied SME Capability Building Center (Model Factory). This will be achieved through:

-    Analysis towards establishment of a Model Factory (MF) to identify (a) the sectors that MF should target, (b) the type of capability building services that an MF should render and (c) the possible location(s) (i.e. provinces) where an MF (or MFs) could be established in Turkey. The studies to be conducted within this activity will facilitate Ministry’s future decisions on where to establish a Model Factory (or model factories) in Turkey.
-    Identification of an appropriate model(s) for establishment of a Model Factory in Turkey. Model factories are applied SME capability building centers that can be established and operated in different ways. Accordingly, different options and scenarios for establishing such centers in Turkey need to be reviewed.
-    Development of a detailed business plan, complete with estimated investment costs, and preparation of training modules, required for operationalization of the Model Factory.   

How will Turkey Benefit?

“Improving Productivity in Manufacturing Industry” is one of the main objectives of the Government of Turkey as stated in the 10th National Development Plan. The project will contribute to the productivity-related objectives set forth in the national, regional and sectoral policy and strategy documents. SMEs (owners, managers and employers) can be trained on a wide variety of issues ranging from lean manufacturing to energy efficiency. The unique value proposition of such centers is that trainees can directly deploy their learnings at their manufacturing facilities.  Thus, the Model Factory may contribute to improving manufacturing capabilities of SMEs. 

What has been achieved until today?

Analysis including secondary and primary research has been conducted both with desk review, focus meetings and in depth interviews with SMEs and local stakeholders in the field.  Based on the research and analysis a needs assessment report has been produced demonstrating where model factory or factories can be established, industrial target sectors and types of services to be rendered at the model factory. To identify the appropriate models for the establishment of the Model Factory, good practices in other countries have been analyzed and Model factories in Germany and Italy were visited with the representatives of the representatives from Ministry of Science, Industry and Technology and relevant ministries and institutions. Based on the studies and analysis alternate models have been produced and these alternative models are being reviewed by the Ministry.



Project start date:

December 2015

Estimated end date:

June 2020

Focus area:

  • inclusive growth
  • Project office:

    UNDP in Turkey

    Implementing partner:

    Ministry of Ind. & Technology

    Funding Support by

    Donor name

  • Government Of Turkey
  • Kreditanstalt Fur Wiederaufbau
  • Tur - Ankara Sanayi Odasi
  • Amount contributed


    Delivery in previous fiscal year

    2018 $1,190,144

    2017 $21,777

    2016 $435,334

    2015 $0

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