1. Where lies the Innovators Advantage in Strategic Sourcing? An Interns PerspectiveOutsourcing to Asia is overhyped in the short term, but under hyped in the long term- Daniel H Pink.

2. Innovators Dilemma, Capitalists Dilemma A creative journey through Sound 3. Possible Solutions to the Innovators Dilemma?Guillaume Tell- Overture (Gioachino RossiniWilliam Tell) Antonio Pappano & Orchestra dell' Accademia Nazionale di Santa CeciliaA journey of explorative expedition 4. The Innovators Dilemma in Strategic Sourcing The Innovators Dilemma (Christensen, 1994), applied in context of sourcing: Competition driven by Commoditization Preservation: Existing suppliers have access to resources and processes that allow volume production of products at low overhead costs. Tried, tested and proven suppliers are advantageous. Specialized suppliers/ niche market suppliers can be unattractive to a company, largely because of cost constraints and higher risks. (Dyer, 1996) Market uncertainties- Product specifications (requirements of jobs-to-bedone), market position of supplier and technologies, scaling up of production, etc are difficult to access. Relatively large investments of work and time to qualify and assess a new supplier. New business procedures entailing collaborations across domains- R&D, Marketing, Sourcing, IP may be needed. The Innovators (proposed) solution in Sourcing. Systems Innovation through Strategic Sourcing (aligned with the new Competitive Architecture. Innovating beyond Operations and Supply Chain 5. Outline Defining Competitive ArchitectureSystems Innovation through Strategic SourcingChange in the Competitive Architecture Technology: The Core of Injection Moulding of Plastics Industry: Moulding Markets: Cost, opportunities and technological growth.Innovating beyond operations and supply chain (Leverage suppliers organizational architecture) Leverage core competence and R&D synergies to acquire competitive advantage. Enabling Design-Centricity of suppliers products to target customer profiles. Benchmark of Global Personal Protective Eyewear Suppliers. Seek agile transition to new product platforms and combinations.Conclusion To Hunt or To Gather? Or......Waves of InnovationReferences 6. Defining Competitive Architecture /Competitive Architecture/- The broadest overview of a company in the context of markets, its customers, history, products, services and goals. It shows how external organizations evolve with time.patterns of Traditional definition of competitive architecture is confronted with a generation of transformational- disruptive or radical innovations (new tech in old markets, old tech in new markets, etc) If the company wants to remain competitive, the shiFt in drivers across economic architectures and market architectures should perpetuate and transcend to a change in organizational structures and processes that matches theDESIRES ANDNEEDS of the local commune. 7. Competitive Architecture TransformationalTraditionalCustomers Economic Architecture: Industry & Manufacturing Driven (Outsource manufacturing to low-cost economies for cost- competitiveness)Supply-driven. Mass products. Unit-price reduction achieved via commodisation.Mkting, R&D Materials & Processes SourcingSupplier Management and Relations, Brand DrivenEconomics-drivenShort term ProfitsSuppliersKnowledge Driven, Creative Conceptualization (Core-competence and open innovation, knowledge hubs, emphatic design)Market Architecture: Demand-driven. Design and customized for one. Experience based purchase.Organizational Architecture: R&D, customer centered innovationMarket and Organizational DrivenLong Term Gains 8. Optimization in Supplier Selection and Evaluation: Achieving cost reductions through supplier management and relations. Suppliers that are able to meet Delivery Timelines Manufacturability Alignment Product and equipment of Specifications 6 values Quality and reliability Financial and trade solvency Finding the right supplier in a competitive red oceanInnovating beyond Operations and Supply ChainSustaining Operations and Supply ChainSystems innovation through Strategic Sourcing Creating leverage through strategic Supplier partnerships and Engagement (1) Leverage Core Competence and R&D synergies to acquire competitive advantage (2) Enabling Design-Centricity of suppliers products to target customer profiles (3) Seek agile transition to new product platforms and combinations: Suppliers wanting to break into local and regional markets * N.B. Time to Market is still an important consideration in assessment Specialized/ integrated suppliers in home groundsSuppliers who can create ablue ocean Invention is converting cash into knowledge. Innovation is converting knowledge into cash. And Value is converting cash into knowledge, multiplied in returns of kind to the end-user. (Through development and sourcing of customer centric products and services.) 9. Change in the Competitve Architecture Technology, Industries and Markets 10. Technology: The CORE of Injection MouldingFALLO ApproachFollow all opportunities -Injection of plastic melt through shaped die by means of pressure. -Closed mold and die system -High degree of technical expertise required for production excellence.Source: Plastics Engineering Handbook 11. Industry: Systemic opportunities in Moulding Emphatic Design Fit with customers. *Ref: Frost Customization of products to existing customers of the supplier.Tackling the Niche Market Proximal access to regulatory bodies speeds certification Proximal access to local users enable design changes to be quickly communicated throughout Value ChainRef: (Quek, 2013)Globalization Specialization and niche creation suppliers guarded against dilution Rising labor costs, & lower margins Generalists forced to move to lost cost countriesVertically Integrated Suppliers. (Knowledge expertise) Versus Horizontally Integrated Suppliers. (Possible Network Advantages) *Ref Dyer, JH (1996). Specialized supplier networks as a source of competitive advantage: evidence from the auto industry 12. Value Chain Displacements: Wherein lies new opportunities for growth Asia Pacific Injection Molding Outlook 2 factors driving the Economics pushes from a cost-based Outsourcing plastics industry general mold makers Perspective: (Frost, 2011): that profit by volume 1. Competitive Prices to China. -Cost Savings of 40% - 70% possible, 2. Customized Solutions BUT - Process of finding the right supplier Solution: 1. Find relevant suppliers/ of mold tool and mold material is alternative who differentiate on less crowded intense and the necessary input is market spaces. Niche/ specialized suppliers high (Quek,2013) who are in tune with customer and market needs. 2. Suppliers whose major businessesofferings are aligned with what the company Question: Is there room for would outsource for manufacturing (and competitive insourcing/ development).global sourcing? 13. Market: Cost Versus Profitability Concerns(2012)Solid red circles: Traditional economics driving decisions in organizations. Yellow circles: Strategic and technological planning decisions within organizational controls. Dotted yellow circles: Relatively weaker factors of market influence. 14. Performance/ valueBenchmark of Technology Evolution Bioplastics $590.9 million in 2011. Estimates this to reach $1,075.8 million in 2018. (Frost) Estimated market sizeTBC Basic Polymer Processin g & Injection MouldingComposite materials Market growth (5-7%), Market value of (12%) (The plastics Industry: Economic Overview)Integrated Injection Moulding and Assembly. E.g. Dual-shot injection Moulding3D Printing. Estimates this to reach $0.2- $0.6 trillion in 2025 (McKinsey) Effort / Time1940s 1970s2000s2013 15. Innovating beyond Operations and Supply Chain Leverage/ Acquire Suppliers Organizational Architecture in Innovation Case Study: Suppliers of Plastics Injection Moulded Eyewear in Asia 16. (1) Leverage Core Competence and R&D synergies to acquire competitive advantage Case: Brand A 17. Core-Competence Leverage Brand A Mapping of Relevant Core Competencies Raw MaterialsPolycarbo nate High Density Poly EthyleneCore Competencies Design for ManufacturingR&DEnd ProductsOptic lensesSafety SpectaclesFilters Versatile CoinjectionHigh production turnover300 personnel 24-7DistributionThermoplastic Poly-UrethaneProductsCoating Technologies40 minutes driving from Kaohsiung International Airport (KHH) & Sea Port.Coatings Frames*Strong knowledge assets in Polycarbonate processingLaser Optic Goggles Laser Protective Eyewear 18. Knowledge-In-Sourcing: Access to R&D Networks Electrichromism goggles Apply voltage to change opacity of the glasses Wide use of goggles/ safety eyewear for different environments Products Thermoplastic PolyurethanePolycarbonate Co-injection Concurrent/ Multilayed molding Single molding process Firm attachment of different materials Relevant R & DPolymer co-injection References: http://www.google.com.br/patents/US7132167Electrochromic gogglesR&D Technologies Multiple layered polymer injection molding Flexible manufacturing of multilayered products Concurrent manufacturing and assembly of gogglesResearch Partnerships Laser Application Technology Center of Industrial Technology Research Institute of Taiwan Nano Powder and Thin Film Technology Center 19. (2) Enabling Design-Centricity of suppliers products to target customer profiles From mass manufactured designs to (possibly) customized designs Case: Brand B 20. Ethnographic StudiesLab Based Machining Workshop in NUSVenue: Control & Mechatronics Lab 1, EA 04-05/06 Department of Mechanical Engineering, National University of Singapore 9 Engineering Drive 1 21. Ethnographic StudiesLab Based Machining Workshop in NUS Venue: Control & Mechatronics Lab 1, EA 04-05/06 Department of Mechanical Engineering, National University of Singapore 9 Engineering Drive 1 22. Ethnographic studiesMaterials Lab in NUS Cabinet housing the storage of PPEsVenue: Materials Lab, E3-04-01 Department of Mechanical Engineering, National University of Singapore Engineering Drive 3Safety Glasses chosen because of Design and Brand Name.Cleaned with alcoholic wipes (Complementary Assets) of the same companyCenturion: Brand Leader in Protective Goggles 23. Match Supplier Designs with End User Desires Target consumers may pay more for (emotional) durable designs. Synergistic with Companies strong with Brand and Market PremiumsOne cannot put a price tag on safetyMr Jeridson Ong, Safety Officer, Office of Safety, Health and Environment (OSHE), NUSBlue Ocean Effectual DesignSafety glasses from Brand BEffectuation TransformationalBeing emphatic in selection of designs *Lead user studies are often necessaryDesign Form, Fit and Function DurabilityStandards Managers/ Department offices make decision here, based on budget and durability. Company that competes on Market and Brand Leverage lose on Price attractivenessCompliance Traditional*Be aware of Standard (C.f. Art of Standard Wars)Wars 24. Benchmark of Global PPE Suppliers Focus on Transformational Competitive Architecture - Design, Technology and Markets 25. Benchmark of Eyewear Suppliers Brand ABrand B (HK)Brand CBrand DBrand EBrand FIndustry StatusOBMODMOEMOEMVARVARDominant Product ClassesEyewearEyewearNilNilNilNilTechnologyDual Shot Injection MouldingDual Shot Injection MouldingSingle Piece Injection MouldingSingle Piece Injection MouldingUnclearUnclearCore CompetencePolycarbonates, Dual-shot injection molding & CoatingsDesign, Anti-fog coatingManufacturingManufacturingDistributionDistributionTechnology Benchmark with IndustryKeyPacingBaseBaseBaseBase*Generalized assessment, based on information presented on Companys website 26. Evaluation of Eyewear Suppliers: R&D LeverageDesign LeverageBrand A Brand B Brand C Brand EBrand D Brand FStrongTenabl e WeakManufacturer Safety Specialist Leading technology competence Manufacturer Safety Specialist Following technology capabilities Manufacturer Me too companies General retailer/ DIY and big box retailers Laggards 27. Redesigning dimensions of sourcing competitiveness. Next wave of technologies that can disrupt the current supply chain. Do current suppliers have the capacity to innovate and remain competitive? Does sourcing have options to move on to suppliers of the next wave of technologies? e.g. Composites in packaging, biodegradable packaging. Recall: Composites- 4-5% growth, faster than rest of plastics industry , 12% in terms of total market value (Biron, 2013) Fiber sewing of composite materials and fabrics, L-glass versus S-glass for fibre optics transmission, etc.Access to new markets and industries, e.g. defense and aerospace through new suppliers. 28. (3) Seek agile transition to new product platforms and combinations Sourcing for discontinuous innovations 29. Example: Filacon- Fiber weaving of aerofoil panel Technology was a key exhibit at JEC Composites Asia 2013.German company. Licensed fiber weaving machine to Singapore Polytechnic. Has potential to replace the manufacture of PPE equipment, such as Hardhats. 30. Filacon- Fiber Weaving PanelEconomic benchmarks for plastics and composites in terms of raw materials and processing- Biron (2013), pp. 42-46 31. Benchmark of costings for Carbon-fiber Woven Hardhats Beware of The Innovators DilemmaCost: US$19.95 Red Carbon Fiber Hard HatCost: US$69.95 Skullgard hard hats meet or surpass all requirements for type 1 hard hats,Excellent safety, comfort, and superb design. Standards: Four point ratchet suspension - fully SEI certified, and meet ANSI Z89.1 adjustable, 2003, Class G and ANSI/ISEA z89.1High-density polyethylene shell is 2009 standard requirements. finished with a high-gloss Carbon Can costs be minimized through fiber look. innovative measures such as Standards:ANSI Z89.1-2003 Type 1, technological outsourcing? Source: Class C and G. http://www.hatsrcool.com/ 32. Cost-benchmarks for glassfibre reinforced composites*Plastic additives and filler material costs are not reflected on chart.Source: Biron(2013), pp. 43Source: Biron(2013), pp. 47 Raw material costs may not see a drastic increase as compared to traditional plastics. Higher price of composite products may be attributed to other manufacturing and supply chain factors. 33. Insanity is doing the same things over expecting different results- Albert EinsteinInnovation Ecosystems RIs Students Knowledge Hubs Uni. TTO 34. Performance (Unit cost reductions) New Dimensions of Innovation Opportunities for DisruptionGood enough Performance,(Unknown Deep Insights, market) New Markets, New Customers EffortTime 35. References: Bengtsson, L., Von Haartman, R., & Dabhilkar, M. (2009). Low-Cost versus Innovation: Contrasting Outsourcing and Integration Strategies in Manufacturing. Creativity and Innovation Management, 18(1), 3547. doi:10.1111/j.1467-8691.2009.00510.xBiron, M. (2012). Thermoplastics and thermoplastic composites. In The Plastics Industry: An economic Overview (pp. 32- 133) William Andrew.Carpay, F, Hang, CC, Dan, Y. Management of Outsourcing R&D in the era of open innovation. The 5th International Symposium of Management of Technology (ISMOT07), pp. 252-256.Christensen, C. (1997). The innovator's dilemma: when new technologies cause great firms to fail. Harvard Business Press.Christensen, C. M., & Raynor, M. E. (2003). The innovators solution: Creating and sustaining successful growth. Harvard Business Press.Dyer, JH (1996). Specialized supplier networks as a source of competitive advantage: evidence from the auto industry. Strategic Management Journal (17), pp. 271 291 36. References: Howells, J., James, A., & Malik, K. (2003). The sourcing of technological knowledge: distributed innovation processes and dynamic change. R&D Management, 33(4), 395409. doi:10.1111/14679310.00306Mahajan, S, et al (2012). Strategic Analysis of Engineering Plastics Market in Southeast Asia, Growth in Automotive Industry will drive demand. Frost and Sullivan, Market Engineering.Manyika, J, Chui, M. et al (2013). Disruptive technologies: Advances that will transform life, business and the global economy. McKinsey Global Institute.Nonaka, I. (1995). The Knowledge-Creating Company: How Japanese Companies Create the Dynamics of Innovation: How Japanese Companies Create the Dynamics of Innovation. Oxford university press.Pink, DH (2008). A Whole New Mind. Marshall Cavendish Education.Quek, A (2013). Asia Pacific Metalworking Equipment News. In The Mold and Die Industry to change with the times. Pp. 54-56Shapiro, C., & Varian, H. R. (1999). The art of standards wars.Teece, D. J. (1986). Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy. Research policy, 15(6), 285-305Yu, H (2011). Rethinking strategy to escape commoditization. A lesson from Mickey Mouse. 37. Stefan Choo | Creative Analysis | Passion | | Making a Difference|Email: Stefan.JQ@gmail.com https://www.facebook.com/StefanChoohttp://www.linkedin.com/in/stefanchooThe EndOr is it really? 38. How to purchase? Visit the website at http://www.slingprint.com/innovato rsdna Or Scan the QR Code: 39. Supplementary Slides/ Working Slides 40. Outsourcing: Why outsource? A creative conundrum Slower time to market, CostsLower costs (but really so in the long term?)OperateImproving Innovation CapabilityInnovatePresent/ Past Cost Economy of Scale Lower WagesCapacityBetter Products Redistribute resources from non-core to innovation activities Access to new, noncore Competencies Loss of Knowledge Architecture Loss of Process ArchitectureFaster Time To Market Acquisition of Product and Process Architecture Development of Knowledge Architecture Source: Bengstsson, L (2009) 41. Ref: Wanamaker, B (2013). When will plug and play medical devices and data be a reality? Extracted from the World Wide Web. Clayton Christensen Institutehttp://www.christenseninstitute.org/when-will-plug-and-play-medical-devices-and-datafinally-be-here/#sthash.FHyIxJiH.dpuf on 20 Aug 2013. 42. Ethnographic StudiesLab Based Machining Workshop in NUSVenue: Control & Mechatronics Lab 1, EA 04-05/06 Department of Mechanical Engineering, National University of Singapore 9 Engineering Drive 1 43. Ethnographic StudiesLab Based Machining Workshop in NUS Venue: Control & Mechatronics Lab 1, EA 04-05/06 Department of Mechanical Engineering, National University of Singapore 9 Engineering Drive 1 44. Ethnographic studiesMaterials Lab in NUS Cabinet housing the storage of PPEsVenue: Materials Lab, E3-04-01 Department of Mechanical Engineering, National University of Singapore Engineering Drive 3Cleaned with alcoholic wipes (Complementary Assets) of the same companySafety Glasses chosen because of Design and Brand Name.Centurion: Brand Leader in Protective Goggles 45. Guidelines to assess the technological competitive strength of a company 46. Frost and Sullivans classification of suppliers of PPEs 47. Brand A Quick Summary Established in 1981. Started off with Polycarbonate optic lenses, Poly-carbonate Infrared Lenses, welding filters, safety spectacles and laser goggles. OEM/ODM to OBM. (Tier 1) SO9001 Certified, TUV Certified. Claims to have passed global ANSI, CSA, CE, JIS and AS safety standards (Likely to have passed, but bad website representation) Customers: Medical, Research, and recently Military Personnel **Comments: Display resolution on ISO Certificate is too small 48. Brand A Sourcing Interests: Eyewear Laser Protective Goggles Core: Injection molded Laser filtered lenses Complementary: Customizable range of coatings for anti fog, anti-scratch, etc Safety Goggles Core: Injection molded eyewear UV/IR protection Complementary: Customizable range of coatings for anti fog, anti-scratch, etc Images obtained from: http://www.tarokoint.com.tw/products.html 49. Brand A SWOT Analysis Strong Technology Competence Polycarbonates durability, optical clarity, and ability to be blended with other polymers contribute to the strong performance. Distribution Tier 1 Distributor Close access to distribution channels: 40 minutes driving from KaohsiungInternational Airport (KHH) & Sea Port.SWOT 50. Brand B Industrial Company Pte Ltd Safety/ Assurance ISO 9001:2000 Certification in 2003 Core Technologies (Lens) Fog free (Hydrophobic surface) machine Hard coating High vacuum deposition machines on lens 51. Brand B Geographical Advantages - Located 5 mins away from the Mission Hill Golf club in Guan Lan, mainland China. Easy transportation ensures prompt services. Source of supplies/ raw materials Materials are imported from the US, Germany and Japan. Machinery / Production Process From injection molding to packing- Stringent QC. 4 groups different groups from engineering and QC departments monitors the entire production procedure. 52. Brand B Profile Total area of : 2000 square meters (21528 square feet) Staff Details Production Staff: 200 to 280 QC Staff: 20 to 29 R&D Staff: 5 to 9 53. Brand B ProductionQuality ControlImage sourced from http://www.chaplin.com.hk/factory.phpAppears to be 2nd or 3rd Generation R&D Dominant 54. Brand B Range of Products: Safety Eyewear & Goggles- New DesignsFavorable Designs!New Safety Eyewear: Model 919B Soft rubber nose pads for superior comfort and fit High performance Stylized frames feature a cutting edge design that's ideal for work and play Polycarbonate lens provides 99.9% UV protection Dual lenses, wrap-around protection Anti-scratch or anti-fog coating Exceeds the "High Impact" level of the ANSI Z87.1+ safety standardsNew Safety Goggles: Model 981 Unique 3-way adjustable temples give a customized fit Ratch-it-fit adjusts lens angle P.V.C nose bridge for comfort and secure fit High performance polycarbonate lens provides 99.9% UV protection Lightweight sport-frame styling Lens options include anti-scratch or anti-fog coating Integrated wrap-aroung side shields Exceeds the "High Impact" level of the ANSI Z87.1+ safety standards 55. Brand B Range of Products: Safety Eyewear & Goggles- New DesignsFaceshields & Safety VisorsEyewear Accessories (Complementary Assets to Safety Spectacles/ GogglesHearing Protection / Folding Earmuffs 23NRRWelding GogglesEarmuffs Meets ANSI S3.19 requirements 23NRR 56. Brand B Complementary Assets- Customizable range of packagingBlister CardJumbo Box for Multiple Pdts PackagingPVC Box 57. Brand CTier 2 Supplier (OEM/ ODM)Manufacturing- Eyewear Manufacturing in Tainan, Taiwan. Rest of facilities for PPE Manufacturing and Respiratory Manufacturing Facilities in Xiamen, China and Donguan, ChinaCore competencies: "dual-coat" lenses with different types of coating on the outside and inside of the lens, for example, hard coat on the outside & AF on the inside.SafetySelection of Safety Goggles ANSI, AS, ASTM, CE, CSA, NIOSH standards compliant ISO 9001 & ISO 14001 CertifiedISO14001 entails Reduced cost of waste management Savings in consumption of energy and materials Lower distribution costs Improved corporate image among regulators, customers and the publicSelection of Safety Glasses and Eyewear 58. Research/ Design PlanningAnalysisPrototypingInformation GatheringCAD Desig n??Style Research Color Selection ??QA/ Materials testingVertical injection machineP r o d u C c y t c l D e e v e l o p m e n tHorizonta l Injection MoldingL i f eBrand COptical Analysis System for CE standard?High Impact TestingInspection?Assembly Packaging?? 59. Brand D Claimed core competencies --- Lack of understanding of core competencies Research & Development Production Process Safety & Standards Quality Assurance Lack of Understanding of Core CompetenciesOur test procedures areCertifications Andbased onAccreditationsUSA-ANSI Z87.1ISO 9001-.OCTOBER 1998 AUSTRALIANEUROPE-CE EN166 AUSTRALIA-AS/NZS1337 JAPAN-JIS T 8147 CANADA-CSA Z94.STANDARDSsince 1995 CE 60. Brand D Production Value Chain- Vague and Confusing DesignInformation and Process FlowMachining???PackagingSafety CertificationsEnd of Line TestingProductionFinishing Operations 61. Brand D Relevant Products Offered By Brand DGogglesOver spectacles 62. Brand E ISO 9001: 2000 certified in 2002Claimed to be an OEM. More likely a VAR.One of capabilities listed in OEM is Reverse EngineeringMany (NOT ALL) products meet European CE and U.S. ANSI/NIOSH standards.Appears to be a mere distributor of products (middleman).Seems to be a distributor associated with manufacturers across China.Although mufflers were procured, the company offers a reasonable range of safety goggles and spectacles.Source of suppliers unknown. 63. Brand E Range of Eyewear Offered Chemical Splash Goggle SE1112: Indirect ventilation, Polycarbonate Lens, Fits over personal spectacles CE EN166, ANSI Z87.1Impact Goggle PC direct ventilation, Tough Polycarbonate Lens, Fits over personal spectacles, ANSI Z87.1Protective spectacles Foldable sideshields with direct ventilation, Polycarbonate lens, ANSI Z87.1Protective spectacles Stylishly wraparound design frame with curve lens for a snug, secure fit. ANSI Z87.1Wide Range of eyewear, however inconsistent in terms of compliance. 64. Brand E Range of Mufflers Offered SE1310: Lightweight, snug fitted, adjustable headband CE EN352-1, ANSI S3.19 SNR:27dB; NRR:20dBSE1331: Lightweight, padded headband No certificationsSE1340 Cushioned earcups, compact and portable CE EN352-1, ANSI S3.19 SNR 30dB; NRR: 25dBSE1348 Dual colored with double shell, compact and portable Pending CE and ANSI clearanceWide range of mufflers, however inconsistent in terms of critical certifications. 65. What influences Organizing Decisions in PPE. Search and analysis of products available in market is time consuming (1000 pdts on market) Rebuys are the most convenient and adopted method Clean slate is recommended by Health & Safety Orgns. Buyer develops new choice criteria for product selection. 66. PPE Market Product SegmentsUser prefer e-Commerce End users less choosy in selecting above the neck PPE products. 67. Differentiating factors for PPE Supliers 68. End-user information for PPEs- Global 2012`Unless of major Industrial users account for >70% of PPE demand 69. Overview of the PPE Industry One cannot put a price tag on safetyMr Adison Tan, OSHE 70. Structure of Distribution of PPEGap 71. Trends and Market forecasts of plastics and injection molding 72. Drivers- Technical Improvement Heat and moisture resistant polymers- such as PBT are being increasingly used in industrial plastics Creep resistant polymers. Ultra-high molecular weight polyethylene being used as hip-socket joint replacements for prostheses. Opacity- Poly (methyl methacrylate) (PMMA compounds can scatter light more efficiently efficiency in lighting up surface and optical displays Polycarbonates- Tough and flexible 73. Drivers- Substitute to traditional materials Elimination of secondary manufacturing steps Plastics superior choice to metals. Many structural plastics match job requirements in resistance against cracks, deformation, breakage and corrosion Weight considerations in transport & automotive applications. 50% Volume for 20% weight. Cheaper for supply chain shipping and distribution PMMA and PC replace glass for outdoor and indoor applications. They are safer and give flexibility in design. 74. Restraints to Engineering Plastics Growth and Developments- Price Sensitivity of Consumer Raw material prices are steadily and substantially increasing for Engineering plastics since 2010. Cost is passed on to consumers A carry forward trend will push customers away from engineering plastics. Income divide in Middle of Pyramid (MOP) countries is vast; purchases in finished products dampened due to raw material prices. 75. Restraints to Engineering Plastics Growth and Developments- Substitute Materials Price/ Performance Tradeoff Performance must meet costs, or buyers will source for alternatives Improved performance of substitutes hinder technological advancement for plastics in Southeast Asia. Nylon (Polyamide, PA) often substituted with Polyethylene/ Polypropylene 76. Geographical Case Study: China 77. Plastics Processing Machinery- Global Strategic Business Report Global Global recession pushed plastics processing machinery manufacturing services from West to East. Brazil, China, India and Russia emerge in sales volume and manufacturer revenues. China replaced Germany as leading producer of plastics processing machinery in 2009 with lower labor costs.Industry Shift towards complete production systems and highly automated systems Construction products, automotive parts and packaging products form bulk of plastics applications in developing countries. Local market drives demand. Machining Technology Lifespan in short. Competition is based on speed, efficiency, low maintenance and intricate decorating capabilties (Innovation 1). Which companies can do a Blue Ocean Strategy? Taiwan is ranked as Top 5 amongst manufactures and exporters of plastic and rubber processing machinery.