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How can a university like Purdue strengthen its innovation ecosystem? A Purdue-Fraunhofer team has tackled this issue.
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ED MORRISON FEBRUARY 11, 2014
ACCELERATING INNOVATION STRENGTHENING PURDUE’S INNOVATION ECOSYSTEM
1
The Innovation Gap at PurdueStrengthening Purdue’s Innovation Ecosystem
The Fraunhofer Connection Insights from the Global Leader in Applied Research
Purdue’s Innovation Acceleration NetworkUsing “Link and Leverage” Networks to Monetize Purdue Assets in New Ways
Launching the Network Defining “next steps” to implementation
Overview
The Gap in Purdue’s Innovation Ecosystem
9
8
7
6
5
4
3
2
1Purdue Research System
Purdue TAP
Basic Technology Research
Feasibility Research
Technology Development
Technology Demonstration
System & SubsystemDevelopment
System Test, Launch& Operations
Technology Readiness Levels
Time to Market
Mid term: 6-18 months
Short term: 0-6 months
Long term: 18-48 months
Gap
Purdue’s Agricultural Research and Engagement System extends across technology readiness levels, but the same is not true for other technology fields. That leaves a gap. Purdue TAP and Discovery Park partially fill this gap, but not completely. This presentation explores this gap and how to fill it.
The Gap in National Innovation Ecosystem
The Design Team for the National Network for Manufacturing Innovation identified a similar gap at the national level.
Source: National Science and Technology Council, National Network for Manufacturing Innovation: A Preliminary Design (2013), page 8.
“The focus of the NNMI lies squarely in the applied research region, after basic research has been conducted and prior to full commercialization of a technology..TRLs 4-7.”
Committee on Science, Space and Technology
U.S. House of Representatives May 12, 2012
The Gap in National Innovation Ecosystem
Manufacturing companies involved in the National Network for Manufacturing Innovation have expressed this gap in another way.
Source: Conrady, C. and Carrick, G., “American Manufacturing Innovation Network”
Structural problem requires a structural solution
Universities, NSF Centers, Federal Labs • High-risk research • Long time horizon
• Not focused on shop floor implementation
Industry, NIST MEP
• Incremental improvement • Off the shelf technology
• Short time horizon
Time to deployment
Tech
nica
l Inn
ovat
ion
Best Practices
Basic Research/ Education
Manufacturing Technology Innovation
Missing Middle • Manufacturing technology
innovation, maturation, commercialization, insertion
• Medium time horizon • High impact
The Gap in an International Context
Source: Hauser, H., The Current and Future Role of Technology Innovation Centres in the UK (2010).
The UK government, facing a similar gap between its universities and the market, is implementing a series of Technology and Innovation Centers (TICs). Called Catapult Centres, these centers are designed to transform the UK innovation system.
Filling the Gap involves expanding research that will:
• Focus on Technology Readiness Levels 5 through 9, converting knowledge and technology into money;
• Fit between typical multi-year government research contracts and short-term Purdue technical assistance contracts;
• “Face the market” in that industry managers -- not academic researchers -- will define the research agenda;
• Focus on accelerating innovation: the application of knowledge to generate money
• Accelerating the transfer of knowledge into revenue generation by business firms
Filling the Gap: Expanding Market-Facing Research
Technology Readiness Levels 1-5
MoneyTechnology
Technology Readiness Levels 5-9
Purdue’s Research System
Purdue’s Engagement System
Filling Purdue’s Innovation Gap will:
1. Create new pathways to expanded market-facing research where the industry sets the agenda;
2. Create new innovation hot spots to accelerate innovation across Indiana;
3. Provide new, powerful learning experiences that are market-driven, multi-disciplinary, and team-based.
Key Success Metrics: Examples
For Purdue Colleges For Discovery Park For Indiana
• Increased diversity of research projects across TRLs
• Powerful learning experiences for students and graduates
• Increased industry research
• Increased cross disciplinary innovation initiatives addressing large scale innovation challenges
• Accelerate innovation among Indiana SMEs revenues from new products and services
• Increased retention and value of Purdue graduates
Filling the Innovation Gap
Creating new pathways to expanded market-facing research at Purdue involves:
• Organizing Purdue around strategic thematic areas
• Developing new paradigms of industry research collaboration and creating networks and alliances of researchers around each thematic area;
• Designing rapidly deployable, agile and sustainable platforms for continuous engagement of industry with Purdue; and
• Generating new revenue from Purdue’s extensive research assets.
Filling Purdue’s Innovation Gap will:
1. Create new pathways to expanded market-facing research at Purdue;
2. Create new innovation hot spots to accelerate innovation across Indiana; and
3. Provide new, powerful learning experiences that are market-driven, multi-disciplinary, and team-based.
Filling the Gap: Expanded Industry Research
Creating new innovation hot spots to accelerate innovation in key strategic areas within Indiana means:
• Increasing access to proven technology and innovation management tools;
• Supporting Indiana companies with an agile innovation infrastructure to accelerate the development and introduction of new products, processes, and services;
• Providing customized connections to the world’s advanced applied research networks; and
• Expanding access for Indiana’s small and medium size enterprises (SME’s) to globally sophisticated innovation infrastructures
Filling Purdue’s Innovation Gap will:
1. Create new pathways to expanded market-facing research at Purdue;
2. Create new innovation hot spots to accelerate innovation across Indiana; and
3. Provide new, powerful learning experiences that are market-driven, multi-disciplinary, and team-based.
Filling the Gap: New Innovation Hot Spots
Providing powerful learning experiences involves:
• Experiential learning by students engaged in real-world projects defined by industry;
• Working directly with industry partners;
• Expanding beyond traditional student/professor relationships to work in teams; and
• Providing unique and global educational experiences
Filling Purdue’s Innovation Gap will:
1. Create new pathways to expanded market-facing research at Purdue;
2. Create new innovation hot spots to accelerate innovation across Indiana; and
3. Provide new, powerful learning experiences that are market-driven, multi-disciplinary, and team-based.
Filling the Gap: Powerful Learning Experiences
Filling the Innovation Gap will strengthen horizontal ties across Purdue’s colleges and vertical ties to the market economy:
• Horizontal ties will come from multi-disciplinary research; • Vertical ties will come from research agendas defined by
industry partners.
Filling the Gap: Horizontal and Vertical Connections
Filling the Gap
x.y<process name>
<pro
cess
na
me>Strengthen
vertical ties with industry
Strengthen horizontal ties across
Purdue
9
87
6
5
4
3
2
1Basic Technology
Research
Feasibility Research
Technology Development
Technology Demonstration
System & SubsystemDevelopment
System Test, Launch& Operations
Technology Readiness Levels
Engineering133.4
Agriculture61.6
Science61.6
Health26.7
Veterinary13.4
Pharmacy11.6
Technology9.4
Liberal Arts5.7
Education3.7
Rese
arch
Foc
us Appl
ied
Basic
Market Economy
Purdue's Engagement System: Engaged Research
Purdue's Extramural Research Awards, 2011-2012 (in $millions)
Other18.6
Purdue's Research System: Academic Research
Start-up firms Investor networks
Colleges and universities
Skilled talent pool
Innovating Growth
Companies
Provides ideas, incubators
and smart people
Provides capitaland expertise
Recruits smart people
Recruits and trains smart people
Provides networkand mentoring to
start-ups
Provides R&D partners
Recruits and supplies
smart people
Provides investment
and generates wealth
Provides technology support and training
Acceleratesnew venture investment
Source: Ed Morrison
Universities Operate Within Ecosystems
Startup Ecosystem
Innovation Ecosystem
Two Purdue Ecosystems for Market Engagement
Purdue anchors two “ecosystems” to translate technology into money.
Small and Medium Sized Companies
with Growth Potential
+Bundled Innovation
Management Frameworks and Tools
+Purdue and Corporate
Partner Teams
Existing
Existing
New
New
Technology
Markets
Efficiency Innovation
-Market Penetration
Sustaining Innovation
-Product Extension
Transformative Innovation
-Product Market Diversification
Sustaining Innovation
-Market Extension =
More Growth
Higher rates of innovation among Indiana companies
Purdue’s Innovation Ecosystem
Purdue’s Startup Ecosystem
Technology Talent
Intellectual Property
University Innovation Inputs
+Business Model and
Lean Start-up Frameworks
+Business Formation and
Support Networks
=More Growth
Spin-out Companies
Ecosystem Strategic Focus Existing Anchors Primary Customers Outcome Metrics
Purdue Entrepreneurship Ecosystem
Producing start-ups from Purdue technology
Purdue Foundry Purdue research faculty
Number of Purdue start-ups
Purdue Innovation Ecosystem
Accelerating innovation in existing companies using technology and innovation management tools
Purdue TAP
Purdue Extension
High growth SMEs and Consortia of industrial firms facing a common innovation challenge
Revenues coming from improved and new products and services
Two Purdue Ecosystems for Development
Purdue can attract more investment to the university by strengthening these two ecosystems. Steps are being taken to strengthen the Startup Ecosystem. More can be done to strengthen the Purdue Innovation Ecosystem.
MoneyTechnology
Purdue’s Research System
Purdue’s EngagementSystem
Purdue’s Innovation Ecosystem
Purdue’s Startup
Ecosystem
PurdueFoundry
PurdueResearch
Foundation
DiscoveryPark Purdue
TAP
PurdueExtension
The Innovation Gap at PurdueStrengthening Purdue’s Innovation Ecosystem
The Fraunhofer Connection Insights from the Global Leader in Applied Research
Purdue’s Innovation Acceleration NetworkUsing “Link and Leverage” Networks to Monetize Purdue Assets in New Ways
Launching the Network Defining “next steps” to implementation
Overview
Purdue Innovation Ecosystem: Fraunhofer as Partner
17
To determine how to fill the Innovation Gap, a Purdue team from the College of Technology and the Purdue Center for Regional Development explored Fraunhofer as a model.
The Fraunhofer Society (Gesellschaft) formed in 1949 and named after a famous inventor, scientist and entrepreneur: Joseph von Fraunhofer (Think Edison).
Now the largest applied research organization in EuropeApplied research, technology licensing (e.g., mp-3 format), and spin-out companiesSimilar to (but about 10X the size of) SRI International (formerly Stanford Research Institute)
Purdue Innovation Ecosystem: Fraunhofer as Partner
18
Applied Research
Basic Research
Predominantly public Predominantly private
Characteristics of Research
Funding
Federal/German Länder Institutes
HGF
WGL
Universities
Industry (internal and
external expenditures)
AiF
MPG
HGF Hermann von Helmholtz-Gemeinschaft WGL Wissenschaftsgemeinschaft Gottfried Wilhelm Leibniz AiF Arbeitsgemeinschaft industrieller Forschungsvereinigungen MPG Max-Planck-Gesellschaft
Source:: Fraunhofer
In the German research landscape, Fraunhofer occupies a pivotal position between public and private sectors.
The Gap
19
nEstablished in 1949, Fraunhofer represents one of the world’s largest applied and most successful applied technology agencies with over 80 institutes and centers
nMore than 22,000 employees: 4,000+ PhD’s
nAn annual research volume of €1.9 billion, of which €1.6 billion is generated through contract research. n70% of this research revenue derives
from contracts with industry and from publicly financed research projects.
n30% is contributed by the German federal government and the Länder governments in the form of matching funds.
München
Holzkirchen
Freiburg
Efringen-Kirchen
FreisingStuttgart
PfinztalKarlsruheSaarbrücken
St. IngbertKaiserslautern
DarmstadtWürzburg
Erlangen
Nürnberg
Ilmenau
Schkopau
Teltow
Oberhausen
Duisburg
EuskirchenAachen St. AugustinSchmallenberg
Dortmund
PotsdamBerlin
RostockLübeck
Itzehoe
Braunschweig
Hannover
BremenBremerhaven
Jena
Leipzig
Chemnitz
Dresden
CottbusMagdeburg
Halle
Fürth
Wachtberg
Ettlingen
Kandern
Oldenburg
Freiberg
Paderborn
Kassel
GießenErfurt
AugsburgOberpfaffenhofen
Garching
Straubing
Bayreuth
Bronnbach
Prien
Hamburg
Leuna
Fraunhofer: Global leader in applied research
Fraunhofer: Groups, Alliances and Networks
Over 60 Fraunhofer institutes are organized into 7 Groups…
Information and Communication TechnologyLife SciencesMicroelectronicsLight & Surfaces Production Materials and Components Defense and Security
with multiple internal alliances…
Adaptronics
Ambient Assisted Living
Building Innovation
Digital Cinema
E-Government
Energy
Food Chain ManagementAdditive Manufacturing
Cloud Computing
Advancer
Nanotechnology
Simulation
Optic Surfaces
Photocatalysis
Polymer SurfacesCleaning Technology
Water Systems
Traffic and Transportation
Vision
Automobile Production
Lightweight Structures
Embedded Systems
…and global networks.
Fraunhofer: Market Facing, Market Driven
21
Matching Funding
Industry and Government Contract Research
Institute business model:• Institutes work as profit centers: incentive
to “run to cash”• Institutes keep most of what they
generate • Private sector funding matched with
public sector dollars• Spinoffs by Fraunhofer researchers are
encouraged
Customer base: • Industrial and service companies• Public sector
R&D activities:• Application-oriented research based on
industry’s agenda• Application-oriented basic research with
longer time horizons• Research for German Defense Ministry €0
€500
€1,000
€1,500
€2,000
2006 2007 2008 2009 2010 2011 2012
Total Business Volume
Design: The model of innovation of the Fraunhofer Society can be described as a network model,…The network, together with a strong reputation, makes it fairly easy for small and big firms to establish a contact with the Society.
Drivers: The Fraunhofer model allows the organization to set up new institutes where it sees a new market demand.
Åström, Eriksson, Niklasson and Arnold, International Comparison of Five Institute Systems (2008)
Fraunhofer: Design and drivers
“
“
“”
”
The Innovation Gap at PurdueStrengthening Purdue’s Innovation Ecosystem
The Fraunhofer Connection Insights from the Global Leader in Applied Research
Purdue’s Innovation Acceleration NetworkUsing “Link and Leverage” Networks to Monetize Purdue Assets in New Ways
Launching the Network Defining “next steps” to implementation
Overview
The Central Idea: Achieve Scale with Coherence
Current Engagement Systemfor Innovation
a loose collection of components that lacks coherence
Proposed Engagement Systemfor Innovation
achieve scale with shared market-facing innovation disciplines
Purdue’s Innovation
Acceleration Network
1 2 3 4Deploying shared frameworks
An Innovation Acceleration Network will provide the common language, frameworks, platforms and tools needed for Purdue innovation projects to scale across campus. With common understandings, innovation becomes more “plug and play” across Purdue.
Building on sharedplatforms
Developing shared metrics
Using shared processes
Use new, emerging models of technology and innovation management
Define new innovation processes based on open and collaborative innovation
Achieve scale through common platforms that connect different networks
Rely on shared metrics to evaluate “what’s working” across campus
Example: Technology Readiness Levels
Example: Open innovationStrategic doing
Example: Purdue One Hub
Example: Common knowledge transfer metrics developed in the UK
Outcome: Achieving Scale through a Shared Platform
Innovation Acceleration Networkwith Market-Facing
Innovation Disciplines
The Innovation Acceleration Network
As the Innovation Acceleration Network establishes itself across campus, it will bring coherence, speed, and “link and leverage” opportunities to expand industrial investment in Purdue’s market-facing research.
University and College
CentersUnviersityUnviersityUnviersityUniversity
College1College
1
College2College
2College2
Colleges and Departments
CollegeCollege
CollegeCollege 1 Departments
ExistingEngagement
Networks
Purdue Extension
Purdue TAP
To achieve scale in innovation engagement, Purdue will need to pioneer new approaches to market-facing research and engage industrial firms in ways not currently taking place on the Purdue campus.
The Innovation Acceleration Network includes:
1. A core innovation lab; and
2. Multiple innovation labs (iLabs) within colleges across the campus and Indiana.
This network would:
1. Increase market-facing industry research in Discovery Park and across Purdue colleges and departments;
2. Link more effectively with global partners conducting similar market-facing research;
3. Create new multi-disciplinary learning opportunities for Purdue students locally and globally;
The Innovation Acceleration Network
Purdue Core Innovation Lab
(Core Lab)
Innovation lab
(iLab) 1
iLab 2
iLabn
The Core Lab will provide:
1. Common pool of innovation assets.— Assemble and support a shared pool of tools, frameworks, platforms and training for innovation and technology management.
2. Asset leverage across campus.-- Provide a market facing innovation infrastructure to departments and centers.
3. External linkages to additional innovation assets.-- Identify and link to external innovation assets that can be rapidly deployed by Purdue’s industrial partners and research teams.
4. Powerful learning experiences.— Provide Purdue students opportunities to engage with global research teams.
Functions of the Core Lab
The Core Lab provides servicesto all iLabs and manages the external relationships with multi-disciplinary applied research institutes, such as Fraunhofer (Germany); ITRI (Taiwan); VTT (Finland); A*STAR (Singapore)
iLab 3
iLab 2
Purdue Core Innovation Lab
(Core Lab)
iLab1
Core Lab’s Common Pool of Innovation Assets
• Technology and Market Assessments.— Evaluating technology readiness and market opportunities.
• Agile Strategy Discipline.— Developing and implementing collaborative strategies;
• Network and Alliance Development.— Designing and supporting technology and innovation networks and alliances;
• TechnologyRadar.— Identifying, evaluating emerging technologies in existing markets;
• MarketExplorer.— Identifying market opportunities for existing technologies;
• Shared IT and Open Innovation Platforms.— Designing IT support for technology and innovation management;
• Operations.— Organizing innovation and research and development (R&D) effectively and efficiently using lean processes;
• Technology and Innovation Management Training.— Conducting training to increase the capacity for innovation among Purdue and its partners;
• Innovation Metrics.— Developing metrics to evaluate innovation performance
iLab 3
iLab 2
Purdue Core Innovation Lab
(Core Lab)
iLab1
Purdue iLabs provide industry partners with:
1. Customized, agile innovation infrastructure.-- Each iLab will design an lean infrastructure to rapidly meet an industry research agenda;
2. Access to powerful innovation tools on demand.-- Each iLab will have a portfolio of the latest innovation tools, frameworks and training supported by the Core Lab;
3. Access to researchers, faculty and students on demand.— Each iLab will be staffed by Purdue researchers, faculty and students with a background in the technologies of interest to the industry partner.
The iLabs Value Proposition to Industry
PPI core innovation lab
Innovation lab1
Innovation lab2
Innovation lab3
Industry support for iLabs will come in a variety of ways:— Base funding commitments to each iLab— Contract research— Donations of equipment— Unrestricted gifts from alumni
Scaling Purdue’s Innovation Acceleration NetworkR
even
ues
in $
000
$0
$5,000
$10,000
$15,000
$20,000
$25,000
Year 1 Year 2 Year 3 Year 4 Year 5
Year 1 Year 2 Year 3 Year 4 Year 5Number of iLabs
Small ($100-200K) 2 5 10 15 25Medium ($300-500K) 0 1 2 5 10Large ($700-900K) 0 0 1 2 5
Core Lab ($1.5M-$3M) 1 1 1 1 1
• Potential Scale.— Deploying the network across campus and Indiana could increase industry support for Purdue research by $20 million to $25 million in 5 to 7 years.
• Timing.— Revenue generation will accelerate as the network grows.
• Drivers.— Success will depend on how many iLabs can be “franchised” by the Core lab.
Metrics: A Purdue Innovation Dashboard
Northwestern University has developed an “innovation radar” to measure the innovation performance of individual companies. A similar innovation metric could be developed for individual Purdue centers, departments and colleges. This metric would enable measured, focused improvements in performance.
Fraunhofer has developed similar dashboards to evaluate innovation productivity and efficiency across different Fraunhofer institutes.
Company A Company BThe Core Lab would develop and deploy an Innovation Management Dashboard to promote:• Common Metrics.— Create a
campus-wide performance metric for innovation
• Improved Focus.— Enable focused improvement on critical characteristics of effective and efficient innovation
• Continuous Learning and Improvement.— Promote a collaborative culture of continuous improvement
• Global benchmarking.— To the extent that Purdue aligns ints metrics with Fraunhofer, enable global comparisons
The Innovation Gap at PurdueStrengthening Purdue’s Innovation Ecosystem
The Fraunhofer Connection Insights from the Global Leader in Applied Research
Purdue’s Innovation Acceleration NetworkUsing “Link and Leverage” Networks to Monetize Purdue Assets in New Ways
Launching the Network Defining “next steps” to implementation
Overview
Launch of the Core Lab will take place in Year 1. Development of the Core Lab will occur coincident with the development of the first iLab. Configuration and launch of iLabs will be flexible, driven in part by industry expressions of interest.
Launching the Network: Strawman Schedule
Year 1 Year 2 Year 3
Core Lab
iLab 1
iLab 2
iLab 3
iLab 4
iLab 5
iLab 6
iLabs 7-13
Next Steps
The next steps to developing the Innovation Acceleration Network include:• Workshop at Purdue.— Assemble a
core team to review this presentation and develop a set of detailed outcomes to engage with Fraunhofer.
• Workshop at Fraunhofer.— Conduct a 1.0 to1.5 day workshop at Fraunhofer: • Develop detailed specifications for Core
Lab and iLab.• Draft agreement with Fraunhofer IAO on
design and management of the Network.
• Preparation of detailed prospectus.— Prepare a business plan and investor prospectus for the Network.
© Fraunhofer IAO, IAT Universität Stuttgart
For more information, please contact:
Antonino ArdilioDr.-Ing. Dipl.-Ing. Des. Head of Technology ManagementTelephone : + 49 (0) 711 / 970-2246E-mail: [email protected]
Joachim Warschat Univ.-Prof. Dr.-Ing. habil. Director and Head of Technology & Innovation ManagementTelephone : + 49 (0) 711 / 970-2081E-mail: [email protected]
Ed Morrison Regional Economic Development Advisor Purdue Center for Regional DevelopmentTelephone : + 1 216 650 7267E-mail: [email protected]
http://www.iao.fraunhofer.de