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PART A: Technology & Society Readings (Purely Policy Perspective) Keep in mind: 1. Creative Destruction 2. New Growth Theory a. For a developing country, the most important government policies may be those that determine the rate of technological transfer from the rest of the world b. For an advanced economy, the most important policies may be the ones that influence the rate of technological innovation in the private sector Section 1: Global Innovation Index Singapore, China, India, Vietnam, Malaysia and Switzerland Global Innovation Index Conceptual Framework (Annex 1). Know how this framework works, and how is it used?

Index Factors Innovation Institution Input SubIndex

Key Points An institutional framework attracting businesses and fostering growth by providing good governance and the correct levels of protection and incentives is essential to innovation Political environment: quality of public and civil services, policy formulation, and implementation; and perceptions on violations to press freedom Regulatory environment: Ability of govt to formulate and implement cohesive policies that

Technology and World Change

Human Capital and Research


Market Sophistication

promote the development of the private sector and at evaluating the extent to which the ROL prevails; evaluating the cost of redundancy dismissal as the sum, in salary weeks, of the cost of advance notice requirements added to severance payments due when terminating a redundant worker Business environment: What affects private entrepreneurial endeavours? Looks at the ease of starting a business, resolving insolvency and ease of paying taxes Elementary and secondary education levels: What is the education expenditure, school life expectancy? Public expenditure per pupil? Quality of education? Tertiary education: What is the tertiary employment? Priority given to the sectors traditionally associated with innovation (series on % of tertiary graduates in science and engineering, manufacturing and construction); inbound and gross outbound mobility of tertiary students R&D: Level and quality of activities; indicators on researchers (headcount!), expenditure, perceptions of quality of scientific and research institutions Information and communication technologies (ICT): ICT access, ICT use, online service by governments, and online participation of citizens General infrastructure: electricity supply (the average of electricity output and consumption in kWh per capita); a composite indicator, a composite indicator on the quality of trade and transport related infrastructure (roads, ports, etc); and gross capital formation (outlays on additions to fixed assets and net inventories of the economy land improvements, construction of roads, schools, etc) Ecological sustainability: GDP per unit of energy use (a measure of efficiency in the use of energy), the Environmental Performance Index of Yale and Columbia University, and the number of certificates of conformity with standard ISO 14001 on environmental management systems issued Credit: Ease of getting credit, aimed at measuring the degree to which collateral and bankruptcy laws facilitate lending by protecting the rights of borrowers and lenders, as well as rules and practices affecting the coverage, scope and accessibility of credit information Investment: % rank index on the ease of protecting investors Trade and competition: Average tariff rate

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Business Sophistication

Innovation Output Sub-Index

Knowledge and technology outputs

Creative outputs

weighted by import shares, and a measure capturing market access conditions to foreign markets (five major export markets weighted actual applied tariffs for non-agricultural exports) Knowledge workers: Employment in knowledgeintensive services; the availability of formal training at the level of firm; and the percentage of total gross expenditure of R&D that is either financed or performed by business enterprise Innovation linkages and public/private/academic partnerships essential to innovation: qualitative and quantitative data regarding business/university collaboration on R&D, the prevalence of well-developed and deep clusters, collaboration in incentive activities, the level of gross R&D expenditure financed by abroad and the number of deals on joint ventures and strategic alliances Knowledge absorption (sectors that have hightech content or are key to innovation): Royalty and license fees payments as a % of GDP; hightech imports (net of re-imports) as a % of total imports; imports of computer, communications, and other services as a % of commercial service imports; and net inflows of FDI as a % of GDP Creation of knowledge: Patent applications filed by residents both at the national patent office and at the international level through the PCT; utility model applications filed by residents at the national office; and scientific and technical published articles in peer-reviewed journals Knowledge impact: statistics representing the impact of innovation activities at the micro and macro-economic level or related proxies: increases in labour productivity, the entry density of new firms, and spending on software Knowledge diffusion: royalty and license fees receipts as a % of GDP; high-tech exports (net of re-exports) as a % of total exports (net of reexports); exports of computer, communications, and other services as % of commercial service exports; and net outflows of FDI as a % of GDP Creative intangibles: statistics on trademark registrations by residents at the national office and under the Madrid System, as well as two survey questions regarding the use of ICT in business and organizational models, new areas that are increasingly linked to process innovations in the literature Creative goods and services: proxies used to get at creativity and creative outputs in an economy Creation of online content (such as YouTube, Wikipedia monthly edits, etc): made to cover

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production of cultural products, rather than emphasizing their consumptions or trade

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Chapter 2 the role of public and private (p 82)

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Chapter 3: Academia-Industry Innovation Linkages in the Case of Saudi Arabia: Developing a University-Industry Triple-Helix Framework to Promote R&D Collaboration

Phenomenon of Development Parks in Saudi Arabia o Result of large worldwide industrial organisations decentralising their R&D facilities and building new ones in offshore locations o Within a few years, the research parks of major Saudi universities will bring together academic research organisations, national industries and multinational R&D centres in an emerging Saudi triple Helix arrangement, where each of these three elements combines with the others to offer a dynamic and robust framework. The Saudi triple helix arrangement includes the Saudi Universities, the Saudi mega industries and the MNEs Problems encountered o Low number of Master and PhD students by international standards, a failing that would reflect negatively on R&D o Different difficulties with regard to indigenization of knowledge and transforming knowledge into products in Saudi Arabia Directing the companys investment in R&D and innovation towards areas important to the national economy AND The needs for developing effective academia-enterprise innovation linkages o To address these imbalances, funding for research in universities came under contract with the production and service sectors, thus avoiding being geared merely towards academic publication and career promotion Academia-enterprise innovation linkages dimension o Encompasses several important enables, including: Intermediary institutions that interface education R&D with production and service sectors o Emphasis placed on cooperative technology innovation centres (TICs). TICs involve education and training programmes including, but not limited to, a PhD programme that complements the research programmes and builds engagement, innovation and R&D capacity with industrial members

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The World Banks Innovation Policy Guide for Developing Countries emphasizes the development of an innovation scheme to provide public-private partnership and industry-university collaboration by focusing on funding the seed stage of potential niche research projects as a possible innovation path for Saudi Arabia o Universities and industries: In 2011, TICs were established at three major Saudi universities: KSU, KFUPM and King Abdulaziz University (KAU) o Regulatory Board: National Policy for Technology Business Incubation (NPTBI), is instrumental for encouraging the commercialization of research and promoting technology transfer from universities and research institutes o Policies: The King Abdulaziz City for Science and Technology created the BADIR programme to advance that policy to meet some of the NSTP objectives. The BADIR which means initiate programme is mandated to support a network of five technology-focused incubators that assist emerging-technology companies with specialist accommodation Academia-industry innovation o The industrially oriented NSTP-funded R&D projects, the research parks at major universities, the cooperative TICs, and the focused technology incubation centres constitute jointly a large-scale national effort for aligning universities research with the future strategic needs of the Kingdom and transitioning public R&D results to production and service sector Regulatory regimes and policies needed for Saudi Arabia to enhance current academia-industry linkages o Challenge: Deficit in engineering design skills and inability of labour force to execute small devices or provide specialised shops that can build systems and components to specifications as required by the scope of research projects are among the most challenging difficulties facing the advanced research centres in the Kingdom o Encouraging small- and medium- sized enterprises in Saudi Arabia to invest in these types of engineering design and manufacturing services will require a specially designed favourable investment environment and new types of investment policies o IP rights: In order to stimulate the patenting activity of firms, an instrument used by several countries is offering fiscal incentives to cover patenting costs. This support may be of interest to foreign investors in R&D, who do not want to have the potential loss of control over results o To increase the diversity of FDIs, policy makers would be required to foster scientific excellence through the creation of both scientific and technological networks of public and private research not only within boundaries of the country but also within distant partners o Policies are needed to stimulate Saudi institutions of higher education to continue engaging with enterprises and to adopt a method of systematic and formal consultation with industry in the development of structured Masters and PhD programmes that address industrys requirements o New legislation is essential to facilitate the importation of special materials or ordering equipments. Plans for attracting FDI should also include differentiated packages for R&D related FDIs o Experiences show that one needs to encourage parallel encouragement for indigenous innovation and the acquisition of foreign knowledge

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Chinas, Indias and Brazilians models known as walking on two legs reflect prudent strategy for maximising benefits of developing countries Chapter 8: An Integrated Policy Approach in Science, Technology, and Innovation for Sustainable Development: A UNESCO Idea in Action (MUST READ) Pillars to strengthen Science, Technology & Innovation (STI) into the broader framework of national development plans: Strengthen national capacities in STI policy formulation, evaluation and implementation Promote a culture of innovation by facilitating appropriate innovation ecosystems for firm-based high-technology innovation and grassroots innovation UNESCO promotes the enhancement of human and institutional capacities in science and engineering Improve STI system monitoring and foresight by developing multidimensional, comprehensive and policy-relevant assessment Strengthening National STI Systems and Policies To build knowledge societies, it is essential to integrate STI into national development policies and the economic reform agendas of countries. To this end, UNESCO supports its Member States in developing new approaches for the formulation of science policies by providing technical assistance in the reform of STI systems and by assisting in the elaboration of STI strategies and action plans To address major socioeconomic development challenges, UNESCO carries out science reviews and participates in country reviews (e.g. providing supporting for the implementation of the African Consolidated Plan of Action through its flagship projects, including the African Virtual Campus) Effective STI must mobilize broad-based participation, thus UNESCO works to develop public awareness and expand citizen science through the popularization of science. UNESCO support Member States in the development of science centres, museums, and science and technology exhibitions (e.g. 2011: UNESCO organised two regional training workshops on science centre and science museum governance in Africa and the Asia Pacific Region) Seeks to safeguard local and indigenous knowledge systems and promote their participation in socioeconomic and environmental development issues (e.g. joint work with the ministries of education in Nicaragua and the Solomon Islands to promote vernacular language and indigenous knowledge in national education curricula) Strengthening the interface between science and policy and to deepen exchanges in STI policy at the international level: o Organises the World Science Forum on a biennial basis in close cooperation with the Hungarian Academy of Sciences and the International Council for Science o Supported the creation of the Intergovernmental Platform on Biodiversity and Ecosystem Service (IPBES), an interface between the scientific community and policymakers that aims to build capacity and strengthen the use of science in policy making on biodiversity and ecosystem services Promoting a culture of innovation
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Acts on three levels to build a culture of innovation: o Seek to FACILITATE THE DEVELOPMENT OF INNOVATION SYSTEMS Developing countries lack an appropriate innovation system to ease interaction among key factors Such a system should foster investment in advanced technology and promote the development of affordable technology to meet the needs of the poor Problem: involves formal sectors enterprises, universities, research institutes, the government and the financial systems along with NGOs and informal sector, including grassroots investors and local and indigenous knowledge Special emphasis on regional innovation ecosystems, by supporting the development of science parks and technology business incubators (e.g. UNESCO supported the development of science parks at the University of Nairobi Science and Technology Park (Kenya), the Indonesia Science and Technology Park in Jakarta, the ICT Cluster in Mongolia, and the Nanotechnology Park in Sri Lanka) o Promote FIRM-BASED INNOVATION In 1993, UNESCO launched the University-Industry Science Partnership Programme (UNISPAR): Crete synergy between research in universities and in particular sectors The programme adopted a triple helix model of innovation, seeking to bring together the institutional spheres of academia, industry and govt Ultimate goal: Develop national capacity in creating, nurturing and managing knowledge-based small and medium enterprises o Promote GRASSROOTS INNOVATION FOR SUSTAINABLE DEVELOPMENT through a network of activists and organisations generating bottom-up solutions that respond to the needs of local communities UNESCO is elaborating on a strategy that will focus on empowering people to use science and technology to find affordable solutions that meet the needs of the disadvantaged The strategy provides also for the popularization of science (science communication), technopreneurship development, engineering, local and indigenous knowledge and biodiversity conservation

Building capacities in basic sciences and engineering Education is especially vital for developing countries so that they can build a critical mass of scientists, researchers and engineers that will allow them to fully participate in the global economy UNESCO supports through International Basic Science Programme (IBSP) and the activities of its engineering programme Public-Private Partnerships: UNESCO is elaborating several agreements with private companies such as Intel, F.Hoffman-La Roche Ltd, among others to jointly promote science, technology, engineering, and mathematics education Integration of gender perspectives, vision, knowledge and skills into the design, implementation, and evaluation of STI policy: supporting young women scientists and facilitating cooperation and exchange of scientific knowledge among women scientists UNESCO works closely with ISTIC to organise an International Forum on Women in Science and Technology in

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Muslim Countries, held in KL Improving STI monitoring and foresight systems Foresight is important to support govt and industry with the information required for timely decisions and strategic planning 1965 1994: UNESCOs Science Policy Studies and Documents published a number of studies and documents totalling 74 vols After 2003: UNESCO began to publish monographs on STI policy analysis UNESCO Science Report published every five years, presenting the state of affairs in STI worldwide UNESCO led the Encyclopedia of Life Support Systems, an Internet-based encyclopedia for use by natural and social scientists, engineers, economists, educators, university students and professors UNESCOs publication Engineering: Issues, Challenges and Opportunities for Development sets the global picture of engineering issues, applications and innovation, infrastructure, capacity building and education To strengthen dissemination of STI policy data and information, UNESCO supported the establishment of the International Research and Training Centre for S&T Strategy in Beijing (China) as a category 2 centre under the auspices of UNESCO The absence of relevant indicators is a major obstacle for the design and implementation of science and STI policies, especially in developing countries. To tackle this, UNESCO has launched two initiatives: o The Science, Technology and Innovation Global Assessment Programme (STIGAP): designed to strengthen conventional STI monitoring systems by adding a bottom-up approach to fill in the gaps in the global assessment of STI; broadening the scope of STI data collection to develop more relevant and country-specific data o Global Observatory on Science, Technology and Innovation Policy Instruments (GOSPIN): STI policy cluster of databases. Equipped with graphics and analytical tools to provide information about the structure of STI national systems and the descriptions of national priorities and goals, legal framework, operational policy instruments, and international cooperation strategies Data tables o Appendix II: Government effectiveness (1.1.2). Identify the data for the six countries mentioned. Focus on the specific numbers for each country System of Innovation: Understand the linkages and its applications o When we talk about applying, it means that you need not follow traditional definitions. It must be practical. That is why you need to know the spider diagram o Question assumptions, theories applied to real-life situation may differ Appendices, Appendix 1: Radar diagram must be conversant with it (spider diagram) o Country / Economy Profiles o Take this and print six countries

Website: Report: Presentation slides:

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Section 2: Radar Chart What it is: A radar chart graphically shows the size of the gaps among five to ten organizational performance areas. The chart displays the important categories of performance and makes visible concentrations of strengths and weaknesses. When to use it: A radar chart shows how a team has evaluated a number of organizational performance areas. It is therefore essential that the initial evaluation include varied perspectives to provide an overall realistic and useful picture of performance. How to use it: Create categories. Use headers from an affinity diagram or brainstorm major categories of organizational performance to be plotted. A radar chart can normally include five to ten categories. Standardize performance definitions. Have all evaluators agree to use standardized definitions of both full performance and non-performance in each category so that ratings are performed consistently. Define the scoring range (e.g., 0 to 5 with 5 being full performance). Rate each performance category. Each evaluator rates each category individually, and the team then develops an average or consensus score for each category. Alternatively, the team as a whole may initially develop an average or consensus score for each category. Construct the chart. 1. Draw a large circle and insert as many spokes or radii as there are performance categories. 2. Around the perimeter of the circle, label each spoke with the title of a performance category. 3. Subdivide each spoke into the number of increments established in the rating scale. Label the center of the circle where spokes join as 0 (no performance) and place the highest rating number (full or exceptional performance) at the end of the spoke at the outer ring. (You may want to draw additional concentric circles linking equal values on each spoke.) Plot the ratings. For each performance category, plot on the chart the associated rating. Then connect the plotted points on all the spokes. Highlight the enclosed central shape as necessary for ease in viewing. Interpret and use the results. The resulting radar chart will graphically show areas of relative strength and relative weakness, as well as depicting general overall performance.

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Section 3: Silicon Valley Innovation Secrets & Culture of Innovations There is not just one model, there are several that you can look at Babson is more useful When we talk about innovation in a country or region, you can create your own theory. But there are a couple of things which are there that cannot be changed (government, finance, etc) Flexible, open-minded

(A) Booz One in five global companies have no innovation strategy at all, but in the Bay Area, 90% of the companies have strong innovation strategy supported by top executives Bay Areas success due to a combination of: o Innovation capacity o Access to capital o Secret ingredient corporate culture of innovation. Bay Area said that 50% of their companies have a strong corporate culture (46%) that supports innovation, more than double that of the rest of the world (19%) Secret for success: o Organisational alignment of putting the customer first o Deep user understanding Such a strategy can be replicated anywhere: o Have a clear innovation strategy, one that aligns you with your customer needs o Have your technical leads report directly to your CEO o Developing and communicating innovation strategy from the top o Constantly refresh your product development staff and welcome their ideas Success at innovation is not a blend of hard elements such as the number of researchers, the amount that they receive in funding, or the number of patents they receive. The study has shown that the absolute amount spent does not correlate with financial performance at all The current study indicates that the most innovative companies appear to have a secret sauce that makes them different from their peers a distinct culture of innovation that ensures that their chosen innovation strategy is clearly aligned with their overall corporate strategy Classifies companies according to three strategic profiles: Need Seekers, Market Readers and Technology Drivers o What differentiates them is primarily their approach to markets and customers o Need Seekers: Concentrate on gathering the deepest insights possible into both the articulated and unarticulated needs and desires of their customers. Want to be first to market Excel not just at technology but also at gaining insights into the

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needs and desires, both articulated and unarticulated, of their present and future customers Succeed in two critical areas: customer insight and product development Depends on three key cultural attributes: a passion for the product, strong identification with the customer, and an openness to ideas from all manners of sources o Market Readers: Meet the needs of their customers, but they typically follow already established trends in the overall market. Fast followers o Technology Drivers: Depend to the greatest extent on their own technical expertise to develop attractive products and services. Tend to bring their technology-driven products to market with somewhat less regard for timing Companies in the Bay Area are twice as likely to follow a Need Seeker Innovation Model, compared to the general population of companies in the Booz global survey 46% v 28% - while the proportion of Technology Drivers is almost exactly the same as the overall population. They are almost three times as likely to say their innovation strategies are tightly aligned with their overall corporate business strategies 54%, compared with just 14% among all companies Many of the largest and fastest growing companies in the US are based in the Bay Area. Its formula for success can be attributed to three critical factors: o Infrastructure (both hard and soft) o Finance o Culture Bay Area plays host to: o Five national laboratories: Lawrence Livermore, Lawrence Berkeley, Sandia, NASA Ames and the Stanford Linear Accelerator o Five of the nations leading research universities: UC Berkeley, UC San Francisco, UC Davis, UC Santa Cruz and Stanford o Private sector companies with world-class research facilities: Apple, Agilent, Genentech, Google, HP, IBM, Intel, Lockheed Martin, and many more The Bay Area remains at the head of its peers in terms of patents granted Education: o University and industry resources are brought together through two of the four California Institutes for Science and Innovation: QB3 (California Institute for Quantitative Biosciences), which focuses on the convergence of information and biotechnology, and CITRIS (Centre for Information Technology Research in the Interest of Society) o Universities and national laboratories are increasingly collaborating (e.g. Joint Bio-Energy Institute: JBEI) Venture Capital: o The amount of venture capital money invested from Y-to-Y may vary, but between 35-40% of all venture funding in the US is routinely invested in the Bay Area o Venture funding, as well as the funding of very young companies by angel investors, has fuelled most of the technology commercialisation in the region and many of its successful companies o Thus, the Bay Area is home to the worlds largest assembly information technology, biotechnology, Internet, digital entertainment and cleantech firms

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Human Capital o Bay Area is closely identified with entrepreneurship and a strong culture of risk-taking Key Findings of the 2011 Global Innovation 1000 Study o 68% of all companies tracked increased their R&D spending in 2010. Three industries accounted for $36.1 billion, or 77%, of the total $46.8 billion increase: computing and electronic, health, and automotive o Globally, every region increased innovation spending in 2010, a significant turnaround compared to the previous year, when the three regions making up the lions share North America, Europe and Japan all cut back. India- and China-based firms again increased their total R&D outlays at a far higher rate than companies in the three largest regions o The top 10 most innovative firms outperformed the top 10 R&D spenders across three key financial metrics over a five-year period revenue growth, EBITDA as a % of revenue, and market cap growth How the Bay Area is Different o Bay Area companies reported both stronger alignment on business and innovation strategies and cultural support for innovation strategy o Bay Area companies have the highest proportion of their innovation agenda developed and communicated top-down o Most Bay Area companies view continuous refreshment of their product development talent base as a critical advantage

(B) Babson Entrepreneurship Ecosystem Project (BEEP) lpage&v=3R2O49lOfck An entire ecosystem that evolve over time that support sufficiently high growth entrepreneurship BEEP is a set of methodologies, concepts and a series of workshops that we use over a period of time to actually create more entrepreneurs in those regions Activation Phase: Begin to work with the stakeholders by convening them. Educational institutions, government institutions, financial institutions, entrepreneurs, various entrepreneurship programmes, media, etc. Teach them and work with them! Try to impact the social norms around entrepreneurship Integrated series of programmes: By people on the ground in collaboration with the stakeholders to achieve very specific kinds of entrepreneurship goals Fast-tracking: Accelerate successes Being clear about where we are heading! Rationalisation about the organisation because some organisations do compete for scarce resources. Having the policymakers, the financial institutions, educational institutions, etc, go a long way in making the stakeholder integration tighter and save resources The current catch phrasesincubators, angel networks, crowd funding, accelerators, business competitions, clustersusually fail to deliver, and when they work, it is because of the existence of a comprehensive ecosystem that supports high growth
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entrepreneurship. Since 2010 BEEP has been pioneering the development of advanced methodologies for using entrepreneurship as an effective, results-oriented strategy for the development of economic prosperity. But rather than observing, assessing, and studying, we develop our reservoir of knowhow by doing. Here are some of the lessons we have been learning in our projects: 1. Understand and holistically enhance all relevant elements of your entrepreneurship ecosystem. (Note diagram below). For example, financing without education and culture wont lead to entrepreneurship. You must consider all these elements and how they drive each other. 2. Dont worry about changing everything on a full scale at once. When focusing on one or two domains of the ecosystem (social norms about failure, for example), you still need to address the other domains. However, we can do so on a smaller scale. 3. Learn from best practices from around the globe, but dont imitate others successes. Silicon Valley evolved in a unique environment, completely different from Israel or Taiwan. You cannot build another Silicon Valley; rather you need to be creative and innovative with the resources, and problems, you have at hand. That, after all, is what entrepreneurship is all about. 4. Be local: dont target the entire country, target several regions simultaneously. Only limited (but important) aspects of the entrepreneurship ecosystem, such as regulation, are handled effectively at the national level. Even in small countries, entrepreneurship tends to be localized in what we call watering holes, where entrepreneurs come to get access to the resources they need to survive and grow. That is why entrepreneurship-related portals, or incubators, usually dont work, and when they do, it is when they are supported by a broad group of local stakeholders, including successful entrepreneurs. 5. Have a dedicated, independent team of entrepreneurship enablers on the ground. This new professional role, conceived of and pioneered by BEEP, consists of a team with the skills to activate the local stakeholders by impacting, in a coordinated manner, all six of the domains of the ecosystem. This project team or agency must be supported by committed stakeholders, but be able to act independently of them. 6. Success breeds success. Entrepreneurship is a positive addiction and successful entrepreneurs like to help others be successful. Often they help with their expertise and capital. That means that anything we can do to accelerate specific success stories helps stimulate broad based entrepreneurship. And, in the law of small numbers, it only takes a few, local successes to change the whole game.

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PART B: Technology & Industry Readings (Purely Business Perspective) Technological development life cycle, the network effects, Technological and Industry (First and Second Lectures) Innovation strategies Biggest company is 3D systems. Have a read at their Annual Report. One of the forerunners of the 3D industry. Look at the investors presentation and see if you are confused? (Incumbent) PP3DP: Extremely small firm Question is how the big and small guys play. Couple of theories we know how do we apply it to the various innovations Things to look out for: 1. Performance Trajectory: Technological trajectory that can meet the demands of your customers over time. Your performance trajectory must be able to cross the mainstream demand 2. Performance OverShoot: Features that customers do not really need (e.g. Siri) 3. Motivation Asymmetry: Whether they should channel their resources to compete with a low-end competitor? If there is no motivation asymmetry, it is like pushing a dog against the wall. Section 1: The 3rd Industrial Revolution Impact on manufacturing processes 3D printing builds things layer by layer a process more properly described as additive manufacturing For a 3D printer, though, economies of scale matter much less. Its software can be endlessly tweaked and it can make just about anything. The cost of setting up the machine is the same whether it makes one thing or as many things as it can fit inside the machine! As the number of people directly employed in making things declines, the cost of labour as a proportion of the total cost of production will diminish too. This will encourage makers to move some of the work back to rich countries, not least because new manufacturing techniques make it cheaper and faster to respond to changing local tastes Everything in the factories of the future will be run by smarter software. Digitisation in manufacturing will have a disruptive effect every bit as big as in other industries that have gone digital, such as office equipment, telecoms, photography, music, publishing and films SMEs will also do it too this phenomenon would be called social manufacturing The cost of producing much smaller batches of a wider variety, with each

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product tailored precisely to each customers whims, is falling. The factory of the future will focus on MASS CUSTOMISATION ad may look more like those weavers cottages than Fords assembly line 3D printers can run unattended, and make many things which are too complex for a traditional factory to handle The GEOGRAPHY OF SUPPLY CHAINS WILL CHANGE: An engineer working in the middle of a dessert who finds that he lacks a certain tool no longer has to have it delivered from the nearest city Other changes are nearly as momentous: o New materials are lighter, stronger and more durable than the old ones o Carbon fibre is replacing steel and aluminium in products ranging from aeroplanes to mountain bikes o New techniques let engineers shape objects at a tiny scale o Nanotechnology is giving products enhanced features, such as bandages that help heal cuts, engines that run more efficiently and crockery that cleans more easily The internet now allows more designers to collaborate on new products, causing barriers to entry to fall

Impact on Labour The manufacturing jobs of the future will require more skills: Many dull, repetitive tasks will become obsolete. Most jobs will not be on the factory floor but in the offices nearby, which will be full of designers, engineers, IT specialists, logistics experts, marketing staff and other professionals Offshore production is increasingly moving back to rich countries not because Chinese wages are rising, but because COMPANIES NOW WANT TO BE CLOSER TO THEIR CUSTOMERS so that they can respond more quickly to changes in demand (Boston Consulting Group: Areas such as transport, computers, fabricated metals and machinery 10-30% of such goods are now imported by America from China could now be made at home by 2020, boosting American output by $20b - $50b a year) Impact on Government Concerns to the Govt: o Instinct to protect industries and companies that already exist, not the upstarts that would destroy them o Showered subsidies on old factories and bully bosses who want to move production abroad o Spent billions backing the new technology which they, in their wisdom, think will prevail o Believed that manufacturing is superior to services, let alone finance Writer argues that as the revolution rages, govt should stick to the basics: better schools for a skilled workforce, clear rules and a level playing field for enterprises of all kinds. Leave the rest to the revolutionaries 3-D Printing in the Third Industrial ( Impact on manufacturing costs 3-D entrepreneurs are particularly bullish about additive manufacturing, because the process requires as little as 10 percent of the raw material expended in traditional manufacturing and uses less energy than conventional factory production, thus Revolution

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greatly reducing the cost. The energy saved at every step of the digital manufacturing process, from reduction in materials used, to less energy expended in making the product, when applied across the global economy, adds up to a qualitative increase in energy efficiency beyond anything imaginable in the First and Second Industrial Revolutions. When the energy used to power the production process is renewable and also generated on site, the full impact of a lateral Third Industrial Revolution becomes strikingly apparent. Impact on Marketing The democratization of manufacturing is being accompanied by the tumbling costs of marketing. Because of the centralized nature of the communication technologies of the first and second industrial revolutionsnewspapers, magazines, radio, and televisionmarketing costs were high and favored giant firms who could afford to devote substantial funds to market their products and services. The internet has transformed marketing from a significant expense to a negligible cost, allowing start ups and small and medium size enterprises to market their goods and services on internet sites that stretch over virtual space, enabling them to compete and even out compete many of the giant business enterprises of the 21st century. Impact on manufacturing As the new 3-D technology becomes more widespread, on site, just in time customized manufacturing of products will also reduce logistics costs with the possibility of huge energy savings. The cost of transporting products will plummet in the coming decades because an increasing array of goods will be produced locally in thousands of micro-manufacturing plants and transported regionally by trucks powered by green electricity and hydrogen generated on site. Impact on SMEs The lateral scaling of the Third Industrial Revolution allows small and medium size enterprises to flourish. Still, global companies will not disappear. Rather, they will increasingly metamorphose from primary producers and distributors to aggregators. In the new economic era, their role will be to coordinate and manage the multiple networks that move commerce and trade across the value chain. Complementary effects 3D printing is hailed as enablers of a new industrial revolution Hod Lipson, Director of Cornell Universitys Creative Machines Lab We are focusing on bio-printing and recently worked on food printing. Now we are focusing on multi-material printing integrating electric wires, batteries and motors Cloud manufacturing model simply send the design online and it could be shipped overnight to you or your customer Industrial applications: o Engineers at EADS (The European Aeronautic Defense and Space Company) parent of plane manufacturer Airbus, are researching
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thorough into it Advantageous for them to have a technology where they do not need specialising tooling. When one invests in tooling it drives the person to a requirement for higher volumes in order to make the cost case o EADS is working with titanium alloys, high-strength steels and aluminium alloys, turning them from powder into a solid object (a process called sintering) using a laser or an electron beam o Benefits: Cutting down on waste; create new system parts that are complex than ones made using conventional machining (e.g. hydraulic manifold channels can now be curved instead of straight) o Printing reduces weight by up to 65% without compromising on strength 3D printing would not be a direct replacement for all existing manufacturing technologies, but it will be a very, very significant introduction of capabilities to complement that o =0 Just-in-time production Bespoke Innovations plan to use 3D printing to create prosthetic limb casings wrapped in embroidered leather, shimmering metal or whatever else someone might want Customised limbs could possibly cost a tenth of comparable artificial limbs made using traditional methods 3D printer creates an object by stacking one layer of material typically plastic or metal on top of another A California start-up is even working on building houses. Its printer, which would fit on a tractor-trailer, would use patterns delivered by computer, squirt out layers of special concrete and build entire walls that could be connected to form the base of a house By doing away with manual labour, 3D printing could REVAMP THE ECONOMICS OF MANUFACTURING AND REVIVE AMERICAN INDUSTRY AS CREATIVITY AND INGENUITY REPLACE LABOUR COSTS as the main concerns around a variety of goods Challenges: Customised products may be more expensive than mass-produced ones and take longer to make. The concept may seem out of place in a world trained to appreciate the merits of mass consumption. But as 3D printing machines improve and fall in cost along with the materials used to make products, new businesses have cropped up For architects, they no longer need to build $100,000 model; they can simply build $2000 models using an architects design and homegrown software for a 3D printer and turn it around in one night Contour Crafting is seeking money to commercialise a machine capable of building an entire house in one go using a machine that fits on the back of a tractor-trailer Disruptive technology: 3D printing will become desktop factories and will one day become a $1 trillion industry completely changing the traditional

Technology and World Change


factory model forever Everyone from consumers to big businesses to solo investors will be able to make their own unique products in just a couple of hours Medical products: an 83 yr old woman in Europe recently received a new jaw doctors printed with titanium powder. Medical team members could make the implant in just a few hours compared with the several days usually required with existing methods Providing for the masses: 3D Systems launched the Cube, a competing device that lists for $1,299. A related website,, combines the simplicity of a colouring book with robust digital resources Investors will be able to use a low-cost 3D printer to truly unleash the power of their imaginations Museum: At Smithsonian they can scan original artefacts at their museum and print replicas, thereby loaning to other museums Planes: Two British researchers created a spyplane within a week, taking two days to design on the computer and five days to make. The small, unmanned plane with a wingspan of about 4.5 feet soared at 100MPH Dentists: German supplier EOS said they can create up to 450 dental crowns a day compared with a dozen for most firms using the conventional systems Violins: EOS used a specialty compound to make parts for a violin


Section 2: 3D systems - Cubify; Section 3: PP3DP;

Categories Dominant Design

3D Systems Cubify Most 3D printers still have one drawback over other types of printers, in that they typically need to be put together like a hobby kit. 3D Systems is hoping to rectify the problem with its own 3D printer that actually works right out of the box (10 x 10 x 13 inches) Plastic jet printing technology. Tendency to warp, as the printer only has a heated bed with no enclosure

PP3DPs UP! Full metal, temperature stabilizing enclosure and groundbreaking sub $1000 USD retail price, suitable for family use Based on the simplicity of a traditional inkjet printer, with a snap in printer head, slide in build table and clip in consumable roll. Make 3-Dimensional usable models out of tough ABS+ plastic. However, still needs to be assembled (4.7 x 4.7 x 4.7). Double linear bearings on each axis ensures consistent build quality throughout the entire print process. Enclosed chamber to reduce warping. Various printers: $899 -


Various printers: $1300 -

Technology and World Change


$950 000 (selective layer sintering, multi-jet modelling, film transfer imaging, selective laser printings, etc) Cartridges Signature: $1299 Single Cartridge: $50 10 colours

$1850 Signature: $899

Business Model

No retailer Huge monopoly on its products: You have to activate the Cube beore using it

Variety of colours: $70 5 colours. You can use any suppliers ABS roll of 1.75mm plastic with your UP! Mini. The UP! Mini consumable is an open design so you are not locked into expensive consumables as opposed to expensive inkjet cartridges. 22 retailers across the world

Network Externalities

Cubes filament cartridges have a PCB on them CLOSED SYSTEM OPEN SOURCE PRIORIETARY FEEDSTOCK AND PAY-FOR-CONTENT Cloud Printing Allows for individuals to submit their designs and Cubify would print it for you. A new Cubify platform for designing and distributing printed creations. With intuitive 3D apps, rich 3D printable content libraries of games, puzzles and collections, turns any mobile device, tablet or Kinect into a powerful, digital canvas that unleashes creativity and brings ideas to life in 3D. Compelling content creation, capture and customization apps make

Technology and World Change



it simple and fun to personalize creations and Cubify them at home on a Cube 3D printer or have them Cubified using our online 3D printing service. Print quality is worse than Complicated PP3DP process JP Morgan expectations relating to consumer product launch are unrealistic


Print Speed Layer Resolution

10-100 cm3 per hour 250 microns

Technology and World Change