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Title: Building Systems of Innovation Royal Hospital Kilmainham Monday 28th June 2004


1
Building Systems of InnovationRoyal
Hospital KilmainhamMonday 28th June 2004
2
The Capability Triad
Skill Formation
Business Model
Production System
3
Evolution of Industrial Structure
PS 5 Knowledge intensive (systems
integration) information, communication,
instruments
future
PS 3,4 Complex-assembly intensive (flow) auto,
consumer electronics
PS 2 Material-intensive (flow) steel,
plastic food processing
present
PS 1 Low technology, labour intensive (interchange
ability) apparel, toys, furniture
(Principle of production)
4
Technology Management and Production Capabilities
Spectrum
1. Pre-flow, pre-interchangeability TM1 2. Interch
angeability TM2 3. Single product
flow TM3 4. Single product flow with continuous
improvement 5. Single product flow with process
innovation 6. Multi-product flow TM4 7. Multi-prod
uct flow and product development 8. New product
design and technology fusion TM5 9. Systems
integration and disruptive innovation 10. Open
systems and design modularization
5
Table 2. Five Models of Technology Management
Case Armory Ford Toyota Canon Intel
Production Principle Inter- changability Flow
Flow Flow Systems Integration
Application Specialization Single
Product Multiple Products New
product development Technology integration
Generic Capabilities Product engineering Synch
ronization Kaizen Product development Design
rules
TM1 TM2 TM3 TM4 TM5
Performance Breakthrough Standardization Cost
Cost, Quality Time Cycle time Innovation
6
TM4 Fast-Cycle Development and
Product-Concept Pull
Generational technology improvement
Fast-cycle competitor
6
5
Slow-cycle competitor
4
4
3
3
2
2
1
Time
Source Steven Wheelwright and Kim Clark,
Revolutionizing Product Development, Free Press,
1995
7
New Product Development Process
  • Product concept
  • conceptual design
  • product architecture
  • technology search and analysis
  • target market
  • Product planning
  • model building
  • structural testing
  • technology design viability testing
  • technology RD and integration
  • investment/financial projections
  • Product/process engineering
  • detailed design of product
  • tooling/equipment design and specification
  • building/testing prototypes
  • master technology and engineering interfaces
  • setting standards
  • supplier tie-ins
  • Pilot project/scale-up
  • initial production runs
  • establish work skills and activities
  • volume production tests
  • Production
  • factory start-up
  • volume ramp-up
  • establish performance standards (cost, quality,
    time)
  • maintain standards
  • master engineering and work team interfaces for
    continuous improvement

Source New Competitive Advantage
8
Competing Business Models
The Old Vertical Computer Industry - Circa 1980
The New Horizontal Computer Industry - Circa 1995
Retail Stores
Superstores
Dealers
Mail Order
Sales and distribution
I-net
Sales and distribution
Word
Word Perfect
Lotus
Application software
SAP
Application software
DOS and Windows
OS/2
Mac
UNIX
Operating systems
Linux
Compaq
Dell
IBM
Etc
Packard Bell
HP
Computer
Operating systems
Seagate
Quantum
Western Digital
Maxtor
Disk drives
Intel Architecture
Motorola
RISC
Chips
Computer
Contract manufacturers
Selectron
SCI
Flextronics
Jabil
Celestica
Chips
HP
Epson
Printers
Sperry Univac
Wang
IBM
DEC
Source Adaptation from Only the Paranoid
Survive by Andrew Grove, 1996. Used by
permission of Doubleday, a division of Random
House, Inc.
9
Dynamic Dialectic (HPWS)
WANG, with Dr. Wang
HP
Strong
Top-down actions
WANG, without Dr. Wang
APPLE with Sculley
Weak
Weak
Strong
Bottom-up actions
Source Andrew Grove Only the Paranoid Survive,
1996
10
Design capabilities and skills integration
Source Penang Design Center
11
Multi-Disciplinary RD Group
Immunologists
Biochemists
Clinicians
Molecular Biologists
Biologists
Physicists
Complete Diagnostic System
Synthetic Chemists
Software Programmers
Physical Chemists
Electrical/Electronic Engineers
Neural Network Specialists
Mechanical Engineers
Polymer Chemists
Source Randox, NI
12
Cluster Growth Dynamics
Industrial District specialization and speciation
dynamics
Inter-firm Networks open-systems dynamics
Entrepreneurial Firms internal dynamics
New Firms technological diversification
13
Family tree data communication equipment
Source Steven Syre,Charles Stein, Boston Globe
10/14/1999
14
Product Diversification of the Cascade Family of
Companies
Updated 9/10/2003
15
Local Production Network
Project Design Engineers
Ewart Liddell
Moyola
Club Herdman
Martin Baker
Bombardier- Shorts
Denroy Plastics
RFD
Active Multi-Media
B/E Aerospace
Ulster Weavers
Mallaghan Engineering
Langford Lodge Engineering
Huddleston Engineering
16
(No Transcript)
17
Science Push Innovation U.S. Big Business
Knowledge Domain Science
BR
Technology Design Eng
DR
AR

Engineering Detail
Product
BR Basic Research AR Applied Research DR
Dev. Research
Incremental Innovation Japan PS 4
DR
PC1
PC2
PC3
Product Development
Technology Applied
AR
Technology Generic Proprietary
TR
PC Product Concept TR Technological
Research (New Technological Knowledge)
Source Adapted from David Methé Engineered in
Japan. Oxford University Press 1995
18
Systems Integration Innovation
PC2
PC3
PC4
PC1
Product Development
Technology
SI
TR1
TR2
New Technology
BR
Science
SI Systems Integration Enabled by information
technology Hardware software Discipline
integration
19
Biodegradable Polymer Research Center University
of Massachusetts Lowell
Cargill 3M Monsanto Eastman Chemical Convatee Morf
lex Dow BASF BF Goodrich National Starch EPA US
Army Natick
Synthesis (chemistry) Biodegradability Testing
(biology) Microscopy Instrumentation
(physics) Processing Blending Techniques
(plastics eng)
Scientific Technical Expertise
NSF
Companies
Scientific Literature Patent Search
Polymer Biodegradation Center
Mitsubishi Taizel Mitsui Topan Ajinomoto Damippon
Kirin Nippongos Shimatsu Unitika
Japanese Companies
Research Projects
Global Competitor Analysis
Govt Agencies Labs
Regional Companies
Japanese Companies
Tsukuba MITI
New Materials
Processing Blending
Environmental Testing
Graduate Students
A National Science Foundation Industry /
University Cooperative Research Center since 1993
20
Regional Innovation Processes
  • Technology capability/market opportunity
    (internal to firm)
  • Groves dynamic-dialectic (internal to firm)
  • Dip-down innovation
  • Techno-diversification
  • Networking (fosters specialization and
    partnering)
  • New Technology combinations (fosters speciation)
  • Transformational (capability triad transition)

21
Regional Growth and Skill Formation Dynamics
22
Electrical Engineering Graduates in Massachusetts
Source New England Board of Higher Education
23
Republic of Ireland Engineering Graduates
Source National Council for Educational Awards,
Republic of Ireland
24
Growth in Engineering and Science Graduates
1975-1995
25
Changing Economy Makes Education More Important
Source Mission Critical Closing the Achievement
Gap Conf., Joint Venture Silicon Valley Network
26
Knowledge Workers in MassachusettsCompared With
the United States
Statistically significant at the 5 level.
Source R. Forrant, P. Moss and C. Tilly,
Knowledge Sector Powerhouse, UML 2001.
27
High Growth Rate Processes
  • 1. Enterprise growth dynamics
  • technology capabilities / market opportunities
  • design ideas / leadership (Groves dynamic
    dialectic)
  • 2. Regional growth dynamics
  • enterprise
  • techno-diversification
  • open systems (internal / external dynamic)
  • innovation
  • disruptive internal / external dynamic
  • dip-down fast-cycle product development
  • design diffusion leveraging creativity
  • dispersed laboratories for experimentation
  • diversity new technological combinations
  • 3. Transformational growth
  • PS 1-5 and sectoral transition
  • capability triad

28
High Growth Challenges
  • Entrepreneurial firms
  • Open systems networking
  • Technology management
  • Technology transitions
  • Skill formation

29

The Law of Diminishing Sizes
1st Prerequisite to mass production
Armory 1817
Robbins Lawrence 1000ths
Mechanical Age
10-3
Vernier Caliper 1851 Micrometer 1867
Brown Sharpe
2nd Prerequisite to mass production
Electrical Age Megahertz/sec to
Terahertz/sec (Measure of flow)
Critical Size Dimension (Meters)
Central Power Station 1890
-4
Edison/ Ford
10
Moores Law Electronics
Transition to nanotechnology self-assembly
Mechanical
-9
10
Electrical
-12
Photonics 10 bits/sec Genome 1/10 atom
diameter

Electronic
-12
10
Atomic

1850
1890
1950
2000
1860s
1800
Photonics
Biotech
Mechanical
Electro-mechanical
Electronic
Technological Periods
Nanotechnology
30
ITRI Technology Output
Including conferences, seminars, workshops, and
technical training programs
Source Industrial Technology Research Institute,
Taiwan
31
Anticipating Technology Trends
A Proactive Approach to Regional Economic
Development
Create Extensive Company Database
Perform Data Analysis
Develop Visualization Techniques
Generate a Regional Knowledge Base
Technology Roadmaps
UML Regional Development Partnerships
Curriculum Development

Research Priorities

Regional Outreach Programs

32
CorpTech Technology Classification System
Stratification of Telecommunication Industry
Technologies
18 Industry Segments AUT Factory
Automation BIO Biotechnology CHE
Chemicals COM Computer Hardware DEF
Defense ENR Energy ENV Environmental MAN
Manufacturing Equipment MAT Advanced
Materials MED Medical Equipment PHA
Pharmaceuticals PHO Photonics and Optics SOF
Computer Software SUB Subassemblies
Component TAM Test Measurement TEL Telecomm
Internet TRN Transportation ZZZ Holding
Companies
15 Telecommunications
Internet Components TEL-NW-C
Network Components TEL-NW-CA
Annunciators TEL-NW-CB Data Bridges TEL-NW--CE
Encoders/Decoders TEL-NW-CH Hubs TEL-NW-CP
Repeaters TEL-NW-CX Extenders TEL-NW-CS
Data Network Switches TEL-NW-L Local Area
Networks (LANs) TEL-NW-LB Baseband-based
LANs TEL-NW-LF Fiber optic-based LANs TEL-NW-LR
Broadband-based LANs TEL-NW-LZ Other
LANs TEL-NW-W Wide Area Networks TEL-NW-CZ
Other Network Components
23 Telecommunications
Sub-Segments TEL-AV Audio/Video
equipment TEL-BR Broadcasting/Receiving
equipment TEL-CI Communications
interfaces TEL-CS Communications security
devices TEL-DC Data concentration
equipment TEL-EM Electronic mail
equipment TEL-IA Internet data aggregation
services TEL-II Internet infrastructure
services TEL-IF Internet transaction/security
services TEL-IM Internet multimedia
services TEL-IS Internet search/indexing
services TEL-IW Internet web-site-related
services TEL-IZ Other Internet-related
Services TEL-MX Multiplexers/modems TEL-NW
Networks/Internet components TEL-SI
Signal-related equipment TEL-SM
Satellite/microwave com equipment TEL-SV
Telecommunications services TEL-TD Telecom
distribution equipment TEL-TE Telephone/voice
equipment TEL-TR Transmission
systems/equipment TEL-ZD Other data
communications equipment TEL-ZZ Other
telecommunications equipment
33
(No Transcript)
34
This slide will be Chart 2a.
35
Lowell Area CompaniesForeign Investment
36
Anticipating Technology Trends Group
37
Anticipating Technology Trends Group
38
(No Transcript)
39
Northern Irelands Capability Triad
  • Business Model
  • NI lacks entrepreneurial firms
  • Open-system networking is limited
  • Production Capabilities
  • Production capabilities for a knowledge economy
    are lacking
  • HPWS not widely pursued outside the
    externally-owned sector
  • Technology Mgnt not considered a powerful
    resource for growth
  • Skill Formation
  • Wide range of university level disciplines in
    EngineeringScience
  • World class research facilities but
  • Active ind/univ partnerships student
    involvement too few
  • FE Colleges enjoy little guidance in area of
    manpower planning
  • Strategic development of visible invisible
    colleges of knowledge diffusion

40
Policy Proposals Linked to the Capability Triad
Source Thanks to John Bradley
41
Policy Proposals (PPs)
  • PP1 Concentrate on entrepreneurial firms.
  • PP2 Foster open networks.
  • PP3 Apply principle of system integration.
  • PP4 Diffuse high performance work organisations.
  • PP5 Develop and diffuse technology management
    capabilities.
  • PP6 Partner with inward investment to advance
    capabilities.
  • PP7 Integrate technology management and skill
    formation.
  • PP8 Integrate mission-driven diffusion agencies
    with industrial policy goals.
  • PP9 Link visible and invisible colleges.
  • PP10 Administer the research, technology
    development and innovation infrastructure.
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