2017 European Thermal Diffusion Coatings Technology Innovation Award

Transcription

1 2017 European Thermal Diffusion Coatings Technology Innovation Award 2017 EUROPEAN THERMAL DIFFUSION COATINGS TECHNOLOGY INNOVATION AWARD

2 Contents Background and Company Performance... 3 Industry Challenges... 3 Technology Leverage and Business Impact... 4 Conclusion... 7 Significance of Technology Innovation... 8 Understanding Technology Innovation... 8 Key Benchmarking Criteria... 9 Best Practices Award Analysis for Thermission AG... 9 Decision Support Scorecard... 9 Technology Attributes Future Business Value Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices The Intersection between 360-Degree Research and Best Practices Awards Research Methodology About Frost & Sullivan Frost & Sullivan We Accelerate Growth

3 Background and Company Performance Industry Challenges According to NACE International, the global cost of corrosion was estimated at about $2.5 trillion in This high cost directly impacts the global economy as iron in all its forms, including cast iron, steel, and rolled metal, is the most widely used structural material, compared to wood, cement, and ceramics. Even as demand for iron and its various forms continues to increase at a steady rate across geographies, stakeholders across the value chain in each end-use industry are constantly looking for new methods to mitigate corrosion. One approach to mitigating corrosion is the application of a sacrificial zinc metal layer as a coating on the metal substrate because zinc acts as a barrier, thus preventing corrosion. While some low-cost zinc plating processes offer short-term corrosion protection for up to 5 years, industries are open to exploring new, higher-cost technologies with a corrosion performance for up to 15 years so that cost neutrality can be achieved by extending maintenance cycles. The following are the key challenges driving the need for an effective alternative to traditional zinc coating processes. Corrosion in Hybrid Construction: Lightweighting of components in industries such as automotive and aerospace has become a top priority objective for all major manufacturers. For instance, the vehicle body s hybrid construction is made of composite materials comprising electrochemical-based light metal alloys and low alloy steel. These components face corrosion problems because of the difference in the electrochemical potential of individual constituent metals. In addition, because magnesium and aluminum alloys offer a good weight-to-strength ratio, they are the most preferred for lightweighting; however, they are susceptible to corrosion at the joints. Protection of Precision Components: Parts and components with a sealing function come with stringent specifications on tolerance and secure sealing abilities. Any additional protective coating layer can alter the dimensions of these components and degrade the integrity of the seals. Alternately, precision components covered with expensive stainless steel layers are uneconomical and, thus, not preferred. These factors have led to a high demand for an effective technology that mitigates corrosion without altering the tolerance for delicate parts. Hydrogen Embrittlement: Hydrogen absorption in the steel structure s crystal lattice is a major concern in galvanizing processes. For instance, in the hot-dip galvanizing process, prior to galvanizing, a solution with a 10 to 15% concentration of hydrochloric acid is used at ambient temperatures to remove mill scale on the steel s surface. During this step, hydrogen is absorbed into the structure and alters the mechanical properties of the highstrength steel, i.e., steel with tensile strength greater than 1,000 megapascal (MPa) and Rockwell hardness of greater than 30 Rockwell C, resulting in the loss of tensile and torsional ductility and increasing the chances of component failure. Re-work to Finish: The occurrence of varying design specifications provided by the component manufacturer is common when using hot-dip galvanizing or electro-plating Frost & Sullivan We Accelerate Growth

4 processes. For instance, while coating a threaded small-to-medium sized steel part, a hotdip galvanizing process may fill in the threads and cover the part s fine details, necessitating further re-work to strip the coating and regalvanize to achieve exact specifications because the hot-dip galvanizing process has a heavy coating coverage with a non-uniform coating thickness of above 100µm. A process is needed that can provide a conformal coating with a uniform coating thickness. High Temperature and High Energy: Traditional zinc thermal diffusion coating processes, such as hot-dip galvanizing, sherardizing, and electroplating, are required to maintain the process bath at a temperature between 870 and 1,030 degrees Celsius for up to 8 hours. These requirements are a major concern for component manufacturers because they involve high energy-related costs. These challenges with conventional zinc metal plating processes have led to increasing interest in identifying an effective alternative that is fine tuned for lightweight metal alloys. Technology Leverage and Business Impact Based in Switzerland, Thermission AG is a technology developer in the thermal diffusion coating process field and a manufacturer and supplier of coating equipment. Introduced in 2012, Thermission s technology overcomes barriers in corrosion mitigation, specifically for parts and components made from high-strength steel and other metal alloys containing aluminum and magnesium. The patented technology offers a new range of possibilities by lowering the temperature of the thermal diffusion process and by improving the material properties of the substrate being coated. The technology is based on a combination of zinc powder and additives that are proprietary and chosen according to the composition of the metal substrate to be coated. In a typical process, parts and components made of lightweight metal alloy containing aluminum, titanium, magnesium, or copper are pre-treated to remove oxides and to activate the surface. The coating application is performed at a temperature between 280 and 370 degree Celsius, when the zinc dust mixture is applied to form a zinc diffusion layer. Industry Impact Innovation is at the core of Thermission s business. With a clear vision to solve the corrosion challenges that reduce asset lifetime, Thermission has emerged as a leader in technology innovation by bringing a new thermal diffusion technology to the market that provides highly differentiated and customized coating solutions to customers across industries, including automotive, marine, and railways. Thermission s technology is differentiated from its competitors in three aspects. Firstly, the process takes place at temperatures below the melting point of zinc, which widens the scope of adoption for the thermal diffusion process. Secondly, there is no formation of brittle zinc/metal intermediate phases, thereby eliminating the risk of flaking under mechanical stresses. Thirdly, the process works on the internal properties of the metal substrate and improves strength and ductility. Frost & Sullivan We Accelerate Growth

5 Thermission s technical expertise is built upon a strong innovation framework that identifies the evolving changes in material requirements in industries such as automotive. Thermission offers end-to-end corrosion protection services to clients throughout the intended life of metal components. For instance, with the need to eliminate preferential corrosion in metal mixtures used in lightweight components for the automotive industry, Thermission s technology offers a competitive advantage for original equipment manufacturers (OEMs) to differentiate their products in terms of increased safety, with excellent resistance to acids, salts, and wear, even in the component s edges. This highvalue product quality evaluation criterion enables OEMs to offer a unique value proposition to their customers in terms of product lifetime and performance in harsh environments. As a testament to its impact, Thermission has a strong footprint in the automotive industry, with over 50 major customers in Europe and US developing customized coating solutions for cars and trucks. Product Impact Even as new metal combinations are being tested for use across industries, manufacturers are continuously evaluating new corrosion mitigation technologies to extend service life. The cost versus performance of a new technology is a key factor impacting the choice of adoption. For example, in the automotive industry, 80% of the metal and metal alloy components are required to prove performance for 320 salt spray test hours. Existing thermal diffusion coating technologies already meet this requirement at a cheaper cost. However, premium brands in the automotive space expect their part suppliers to provide certifications that show protection for more than 720 salt spray test hours. Thermission s technology meets these requirements and exceeds expectations by delivering corrosion protection for up to 1,400 salt spray test hours. This ability has a huge impact on the automotive industry as maintenance costs can be significantly reduced, translating into a positive consumer perception of the automotive brand. In an industry such as automotive, where customers are willing to pay a premium of up to 30% on parts and components to ensure stability for up to 720 salt spray hours and even more, Thermission is considered a leader in setting new performance standards for endurance and durability of metal components. Scalability Thermission s technology is developed as a platform coating process that seamlessly fits into the specifications and requirements from across industries, including automotive, marine, and railways. Offering a portfolio of three products and services, Thermission leverages the competencies of its strong technical team, technology ownership, and direct coating facilities to provide best in-class services for component manufacturers. For coating single components in small batches, Thermission allows its customers to utilize its own coating facilities in Switzerland and the United States to test new parts and realize the benefits of Thermission s technology for new applications where ferrous and nonferrous metals are being explored. Frost & Sullivan We Accelerate Growth

6 To offer customers an edge over their competitors, Thermission offers turn-key production lines customized to coat large bulky components that can be integrated into the production process at the customer s site, enabling its customers to gain complete control and flexibility to tune the coating process and reduce response times. One of Thermission s first commercial successes was in 2014 when KAMAZ, the largest truck manufacturer in Russia, bought exclusive patent rights to Thermission s technology and entered into a joint venture with Thermission to set up coating lines for part processing. In the meantime several car manufactures and big suppliers have licensed the Thermission technology Visionary Innovation With its well-structured innovation strategy, Thermission is positioned to become the leader in offering disruptive technologies for metal part processing. Even as new highstrength, lightweight metal alloys are being explored as effective alternatives to steel, Thermission is focusing its research on identifying material strength and durability challenges faced when metals and non-metals are combined. Thermission s Thermal Diffusion process offers above-par corrosion protection and alters the metallurgy of the interlayers during the process, which improves the ductility and elasticity of the substrate being coated. Additionally, Thermission is focusing on new applications and markets to expand its technology s reach. For example, anti-corrosion coatings currently used in marine vessels require a re-coat every year; therefore, ship owners are pushed to invest heavily on annual maintenance. In addition, repeated re-coats applied on vessel exteriors increase the vessel s weight, thereby resulting in an 8 to 10% increase in fuel consumption. Thermission aims to address this top priority application need for the marine industry. The adoption of Thermission s thermal diffusion process allows ship building companies to achieve desired corrosion protection and double the duration of maintenance cycles. The prospect of improvements in normal steel s ductility opens up an opportunity for ship building companies to achieve desired material strength, even at 15 to 20% less thickness, thereby contributing to the industry s lightweighting objective. These clear indicators place Thermission as a visionary innovator in industries such as automotive, marine, and aerospace that are witnessing a significant shift towards the adoption of new metal and non-metal alloys to reduce the weight, realize fuel savings, and reduce the carbon footprint. Application Diversity Thermission s technology expertise in zinc-based coatings for metal substrates, including raw material choice, coating system design, and commissioning, is unmatched in the European thermal diffusion industry. The new thermal diffusion process transcends the boundaries and limitations of competing galvanizing processes, specifically for high strength steel applications. The technology s flexibility to coat a wide variety of base metals, non-metals, and metal alloys positions it as an innovative coating technology platform that can be customized to match end-use application needs. Frost & Sullivan We Accelerate Growth

7 Thermission s highly skilled team of technical experts recommends modifications to the process in terms of choice of coating material and design of optimum process conditions, enabling customers to achieve their desired coating properties, such as coating thickness, hardness, and density, that meet the highest quality standards of the target application. For instance, Thermission has worked closely with several car munfacturers to develop automotive vehicle body components with a hybrid metal. The patented vehicle component is a non-ferrous metal hybrid construction with a zinc diffusion layer applied at a temperature between 280 and 390 degree Celsius. This ability clearly allows Thermission to contribute at every level of product development, from material choice to optimizing thermal diffusion parameters, to achieve best-in-class corrosion protection in-line with expectations from key stakeholders in end-use industries. Technology Licensing Thermission has made significant inroads in identifying high-value/low-risk opportunities in terms of short-term revenue generation. With a streamlined approach to evaluating technology licensing partners, Thermission has concentrated its efforts on increasing its visibility, mainly in the automotive industry over the next 1 to 2 years, while the marine and offshore industries will be of interest in the long term. Thermission s systems technology service delivers customized solutions to licensing partners, with a complete transfer of technology know-how that allows partners to formulate their own process quality monitoring mechanisms. In addition, Thermission s guaranteed full lifetime service support enhances customer trust and promotes long-term business relationships. Conclusion As a leader in providing disruptive thermal diffusion process technologies, Thermission has demonstrated a commitment to delivering its proprietary thermal diffusion technology as a low-cost, energy-efficient, and eco-friendly process to meet end-user requirements in high impact application industries, such as automotive, aircraft, and marine. According to Frost & Sullivan s research on best practices followed by coating process technology developers, Thermission s well-structured approach to identifying and overcoming key technology barriers to deliver long-term corrosion protection for hybrid lightweight construction is the benchmark in the thermal diffusion coatings industry that enables customers to develop lightweight premium products with un-matched corrosion protection. With its strong overall performance, Thermission has earned Frost & Sullivan s 2017 Technology Innovation Leadership Award. Frost & Sullivan We Accelerate Growth

8 Significance of Technology Innovation Ultimately, growth in any organization depends upon finding new ways to excite the market and upon maintaining a long-term commitment to innovation. At its core, technology innovation, or any other type of innovation, can only be sustained with leadership in three key areas: understanding demand, nurturing the brand, and differentiating from the competition. Understanding Technology Innovation Technology innovation begins with a spark of creativity that is systematically pursued, developed, and commercialized. That spark can result from a successful partnership, a productive in-house innovation group, or a bright-minded individual. Regardless of the source, the success of any new technology is ultimately determined by its innovativeness and its impact on the business as a whole. Frost & Sullivan We Accelerate Growth

9 Key Benchmarking Criteria For the Technology Innovation Award, Frost & Sullivan analysts independently evaluated two key factors Technology Attributes and Future Business Value according to the criteria identified below. Technology Attributes Criterion 1: Industry Impact Criterion 2: Product Impact Criterion 3: Scalability Criterion 4: Visionary Innovation Criterion 5: Application Diversity Future Business Value Criterion 1: Financial Performance Criterion 2: Customer Acquisition Criterion 3: Technology Licensing Criterion 4: Brand Loyalty Criterion 5: Human Capital Best Practices Award Analysis for Thermission AG Decision Support Scorecard To support its evaluation of best practices across multiple business performance categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool allows our research and consulting teams to objectively analyze performance, according to the key benchmarking criteria listed in the previous section, and to assign ratings on that basis. The tool follows a 10-point scale that allows for nuances in performance evaluation. Ratings guidelines are illustrated below. RATINGS GUIDELINES The Decision Support Scorecard is organized by Technology Attributes and Future Business Value (i.e., these are the overarching categories for all 10 benchmarking criteria; the definitions for each criterion are provided beneath the scorecard.). The research team confirms the veracity of this weighted scorecard through sensitivity analysis, which confirms that small changes to the ratings for a specific criterion do not lead to a significant change in the overall relative rankings of the companies. Frost & Sullivan We Accelerate Growth

10 The results of this analysis are shown below. To remain unbiased and to protect the interests of all organizations reviewed, we have chosen to refer to the other key participants as Competitor 2 and Competitor 3. Measurement of 1 10 (1 = poor; 10 = excellent) Technology Innovation Technology Attributes Future Business Value Average Rating Thermission AG Competitor Competitor Technology Attributes Criterion 1: Industry Impact Requirement: Technology enables the pursuit of groundbreaking ideas, contributing to the betterment of the entire industry. Criterion 2: Product Impact Requirement: Specific technology helps enhance features and functionalities of the entire product line for the company. Criterion 3: Scalability Requirement: Technology is scalable, enabling new generations of products over time, with increasing levels of quality and functionality. Criterion 4: Visionary Innovation Requirement: Specific new technology represents true innovation based on a deep understanding of future needs and applications. Criterion 5: Application Diversity Requirement: New technology serves multiple products, multiple applications, and multiple user environments. Future Business Value Criterion 1: Financial Performance Requirement: Potential is high for strong financial performance in terms of revenues, operating margins, and other relevant financial metrics. Criterion 2: Customer Acquisition Requirement: Specific technology enables acquisition of new customers, even as it enhances value to current customers. Criterion 3: Technology Licensing Requirement: New technology displays great potential to be licensed across many sectors and applications, thereby driving incremental revenue streams. Frost & Sullivan We Accelerate Growth

11 Future Business Value BEST PRACTICES RESEARCH Criterion 4: Brand Loyalty Requirement: New technology enhances the company s brand, creating and/or nurturing brand loyalty. Criterion 5: Human Capital Requirement: Customer impact is enhanced through the leverage of specific technology, translating into positive impact on employee morale and retention. Decision Support Matrix Once all companies have been evaluated according to the Decision Support Scorecard, analysts then position the candidates on the matrix shown below, enabling them to visualize which companies are truly breakthrough and which ones are not yet operating at best-in-class levels. High Thermission Competitor AG 2 Competitor 3 Low Low Technology Attributes High Frost & Sullivan We Accelerate Growth

12 Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices Frost & Sullivan analyst follows a 10-step process to evaluate Award candidates and assess their fit with select best practice criteria. The reputation and integrity of the Awards are based on close adherence to this process. STEP OBJECTIVE KEY ACTIVITIES OUTPUT 1 Monitor, target, and screen Identify Award recipient candidates from around the globe Conduct in-depth industry research Identify emerging sectors Scan multiple geographies Pipeline of candidates who potentially meet all bestpractice criteria 2 Perform 360-degree research Perform comprehensive, 360-degree research on all candidates in the pipeline Interview thought leaders and industry practitioners Assess candidates fit with best-practice criteria Rank all candidates Matrix positioning of all candidates performance relative to one another 3 Invite thought leadership in best practices Perform in-depth examination of all candidates Confirm best-practice criteria Examine eligibility of all candidates Identify any information gaps Detailed profiles of all ranked candidates 4 Initiate research director review Conduct an unbiased evaluation of all candidate profiles Brainstorm ranking options Invite multiple perspectives on candidates performance Update candidate profiles Final prioritization of all eligible candidates and companion best-practice positioning paper 5 Assemble panel of industry experts Present findings to an expert panel of industry thought leaders Share findings Strengthen cases for candidate eligibility Prioritize candidates Refined list of prioritized Award candidates 6 Conduct global industry review Build consensus on Award candidates eligibility Hold global team meeting to review all candidates Pressure-test fit with criteria Confirm inclusion of all eligible candidates Final list of eligible Award candidates, representing success stories worldwide 7 Perform quality check Develop official Award consideration materials Perform final performance benchmarking activities Write nominations Perform quality review High-quality, accurate, and creative presentation of nominees successes 8 Reconnect with panel of industry experts Finalize the selection of the best-practice Award recipient Review analysis with panel Build consensus Select recipient Decision on which company performs best against all best-practice criteria 9 Communicate recognition Inform Award recipient of Award recognition Present Award to the CEO Inspire the organization for continued success Celebrate the recipient s performance Announcement of Award and plan for how recipient can use the Award to enhance the brand 10 Take strategic action Upon licensing, company is able to share Award news with stakeholders and customers Coordinate media outreach Design a marketing plan Assess Award s role in future strategic planning Widespread awareness of recipient s Award status among investors, media personnel, and employees Frost & Sullivan We Accelerate Growth

13 The Intersection between 360-Degree Research and Best Practices Awards Research Methodology Frost & Sullivan s 360-degree research methodology represents the analytical rigor of our research process. It offers a 360-degree-view of industry challenges, trends, and issues by integrating all 7 of Frost & Sullivan's research methodologies. Too often companies make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. The integration of these research disciplines into the 360-degree research methodology provides an evaluation platform for benchmarking industry 360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS participants and for identifying those performing at best-in-class levels. About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages more than 50 years of experience in partnering with Global 1000 companies, emerging businesses, and the investment community from 45 offices on six continents. To join our Growth Partnership, please visit Frost & Sullivan We Accelerate Growth