Denmark: Manufacturing Academy of Denmark (MADE)

Transcription

1 Digital Transformation Monitor Denmark: Manufacturing Academy of Denmark (MADE) May 2017 Internal Market, Industry, Entrepreneurship and SMEs

2 Denmark: Manufacturing Academy of Denmark (MADE) freeimages niller56 Fact box for Denmark s MADE policy initiative Policy Lever(s) Funding Model Equal financing through public and private funds; Balanced between technology and skills focus with tendency towards development of new technologies; Bottom-up implementation approach Public-private partnership (SPIR) managed by an independent association equally called MADE Target audience(s) Targeting mainly Danish SMEs active in manufacturing sector; stakeholders from research institutes / academia Concepts & Focus Areas MADE covers nine research themes focusing on business related challenges of Industry 4.0, e.g. High speed product development Key drivers Involvement of Danish Employers Federation; Motivation / initiative of involved partners from industry and academia Key barriers Attracting world-class researchers proved to be challenging; Overcome skepticism of academia regarding an industry dominated agenda Implementation strategy Initiated and designed by partners from research and industry; Building a public private partnership Results achieved Budget Uniqueness factor Network growth to109 MADE members; Total of 34 innovation activities with 2213 participants; Total of 70 projects (44 industrial projects); Significant communication outreach Total budget 24.2 million; 11.8 million from participating companies; 8.2 million from the Innovation Fund; 2.8 million from foundations / associations; 1.4 million from universities Diverse platform with broad membership base from industry and research; Thematic flexibility for participants of demonstration projects Value-added for policy-makers Creation of MADE as an independent association; MADE membership structure; Integration within European manufacturing ecosystem Expected Impact New development of technologies for manufacturing companies; increasing the competitiveness of Danish manufacturing Source: Digital Transformation Monitor 2

3 Introduction The Manufacturing Academy of Denmark (MADE) is a crossindustrial innovation initiative launched officially in late The national initiative bundles forces from major industrial players along with manufacturing SMEs, Denmark s 5 technical universities and 3 technology organisations in an effort to stop the growing tendency of offshoring manufacturing operations from Denmark. The initiative is financed by mixed public-private sector funds amounting to 24.4 million between 2014 and MADE s main mission lies in applying research, driving innovation and strengthening education to improve the competitiveness of Danish manufacturing. The platform is managed by an independent association MADE offering a wide range of different activities to its currently 109 members. The initiative targets primarily Danish SMEs which contrary to larger members can benefit from a lower membership fee and access to specific support programmes. The design of MADE is unique in its strong bottom-up implementation approach. MADE has achieved to grow a Danish ecosystem with focus on industrial research, attractive to large industrial players and SMEs alike. The MADE model impresses through its lean, multi-layered governance structures which server as the cornerstones of MADE Digital, the initiative s recent scale-up focusing on digital solutions. Equipped with an equivalent amount of public funding as its predecessor, MADE Digital will run between being under the management of MADE association. Scenarios for future Danish production In 2010 the Danish branch of manufuture published a collaborative study titled Manufacturing The report identified five future scenarios where Danish manufacturing can be competitive. These scenarios served as viable contributions to preparing the MADE initiative. The five scenarios included the following: (1) High competence at manufacturing company level exploiting new technologies and developing new products; (2) Coordination and exploitation of the industrial power ecosystem comprising businesses, industries, universities and knowledge centres; (3) The innovation factory at the interface between design and manufacturing competences developing intelligent products; (4) The development of a network of suppliers supported by flexible value chain intregrators; and (5) The virtual business network capable of rapidly and effectively exploiting business opportunities and pool resources across the production process. Boosting Danish competitiveness At the outset of MADE one of the main challenges was and still is today the increased offshoring of Danish manufacturing. In the light of high salaries in Denmark, it was clear that competing on the basis of cost is not a viable option for the country. Therefore, means had to be explored where the value of a product made in Denmark would be greater than the high manufacturing cost. 2 Against this core challenge, MADE s primary goal is to ensure that Denmark has a world-class advanced manufacturing industry. More specific objectives of MADE include: (1) to increase Denmark s competitiveness through industrial based research in manufacturing, (2) to strengthen the Danish technical research community, (3) to create an ecosystem focusing on research innovation and knowledge sharing; and (4) To optimise education to support manufacturing. In addition, MADE also aims to connect to other national initiatives in the field of manufacturing and to act as the central national hub for Danish production. Stakeholders in Denmark agreed that the road towards more Danish manufacturing jobs requires industry to become smarter, faster and more innovative in order to regain competitiveness. Policy levers for Denmark s MADE initiative Source: Digital Transformation Monitor 3

4 A PPP with bottom-up implementation Initially, MADE obtained seed funding from the Danish government. Today, the initiative is a public private partnership equally backed by public sector and private sector funds. While technology development and skills are both important elements of the initiative, MADE s focus on technology overweighs. PhD research projects focus on producing new technologies which can be used by industry. On the other hands, the PhD students also acquire skills through their research. The initiative is characterised by a strong bottom-up implementation approach. This is reflected by the strong initiative of industry and research to start the initiative and the governance of the initiative. The Board of Directors and the Advisory Board both have strong representation of industry, with lower representation of academia and none from the Danish government. Seed funding from the state, developed by industry MADE is referred to as a national investment project financed by mixed public-private sector funds. For the 5-year-period of the project ( ), a total of million Danish Crowns ( 24.4 million) are allocated. The entity managing the Manufacturing Academy of Denmark equally titled MADE was set up as an independent association in Initially, the Danish Council for Strategic Research and the Danish Council for Technology and Innovation provided seed funding in support of the action programme MADE - Platform for future manufacturing. Shortly after, MADE was supported as one of the Strategic Platforms for Innovation and Research (SPIR). Administered by Innovation Fund Denmark, the strategic platforms provide funding to initiatives that strengthen the link between strategic research and innovation. At the end of 2016, MADE Digital was announced focusing on digital solutions tailor-made to the specific needs of Danish manufacturing companies. In total 25.8million was allocated to MADE Digital for the period Private financing MADE relies significantly on private sector funds. The public grant is cofinanced with 11.8 million from participating companies, 2.8 million from foundations / associations and 1.4 million from participating universities. Combining research with SME support activities Next to its diverse research activities covered through 9 work packages, MADE provides access to state-ofthe-art research valuable knowledge for manufacturing companies. Some of MADE s involved research and industrial partners also have MADEdedicated PhD positions. SME members of MADE have the opportunity to participate in demonstration projects where they obtain economic and knowledge support. The maximum duration of these projects is eight month with support funds of up to 12,250 per company. Participants can choose between focusing on existing management systems, demonstrating new technologies, or a combination of these two. However, the project needs to fit into one of the nine research themes of the initiative. Further activities available for members include the MADE Open Lab, industrial visits and innovation workshops. On average MADE members have access to at least one of these activities. Through the Open Lab companies and academic researchers can gain insights into the state-of-the-art technologies in a specific area. Typically an Open Lab often involves short presentations, case studies and technology demonstration. Industrial visits, on the other hand, refer to visits to companies excelling in a particular area. While serving mainly to inspire companies by delving into the experience of market leaders, corresponding WP leaders equally intervene to elaborate how the visit fits into the specific research context. Ultimately, networking is also a part of the visits. Meanwhile, the Innovation Workshops are a more interactive format to engage researchers from industry organized in mixed groups. On the basis of real company cases and expert assessments participants explore ideas and ways to implement new processes and technologies in their own companies. The themes covered range from lifelong product customisation (over model based supply chain development), to hyper-flexible robotics. SFIO CRACHO/Shutterstock.com 4

5 Target audience Prioritising SMEs MADE targets Danish manufacturing companies, in particular SMEs, by giving them the opportunity to participate in demonstration projects and open labs. However, the initiative also brings together stakeholders from large manufacturing companies, specialised technology providers (e.g. FORCE) and academia. Concepts and focus areas Research for the benefit of industry The nine research themes of MADE focus on manufacturing business related challenges of Industry 4.0. Each research theme is tied to one work package: (1) High speed product development; (2) Modular production platforms for high speed ramp-up; (3) 3D print and new production processes; (4) Model based supply chain development; (5) Digitalisation of supply chains; (6) Lifelong product customisation; (7) The new Manufacturing Paradigm; (8) Hyper flexible automation and (9) Sensors and quality control. Through these nine focus areas MADE intends to reach impacts to develop new technologies for Danish manufacturing companies, to enhance the knowledge transfer and exchange between MADE members and ultimately to make Denmark the most competitive manufacturing industry in the world. Through MADE s recently launched scale-up - MADE Digital the platform applies a stronger focus on digital manufacturing solutions in line with the needs of Danish industry. The research themes are again diverse including the following work packages (1) Smart Industrial Products, (2) Digital Assistance Tools, (3) Sensor Technologies and Production Data, (4) Digital Manufacturing Processes, Smart Factories, (5) Smart Factories, (6) Intelligent Supply Chains, (7) Organising Digital Production, (8) Automation with Collaborative Robots, (9) Digital Design. Leveraging the weight of Danish manufacturing One of the key drivers in the implementation of the initiative was the involvement of the Danish employers organisation (Danish Industries). Thanks to its participation, MADE gained a more solid membership base as well as a political intention. As a result, representatives from partially competing - large Danish companies sat together on one table to draw up a 5-year collaboration plan. Without the umbrella of Danish Industries this would have been impossible. An additional driver of MADE lies in providing companies with multileveled membership options, attractive for large companies and SMEs alike. While large companies carry the heavy burden of the private sector contributions, they can participate in the research activities by financing half of the PhD position. In return, they can benefit directly from the industrial research. SMEs, on the other hand, can make use of an established structure paying only a smaller membership fee while being able to participate in areas of interest. Through the Demonstration Projects SMEs are paired with a Research and Technology Organisation allowing them to work on focused research on their core challenges to increase their competitiveness. SWOT Matrix for MADE Strength Bottom-up approach which achieved to build trust between industry and research Effective governance structure driven by Danish industry Opportunities Successful scale-up of MADE Digital demonstrates further potential for growth Openness to collaborate with I4.0 initiatives in Europe may open up new opportunities Source: Digital Transformation Monitor Designed by Danish research & industry Although MADE started as an association in January 2014, the idea of a joint industry-research manufacturing initiative dates back to Set at Aarhus University research and industry representatives drew up several scenarios for future Danish production. To avoid increasing offshoring of Danish manufacturing both camps shared an awareness that industry and academia must act jointly. Indeed, the basic structure of the initiative, e.g. an industry dominated Board of Directors and a general Advisory Board was designed by the involved partners from research and industry. The priority was from the start that the initiative would match the demands from the manufacturing industry. The structure equally foresaw the organisation of the initiative into 9 WPs. An important design aspect concerned equally that each headed by one of the academic partners with each WP having a separate steering committee. Every ½ year the Steering Committees come together to report on the progress made in each WP and so far the progress is continuous. Weaknesses Initial unwillingness of researchers to participate due to competition of universities Broad coalition approach risks excluding some of the most disruptive ideas Threats No long-term funding model in place, in case the willingness of the Innovation Fund to support the initiative was to disappear 5

6 The process towards a SPIR Once the basic structure and core contents of MADE were defined by involved partners, the search for funding from the government started. In other words: In the case of MADE, the design was ready before there was even a policy. The process towards a public private partnership picked up speed in early 2013 when researchers and the employers federation got together to apply for a SPIR grant a Public Private Partnership for a 5-year project. The application built on the framework created earlier. Next to highlighting the importance to respond to industrial needs, this included a rough structure for the WPs including the PhD programmes. The Danish government had an advisory role regarding how to best build the PPP. There was no direct intervention in the process. Finally, the SPIR application was accepted providing public funds for a large 5- year programme and MADE was founded as an association with an industry dominated steering body. The MADE association received the funds and distributed the funds to the PhD programmes led by the 5 Technical Universities of Denmark. The challenge to win world-class researchers Initially, some of the country s best researchers would not participate, since there is competition between universities in Denmark like anywhere else in Europe. However, the prospect of industrial outsourcing, relocation of companies abroad and lost employment made was a common threat, mainly to industry but also to academia. Both parties therefore decided to counteract this trend together. Furthermore, some researchers were initially reluctant to buy into an industry dominated agenda. They did not believe that industry could make the right decisions. Ultimately, researchers have also learned a new of working with industry. Nowadays, the academic community is appreciating the lead by industry. Multi-level results and first impacts MADE has achieved to create a Danish manufacturing ecosystem composed of partners from industry, research and technology centres. Today, the platform counts 83 companies, 26 industrial partners, 5 universities, 3 technology institutes and 5 educational institutions. Within its 9 research themes, MADE partners have created 70 projects dealing with concrete challenges manufacturing SMEs are faced with today. Furthermore, MADE organised 34 innovation activities / events, thereby involving 2213 participants. MADE has also made significant use of social media channels such as Twitter and LinkedIn to promote and disseminate information around the platform's activities. Concerning MADE s evaluation and monitoring mechanisms, the initiative has not yet been subject to a formal evaluation. However, MADE delivers an annual report to the Danish Innovation Fund on the progress made in its 9 Work Packages. In addition, MADE keeps track of some key impact data incl. its outreach via different communication channels, MADE projects and innovation activities. Achieved results for MADE in the period MADE platform MADE membership platform membership companies companies (increase of 400% since 2013) 26 industrial partners More 5 universities than 800 companies have received loans 3 technology institutes 5 educational institutions Innovation and research activities MADE outreach Total of 34 innovation activities with 2213 participants Total of 70 projects (44 industrial projects) 32% success rate for research MADE research proposals Social media followers on twitter; +650 twitter posts; +460 LinkedIn followers Website MADE.dk Publication of 59 articles 16 periodic newsletters; +10,495 news s Source: MADE; Danks Produktion MADE Report for Innovation Fund Denmark Anteromite/Shutterstock.com 6

7 A scalable and transferable model MADE s high potential to be scaledup is demonstrated by MADE Digital, MADE s digital sister project. Despite being two years shorter, MADE Digital is provided with the same budget as its predecessor ( 24.4 million). MADE Digital relies on the same successful structure in terms of governance and is equally managed by MADE Association. MADE has been faced with significant interest to replicate its model from other countries and regions in and outside of Europe. Among others, the government of South Korea has expressed interest to explore ways to set up a similar project in Korea. From the very start MADE has been seeking partnerships with other European initiatives and organisations, e.g. Industrie 4.0 in Germany and the Dutch Brainpoort. One important aspect to consider concerning the transferability of MADE is the small size of the country facilitating rapid set-up and roll-out. For example, there are 5 Technical Universities in Denmark and all of them are on board of the initiative. However, there are also cultural factors to consider: In general, Danish people tend to be rather informal not being afraid of speaking across hierarchies. This has equally contributed to a more constructive and balanced spirit of co-operation. Trusting industry to innovate The involved Danish funding bodies have from the start applied an approach to leave industry and research create the particular design of MADE. In so doing it has taken a certain degree of risk to leave industry and research partners a high degree of autonomy and design the initiative that best corresponds to Denmark s needs. It is not unlikely that if the government had already had everything defined from the start, the chances of MADE to succeed would have been lower. MADE can serve as an example how trusting motivated stakeholders in this case industry and research can lead to significant results. In other words: MADE entered new grounds in not following any particular model but leaving partners to structure and develop MADE the way they wanted. References 1 Johansen, J., Madsen, O., Jensen, H. V., & Vestergaard, A. (2010). Manufacturing 2025: Future scenarios for Danish manufacturing companies. Aalborg: Center for Industrial Production and Department of Mechanical and Manufacturing Engineering. Retrieved from activities/ production-2025/ ² Moller, C. Business Process Innovation as an Enabler of Proactive Value Chains. Available at: 07/ _2?noaccess=true Willyam Bradberry/Shutterstock.com 7

8 About the Digital Transformation Monitor The Digital Transformation Monitor aims to foster the knowledge base on the state of play and evolution of digital transformation in Europe. The site provides a monitoring mechanism to examine key trends in digital transformation. It offers a unique insight into statistics and initiatives to support digital transformation, as well as reports on key industrial and technological opportunities, challenges and policy initiatives related to digital transformation. Web page: This report was prepared for the European Commission, Directorate-General Internal Market, Industry, Entrepreneurship and SMEs; Directorate F: Innovation and Advanced Manufacturing; Unit F/3 KETs, Digital Manufacturing and Interoperability by the consortium composed of PwC, CARSA, IDATE and ESN, under the contract Digital Entrepreneurship Monitor (EASME/COSME/2014/004) Authors: Demetrius Klitou, Johannes Conrads & Morten Rasmussen, CARSA and Laurent Probst & Bertrand Pedersen, PwC DISCLAIMER The information and views set out in this publication are those of the author(s) and should not be considered as the official opinions or statements of the European Commission. The Commission does not guarantee the accuracy of the data included in this publication. Neither the Commission nor any person acting on the Commission s behalf may be held responsible for the use which might be made of the information contained in this publication European Union. All rights reserved.