Mag. Dr. ARNO RETTENBACHER Vice President for Research, SWAROVSKI ENERGY Studies of Physics and Chemistry at the University of Innsbruck Industrial research and employment in international companies (pharmaceutical industry, materials science, electronics) 2001 Ph.D. degree in organic chemistry (University of Innsbruck) 2001 2003 Research Assistant at the University of Innsbruck (research and teaching) 2004 Postdoctoral Fellow at Clemson University, South Carolina (USA) in the field of materials science and nanotechnology 2005 2006 Senior Scientist and DOE project leader (fuel cells, photovoltaics) at the Advanced Materials Research Laboratories, Anderson, South Carolina (USA) 2007 Visiting Professor (research and teaching) at Clemson University, South Carolina (USA) Numerous publications, patents and talks at international conferences, several awards and distinctions in science Acquiring and coordination of well donated US research grants (DOE, NSF in the field of renewable energies and materials science) Consultancy in the field of fuel cell membranes for a major US automotive manufacturer 2008 2011 Head of Future Technologies at D. Swarovski KG, Wattens (Austria) since 2012 Vice President for Research at SWAROVSKI ENERGY, Vienna (Austria)
SWAROVSKI s next evolutionary step and logical response to the Concept of Open Innovation SWAROVSKI ENERGY Mag. Dr. ARNO RETTENBACHER Vice President for Research, SWAROVSKI ENERGY Austria Connect Canada Canadian Austrian Networking Conference on R & D June 15 th, 2012 02:45 03:15 pm
CONTENT The Evolution of SWAROVSKI : 1892 2011 The Evolution of SWAROVSKI : 2012 The Foundation of SWAROVSKI ENERGY R&D in the Past and in the Future: A Paradigm Shift Funding Opportunities in Austria (Best Practices in R&D collaborations)
The EVOLUTION of SWAROVSKI
OUR EVOLUTION The 4 maxims by the founder Daniel Swarovski for ongoing progressive change and social innovation: Every new era offers new possibilities for action and development. Evolution never stops. Innovations in one field inevitably lead to innovations in others. One must remain alert at all times, always ready to make the very best use of what emerges. You will only achieve lasting success if you strive to think not only of yourself, but also of others. Where you manage that, you will doubtlessly be blessed with success. Daniel Swarovski (1862 1956)
OUR EVOLUTION 1892 Daniel Swarovski, a Bohemian inventor and visionary, revolutionizes crystal craftsmanship by inventing the first crystal-cutting machine, making it possible to cut jewelry stones with greater precision than traditional manual methods had allowed. Daniel Swarovski (1862-1956)
OUR EVOLUTION 1895 In 1895 Daniel Swarovski moved to the Austrian village of Wattens, Tyrol with his newlyinvented machine and laid the foundation for the world s leading producer of precisioncut crystal for fashion, jewelry, lighting, architecture and interiors industries. His vision: to give the world a crystal of unprecedented beauty and brilliance. To achieve this vision, he set a high standard that to this date is central to Swarovski s corporate mission: constantly improve what is good. Daniel Swarovski with his sons Wilhelm, Fritz and Alfred Wattens, Austria
OUR EVOLUTION 1919 Tyrolit is founded in Wattens, Austria, to capitalize on Swarovski s experience with grinding tools. Today, Tyrolit is the leading brand for innovative cutting technology and one of the world s largest manufacturers of bonded grinding, cutting, sawing, drilling and dressing tools and machines for the stone and construction industries. Tyrolit s grinding wheel Turnover 2011: 548 Mio. Employees 2011: 4,512
OUR EVOLUTION 1937 After years of development, Swarovski launches Swareflex. The glass reflectors are developed to improve visibility and safety on the road. Today, Swareflex produces high-quality, precision-made reflectors as well as newly developed LED (light-emitting diode) products for road safety. Swareflex LED lane indicator for tunnels and galleries
OUR EVOLUTION 1949 Swarovski Optik is founded and goes on to become the world leader in manufacturing of precision optical instruments for hunting and nature observation (binoculars, telescopes, rifle scopes, range finders, and night vision optronic devices). Turnover 2010: 94 Mio. Employees 2010: 700
OUR EVOLUTION constantly improve 1956-2011 what is good Aurora borealis, gemstones Crystals for chandeliers and lighting Hotfix, a crystal application technique Crystal figurines Jewelry collection Swarovski Crystal Society (SCS) Crystal Mesh Crystal Worlds SWAROVSKI GEMS TM Swarovski Creative Service Centers Crystal Palace Swarovski Xilion
OUR EVOLUTION STATUS QUO 2011 Leading manufacturer of cut crystal, grinding tools, long-range precision optics, road safety products Turnover Swarovski Group 12/2010: 2.6 billion Employees Swarovski worldwide 12/2010: 23421 Swarovski Headquarter (Wattens/Austria)
OUR EVOLUTION CONTINUES A maxim of our company founder Daniel Swarovski was to always combine the successes of today with the opportunities of tomorrow Every new era offers new possibilities for action and development. Swarovski Sustainability Report 2010 as well as his vision of a sustainable development You will only achieve lasting success if you strive to think not only of yourself, but also of others. His visionary spirit is still as strong as ever and as a logical consequence this led to the next evolutionary step Swarovski Water School The foundation of SWAROVSKI ENERGY
OUR EVOLUTION 2012 SWAROVSKI ENERGY is founded in Vienna, Austria and is tasked to shape innovations with entrepreneurial and pioneering spirit taking advantage of SWAROVSKI s vast core competencies in Glass melting (own development and production of glass) Glass forming technologies (pre-forming and second deformation) Grinding and polishing technologies (special machines developed by Swarovski) Surface treatments (AR coatings, sandblasting) Connection technologies: gluing, mechanical bonding techniques The strength of the brand, which forms a great asset and applying them to pacing technology of the 21 st century - PHOTONICS - with the strong belief that strategic partnerships and lead customer interaction are the foundation of sustainable success. High Quality Lenses in LED applications High Quality Lenses for CPV (Concentrated PhotoVoltaics)
R&D WITHIN THE CRYSTAL BUSINESS The making and refining of cut crystal can be done completely in house due to Swarovski s vast core competencies. R&D activities with outside partners are rare and limited to specific occasions. Confidentiality has top priority and public research funding is therefore restricted to the General application-oriented research funding provided by the Austrian Research Promotion Agency FFG (within this program an outside partner is not mandatory!). final product outside collaborators Final product delivered to customers via company owned worldwide network of over 1150 Swarovski stores
SWAROVSKI ENERGY -A PARADIGM SHIFT IN R&D What worked well for R&D within the CRYSTAL BUSINESS for almost 120 years, does not work for the R&D within the new subsidiary company. final product Final product delivered to customers (LED manufacturers) SWAROVSKI ENERGY outside collaborators
SWAROVSKI ENERGY -A PARADIGM SHIFT IN R&D What worked well for R&D within the CRYSTAL BUSINESS for almost 120 years, does not work for the R&D within the new subsidiary company. final product SWAROVSKI ENERGY outside collaborators Final product cannot be delivered to customers (LED manufacturers) without a deep knowledge of the very complex design of an LED lamp.
SWAROVSKI ENERGY -A PARADIGM SHIFT IN R&D Concept of OPEN INNOVATION is a must: utilization of external knowledge (cooperation with partners in industry and academia), catalyzed by the use of national and international research grants. LED lens Cathode Lead LED lens bonding LED chip + Phosphor final product SWAROVSKI ENERGY Submount (silicon) Thermal Heatsink Outer Package Bond Wire outside collaborators Final product delivered to customers (LED manufacturers)
FUNDING OPPORTUNITIES IN AUSTRIA The Austrian Research Promotion Agency (FFG, Forschungsförderungsgesellschaft) FFG is the national funding agency for industrial research and development in Austria FFG also works for other national and international institutions FFG is a one-stop shop" offering a diversified and targeted program portfolio FFG gives Austrian businesses and research facilities quick and uncomplicated access to research funding FFG is wholly owned by the Republic of Austria, represented by Federal Ministry for Transport, Innovation and Technology Federal Ministry of Economics, Family and Youth Huge variety of different funding programs with an overall budget of ca. 300 Mio. per year, noteworthy to mention the General Program BRIDGE Program
FUNDING OPPORTUNITIES IN AUSTRIA General Program (Basisprogramm) Objectives in general The General Program supports research projects run by individual companies of all sizes individual research institutes individual researchers and inventors consortia cooperation between industry and research institutions (universities) Funding is totally application orientated: the economic assessment focuses on the commercialization potential and the applicant s economic performance (Capability to commercialize R&D) Duration: funding for individual projects is provided on an annual basis only. Follow-on applications must therefore be submitted for longer projects. Funding: for large companies no limit (not exceeding 7% of the company s annual R&D expenditures; overall budget per year is currently about 200 Mio. ) Example: Turnover for Swarovski Group is 2600 Mio. Assumed the percentage of total revenue invested in R&D is 5% (130 Mio. ) The maximum amount for all research grants per year: 9,1 Mio. (theoretically)
FUNDING OPPORTUNITIES IN AUSTRIA Eligible costs in the General Program Maximum funding volume (depends on the firm size): Generally 50% Startup companies 70% The FFG uses a mix of three different kinds of funding Non-repayable grants (limited to 19%, in some cases up to 25%, if sub contractors are involved) Repayable grants: low-interest loans (1%) with a time frame of 3 years. guarantees for bank loans plus interest subsidies. There are many other detail to consider, for example: a fully working prototype which can be used by the company for making goods, cannot be paid by a non-repayable grant (but with a low-interest loan). Example for General Program: No subcontractor(s) involved, no prototype Total costs: 1000K 100% Swarovski s own costs: 500K 50% Maximum funding for large enterprise: 500K 50% Non-repayable grant: 190K 19% Repayable grant (at the rate of 1% within 3 years): 310K 31%
FUNDING OPPORTUNITIES IN AUSTRIA What are the benefits within a General Program project? A partner in academia is not mandatory for the SME or large enterprise: good for companies which do not depend on external knowledge and which like to keep it very discrete. Enabling of more risky projects (CEOs sometimes can be very conservative when it comes to the support of high-risk research projects). High Volume Funding: 200 Mio. per year totally, for a large size enterprise like Swarovski, the maximum amount for all research grants per year: ca. 9 Mio. (theoretically) What are the downsides within a General Program project compared to other funding possibilities? Maximum funding is 19 to 25% only compared to 60% within the BRIDGE 1 Program e.g.: Total project costs 1000K Total maximum funding within the General Program: 250K Total maximum funding within the BRIDGE1 Program: 600K
FUNDING OPPORTUNITIES IN AUSTRIA BRIDGE 1 Program* Closing the "funding gap between basic and applied research Objectives in general Further development and utilization of findings in basic research for commercial applications Funding is available for any research subject Intensification of research co-operation between science (at least one partner) and industry Duration: up to 3 years Funding: for large companies no limit (not exceeding 7% of the company s annual R&D expenditures; overall budget per year is currently about 12 Mio. ) Example: Turnover for Swarovski Group is 2600 Mio. Assumed the percentage of total revenue invested in R&D is 5% (130 Mio. ) The maximum amount for all research grants per year: 9,1 Mio. (theoretically) *Currently there are no more calls for BRIDGE 2 (lower funding and industrial partner is more involved into basic research)
FUNDING OPPORTUNITIES IN AUSTRIA Eligible costs in the BRIDGE 1 Program The majority of costs (at least 80 %) must be met [meaning generated and not paid] by the academic research partner. The participating companies, as the potential users of the research findings, contribute to the project by providing financial support and/or payments in kind and manpower (up to 20 %). Maximum funding volume (depends on the firm size): large size enterprises 60% SMEs 70% regional development areas +5 % The gap financing (private funding) for the academic research partner must be covered by the industrial partner in cash. Example for BRIDGE 1: basic research on new glass recipes on a molecular level, far away from commercialization. Thinking outside the box: Teaming up with a professor (= research partner) having a high reputation in solid state chemistry. Total costs: 400K 100% Academic Partner (Austrian University): 320K 80% Swarovski: 80K 20% Public funding for University partner by FFG : 240K 60% Private funding for University partner by Swarovski: 80K 20% Swarovski s own costs: 80K 20%
FUNDING OPPORTUNITIES IN AUSTRIA What are the benefits within a BRIDGE1 project for each partner? 1) Academic research partner (big winner!): A project at zero costs for up to 3 years, e.g. the 320K in the example mentioned before (own expenses for manpower, infrastructure, new equipment etc) are fully covered by FFG and industrial partner. Industrial partner has to cover his own expenses fully by himself. Full coverage of the remuneration for at least one full PhD position (typically 3 years). 2) Industrial partner: The company saves at least 1 60% of the research expenses, provided the project in mind would have been realized anyway, even without external funding. Results, IPRs fully belong to the company (provided a compensation to the academic research partner has been paid upfront). Enabling of more risky projects (CEOs sometimes can be very conservative when it comes to financing of research projects). Intensification of research co-operation between science and industry (extending the professional and sometimes even private network). What are the downsides within a BRIDGE1 project compared to other funding possibilities? Low Volume Funding: 12 Mio. per year totally, compared to 200 Mio. per year for the General Program. 1 Salaries in academia generally are lower than in industry.
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