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  1. 1. © Siemens AG, Corporate TechnologySiemens Corporate Innovation SystemDr. Martin Gitsels
  2. 2. © Siemens AG, Corporate TechnologySiemens around the World Siemens is the largest electric and electronics company,a world leader in solutions for a wide range of industries. Since more than 165 years the Siemens brand standsfor advanced technologies, progress and constantgrowth. Today the company operates in more than 190 countriesacross the world with more than 370 000 employees. In FY 2012 (as of September 30, 2012) sales reached78,3 bln euro, while the profit exceeded 4,59 bln euro.
  3. 3. © Siemens AG, Corporate TechnologyToday’s businessMajor R&D investments € 4,2 billion in FY 2012, or5,4% of revenue 29,500 R&D employees worldwide about 18,000 software engineers 188 R&D locations in over30 countries around the world 8,900 inventions in FY 2012 57,300 active patentsFY’075,1%4,7%4,9%5,1%R&D spending in% of revenue5,5%FY’08 FY’09 FY’10 FY’11We pioneer in the areas of …EnergyefficiencyIntelligentinfrastructuresolutionsAffordable &personalizedhealthcareIndustrialproductivityFY’125,4%
  4. 4. © Siemens AG, Corporate TechnologyResearch and innovation complement each other Research is a necessary though notsufficient precondition for innovation Business strategy drives R&Dstrategy Innovation is the creation ofsomething new and its successfulintroduction into the marketInnovation is transformingknowledge into moneyResearch is transformingmoney into knowledgeInnovation =Invention + market success= Economic value
  5. 5. © Siemens AG, Corporate TechnologyInnovation strategyFocus on innovation with highestcustomer value and profit expectations Understand the customerTrend scouting to respond immediatelyto upcoming developments, e.g. in theenergy market Understand trends and rulesCross-Divisional innovation strategies Fill the innovation pipeline213
  6. 6. © Siemens AG, Corporate TechnologyUnderstand the CustomerAnforderungen desKundenInventionImplementation inthe companyImplementationin the marketGenerating ideas Customer benefits Creativity workshopsSelecting ideas Value creation Competition CompetenceIP generationBusiness plan (draft) Product specification Business strategy Business dataTop managementsupportFinancingProject managementProduction/logisticsIntegration (testing)ControllingMarketing Market segmentation Timing Alliances/cooperation Key customersSalesAfter-sales serviceLösungenfür denKunden
  7. 7. © Siemens AG, Corporate TechnologyUnderstand trends and rulesUrbanization 60 percent of the world’spopulation will live in citiesin 2030 With efficient planning andmanaging we can handlethe complexity of soaringMegacities.Demographic Change The 65+ generation willnearly double worldwide by2030 (from 7% to 12%) We have to provideaffordable and high-qualityhealthcare for developedand emerging countries.Climate Change To limit CO2 to 450 ppm:Additional investment of€10.5 trillion is required inenergy sector by 2030. By combining all efficiencymeasures we can limitClimate Change.Globalization Average annual GDPgrowth until 2050: India~6%, China >4%, USA1.9%, Germany 1.7% Emerging markets offertremendous opportunitiesand also challenges.
  8. 8. © Siemens AG, Corporate TechnologyInnovation StrategyConsistent with respect to:Consistent strategy: be a pioneer in all our businessesTechnologystrategyPatentstrategyR&DresourcestrategyStandardsstrategyProcessesPeople / Skills/ Culture Be a pioneer in all our businesses tosecure the most competitive edge Focus on trendsetting technologyportfolios per business and achieveleading position Increase patents in trendsettingtechnologies Effective R&D spending Full leverage of our capabilities andassets to tap further potential
  9. 9. © Siemens AG, Corporate TechnologySiemens answers the toughest innovation challengesTechnologicalchangeBusinessModelLow HighNewUn-changedRadicalDisruptiveDisruptiveRadicalIncremental(current R&D)132Innovation examplesIncreased digitalization of factoryplanning:Siemens buys UGS to enableintegrated management of wholeproduct lifecycle (digital factory)New materials (e.g. Ceramics withenhanced properties):New heat shield for turbines createcompetitive advantagesEnergy savingsPerformance contracting:Siemens sells reduction of energyconsumption and is paid in % ofrealized reductions123
  10. 10. © Siemens AG, Corporate TechnologyInnovation Pipeline Key objectives of the CIP are- to ensure a timely identification ofdisruptive commercializationchallenges,- to realize their strong potentialbusiness impact,- to have a stringent and holisticcapital allocation decision,- to set-up clear operationalownership and a continuousprocess- to ensure top managementattention CIP will push organic growth insupport of One Siemens growthtargetsGoals Corporate Innovation Process and PipelineDiscussionon Corp.InnovationOpportunitieswithCEO/CFO/CTOElaborationofCorporateInnovationOpportunitiesIdentificationofCorporateInnovation FieldsImplemen-tationFollow-upCapital allocation decisionby Managing BoardPrioritizationPreselectionCorporate Innovation PipelineBusiness Plan Follow up withgo/no go decisionDefined strategy,owner and budgetInnovationFields
  11. 11. © Siemens AG, Corporate TechnologyLeveraging the technological synergies at alllevelsIndustry Energy HealthcareTap further upside potential on all levelsof technology synergies …Best-practice sharing between Divisions,Corporate Departments and Regional Companiesas with Software Initiative (SWI), ProjectManagement3Multiple impact of Corporate Technology,Lighthouse projects, technologies, technologyconsulting, innovation management & processconsulting, patents, standardizationCorporate ResearchBest-practice sharingUse of common technologies, shared R&D-projects, platform projects, common use of IPRs,innovation value chainsCommon technologyand platform12
  12. 12. © Siemens AG, Corporate TechnologyNetworks are the breeding grounds forinnovation (“Open innovation”)Start-up /VCsThink TanksCompetitorsKeyCustomersResearchInstitutesUniversitiesOther IndustriesGovernmentalpartnersBusiness
  13. 13. © Siemens AG, Corporate TechnologyOpen Innovation Culture – PrerequisitesPublic Incentive Mechanisms to stimulate Entrepreneurship, e.g. Joint Research tax reduction for specific projects or on entire operation (e.g. staff, import) grant mechanism connected with focus programs (risk sharing) special focus on SMEs but incorporate majors support in exploitation of resultsMechanisms of Know How Protection, e.g. in Joint Venture regional registration of patents (only 12 month after 1st registration possible) contracts to avoid transfer of know how to 3rd party (reselling of shares) registration of patents by shareholders and transfer of licenses to JV …and first of all: registration of inventions!!Fair Treatment of Partners, e.g. in Research Cooperations inventions from subcontracts belong to financing instance, but partner gets non-exclusive royalty-freelicense inventions from joint research (e.g. publicly funded) are shared or registered jointly our policy sharing with partners rather than blocking them
  14. 14. © Siemens AG, Corporate TechnologyScenarios forthesectorsTime horizon (varies markedly across the different sectors)Short-term Medium-term Long-termTodayInfluencingfactors New markets New customerrequirements Newtechnologies New businessToday’sbusinessExtrapolationvia roadmaps Products Technologies CustomerrequirementsRetropolationout of scenariosIndividualsSocietyPoliticsEconomyEnvironmentTechnologyCustomersCompetitionStrategicvisionStrategic innovation planning for allareas of businessIndustryEnergyHealthcare
  15. 15. © Siemens AG, Corporate TechnologyMissionComputer ScienceElectricalEngineeringPhysics/ChemistryMathematicsMechanicalEngineeringNon-TechnicalSkills Profile (30% PhD)Our Competence ~ca. 80 Employees(in Moscow/St. Petersburg)PartnersCompetencesStaffLomonosovMoscow StateUniversityNational ResearchUniversity MEPhIMoscow PowerEngineering InstituteSt. Petersburg StatePolytechnical UniversityMoscow institute of Steeland AlloysRussian Academy of SciencePower Engineering & Energy Resources• High energy systems, heat & mass transfer• Thermo-/gas-dynamics, combustion, hydraulicsAdvanced Materials – e.g. Metals• Process & material models for metallurgical processes• Fatigue, crack, corrosion analysis & predictionControl Technologies & SW Engineering• Fault Detection & Prevention, Data Analysis• Dependable and embedded systemsNon-Energy Nuclear Physics• Radiation sources, detection & prevention• Industrial irradiation, accelerationSiemens in Russia – Corporate Research & TechnologyLocalization of Research• CT offers technologies in strategically relevant fields of our regionaland global Siemens Sectors and Divisions• CT creates innovation excellence and realizes synergies ina global network with Divisions, R&D units of Siemens end-customers and external research partners• CT partners with technologically leading research institutes anduniversities, contributing to Russian scientific community• CT provides IP support for Siemens units in Russia• CT supports recruiting and development of top experts andtechnical leadership talents for the local companyCross Module SimulationsIndustrial Heat Recovery UnitOnline Material Property Control at Annealing
  16. 16. © Siemens AG, Corporate TechnologyClosing the Gap of Innovation – The Siemens ApproachSummaryChallenges for Industries• Disconnect between research and result exploitation. Thousands of pieces of intellectual property are owned,however most corporate research units necessarily focus on their disciplinary research, limiting opportunitiesthat their innovations will make it to the marketplace.• Managing the entrepreneurial risk. Demanding relatively low-risk opportunities and requiring proof-of-concept(and sometimes even customers), short-term thinking about return of invest puts implementation of newtechnology to risk.• The trap of Closed Innovation principle. Lack of ability to integrate know-how of external partners (e.g.customers, research institutes, universities) causes significant set-back while facing growing innovationpressure by globalization of competition and shorter product life-cycles.Elements of Siemens Approach• Complement of research and innovation. While research transforming money into knowledge, innovation trans-forms knowledge into money assuming research as prerequisite. Our business strategy is driver of the researchand development (R&D) strategy.• Holistic innovation strategy. To be a pioneer in all our businesses, we focus on trendsetting technology portfoliosper business, increase patents in trendsetting technologies and make spending on R&D effective. Our holisticapproach consists of technology, patent and R&D resources strategies based on standards and processes.• Open Innovation. We consider networks of partners such as research institutes, universities, key customers(and competitors!), governmental partners and other industries (start-ups) as breeding grounds for innovation.We consider our Research Center at Skolkovo (150 staff in 5 years) as part of our Open Innovation strategy.
  17. 17. © Siemens AG, Corporate TechnologyThank you!Siemens LLC115093, Moscow,Dubininskaya str, 96www.siemens.ruQuestions?