University-Business Co-operation: Innovation: EIT Co-Location Centre model Wojciech GREGA KIC InnoEnergy, CC Poland Plus Tomasz Barszcz, EC Systems Sp. z o.o. Krakow Meeting of the Directors General of Higher Education, Dublin 22nd–23rd April 2013

Agenda: EIT overview and objectives KIC model KIC InnoEnergy in operation KIC InnoEnergy: propositions for industry KIC InnoEnergy: propositions for HEI Example of KIC operation: CC Poland Plus Case study: SME experience with KIC InnoEnergy

EIT is as an integral part of Horizon 2020

The European Institute of Innovation and Technology (EIT) Mission: To contribute to sustainable European economic growth by reinforcing the innovation capacity of the Member States and the EU higher education business/ innovation Concept: … by integrating higher education, research and innovation, and buissnes development of the highest standards (the knowledge triangle) research

EIT – objectives new business creation through innovation the transfer of higher education, research and innovation activities in a business context support of innovation-driven research in strategic areas development of talented, skilled and entrepreneurial people through education and training activities

The EIT designated its three first KICs in December 2009: EIT operations – KICs’ The EIT designated its three first KICs in December 2009: sustainable energy (KIC InnoEnergy) climate change adaptation and mitigation (ClimateKIC) future information and communication society (EIT ICT Labs)

Main characteristics of KICs: high degree of integration (each KIC is a legal entity) long-term strategic approach (each KIC is set up for a minimum of 7 years) high degree of commitment of partners (EIT funding to KICs is 25% over time, the rest must be co-funding - from other sources) the collocation model (each KIC consists of cluster-like nodes with a clear geographic location) clear deliverables (each KIC sets up a business plan with measurable deliverables)

KIC InnoEnergy structure and basic facts Partners are regionally mapped in six collocation centres (CC) across Europe, and are either Formal, Associated or Network, depending on their contribution to the industrial plan, and resulting in different participation in the equity in the different legal structures . Smart Cities Smart Grids Clean Coal Chemical Fuels Renewables Convergence Nuclear - Renew KIC InnoEnergy is a commercial company, with 29 founding shareholders, incorporated as SE, with head quarters in The Netherlands. 8 8

Copyright © 2013 KIC InnoEnergy KIC InnoEnergy in operation Innovation Education Practice Generic master MSc thematic masters PHD School Learning Modules Skills Market Knowledge Needs Technical relevance Consortium Entrepreneurship Business creation Services Idea exploration Technology transfer Copyright © 2013 KIC InnoEnergy

Industry involvements Industry presence in partnership: (from 14 in 2010 to 55 in 2011 to 95 in 2012) 10 10 10

Copyright © 2013 KIC InnoEnergy KIC InnoEnergy proposition for industry What does industry get from Education? The talents adapted to their needs Manpower for industry based project Life-Long Learning What does industry get from Innovation projects? New product and services for their own Business Processes A bit of financial complementarity A trusted network, with the best university partners What does industry get from Business Creation? Early adopters of new technology Support for internal spin-offs Investment possibilities What does industry get from such a governance? Long term commitment => If no 7 years, then no industry Stability in the network Governance rules close to theirs own Copyright © 2013 KIC InnoEnergy 11 11 11 11

Copyright © 2013 KIC InnoEnergy KIC InnoEnergy proposition for HEI Public Private Partnership (PPP): Industry becomes a founding member of the collaborative environment. The only way to compete against other “world” powers. What does HEI get from Education? New type of education in the energy field, mobilising the innovative and entrepreneurial spirit of the students. The novel approach proposed and high level of industry involvement are attracting the talents (MSc: 3-4 candidates/ 1 place) Industry involvement in education as a a chain: programs designs, promotion, thesis proposed by industry, internships, transition to the labour market Financial complementarities A trusted network, with the best European universities and industrial partners mobilityEntrepreneurship EIT labelled: hands on (intern) business case market orientation mobility Copyright © 2013 KIC InnoEnergy 12 12 12 12

Copyright © 2013 KIC InnoEnergy KIC InnoEnergy proposition for HEI Public Private Partnership (PPP): Industry becomes a founding member of the collaborative environment. What does HEI get from Innovation projects? Complementing projects supported by other instruments (ETP, Regional, National Funds , DG R&D, DG ENER)- including financial complementarity Shorter time to market A trusted network, with the best industrial partners What does HEI get from Business Creation? Improvement of business side of the proposals KIC InnoEnergy joins idea owners with industrial and capital partners Early adopters of new technology Support for internal spin-offs Copyright © 2013 KIC InnoEnergy 13 13 13 13

Copyright © 2013 KIC InnoEnergy KIC value proposition for industry KIC InnoEnergy can be seen as USP (Unique Selling Proposition) The only existing “one stop shop” where you can find such an ambitious portfolio of activities requiring collaborative innovation, delivered by the best actors of the knowledge triangle, in a commercial joint vehicle that is run as a business. : Copyright © 2013 KIC InnoEnergy 14 14 14

Copyright © 2013 KIC InnoEnergy KIC InnoEnergy: achievements after 30 months 370 students in our 120 ECTS Masters 84 engineers in our PhD School 49 professionals in our Exec. programs 20 patents filled (1/1M€; 1/67M€ in FP7) 26 new technology products & services 51 ventures bring up in our Highway www.kic-innoenergy.com/achievements Copyright © 2013 KIC InnoEnergy 15 15 15

KIC InnoEnergy business model in Education € SUSTAINABILITY Off-setting tuition costs MOOC/LM Reinvesting all revenues USP 1. Quality of HE institutions 2. Program contents 3. Mobility 4. Double degree OUTPUT “CxO” of energy companies Top researchers A PREMIUM PRODUCT Msc School (7 programs) PhD School Executive Programs LLL/LM MOOC CUSTOMERS Bachelors Engineers Mid Career professionals MOOC Customers MEANS Top Universities Industry in all the value chain Top Business Schools Copyright © 2013 KIC InnoEnergy

Copyright © 2013 KIC InnoEnergy Example of KIC operation model: CC Poland Plus Current implementation process of KIC strategy (CC Poland Plus) Partner (from other CC) Partner 1. Ideas generally come from partners network. Partners organize themselves in consortia Partner Partner Partner Idea (inno/bcs) 2. On BCS capture, ideas are identified by KIC KIC/ CCPP Partner Partner 3. KIC by selection criteria or by education improves business side of the proposals Only BCS Partner Partner 4. The consortia are implementing a project with business oriented goals External entities (mostly techno parks) Copyright © 2013 KIC InnoEnergy KIC InnoEnergy | Boosting Innovation for Sustainable Energy | Speaker: Rafał Mrówka 17

Example of KIC operation model: CC Poland Plus New approach to of KIC strategy implementation (CC Poland Plus) All external actors Partner (from other CC) Natural persons Partner 1. KIC InnoEnergy actively searches for new external (and internal) ideas/opportunities Partner Universities& Research Inst. 2. KIC by selection criteria or by education improves business side of the proposals Partner Public and regional agenties KIC/ CCPP Partner Industry 3. KIC InnoEnergy joins idea owners with industrial and capital partners (based on resource need for implementation) Business& Capital partners Idea (inno/bcs) Partner SMEs 4. Partners will provide resources and implement a project. Partner Techno parks,CTT Copyright © 2013 KIC InnoEnergy KIC InnoEnergy | Boosting Innovation for Sustainable Energy | Speaker: Rafał Mrówka 18

KIC InnoEnergy | Supervisory Board 24Nov2010| Speaker: DP Case study: EC Systems experience with KIC InnoEnergy KIC InnoEnergy | Supervisory Board 24Nov2010| Speaker: DP

Who we are? Engineering company from Kraków, Poland Systems for industrial customers Embedded systems Software (from firmware to advanced analysis) 70% sales to foreign markets (DE, CH, DK, FR) Key industries: power generation (conventional, gas, wind), automotive, railway, oil & gas, printing, food, … Staff: 50 people, mostly HW, SW specialists We bridge the gap …

Why bridging the „Valley of death”? Despite a large number of Research & Development projects, only a fraction turns into successful products. The especially important gap spans between a laboratory test as a result of a university project and heavy duty proven product launch Happy developers in a lab is only a start… … it needs a lot of time and money to make their system work in a demanding environment

Valley of Death Valley of Death is the time when the government funding has finished, but there is no reliable product which can be offered to customers In most cases it is a period between TRL 4 and TRL 7 Required investment is so high, that skeletons of many projects are left here TRL: Technology Readiness Level (1…9)

How to bridge the gap? The problem is researched by European and US agencies Solution requires balanced partnership between government, academia and industry Key element are motivated people, oriented on the market success Most people say, that we simply need more money, but it is only partially true Insufficient funding in critical TRL levels will kill the project Too much money too early will cause waste of money Proper decisions are based on the risk/ reward profile for a given case

Understand each other Academia Are „mad scientists” type Prototype driven Learn by doing Say „What if”? Nurture infant technology Ask: „Can it be done”? Fill the funnel: create new options Objective: UNDERSTANDING Industry Are boring and no sense of humor Requirements driven „Do it right the first time” Say „Prove it” Kill the weak and move on Decide: „Should we do it”? Narrow the funnel: increase focus Objective: DELIVERY

Focus on common part End user company Spin off company Academia Business as usual End user company Spin off company New technology development Consulting Waste of money Academia

Wind turbines condition monitoring Wind turbines are istalled over the world Key element to profitability is proper maintenance The biggest problem is failure of the gearbox It can cost >500k€ and several months to replace The exact knowledge about the current technical condition is necessary, but it is very hard due to varying operating conditions

Disruptive innovations vs. competitors Advanced signal processing Automatic data validation of non-stationary signals Automatic peak detection and classification Polyphase current analysis Failure detection by integrating the system kinematic Reliability: monitoring of the machine wear based on statistical model Automatic comprehensive report Offline surveillance for more advanced and complete diagnosis and to accelerate the learning curve using wind turbine expert knowhow No predefined thresholds Spectrum structure: no bandwidth selection Independent of a database Vibration & polyphase current Reliability models « One click » approach

Main milestones to achieve 9 months Embedded prototype (HW&SW) V1 M2 18 months Evaluation on the KAStrion test bench Local GUI and data transfer software completed M3 24 months Evaluation on 2 onshore wind turbines M4 25 months GoTo Market M5 30 months Evaluation over 6-month onshore tests M6 36 months Evaluation over 6-month offshore tests Final Version of KAStrion KAStrion: 36 months Year 1 Year 1&2 Total EIT requested 545 698 € 1 337 139 € 1 882 837 € Own resources 1 566 310 € 3 717 724 € 5 284 034 € TOTAL 2 112 008 € 5 054 863 € 7 166 871 € EIT funding rate 25,8% 26,5% 26,3% Students from French Universities (G-INP, UTT) and Polish University (AGH Krakow) 3 PhD Grants requested to KIC 1 PHD Grant requested to G-INP 4 student masters requested to KIC 1 post-doctoral researcher requested to CNRS KIC requested WP1 WP2 WP3 WP4 WP5 WP6 WP7 Total Master Students 1 2 4 Phd students 1.5 0.5 3

Partners setup EC Systems CETIM GRAVIT Grenoble - INP INPT CNRS MARKET development, sales CETIM testing GRAVIT innovation support Grenoble - INP development INPT CNRS MARKET VALEMO user MECAL Cash flow Products, services dissemination, promotion

Experience with KIC InnoEnergy Pros: Very much bussiness oriented, better than FP7 Simple application process Quick feedback from KIC staff Pro-active approach, helping attitude Professional reviews from KIC experts Cons: Still in start-up phase, thus rules were changing in the beginning Reporting not as easy as initially assumed Participate in future profits

A company run as a company Conclusions KIC InnoEnergy A new Innovation engine, impact oriented Fully aligned with the SET plan (The European Strategic Energy Technology Plan) Integrating Education, Research and Business Demonstrating high efficiency of investment Generally, positively assessed by the industrial partners A company run as a company 31 31

More to know http://www.kic-innoenergy.com 3232 Thank you for your attention! KIC InnoEnergy is funded by: More to know http://www.kic-innoenergy.com wojciech.grega@kic-innoenergy KIC InnoEnergy | Boosting Innovation for Sustainable Energy | Speaker: Rafał Mrówka 32 32