1. The importance of
Open collaboration
Marc Hendrikse
CEO NTS-Group

2. The world is changing S&P 500 in 1980 S&P 500 in 2013 From oil to ICT
IBM
AT&T
Exxon
Standard Oil Indiana
Schlumberger
Shell
Mobil Oil
Standard Oil California
Atlantic Richfield
General Electric
S&P 500 in 2013
Apple
ExxonMobil
Google
Microsoft
General Electric
Johnson&Johnson
Chevron
Procter&Gamble
JPMorgan
Wells Fargo
From oil to ICT

3. The company lifespan declines

4. The high-tech world is challenging too
World wide competition
Increasing complexity
Flexibility and agility demanded
Shorter product life cycles
Upfront investment for new product development grows
Pool of technical talent shrinks
Cost price pressure
Higher quality levels required
Market share US:
2009: 50%, 2013: 2%
Global market share:
2007: 50%, 2013: 3%

5. Innovation costs grow, revenues decline
Own Market
Revenue
Shorter product life
cycle in the market
Revenues
Own Market
Revenue
Option 2
Internal
Development
Costs
Internal
Development
Costs
Rising cost
of innovation
Costs
Close model
Before
Close model
After
Chesbrough H. (2006)

6. Open innovation is one answer
Our current market
Our new market
Other firm’s market
External technology
insourcing
Internal technology base
External technology base
Internal/external
venture handling
License, spin out, divest
Chesbrough H. (2006)

7. With a changed business model
Sale / divesture
Spin-off
New Revenues
Revenues
License
Own Market
Revenue
Own Market
Revenue
Internal
Development
Costs
Internal &
External
Development
Costs
Cost and time savings
from leveraging
external development
Costs
Closed model
Open innovation
business model
Chesbrough H. (2006)

8. High Tech Campus Eindhoven
Founded by Philips 100 years ago
Now 125 companies
10,000 researchers
80 nationalities
Shared facilities

9. Open supply chain is another answer
Value chains compete instead of individual companies
Supply chain is designed to outsource non-core activities or functionalities
Cooperation within high intelligent networks is the model for the future
The supply chain opens itself and takes more responsibility

10. Classic way of outsourcing
OEM VALUE CHAIN
Subcontracting of component production only with different suppliers
1. Research & Development
2. Design & Engineering
3. Prototyping & Industrialization
4. Component production
5. System integration
6. Sales & Service

11. Recent development in outsourcing
OUTSOURCING PART OF THE VALUE CHAIN
Outsourcing core processes including Process Development
Outsourcing support processes like Supply Chain Management, Sourcing and Life Cycle Management
Process Development
1. Research & Development
2. Design & Engineering
3. Prototyping & Industrialization
4. Component production
5. System integration
6. Sales & Service
Supply Chain Management
Sourcing & Life Cycle Mngt.
Sub-Assemblies
Components

12. Future in European high-tech industry
OPEN SUPPLY CHAIN, BUILD TO BUSINESS CASE
OEM transform to lean companies
Business Model Development, Financing & Funding
Quality Assurance
Project Management & Staffing
Process Development
1. Research & Development
2. Design & Engineering
3. Prototyping & Industrialization
4. Component production
5. System integration
6. Sales & Service
Supply Chain Management
1st Tier
Sourcing & Life Cycle Management
2nd Tier
3rd Tier

13. Example of build to business case
PHENOM
originally being a product of FEI, it has been developed and brought into production by NTS-Group and Sioux.

14. Not an easy road to go Transparency & Trust between parties
Cooperation skills at OEM & supplier
Clear IP agreement between OEM and supplier
Insight in the business case of OEM
Risk & reward agreement: how to share
Willingness and ability to invest by supplier
Communication on all levels (C-level, BuDev, R&D, Operations)

15. Thank you!
Marc Hendrikse
CEO NTS-Group