1. Global innovation Lars Goldschmidt 10.dec. 13 Global innovation policies Bundling and competiveness Lars Goldschmidt DI Confederation of Danish Industry

2. Global innovation 10.dec. 13 Lars Goldschmidt Content Confederation of Danish Industries Value creation in Denmark Innovate or die Location of value chain elements Bundling Implications for industry policy 2

3. Global innovation 10.dec. 13 Lars Goldschmidt Confederation of Danish Industry 10.000 large, medium and small companies Collective bargaining All business related policy areas

4. Global innovation 10.dec. 13 Lars Goldschmidt 4 Broad range of members Manufacturing 40 percent Knowledge services 17 percent Trading 14 percent Transport 13 percent Services 7 percent Energy supply 4 percent Others 5 percent Membership by industry sector

5. Global innovation 10.dec. 13 Lars Goldschmidt 5 5 Small and big companies with much in common 80 percent less than 50 employees 20 percent more than 50 employees Employees totals in member companies

6. Global innovation 10.dec. 13 Lars Goldschmidt Vision 6 DI’s vision is an open and prosperous society that features both growth and balance. The result of which recognises Denmark as the world's most attractive country for business to work in and from.

7. Global innovation 10.dec. 13 Lars Goldschmidt Major Challenges Very high cost base, when operating in Denmark 800.000 outside the labor market Low growth on our European markets Future supply of qualified workforce Decrease in private research and development spending in Denmark 7

8. Global innovation 10.dec. 13 Lars Goldschmidt R&D spending pct. of GDP 8

9. Global innovation 10.dec. 13 Lars Goldschmidt Ofshoring of development spending 9

10. Global innovation 10.dec. 13 Lars Goldschmidt 10 Future Danish products and services Denmark competes on the global market by delivering solutions and services to upper middle markets The end user customer demand moves towards uniqueness, identity and experience The B to B and B to C demand moves towards more holistic solutions that solve more complex problems covering the full functionality triangle. The financial and economic crises has shifted market strength towards Asia and market preferences towards price

11. Global innovation 10.dec. 13 Lars Goldschmidt 11 The value triangle: Technical functionality Social functionality and acceptability Esthetic quality and individual identity signal

12. Global innovation 10.dec. 13 Lars Goldschmidt 12 Location and competitive strategy Competitive Force = Cunning * Financial Strength * Framework Conditions Total Costs Relocatable business processes will be located where the competitive force has a maximum Processes located in Denmark will be knowledge intensive either because they are difficult or because they have a high innovation content

13. Global innovation 10.dec. 13 Lars Goldschmidt Radical changes and unsolved global problems increase demand for innovation Financial crises Global change in political and economical power from Europe and USA to Asia and emergent economies Global changes in customer preferences Dramatic increase in available knowledge Population growth Mega Cities Climate change Hunger Environmental degradation Unstable states and other conflicts Ageing / immortality 13

14. Global innovation 10.dec. 13 Lars Goldschmidt Consequence More for less Innovate or die Value in the eye of the different other 14

15. Global innovation 10.dec. 13 Lars Goldschmidt 15 The innovation triangle: Technical possibility Competition drive User need and demand

16. Global innovation 10.dec. 13 Lars Goldschmidt 16

17. Global innovation 10.dec. 13 Lars Goldschmidt Pharmaceutical Idea Lab Work Test Small scale production design Test Authority interaction Approval Large scale process design Pilot plant Production facility construction Etc. Value chains 17 Manufacturing Idea Concept Design Prototype Test Series Mass customerisation Low cost mass production Bottom of the pyramid production Construction Idea Drawing Detailed design Construction Transfer Operation De commissioning

18. Global innovation 10.dec. 13 Lars Goldschmidt Value chain location Location in Denmark member survay Positive drivers Knowledge intensity Interdependency between links in the value chain - bundling Benefit from local resources costumers, knowledge institutions, business ecosystem Affordable cost structure Negative drivers High wages, taxes, etc. Limited marked Limited access to qualified employes Wage cost >= 12% 18

19. Global innovation 10.dec. 13 Lars Goldschmidt Bundling Development – Production Development – Costumers Development – Knowledge institutions Development – Business ecosystems Production – Raw materials Production – Production competence Production – Transport convience 19

20. Global innovation 10.dec. 13 Lars Goldschmidt Innovation policy Demand side Demanding public customers, health sector, energy, water, education Regulation creating demanding private customers, housing, environment Facilitating regulation Free trade, deregulation visa policy Tax incentives for research spending and visiting staff Public reseach High quality research in relevant areas Access to statistical data and clinical research Access to wold class research infrastructure ESS, MAXIV, XFEL Innovation as a part of education 20

21. Global innovation 10.dec. 13 Lars Goldschmidt Relevant research ? 21 LandTEKNATTEK+NAT Danmark14,421,636 Sverige221840 Holland21,520,542 Tyskland22,93759,9 Tjekkiet21,945,467,3

22. Global innovation 10.dec. 13 Lars Goldschmidt Innovation competence The ability to see and seek out differences in needs and opportunities The ability to search for solutions in an open solution space The ability to transcend and combine in a professionally competent manner The ability to introduce the new in an organization Confidence in the competence to meet new challenges, not in the status quo Wildness and enthusiasm Excited multicultural empathy 22