© 2009 by Strategic Business Insights. All rights reserved.© 2009 by Strategic Business Insights. All rights reserved.

Signals of Change

Toward A Sustainable Smart Society17 November 2009

Brock HinzmannTechnology Navigator

Scan

www.strategicbusinessinsights.com

2

Changing Market Needs (Pull)

Aging Population

Health and Wellness

Privacy and Security

Sustainability

Changing Competitive Landscape

Innovation, Standards, and IP Protection

BRICs (Brazil, Russia, India and China)

Global Communication Networks

Challenges In Marketing

Science and Technology Discoveries (Push)

Nanotechnology

Biotechnology

MEMS, Sensors, Robots

Pervasive Computing

Energy Technologies

Advanced Materials

A Global Economy:Opportunities and Threats

3

Complex Systems Underlie Basic Needs

4

Watch

Look continuously across diverse information sources for new

types of information that may be relevant.

Scan

Study

Act

Focus

Scanning Opens Awareness to Potentially New Outside Forces

5

Pattern Recognition, Analysis, and Research

Signals of Change

(on the Scan Web and in

Scan™ Monthly)

Workshops

Scanners and Their Abstracts

Monthly Set of 100 Abstracts

Consultations

Monthly Scan™ Meeting

The Process of Scanning

6

Competition and Policy• Timing Is Everything in Going Green (October 2007)• Carbon Labeling Needs Standards (September 2008)• Empowering the Healthy Consumer (October 2009)• Consumer Applications of SaaS (October 2009)• Pay for Effectiveness (August 2009)

Is Sustainabil

ity Sustainabl

e?

Is Sustainabil

ity Sustainabl

e?

Demand• The New Energy Environment (April 2007)• Conspicuous Conservation (May 2008)• Green Motives (October 2008)• The U.S. Consumer and Global Warming (January 2009)• BRIC: Becoming Really Internationally Competitive

(September 2009)• Strategies to Secure Food (September 2009)

Signals of Change

Technology• Advanced Sensors as Application Enablers (January 2008• Smart Appliances Meet Smart Grid (February 2008)• Net Zero Buildings (March 2009)• Ubiquitous User Interfaces (September 2009)• Micropower (October 2009)• Narrowing Automotive-Energy Options (August 2009)

7

“What more can I buy?” Green Movement

“What more can I buy?” Green Movement

Green Consumerism

Green Consumerism

Challenge of Scaling Up Developing World Using

Western Ways

Challenge of Scaling Up Developing World Using

Western Ways

Modest Lifestyle

Movement

Modest Lifestyle

Movement

China Controls the

Game Board

China Controls the

Game Board

Green Economics (government

incentives policies)

Green Economics (government

incentives policies)

Biofuels as

Signals of Turmoil

Biofuels as

Signals of Turmoil

Governments Get Backbone on Nuclear

Governments Get Backbone on Nuclear

Anti-ConsumerismAnti-Consumerism

Arctic Dynamics

(get more data)

Arctic Dynamics

(get more data)

Environmental ConflictEnvironmental Conflict

Hydrogen SaviorHydrogen Savior

Economic Competition for Clean-Tech Jobs

Economic Competition for Clean-Tech Jobs

Solar BreakoutSolar Breakout

Food InflationFood Inflation

Individual/Corporate

Satisficing Behavior

(effective or not?)

Individual/Corporate

Satisficing Behavior

(effective or not?)

Complexity of Global Change

Remains

Complexity of Global Change

Remains

Uncertainty over Climate

Change

Uncertainty over Climate

Change

Repercussions on Global South (get more data)

Repercussions on Global South (get more data)

Global Middle Class

Drag on Change

Global Middle Class

Drag on Change

Uneven PainUneven PainImportance of IndiaImportance of India

Energy Economic

Nexus

Energy Economic

Nexus

Study Spectrum Watch

Tipping PointsTipping Points

New NetworksNew Networks Digital Solutions Replacing Energy-

Intensive Ways

Digital Solutions Replacing Energy-

Intensive Ways

Corporate Activism to get ahead of the waveCorporate Activism to get ahead of the wave

Evolution, malaria/water, food supply (get more data)

Evolution, malaria/water, food supply (get more data)

Perception of Climate Change (Jan 2008)

8

The New Energy Environment

Major events are shaping the regulatory and economic environment for energy-consuming activities.• The California Global Warming Solutions Act of 2006 (AB 32) garnered much attention as an

aggressive step to stem greenhouse-gas (GHG) emissions. A similar effort is under way in the 12 Northeastern U.S. states forming the Regional Greenhouse Gas Initiative. International carbon cap-and-trade systems already exist in Europe and Asia.

• According to the PricewaterhouseCoopers MoneyTreeReport, venture-capital investment in the energy sector increased 107% from 2005-2006. And 40% of the total investment was in renewables.

• The California Climate Action Registry is a nonprofit GHG registry to promote GHG reductions. Established in 2002, it provides a model for how mandatory reporting systems work.

SoC233

9

The New Energy Environment

The convergence of public attention, developments in alternative-energy technology, and private-sector investment in such technologies is reaching critical mass, but questions remain about whether recent developments will be enough to forge a new energy paradigm. A rapidly changing energy environment is a certainty.

SoC233

10

Conspicuous Conservation

SoC305

Long term, a need exists for energy sources that can effectively replace oil. However, consumers are motivated by short-term economic disruptions. Conspicuous conservation may become the necessary alternative as consumers face increasing economic hardship.

11

SoC337

Green Motives

As the green movement continues to evolve and mature, new segments and types of green consumers are emerging. Consumer reasons for going green are becoming considerably more nuanced and varied than they once were. • According to a survey by General Motors, nine in ten women prefer talking to a man who

drives a Prius over talking to a man who drives a Porsche. In addition, 80% of survey respondents find people more interesting if they drive a fuel-efficient car than if they do not. The survey indicates that a mix of factors—including environmental, monetary, and social concerns—are driving green consumer behavior.

• Hypermilers are people who try to squeeze as many miles as possible from a tank of fuel in a manner similar to how U.S. car owners in the 1950s sought to outdo each other in boosting their cars’ speed and acceleration performance.

• Research engineer Ken Kurani at the University of California, Davis, conducted a study of Prius, Civic, and Insight drivers in 2005. He discovered that owning gas-electric cars for many consumers was less about saving money than about self-expression and self-understanding.

12

SoC347

The U.S. Consumer and Global Warming

The American Climate Values Survey (ACVS) is a 2008 research effort that reveals U.S. attitudes toward global warming. • Only 18% of U.S. consumers strongly agreed that global warming is happening, harmful, and

caused by humans. • U.S. consumers perceive concern about global warming in culturally feminine/tender terms,

whereas they perceive the denial of global warming in masculine/tough terms. • Global-warming “contrarians” tend to be outspoken and informed consumers who instill public

doubt about the science of global warming through various media outlets. • Younger segments of consumers—who focus on fashion, instant gratification, and social

networking—showed particular concern for global warming as a trendy issue. • Innovative, high-resource consumers and hands-on consumer segments strongly identify with

green technology. • U.S. consumers view the issue of global warming as a high-status societal concern.

13

BRIC: Becoming Really Internationally Competitive

SoC395

14

Strategies to Secure Food

SoC398

15

Competition and Policy• Timing Is Everything in Going Green (October 2007)• Carbon Labeling Needs Standards (September 2008)• Empowering the Healthy Consumer (October 2009)• Consumer Applications of SaaS (October 2009)• Pay for Effectiveness (August 2009)

Is Sustainabil

ity Sustainabl

e?

Is Sustainabil

ity Sustainabl

e?

Demand• The New Energy Environment (April 2007)• Conspicuous Conservation (May 2008)• Green Motives (October 2008)• The U.S. Consumer and Global Warming (January 2009)• BRIC: Becoming Really Internationally Competitive

(September 2009)• Strategies to Secure Food (September 2009)

Signals of Change

Technology• Advanced Sensors as Application Enablers (January 2008• Smart Appliances Meet Smart Grid (February 2008)• Net Zero Buildings (March 2009)• Ubiquitous User Interfaces (September 2009)• Micropower (October 2009)• Narrowing Automotive-Energy Options (August 2009)

16

Alternative Energy Technologies Scan™ Workshop, 27 July 2006

From LDCs

to LEDs

From LDCs

to LEDs

Changing Balance of

Power in Energy Trade

Changing Balance of

Power in Energy Trade

Private Sector

Innovation

Private Sector

Innovation

Policy is FluidPolicy is Fluid

Business

Going Green

Business

Going Green

EnergyConservation

EnergyConservation

Changing

Equity

Environment

Changing

Equity

Environment

Transportation

Technology

Advances

Transportation

Technology

Advances

Law of Big

Numbers

Law of Big

Numbers

Still Low

Hanging Fruit

Still Low

Hanging Fruit

Wal-Mart Bores MeWal-Mart Bores Me

Distributed

Incremental Savings

Distributed

Incremental Savings

Not So

Simple

Not So

Simple

Green Accountability

Green Accountability

Where in the WorldWhere in the World

Bio Solutions to Energy Problems

Bio Solutions to Energy Problems

Science of Re-New-Cycle

Science of Re-New-Cycle

Time of

Penetration of Market

Time of

Penetration of Market

Harvesting Mechanical

Hyperactiviry

Harvesting Mechanical

Hyperactiviry

Land Abuse

Planning

Land Abuse

Planning

Energy Density Issues

Energy Density Issues

The Price is Right

The Price is Right

Optimize Your LifeOptimize Your Life

Lets Get Small (Nano)

Lets Get Small (Nano)

Or We'll Do It

for You

Or We'll Do It

for You

Action Spectrum Watch

17

Advanced Sensors as Application Enablers

18

Smart Appliances Meet Smart Grids

SoC351

The integration of sensor, computing, and network technologies in appliances and energy grids is rapidly evolving the means to optimize energy consumption, distribution, and production processes.

• The U.S. Department of Energy’s Pacific Northwest National Laboratory (Richland, Washington) has completed a residential trial of a “Grid Friendly Appliance” controller, which shuts down appliances if the grid drops below the U.S. 60-hertz frequency.

• RLtec (London, England) is working on a system that would allow refrigerators constantly to regulate themselves collectively.

• Boulder, Colorado, is currently implementing a trial smart grid—SmartGridCity—that allows customers to see how much power they’re using.

• General Electric is working on a line of energy-management–enabled appliances suitable for remote control. It is due for release in 2009.

19SoC358

Net-Zero Buildings

Developing and implementing net-zero-energy and zero-carbon-footprint buildings is emerging as significant in architecture and construction. We are seeing traditional buildings transform into more energy-efficient and carbon-friendly configurations.• Masdar City is a $24 billion, nine-year initiative in Abu Dhabi, United Arab Emirates, to

build the world’s first zero-carbon, zero-waste city.• Cisco Systems (San Jose, California) has signed an agreement with Metropolis, an

organization of 106 cities around the world, to create Internet-protocol–based intelligent city infrastructures, including smart power grids and smart buildings.

• Google (Mountain View, California) has recently submitted plans for a building that Google hopes will create a benchmark of sustainability and define new standards for architecture and construction.

• Italian architect David Fisher has designed the self-powered Dynamic Tower—the first building to generate its own electricity, as well as generate electricity for other buildings nearby.

20

EPRI: We Need “Holistic” Smart Grid

21

Ubiquitous User Interfaces

SoC393

22

Micropower

SoC401

23

Narrowing Automotive-Energy Options

SoC391

24

Competition and Policy• Timing Is Everything in Going Green (October 2007)• Carbon Labeling Needs Standards (September 2008)• Empowering the Healthy Consumer (October 2009)• Consumer Applications of SaaS (October 2009)• Pay for Effectiveness (August 2009)

Is Sustainabil

ity Sustainabl

e?

Is Sustainabil

ity Sustainabl

e?

Demand• The New Energy Environment (April 2007)• Conspicuous Conservation (May 2008)• Green Motives (October 2008)• The U.S. Consumer and Global Warming (January 2009)• BRIC: Becoming Really Internationally Competitive

(September 2009)• Strategies to Secure Food (September 2009)

Signals of Change

Technology• Advanced Sensors as Application Enablers (January 2008• Smart Appliances Meet Smart Grid (February 2008)• Net Zero Buildings (March 2009)• Ubiquitous User Interfaces (September 2009)• Micropower (October 2009)• Narrowing Automotive-Energy Options (August 2009)

25

Future of Manufacturing Scan™ Workshop, 12 November 2008

Psychological Factors

Why People Make Choices

Psychological Factors

Why People Make Choices

DDM Advances and Rise of Localized

Design

DDM Advances and Rise of Localized

Design

Leveraging the Weak EconomyLeveraging the Weak Economy

Water Labeling, Lifecycle

Water Labeling, Lifecycle

Are We Giving It

All Away?

Are We Giving It

All Away?

Materials As a Source of

Competitive Advantage

Materials As a Source of

Competitive Advantage

Marketing

Carbon Footprint

Marketing

Carbon Footprint

Manufacturing 3.0Manufacturing 3.0

Workforce Training Costs

A Lot to Get Back

Workforce Training Costs

A Lot to Get Back

Reducing Penalties

Of Rural Living

Reducing Penalties

Of Rural Living

Skills That Matter May Be ChangingSkills That Matter May Be Changing

Energy as a Source of Competitive AdvantageEnergy as a Source of Competitive Advantage

High-Energy Eco-Systems, Separating from Expensive and

Inefficient Urban Areas

High-Energy Eco-Systems, Separating from Expensive and

Inefficient Urban Areas

Information/Knowledge

Security

Information/Knowledge

Security

Retooling IT for Old Manufacturing

Retooling IT for Old Manufacturing

New Ways to Sell

Expensive Things

New Ways to Sell

Expensive Things

Preventive Maintenance Preventive

Maintenance

Data Mining and How to Manage

Resources

Data Mining and How to Manage

Resources

Urbanization As a

Barrier to Globalization [A]

Urbanization As a

Barrier to Globalization [A]

How to Encourage Grassroots Innovation

How to Encourage Grassroots Innovation

Enabling Robots to Leave their Restricted Area

Enabling Robots to Leave their Restricted Area

Finding New Mines For Data Mining

Finding New Mines For Data Mining

Action Spectrum Watch

Government Assistance

Across the Chasm

Government Assistance

Across the Chasm

Innovation, Customization,

And Market Validation

In Manufacturing

Innovation, Customization,

And Market Validation

In Manufacturing

Urbanization As a Barrier to

Globalization [B]

Urbanization As a Barrier to

Globalization [B]

Water Security as a New Priority

Water Security as a New Priority

Invisible GoldInvisible Gold

Customized World + Green World

Customized World + Green World

Digital Security

Cracks/Gaps

Digital Security

Cracks/Gaps

Competition of

Government-Industry Complex

Partner or Competitor?

Competition of

Government-Industry Complex

Partner or Competitor?

Rise of Natural Gas Security

Context of Food and Water

Rise of Natural Gas Security

Context of Food and Water

Finding More Value in

Rethinking Waste

Finding More Value in

Rethinking Waste

Lack of Standards for Carbon Footprint

Lack of Standards for Carbon Footprint

New Interactive Way

To Engage

New Interactive Way

To Engage

Old-School Approach To Moving the Tech

Forward

Old-School Approach To Moving the Tech

Forward

Service as a Business Model

Service as a Business Model

Service Design DeliveryThrough Robotics and

Enhanced Interface Tools

Service Design DeliveryThrough Robotics and

Enhanced Interface Tools

System Integration for Sustainable Urban

Development

System Integration for Sustainable Urban

Development

Bridging the “Silicon-Meatbag”

Divide

Bridging the “Silicon-Meatbag”

Divide

Consumer-Involved Health Care

Consumer-Involved Health Care

Environmental Compliance Monitoring

2.0: Making a Buck?

Environmental Compliance Monitoring

2.0: Making a Buck?

Advancing Science Beyond 1898

Advancing Science Beyond 1898

26

Timing Is Everything in Going Green

SoC254

The rush to support alternative energy technologies is not always tempered by the knowledge that many investments will take time to mature.

• Sugar-derived ethanol transportation fuel has helped Brazil replace 40% of gasoline consumption with ethanol as of 2006. In the United States, efforts to deliver ethanol from corn continue to gain momentum in spite of studies showing that corn-derived ethanol is not cost- or energy effective.

• The promise of clean coal resonates in the United States, China, and India, yet the environmental “cleanliness” of clean-coal power depends on the effectiveness of carbon capture and storage, which, according to a report from the Massachusetts Institute of Technology, is not yet guaranteed to work.

• Coal to liquids (CTL) promises to deliver diesel fuels that derive from abundant coal at competitive prices. Opponents point out that CTL products are expensive to produce, production consumes large quantities of water, and CTL fuels are far greater contributors of greenhouse-gas emissions than conventional petroleum fuels are.

27

Carbon Labeling Needs Standards

Companies are adjusting to increased societal interest

in carbon counting and carbon labeling. • Tesco, a U.K.-based grocery and retail chain, has

introduced carbon labels on its own-brand products that state how much carbon dioxide a product will emit in its lifetime.

• In Japan, a standard government-approved labeling system that breaks down a product’s carbon footprint will appear on food packaging and other products.

• The European Commission is proposing to label car advertisements on the basis of carbon emissions and fuel consumption.

• France is using a diagnostic de performance energetique (test for energy performance): Sellers will have to pay for a diagnostic performance test and provide the results to a buyer or renter.

SoC328

28

Empowering the Healthy Consumer

SoC402

29

Consumer Applications of SaaS

SoC403

30

Pay for Effectiveness

SoC387

31

Source: www.johnsoncontrols.com/publish/us/en/sustainibility

• Definition: “the creation of manufactured products using processes that are non-polluting, conserve energy and natural resources, and are economically sound and safe for employees, communities, and consumers.” US Dept of Commerce's Sustainable Manufacturing Initiative

• Moves beyond “lean manufacturing” to incorporate “the triple bottom line”: economic prosperity, environmental stewardship and social responsibility

• Sustainable manufacturing (SM) practices include:— Regular audits: energy, water, waste, carbon foot print— Systems engineering to optimize toward net zero energy use— Reduced use of carbon-based fuels— Increased use of renewable fuels— Improved energy efficiency (i.e., more efficient motor controls, lighting, capture & reuse of heat)— Reduced water use — Materials substitution— Greater use of by-products— Waste reduction— More and better re-cycling— Re-manufacturing— Eco-friendly product design — Improved vehicle efficiency in transport of raw materials and/or

finished goods— Increased use of local suppliers (to reduce transportation costs, fuel

consumption)

Sustainable Manufacturing

32

Continuous Scanning Makes Sense of Complex Issues

Customer Priorities

Internet

Sales

ChannelsChip Manufacturers

Supply Capacity

EnvironmentCost of Goods Sold

Crime and Security

Public Attitudes

Design/CAD Technology

CustomerExperiences

Social Priorities

Competitive Structure

Use of Media

PoliticalLeaders

Work Patterns

Capital

Healthcare

New ProductsTechnology

Education andLearning

ElectronicCommerce

Populations Shifts

Price

New Media Techniques

Health of OECDEconomies

Perceptions of Risk

Privacy

IndustrializationPatterns

Corporate Demographics

Change Leader Attitudes

Value Chains

33

Generate IdeasNew trends or opportunities suggested

by background info: technologies, applications, services, business

models

Screen Trends NIST screening criteria (potential to change, competitiveness, strategic importance, etc.)

Select Which trends should we analyze further?

Set Objectives

Form Clusters

Which implications should be included in analysis briefings?

Review 80 Scan SoCs, Explorer Viewpoints

Describe ImpactsAdd timing, implications, impact, required capabilities, etc. to 21

13 Trends and their implications are further analyzed after the workshop; NIST opportunity

briefings developed

Analyze Trends and Develop Opportunity and Threat Assessment

Step 4:

Step 2:

Step 3:

Step 1:

Step 5:

Step 7:

Manufacturing Definition and Scope

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Wo

rksh

op Cluster trends having common features

Identify Potential ImplicationsStep 6:

Opportunity Discovery Turns Complexity into Focus and Action

34

Today 2020 and Beyond

Representative

Products

Technology

Manufacturing

Processes

Actions

Business

Considerations

Government Subsidies and RPS Requirements (B1)

Solar PV Arrays [P7]

Price of Oil (B2)

High-Temperature Materials [MP4]

In-situ Measurement of Thin-Film Processing [T1]

Price of Carbon (B3)

Concentrating Solar Thermal [P12]

Wind Turbines [P16]

Geothermal Power Plant [P13]

Cost Competitive IGCC Coal [P4]

ICCS w/CCS – “Clean Coal” [P5]

Cogeneration (CHP) [P2]

Waste Energy Recovery [P3]

Combustion Coal Plant [P1]

Low –cost Thin-Film PV [P8]

Building Integrated PV [P9]

Low-cost 3rd-Generation PV [P11]

High-Efficiency, Low-Speed

Wind Turbines [P19]

Large Off-shore Wind Turbine

Installations [P17]

Ocean Wave/Tidal Power

Systems [P18]

Enhanced Geothermal Power Plant [P15]

Zero-Water CSP [P14]

Biomass Combustion [P6]

High-Throughput Thin-Film Processing

(Roll-to-Roll) [MP1]

Nanomaterial Printing) [MP3]

Grid Status (B4)

Planning Tools – Land Use Efficiency [MP6]

Design Simulation for Large Systems [MP7]

Measuring Extreme Tolerances [T2]

Energy LCA [T3]

Energy Efficient Silicon Refining) [MP2]

Low-Cost Concentrating PV [P10]

Lifetime Estimate[T5]

Carbon Accounting [T4]

Nanomaterials Production [MP10]

Surface Modeling [T6]

Increased Manufacturing Capacity

– High-Strength Composites [MP8]

Increased Manufacturing Capacity

– Very Large Components [MP9]

Automated Manufacturing to Match Foreign

Competition [MP5]

Design Standards [T7]

Roadmapping Anticipates Net Steps

35

Sustainable, Connected, Smart