The role of innovation for

the future of Swissindustrial SME

The role of innovation for

the future of Swissindustrial SME

É C O L E P O L Y T E C H N I Q U EF É D É R A L E D E L A U S A N N E

Laboratoire de gestionet procédés de productionM. Pouly

Content

Content of the presentation

MANUFUTURE : the future of manufacturing in Europe

Where does innovation take place in industrial SME

The “brakes” of innovation

Removing the brakes

MANUFUTURE

The future of manufacturing in Europe

Strengths

• European industry is modern and competitive in many respects. Most sectors have made significant efforts to upgrade their production infrastructures and integrate new forms of organization • A long lasting industrial culture exists, with large European networks linking suppliers, manufacturers, services and user companies• Europe has taken on board the sustainable development dimension. Significant investment in environmental protection, clean technologies and environment friendly production processes have led to new manufacturing and consumption paradigms. 

MANUFUTURE

The future of manufacturing in Europe

Weaknesses

• Productivity growth in European manufacturing industry as a whole has been below US levels in recent years; Increases in ICT and new technology spending over years seems not yet to be translated into productivity gains• The Commission’s competitiveness reports of 2001 and 2002 have identified insufficient innovative activity and weak diffusion of new technologies as key determinants for low productivity growth• Enterprises in Europe are clearly not investing enough in R&D

MANUFUTURE

The future of manufacturing in Europe

“Innovation alone will not secure the future of the enterprises of the manufacturing branch, they will also have to adapt themselves to the evolution of the markets” 

Centralized production

  Actual markets Future markets

Future products

 

New business models and new

technologies

Actual products

 

Distributed production for a global market

 

Technological leadership

Content

Content of the presentation

MANUFUTURE : the future of manufacturing in Europe

Where does innovation take place in industrial SME

The “brakes” of innovation

Removing the brakes

Where does innovation take place ?

Innovation for Swiss industrial SME

Development of new products or services (87%) Improvement of internal business processes (85%) Redesign of existing products (75%) Improvement of business processes within the supply chain (63%) IT is an important tool to support innovative business processes

“ For the SME, the increase of productivity and the reduction of costs are more important than the increase of market shares for the next 5 years”

Source : IPLnet survey 2004

Example of an innovative IT supported business process

Classical method for the purchase of Classical method for the purchase of screws and boltsscrews and bolts

• Inventory managed as C-class articles in the ERPInventory managed as C-class articles in the ERP• Purchase proposals issued at the reorder pointsPurchase proposals issued at the reorder points• Issue an order for the different positionsIssue an order for the different positions• Check the delivery schedulesCheck the delivery schedules• Check the incoming goodsCheck the incoming goods• Transfer the goods to the workshopsTransfer the goods to the workshops

Risk of missing partsRisk of missing parts Important costs (~200 Euros per order position)Important costs (~200 Euros per order position)

Example of an innovative IT supported business process

Vendor based inventory forVendor based inventory forscrews and boltsscrews and bolts

• Screws and bolts in cases placed on balancesScrews and bolts in cases placed on balances• Weighing system linked by modem to the vendor’s serverWeighing system linked by modem to the vendor’s server• Automatic refill by the vendor driven by the needsAutomatic refill by the vendor driven by the needs

No purchase costs and no missing partsNo purchase costs and no missing parts

From supplier of low cost goods to logistic solutionFrom supplier of low cost goods to logistic solution providerprovider

Content

Content of the presentation

MANUFUTURE : the future of manufacturing in Europe

Where does innovation take place in industrial SME

The “brakes” of innovation

Removing the brakes

The « brakes » of innovation

Innovation “brakes”

Too long realization time (68%)

Lack of human resources (55%)

R&D project management problems (55%)

Lack of innovation spirit within the company (49%)

Lack of knowledge of the customer’s needs (47%)

Source : IPLnet survey 2004

Content

Content of the presentation

MANUFUTURE : the future of the European industry

Where does innovation take place in industrial SME

The “brakes” of innovation

Removing the brakes

Removing the brakes

Too long realization time and lack of human resources

Innovationcluster:

Virtual enterpriseClient

To share ressources to

• develop new machine elements• develop new services• develop innovative collaborative business processes (Sales, After Sales, Purchases etc.• reduce production costs

Machine Innovation Network

A new research project with 10 enterprises

Removing the brakes

R&D project management problems Lack of innovation spirit within the company Lack of knowledge of the customer’s needs

Train engineers in the management of technology

• during the master curriculum for the young ones

• during post-grade formation as continuous education for the “old” ones

Conclusions

Conclusions

Transform research results (knowledge) into products

Increase productivity through ICT

Holistic production systems based on humans, technique and organization

Conclusions

Thank you for your attention !