Master of Science Thesis

KTH School of Industrial Engineering and Management

Energy Technology EGI_2016-063 MSC EKV1156

Division of heat and power

SE-100 44 STOCKHOLM

Value maximization in product

development through holistic design

Efraín Arturo Hernández Mora

-I-

Master of Science Thesis EGI_2016-063 MSC

EKV1156

Value maximization in product development

through holistic design

Efraín Arturo Hernández Mora

Approved

August 9th 2016

Examiner

Peter Hagström

Supervisor

Peter Hagström

Commissioner

-

Contact person

Frederick Leßmann

Abstract

Entrepreneurship and startups are widely studied themes that have been the focus of plenty of literature in the last years. In this sense, different methodologies have been proposed in order to ensure a successful market entry for startups, being the lean startup concept considered as the most useful and promising. Almost all of the studies on market entry for startups have been developed focusing on the business-to-consumer market, especially on the information and communication technologies.

An almost complete lack of studies covering product development and market entry was found in the conventional industrial business-to-business market. In order to solve such a problematic, this master thesis has found its motivation.

The present thesis introduces a literature review on methodologies used for product development and market entry for startups, i.e. using the concepts of lean startup, market analysis, minimum viable product, prototyping and business modelling. Afterwards, a methodology is proposed to increase market entry success’ possibilities for startups venturing in the conventional industrial business-to-business market. Finally, the methodology is used in a case study involving a young German start-up.

By using the methodology proposed, an optimal product configuration with its corresponding draft design and business model was obtained. The methodology achieved to solve critical sub-systems’ bottle necks through iterative design, while at the same time delivering a business model that will be considered by the startup for its initial market entry strategy.

Finally, it can be concluded that the methodology proposed is a success, as by using it the process of product and business development had results that correctly fit into the reality of the business. An invitation is left open to finish the design process of the non-critical sub-systems, as well as to keep developing in the customer-feedback iterations for both the product and business development.

-II-

Master of Science Thesis EGI_2016-063 MSC

EKV1156

Value maximization in product development

through holistic design

Efraín Arturo Hernández Mora

Approved

August 9th 2016

Examiner

Peter Hagström

Supervisor

Peter Hagström

Commissioner

-

Contact person

Frederick Leßmann

Sammanfattning

Entreprenörskap och startups är allmänt studerade teman som har varit i fokus i många publikationer under de senaste åren. Olika metoder har föreslagits för att säkerställa en framgångsrik marknad för nystartade företag. Lean startup anses vara det mest användbara och lovande konceptet. Nästan alla undersökningar visar att inträde på marknaden för startups har utvecklats med fokus på business-to-consumer marknaden, särskilt avseende informations- och kommunikationsteknik.

Det är en nästan total avsaknad av undersökningar som omfattar produktutveckling och marknadsinträde i den konventionella industriella B2B marknaden. För att studera den problematiken har detta examensarbete skapats.

Genom att använda den föreslagna metodiken erhölls en optimal produktkonfiguration med ett förslag till design- och affärsmodell. Den metod som uppnåtts löser viktiga delsystems flaskhalsar genom iterativ design, samtidigt som en affärsmodell skapas som kan betraktas som start för en ursprunglig marknadsstrategi.

Slutligen kan det konstateras att metoden som föreslås är en framgång. Genom att använda den processen för produkt- och affärsutveckling erhölls resultat som korrekt passar in i den reella verksamheten. Frågan kvarstår dock rörande designprocessen av de icke-kritiska delsystemen, samt huruvida kundresponsiterationer för både produkt-och affärsutveckling fortsättningsvis skall utvecklas.

-III-

Acknowledgements

Firstly, I would like to thank my supervisor Frederick Leßmann for his constant support and guidance in the realization of this project. With him, I have learned more than the academic knowledge needed for the realization of this thesis, but also an incredible amount of valuable skills. Likewise, thank you for having faith in me and giving me the opportunity to develop this master thesis work at otego.

Secondly, a great thank to the rest of the otego team, André Gal, Matthias Hecht and Silas Aslan, for their help in diverse themes that were both related and non-related to the thesis.

Thank you also to the whole academic team behind the M.Sc. program SELECT. Their whole efforts have made the last two years of my life the most enriching and exciting ones, increasing not only my understanding on sustainability, but on the world in general. Special thanks to Peter Hagström for supervising my thesis, as well as Cesar Alberto Valderrama and Nele Stoffels for their constant support and friendship.

A big thank to my mother, Lilia del Carmen Mora Alcaraz, for always backing me up in all my projects and adventures. I know you have lost your sleep more than once worrying about me, and for that and your constant love and support, I thank you.

Finally, I would like to give my greatest thanks to my grandfather, electric engineer Leon Arturo Mora Catalan, as without the long-lasting knowledge and bases he gave me, I would have never got to where I am now. Thank you for shaping the person I am now.

-IV-

Table of Contents

Abstract ........................................................................................................................................................................... I

Sammanfattning ............................................................................................................................................................ II

Acknowledgements .................................................................................................................................................... III

Table of Contents ....................................................................................................................................................... IV

List of Figures ............................................................................................................................................................. VI

List of Tables ............................................................................................................................................................ VIII

List of Acronyms Used .............................................................................................................................................. IX

1 Introduction .......................................................................................................................................................... 1

1.1 Objective ...................................................................................................................................................... 1

1.2 Work Structure ............................................................................................................................................ 2

2 Literature Review ................................................................................................................................................. 3

2.1 Entrepreneurship, Startups and the Lean Startup ................................................................................. 3

2.1.1 Market Analysis .................................................................................................................................. 5

2.1.2 Minimum Viable Product and Prototyping ................................................................................... 7

2.1.3 Business Modelling ............................................................................................................................ 8

2.2 Case Presentation ......................................................................................................................................13

2.2.1 Thermoelectric Elements Background .........................................................................................13

2.2.2 otego...................................................................................................................................................16

3 Methodology .......................................................................................................................................................20

3.1 Market Analysis through Modified Technology Utilization Model ..................................................20

3.2 Minimum Viable Product Prototyping ..................................................................................................22

3.3 Business Modelling ...................................................................................................................................24

4 Results and discussion .......................................................................................................................................27

4.1 Market Analysis .........................................................................................................................................27

4.1.1 Step 1: Product Configuration, Task and Market Characterization .........................................27

4.1.2 Step 2: Derivation of Evaluation Criteria.....................................................................................28

4.1.3 Step 3: Technology Assessment ....................................................................................................31

-V-

4.1.4 Step 4: Conclusion ...........................................................................................................................45

4.2 Minimum Viable Product Prototype......................................................................................................46

4.2.1 Pre-Design Activities .......................................................................................................................46

4.2.2 Heat Sink and Attachment Method Design ................................................................................48

4.3 Business Modelling ...................................................................................................................................49

4.3.1 Market Value Chain Definition .....................................................................................................49

4.3.2 Activity System Perspective............................................................................................................50

4.3.3 Business Model Canvas ...................................................................................................................53

5 Future Work ........................................................................................................................................................55

6 Conclusion ...........................................................................................................................................................56

7 Bibliography ........................................................................................................................................................57

Annex 1: List of Interviewed Stakeholders ................................................................................................................ i

Annex 2: Previous otego’s Prototypes ....................................................................................................................... ii

Annex 3: Design Iterations Previous to Final Draft Design ................................................................................. iii

Annex 4: First Heat Sink Design ............................................................................................................................... iv

Annex 5: Strap Design .................................................................................................................................................. v

Annex 6: Final Heat Sink Design ............................................................................................................................... vi

Annex 7: Governance Diagram from the Activity System Perspective ............................................................. vii

-VI-

List of Figures

Figure 2.1 The Lean Startup Cycle [13] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Figure 2.2 Concept Development Process [19] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Figure 2.3 Task-Technology-Fit Approach [18] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Figure 2.4 Technology-Uti l izat ion-Model Methodology [21] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Figure 2.5 Direct ional and Incremental Prototyping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Figure 2.6 The a) Business Model Canvas [30] and b) Business Model Cube [31] . . . . . . . . . 9

Figure 2.7 Types of Business Development Processes [27] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Figure 2.8 Porter 's Value Chain Diagram . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Figure 2.9 The Business Model Canvas Template [34] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Figure 2.10 Seebeck’s Instrument [39] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Figure 2.11 Mater ial a) at Constant Temperature and b) at a Temperature Difference 14

Figure 2.12 Representat ion of a) a Thermocouple and b) a Thermoelectr ic Module . . . 14

Figure 2.13 Thermoelectr ic Generators from: a) Marlow Industr ies [41] b) Micropelt

[42] c) Everredtronics [43] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Figure 2.14 Typical Trade-Off Curve from Thermoelectr ic Mater ials [45] . . . . . . . . . . . . . . . . . . 15

Figure 2 .15 Thermoelectr ic Generators ZT compared to Power Generat ion Eff iciencies

[45] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Figure 2.16 otego´s Outstanding Features [52] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Figure 2.17 a) WiTemp WSN Node [57] and b) PowerS trap EHS [58] . . . . . . . . . . . . . . . . . . . . . . . . 18

Figure 2 .18 a) EH-Link [59] b) Customized Assets Tracking System and [60] c)

Harvestor III [61] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Figure 2.19 Generic Wireless Sensor Network Node [62] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Figure 3 .1 Market Analys is , Business Model and Minimum Viab le Product Prototyping

related to the Lean Startup Cycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Figure 3.2 Modif ied Technology -Uti l izat ion-Model Methodology [21] . . . . . . . . . . . . . . . . . . . . . . . 21

Figure 3.3 Iterat ive Methodology Proposed for Minimum Viable Product Prototyping

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Figure 3.4 Methodology Steps for Business Modell ing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Figure 3.5 Market Value Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Figure 3.6 Activ ity System Perspective Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Figure 4.1 otego’s First and Future Market Approaches . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Figure 4.2 Infrared Scanning in Pip ings taken from a) [71] and b) [72] . . . . . . . . . . . . . . . . . . . . . 32

Figure 4.3 "Flexibi l i ty" Identif ied by Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Figure 4.4 a) Power Puck from Perpetua Power [73] and b) PMG from Perpetuum [74]

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

-VII-

Figure 4.5 Sensors Instal led in a BASF Plant [52] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Figure 4.6 Ecovat a) Working Pr inciple Diagram and b) Instal lat ion Process . . . . . . . . . . . . . 37

Figure 4.7 Wireless HART Temperature Transmitter Concept from P+F [76] . . . . . . . . . . . . 38

Figure 4.8 a) Costly Wireless Sensor Ea sy to Instal l [77] , and b) Cheap Cabled Sensors

Hard to Instal l . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Figure 4.9 Graphical Representat ion of Final MTTF Punctuation per Hypothesis . . . . . 45

Figure 4.10 MVPP Assumptions re lated to Questions and Hypothes is from MTTF . . . . 46

Figure 4.11 otego’s First Prototype . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Figure 4.12 otego’s Market Value Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Figure 4.13 otego 's Value Delivery Diagram Combined with Market Value Chain . . . . . . 50

Figure 4.14 Design Elements Diagram from the Activ ity Syste m Perspect ive . . . . . . . . . . . . . 51

Figure 4.15 Design Themes Diagram from the Activity System Perspective . . . . . . . . . . . . . . . 52

Figure 4.16 otego’s Business Model Canvas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

-VIII-

List of Tables

Table 2-1 Act ivity System Design Framework [33] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Table 2-2 Comparison of Mater ials used for Thermoelectr ic Generators . . . . . . . . . . . . . . . . . . . 16

Table 4-1: Industry Sensing Applicat ions and Corresponding Character ist ics . . . . . . . . . . . . 28

Table 4-2 Evaluat ion Criter ia used in the MTUM methodology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Table 4-3 Punctuation Scale for the MTUM .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Table 4-4 Hypothesis 1 evaluat ion for each product configurat ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Table 4-5 Hypothesis 2 evaluat ion for each product configurat ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Table 4-6 Hypothesis 3 evaluat ion for each product configurat ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Table 4-7 Hypothesis 4 eva luat ion for each product configurat ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Table 4-8 Hypothesis 5 evaluat ion for each product configurat ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Table 4-9 Points Assigned per Hypothesis (H) and Final MTTF for each Product

Configurat ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

-IX-

List of Acronyms Used

€ Euros

$ United States Dollars

ASP Activity System Perspective

B2B Business-to-Business

B2C Business-to-Consumer

BM Business Model

BMC Business Model Canvas

BMD Business Model Design

CAGR Compound Annual Growth Rate

CAPEX Capital Expenditures

EHS Energy Harvesting System

EHPD Energy Harvester Power Device

FAQ Frequently Asked Questions

H Hypothesis

IoT Internet of Things

LSC Lean Startup Cycle

MA Market Analysis

MTTF Modified Task-Technology-Fit

MTUM Modified Technology-Utilization-

Model

MVC Market Value Chain

MVP Minimum Viable Product

MVPP Minimum Viable Product

Prototype

OPEX Operational Expenditures

oTEG Organic Thermoelectric

Generator

R&D Research and Development

S Seebeck Effect

TEG Thermoelectric Generator

TEM Thermoelectric Module

THC Thermocouple

TTF Task-Technology-Fit

TUM Technology-Utilization-Model

USD United States Dollars

VC Value Chain

WSEH Wireless Sensor with Energy

Harvester

WSN Wireless Sensor Network

ZT Dimensionless Thermoelectric

Efficiency

1 Introduction

-1-

1 Introduction

In the last years, an increasing attention has been devoted to the entrepreneurship concept, i.e. to the startup

scene. More and more authors talk about how, through certain methodologies, an entrepreneur can turn an

idea into a successful startup in the market.

It has been found as common understanding in the literature that the most promising concept to create a

successful startup is fast iterations. The use of the minimum viable product and the lean startup support the

fast iteration methodology by creating learning loops. These learning loops must conclude in a real, although

not optimal, product to be sold to the customer with the objective to learn from it the most important

information a business can have: What do the customers want?

Through fast iterations, entrepreneurs are able to steer their product and/or service properties in order to

fit the added value offered by the product with the added value wanted by the customers. This way, the

customers will find the product attractive and the purchase will be guaranteed.

Nevertheless, it is also found in the literature that all of the methodologies proposed to do fast iterations

focus in the business-to-consumer market, i.e. in the information and communication technologies and

services. Such a market has the intrinsic properties of fast changes in trends, open and accustomed to

changes customers, as well as wide and easy to develop communication channels for product awareness.

The previous qualities are not truth for the business-to-business market. The business-to-business market

is characterized by a tendency to avoid changes and risks, as well as a distrust towards small competitors.

Market entry is even harder to reach when disruptive technologies are proposed, as they tend to be thought

of going against the status quo, therefore affecting the big companies’ investments.

Adding to the previously stated, product development based in disruptive cutting-edge technologies has the

disadvantage of often requiring a high capital demand and long development times, making the venturing

in this kind of field even riskier for entrepreneurs.

Finding a lack of research in methodologies for market success of startups with disruptive technologies in

the business-to-business area, as well as the need of this kind of startups to reinvigorate and refresh such a

market, this master thesis finds its motivation.

1.1 Objective

The objective of the present thesis is to propose and study a methodology on how to achieve a successful market entry for startups based in disruptive technologies in the business-to-business market.

To propose a methodology the lean startup is taken as cornerstone, with the concepts of market analysis,

minimum viable product prototyping and business modelling evolving around it. Such concept are widely

known and accepted by the experts, and in this thesis are adapted and used as methodology steps inside the

lean startup.

To test the methodology, the case of a young German spin-off called otego is studied. Organic

thermoelectric generators are a novel concept in which no other market player has established activities until

now, and otego’s objective is to venture in the industry 4.0 by integrating its generator in wireless sensor

networks, making it a perfect case study qualifying for both the cutting-edge technology and the business-

to-business startup characteristics.

1 Introduction

-2-

The outcome of this thesis is a methodology that other startups with disruptive technologies can follow in

order to both accelerate and secure their first market entry steps inside the conventional industrial business-

to-business market.

1.2 Work Structure

Following, chapter 2 introduces the necessary knowledge about the lean startup methodology. Inside it, a

literature review of the concepts of market analysis, prototyping and business modelling is presented, while

having a focus in their inclusion on the overall lean startup methodology. This chapter also presents the

concept of organic thermoelectrics and the KIT spin-off that wants to focus in the commercialization of

printed thermoelectric called otego, together with previous works done to integrate it in the market of

wireless sensor networks. After the proper literature review has been presented, chapter 3 combines the

concepts previously explained in order to derive a methodology suitable for startups that want to tackle the

conventional industrial business-to-business market by commercializing cutting-edge technologies. Chapter

4 accounts for the results of using the methodology described in chapter 3 in the case of otego. Since the

lean startup is intrinsically complex and iterative, only the results will be presented in chapter 4, while giving

hints of important steering and iteration steps. Finally, chapter 5 concludes the work by giving a final report

of the results obtained and their value for the objective presented in Chapter 1.

2 Literature Review

-3-

2 Literature Review

Complexity and uncertainty are two concepts that perfectly describe not only the startup scene, but also any kind of entrepreneurship effort. Most of the literature regarding entrepreneurship and startups has made studies on startups with already achieved success, therefore showing survivor biases and studying the components that allowed the startups to succeed once they are already known. Nevertheless, real-life early-stage entrepreneurs have to deal with a big lack of information in their startups, not knowing which market factors will be decisive for their success.

The concept of lean startup is a cornerstone for this work in order to diminish the lack of information entrepreneurs have to deal with. This thesis work includes the concepts of market analysis (MA), business model (BM) and minimum viable product prototype (MVPP) inside the lean startup.

Market entry success in the startup scene is a widely studied theme. In this regard, business modelling is considered one of the main factors to determine the success of a company, being essential for every successful organization, whether it is a new venture or an established player [1]. Business modelling is therefore studied in section 2.1.3.

In order to produce a proper BM, the information it contains has to be close to reality, showing ongoing interactions between the company’s elements. Therefore, a proper BM calls for a methodology that allows it to get real world information about the market in which the startup is venturing on. MA is a crucial element to get to know the relations between the market players in the market. Concepts and elements on MA used in the thesis work are explained in section 2.1.1.

Minimum viable product (MVP) and prototyping are two different concepts that are closely related and can be easily mistaken, as both of them share the goal of diminishing complexity and uncertainty in entrepreneurship efforts. This thesis proposes the usage of MVPP that combines concepts from both the MVP and prototype in order to be used in the special case of developing a product for a business-to-business (B2B) high-tech startup. The literature review on MVP and prototypes are covered in section 2.1.2.

Finally, section 2.2 gives a short case introduction for thermoelectric generators (TEGs) and otego. The information from this section will be used as basis for the results developed in chapter 4.

2.1 Entrepreneurship, Startups and the Lean Startup

There is no universal definition for entrepreneurship. Entrepreneurship can mean different things to different people. For some, it might be Silicon Valley geniuses working on high tech solutions, while for others it could mean opening up a shop in a busy street of their city. Ultimately, entrepreneurship covers these and any other concept that encompasses the process of turning an idea into a profitable business, with high degrees of initiative and risks [2] [3].

An established company usually has a defined market in which it has been developing for a long time and where it has acquired the needed knowledge to become a main player. In this regard, even if a well-established company invests in innovation efforts to bring new ideas into life, it has the advantage of having an already given work force, access to financials, markets, technological and manufacturing resources, as well as tools like historical records and projections. The risk level of its entrepreneurship venturing is not as high and the problems to deal with are mainly the fixed structural thinking and decision making inherent to its established processes. In this regard, entrepreneurship inside established companies can be useful to restore its vitality by braking the fixed structural thinking and decision making it has adopted [4] [5] [6].

Startups, on the other hand, face much bigger problems. In the very beginning, they have no information, market place, customers, relationship with other market players nor proof of concept. All a startup usually has to begin with is an idea.

For Eric Fries a startup is “a human institution designed to create new products and services under conditions of extreme uncertainty” [7]. His definition is extremely accurate as it surpasses the traditional “a good idea is enough” way of thinking and focuses on the managerial concept. An idea is of course needed, but what really matters

2 Literature Review

-4-

for a startup to be successful is the product and services related to the idea, as the product and services are the components that create the value for the customer [7]. Unfortunately, products and services are also the ones with the highest uncertainty since they are the connections between the idea and the market.

The lean startup concept has been supported by many experts as one of the most useful concept for entrepreneurship and market success [8] [9] [10] [11]. As stated by Rasmussen and Tanev, “The lean startup approach is a way of reducing these [complexity and uncertainty] risks and enhancing the chances for success by validating the products and services in the market with customers before launching it [the startup products and services] in full scale. The main point is to develop a minimum viable product that can be tested by potential customers and then pivot the idea if necessary around these customer evaluations. This iterative process goes through a number of stages with the purpose of validating the customers’ problems, the suggested solution, and the final business model” [12].

In “The Lean Startup”, Fries proposes a methodology to encompass the overall efforts to be done by a startup during its creation process. The methodology can be summarized in the lean startup cycle (LSC), depicted in figure 2.1. In the figure, information is shown in green circles, while actions related to the information are shown in orange circles.

Figure 2.1 The Lean Startup Cycle [13]

The LSC focuses solely in validated learning, and its objective is to reduce as much as possible the uncertainties faced by a startup. Considering that the “Ideas” type of information that is on top of diagram is a startup’s initial foundation (which is often the case), the actions can be listed in the following order [7]:

1. Build: The “Idea” is the constitutive block of this action. The objective is to have the “Idea” coded in such a way that the customer can understand it. The coded idea that results from the “Build” action called the “Code”.

2. Measure: Once the “Code” has been defined, the impact it has on the customer must be measured. For it, the coded idea has to be presented to the customer and be tested in real-life conditions. The main objective of the “Measure” action is to obtain useful information about the “Idea” by testing the “Code”. The information that results from the customer interaction with the “Code” is regarded to as the “Data”.

3. Learn: Without this action, the “Build” and “Measure” actions would have been a waste of time. Once the “Data” regarding the “Code” has been gathered, the entrepreneur must learn from it and transfer the learnings to the “Idea” he/she started with, in order to finish the cycle with a more refined and market-oriented “Idea”.

4. Iterate: The LSC does not include the “Iterate” action as part of the loop created by the three before mentioned actions, but refers to it as to minimizing the time inside the loop. Once the “Idea” has been enriched with the “Learn” activity, the LSC has to start again, until the “Idea” can be considered to have a business success once it is commercialized.

Time minimization through the loop does not mean that the actions should be developed in a rush and without planning. Even in the car industry where market factors are always changing, leading to a continuous call for innovation, ideas can take decades to become business implementations [14]. Time minimization also does not refer to a quicker decision-making and prototyping in order to get as much information as possible. Having an overload of information could be as bad as or even worse than having no information

2 Literature Review

-5-

[7]. In the LSC, finding a right timing is the most important, and time minimization through the loop is a helpful tool to increase the chances to find a right timing.

Timing can be a very tricky factor to understand and measure inside the startup scene, with some entrepreneurs and scholars identifying it as the main factor that leads to startups success [15] [16]. Timing does not mean that the faster the startup goes to the market, the more successful it will be. There are many examples of business ideas that were ahead of their time like AskJeeves.com, Webvan and LoudCloud [17]. Timing means for a startup to find the right time to start commercializing its product [7].

Fries suggests a methodology to ensure good timing. He proposes that instead of looking for the right time for a given idea, a startup should look for the right idea configuration to be launched for a given time [7]. This seemingly small change in definition has major implications. It means that a business will follow a main idea, making small changes to it through minimized time in the LSC loop, until the proposed idea configuration fits the market at the specific given time.

Since Fries lacks on developing a methodology to follow the iterative concept, this thesis will use the MA, BM and MVPP concepts inside the LSC in order to fill the methodology gaps. A literature review regarding each one of these concepts is presented in the following sections to be used as base for the methodology chapter.

2.1.1 Market Analysis

This section will cover MA as a tool to get to know the specific market and customers in which a startup should focus on. Before following, a distinction has to be made between tech-push and market-pull characterized business ideas.

Tech-push refers to ideas that are born after identifying a useful invention1. Therefore, the invention pushes to find a market need to become an innovation2. Market-pull, on the other hand, refers to ideas born after identifying a gap in the market that can be fulfilled. This market need pulls for an innovation that can solve it. More times than others, startups are founded in a mixture of these concepts, with a slight predominant tech-push or market-pull orientation [18].

As stated before, tech-push startups usually have no product to be commercialized. Since a startup creates goods and services for customers, an analysis is needed so the tech-push startup knows how its invention can be used by the market and therefore turn the invention into an innovation that customers are willing to pay for.

Figure 2.2 shows a common concept development process. Identifying the customer needs is the first chain to be attacked, therefore calling for a market analysis. If no market analysis is done and it is trusted that the invention will sell itself, the startup is falling for the fallacy that every good technical idea can be transformed into a commercial success [18].

In the figure, the planning chain is introduced as a step before the concept development chain. The planning chain will not be studied in this thesis, since it involves all the planning to initiate the concept development, e.g. finding that the invention could be useful, developing an idea around it, defining a team and a mission, etc.

1 and 2 While invention is the creation of a product or introduction of a process for the first time, an innovation improves on or makes a significant contribution to something that has been already invented. Therefore, while any invention could potentially turn into an innovation, not all innovations come necessarily from an invention [84].

2 Literature Review

-6-

Figure 2.2 Concept Development Process [19]

Metzger and Kraemer support the idea of doing a MA to select the best business model to be used by the company, therefore increasing its chances to turn into a market success [20]. They point out also that complexity and uncertainty are two factors inherent to the entrepreneurship process, and that in order to minimize risks an iterative process for the MA is the best option to gather information for the BM [20].

As a way to analyze a technology that is to be commercialized Hartelt, Wohlfeil and Terzidis present the Task-Technology-Fit (TTF) approach. The TTF approach states that a technology has to have good fit with the customer tasks it supports in order to have a positive impact on the market it is entering [18]. This approach is especially suitable for technology-push startups that want to get to know which kind of product configuration can turn its invention into an innovation [18]. The TTF approach can be seen in figure 2.3.

Figure 2.3 Task-Technology-Fit Approach [18]

By using the TTF, the MA defines the invention optimal characteristics and fits them with the customer needs, creating therefore an innovation. The TTF approach is based on the Technology-Utilization-Model (TUM) presented also in the work from Hartelt, Wohlfeil and Terzidis, which is further explained in the following lines.

The Technology-Utilization-Model

The TUM was proposed by Hartelt, Wohlfeil and Terzidis [21]. The TUM is a methodology to fulfill the TTF approach, as it is ideal to compare technologies and in such a way assess the likelihood of them to be utilized by the final customer.

TUM is a methodology that has showed good results in markets where the studied technology was a newer option compared to the status quo known by the customer. Such application is shown in an example in the paper from Hartelt, Wohlfeil and Terzidis [18], where the manual operation of a laboratory is compared to having intuitive robotic technologies, classical robotic technologies, or special-purpose automation technologies, all of them being economically and technologically feasible. The decisive factor is not which technology can be used to solve the task as all of them can be used, but which technology fits the task in a

2 Literature Review

-7-

way that the biggest value is offered to the customer, making sure that the customer is encouraged to pay for it. The steps of the TUM can be seen in the following figure. In section 3.1, a methodology based in the TUM for MA will be proposed.

Figure 2.4 Technology-Utilization-Model Methodology [21]

2.1.2 Minimum Viable Product and Prototyping

Most of the literature fully supports the creation of prototypes in order to know whether the product concept is technically feasible and usable. Furthermore, with a prototype managerial forces can be more easily persuaded to support a project, seeing it as a real concept. The creation of physical prototypes is therefore of major importance in the development of inventions [14].

Directional prototyping serves as a guidance tool for evaluating the direction in which a team is heading, and can be used for an initial feasibility assessment of the project. Therefore, directional prototyping has to proof that the technology to be used in the product will work in its most basic way. Opposed to directional prototyping, incremental prototyping optimizes a design and further increases the understanding of it, without making considerable changes to the overall design. Incremental prototyping builds on what has been already proven by the directional prototyping, refining the idea [14]. Directional and incremental prototyping should be used in different stages of the project, as it is shown in an example case on figure 2.5, based on the automotive industry.

Figure 2.5 Directional and Incremental Prototyping

used during a project in the automotive industry [14]

2 Literature Review

-8-

In his book, “The Lean Startup”, Eric Fries states a major difference between a prototype and an MVP. A prototype, according to Fries, is built in order to answer the question “can this be built?” in a technical point of view. An MVP, on the other hand, tries to answer the question “should this be built?” testing not only technical but also fundamental business hypotheses [7].

MVP is a very useful concept, but in the literature reviewed most of the presented examples regarding MVP are from the business-to-consumer (B2C) market, i.e. focused in the information and communication technologies industry [7] [22] [23].

A clear explanation of how fast iterations are an intrinsic feature in the information and communication technology is the Moore’s law, stated by Gordon Moore in 1965. Moore’s law predicts that the number of transistors (and therefore the computational power) in a dense integrated circuit (microprocessor) grows exponentially while keeping low prices [24]. Moore’s law perfectly depicts the fast pace of change in the information and communication technologies infrastructure, which is in a constant pursuit of ever better and newer products. Fast iterations in the process of product and business development are not only recommended but a must in such a market.

According to Intel, if the automotive industry were to keep up with Moore’s law, cars would be speeding up to 300,000 miles per hour and getting 2,000,000 miles per gallon while costing only 0.04 USD [24]. Therefore, it can be concluded that both the MVP and prototyping methodologies for ideas in the conventional industrial B2B market have to be different from the ones used in the B2C software market. Conventional industry, in this sense, refers to the industry with objective to produce chemicals, energy, food, manufacturing goods, etc.

The literature that covers the conventional industrial B2B market is scarce and focuses mostly in the case of either big established companies [14] or once again in the information and communication technologies [25].

Because of a lack of literature on MVP and prototyping related to startups that are to endeavor in the conventional industrial B2B market, a methodology will be proposed in section 3.2. Such a methodology will take into account the best characteristics of both MVP and prototyping, resulting on the MVPP methodology, which is characterized for being mostly directional.

2.1.3 Business Modelling

The literature proposes several ways in which a BM can be defined. Ovans compares a BM with art in the sense that, like art, even though a BM can be easily recognized by several, it is extremely hard to define it precisely [26].

For this thesis, a BM is defined as an overall description of the business logic, considering its key components and interactions that have as goal to offer a value proposition to the customer [27] [28]. In fewer words, a BM describes the rationale of how an organization creates, delivers and captures value [29].

Complexity and uncertainty have evolved as two of the main challenges entrepreneurs have to face nowadays, [28] and even though it should be very simple and concise, the complexity and uncertainties it has to cover makes it extremely difficult to define only one way in which the BM logic can be explained and presented to others. For this reason, in the last decade there has been a proliferation of business modelling tools like the “Business Model Canvas”, “Business Model Navigator”, and “Business Model Cube”, each of them proposing a way to visualize and connect the BM elements [28].

2 Literature Review

-9-

a) b)

Figure 2.6 The a) Business Model Canvas [30] and b) Business Model Cube [31]

It is important to keep in mind that business modelling is not a magical concept capable of making any business jump into success. In order to work, a BM needs to be supported with facts that accurately represent the reality, otherwise the BM runs into danger of promising profits in some distant, ill-defined future, without having a proven added value for the customer [1].

Recent literature has concentrated in the importance of the BM innovation, where both technological and business knowledge are related in order to disrupt or sustain existing product/market strategies. The innovation in the BM should be agile, starting early and fast to bring benefits as early as possible.

Heikkilä and Bouwman support the use of business model agility in their study work by providing the example of four business development activities. The four examples can be found in figure 2.7. The study showed that the fourth process, which involved several iterations on the technology and BM through customer validation, was the most successful.

Finally, it can be concluded that all of the literature reviewed supports, directly or indirectly, the concept of having a business modelling approach that is iterative and takes into account the technological and market aspects of the startup. Following, the concepts of value chain, business model design (BMD) and business model canvas (BMC) are presented, as they will be used for the business modeling methodology in section 3.3.

Figure 2.7 Types of Business Development Processes [27]

2 Literature Review

-10-

Value Chain

Most of the value chain (VC) literature has focused its attention in Porter’s VC. Porter’s VC analyzes and categorizes the activities done within an enterprise in order to offer a final value to the customer. It does not analyze the whole market, but the business itself. The University of Cambridge developed an easy to understand diagram for the Porter’s VC. Such a diagram can be seen in the following figure:

Figure 2.8 Porter's Value Chain Diagram from the University of Cambridge [32]

As it can be seen, Porter’s VC describes how each one of the primary activities inside a company are related in a chain. The activities are highly general so clearer vision of the whole business is achieved. Therefore, sub-activities can be found inside the five main activities proposed by Porter. Such a diagram will be used as basis for the methodology shown in section 3.3.

Business Model Design: An Activity System Perspective

The activity systems perspective (ASP) was proposed by Zott and Amit [33] as a conceptual kit that enables and facilitates the entrepreneurial process of designing a BM.

A BM is geared towards total value creation for all parties involved, and the higher the total value created, the more attractive it will be for all of the stakeholders. At the same time, a business should get bargaining power in order to appropriate more of the total value created [33]. The way a company acquire bargaining power depends mainly on the pricing strategy or revenue model, and is therefore excluded of this study.

Value creation and business modelling cannot be studied through rigid concepts, as a business is not only at a specific point in time and space. Just like an organism, a business moves and develops activities inside and within its environment. For a business to be successful, it should not only focus on survival activities, but also on added value ones.

Zott and Amit further develop in preferring the study of activities done by a business instead of rigid concepts categorizing the business divisions through their activity system perspective. Zott and Amit define a business model as depicting “the content, structure, and governance of transactions designed as to create value through the exploitation of business opportunities” [33]. Content, structure and governance are therefore the elements that define the main activities inside the business. The combination of these elements to create a higher value is referred to as design themes. A further explanation of both concepts can be found next:

Design elements describe the activities that are performed in the value chain in the most basic way. Design elements are used by the entrepreneur to get a grasp of how the business works, as well as the basic relations that exist between the company and other companies. Design elements can be defined as content, structure and governance elements. All of the elements should be oriented to support the business core of the company.

o Content: Contains all the activities that should be performed so the business core is achieved. There are many ways to define an activity, from very specific to very broad concepts. It is recommended to use broad activities to group smaller specific activities, as this allows a clearer vision of the ASP. For example, contacting customers can be a broad activity, no matter if the contact is done through phone calls, mailing or any other kind of smaller activity.

o Structure: Refers to how the activities listed as content are related between each other, and the way they have to be sequenced. By ensuring that all activities are linked through a structure, entrepreneurs can identify whether the activities are contributing to the business

2 Literature Review

-11-

core. If this is not the case for an activity, it could also be that it is related through a theme, which will be explained later in this section. If an activity is not linked to any other, either by structure or by a theme, then it is an extra activity does not offer any value to the business, and should be eliminated.

o Governance: This point assigns each one of the elements inside the content to a responsible team, person, company, or any other that has to develop such an activity. Likewise, content should include where such an activity is done by the responsible.

Design themes detail the “system’s dominant value creation drivers” [33] by showing “configurations of design elements, or the degree to which they are orchestrated and connected by distinct themes” [33]. This means that the design themes’ objective is to describe how the business, through the design elements, is able to not only support the business core, but also offer an added value to the customers.

o Novelty: Refers to new activities (content), and/or new ways of linking activities (structure) and/or new ways to do the activities (governance).

o Lock-In: Lock-in is the power the business has to keep third parties attracted to it as participants in the whole VC. Although lock-in usually refers to customers, it can also be the case of that lock-ins are designed for other stakeholders, e.g. partners or suppliers.

o Complementarities: A complementary is created when two activities that usually should not be linked together through a structure design element are linked. A complementarity creates more added value for the stakeholders, even though such a connection may not contribute to the business core.

o Efficiency: This is the most conventional of all the themes. Its objective is to use less resources (e.g. suppliers, capital, elements, services, etc.) while having the same business performance, of preferably improving it.

The way design elements and design themes are sub-divided for their study is shown in Table 2-1. All of the information previously stated will be used to conclude a methodology to be used in this thesis, which is shown in section 3.3.

Table 2-1 Activity System Design Framework [33]

Design elements

Content What activities should be performed?

Structure How should they be linked and sequenced?

Governance Who should perform them, and where?

Design themes

Novelty Adopt innovative content, structure or governance

Lock-In Build in elements to retain business model stakeholders

Complementarities Bundle activities to generate more value

Efficiency Reorganize activities to reduce transaction costs

Business Model Canvas

The BMC created by Alex Osterwalder is arguably the most comprehensive template on which to condense

the hypotheses surrounding the business studied or “modeled”. The BMC can be used by entrepreneurs to

see if they missed anything important inside the main identified structure blocks of the BMC, as well as to

compare their model with the one from other competitors and/or partners [26].

The nine building blocks of the BMC

1. Value Propositions: Refers to the business core and added values that are offered either to the customer or to other stakeholders.

2. Customer Relationships: Describes the nature of the relationship that the business develops with its customers, whether it is personal face-to-face, personal through a channel, through automated answers, self-assistance through documentation, etc.

2 Literature Review

-12-

3. Customer Segments: Customer segmentation is done in order to know the specific needs and individualities of customer groups, while at the same time defining them inside a group. This is useful for the business, as in this way it can offer a more personalized value proposition to each one of the identified groups it serves.

4. Channels: This building block describes the channels through which the each customer relationship takes place. The channels could be very varied and specific, such as mails, phone calls, fax, face-to-face contact, etc. or broader, like personal, impersonal, automated, etc.

5. Key Activities: Here, all the activities that the business realize must be listed, together with the ones done by third parties. The key activities could also be seen as the content design elements of the ASP presented before.

6. Key Partners: The most important and influential actors that support the business are listed in this building block. For its elaboration, the government elements identified in the ASP are especially useful, as almost any actor listed by the government that is not the business itself can be considered a key partner.

7. Key Resources: All of the most important resources that allow the business to do its operations are in this section. It could be anything, e.g. expertise, capital, specific pieces, personnel, etc. Concept like oil for equipment maintenance, scissors, paper, etc. must be avoided, as they do not contribute in the value proposition, but are used for daily minor activities.

8. Cost Structure: Everything that contributes to the loss of capital from the company must be added in this building block. It is especially useful to divide it into capital expenditure (CAPEX) and operational expenditures (OPEX).

9. Revenue Streams: Finally, the ways in which the business can get capital are listed in this section. Nevertheless, these revenue streams should also be aligned with the business core and added value proposed, e.g. a restaurant should not list sales of old equipment as a revenue steam, as this will not be a constant revenue stream that helps the business to offer and added-value to the customer.

The way the blocks fit in the BMC is shown in Figure 2.9. The BMC will be also part of the methodology to be followed in this thesis, since it gives as result the most useful and widely accepted way to represent a BM.

Figure 2.9 The Business Model Canvas Template [34]

2 Literature Review

-13-

2.2 Case Presentation

2.2.1 Thermoelectric Elements Background

A thermoelectric module (TEM) is a two-layered element that is able to produce either electric energy out of thermal energy (TEGs), or thermal energy out of electrical energy (Peltier elements) [35] [36] [37] [38].

Since otego’s focus is into the TEGs area, the case presentation will not cover Peltier elements. This is not to say that otego has completely disregarded the Peltier elements from their business plans in the future, but that at this moment (and for this master thesis work especially), otego’s only focus will be TEGs.

Thermoelectric Generators

In 1821, Thomas Seebeck found that a circuit made out of two dissimilar metals with junctions at different temperatures would deflect a compass magnet, which meant that an electric current passed through the circuit [39]. The instrument used by Seebeck can be seen in figure 2.10.

Figure 2.10 Seebeck’s Instrument [39]

This Seebeck effect goes as follows:

“A temperature difference between two points in a conductor or semiconductor results in a voltage difference between these two points.” [40]

The Seebeck effect is formulated in equation 2.1, stating that the difference of voltage (𝑑𝑉) created by a

material divided by the difference of temperature (𝑑𝑇) the material is subjected to results in a number called

Seebeck coefficient (𝑆), with a magnitude usually expressed in microvolts per kelvin (𝜇𝑉

𝐾).

𝑆 =𝑑𝑉

𝑑𝑇 [

𝜇𝑉

𝐾] Equation 2.1

With the help of figure 2.11, the Seebeck effect can be further understood. As it can be seen, the difference in voltage is related to the electrons inside the material aligning towards the hot end (which therefore charges negatively), and leaving open positions in the cold side (charging it positively), as compared to when there is no temperature difference.

2 Literature Review

-14-

a)

b)

Figure 2.11 Material a) at Constant Temperature and b) at a Temperature Difference a) Random positions of electrons (red circles) inside the atoms (white circles)

b) Electrons oriented towards hot region (in red) leave open positions at the cold region (in blue)

In order to take advantage of the electrons flow a second different material must be included in the circuit, creating therefore a thermocouple (THC) [38]. The importance of the second material is seen with the help of equation 2.2.

𝑉𝑇𝐻𝐶 = (𝑆𝐴 − 𝑆𝐵)∆𝑇 Equation 2.2

On it, 𝑉𝑇𝐻𝐶 is the voltage difference between the THC sides, 𝑆𝐴 − 𝑆𝐵 is the difference of Seebeck

coefficients between material A and B, and ∆𝑇 is the temperature difference between the THC sides. If the

Seebeck coefficient is the same for both materials, 𝑆𝐴 − 𝑆𝐵 will be zero, leading to zero voltage potential. A typical THC construction can be seen in figure 2.12 a), with the voltage produced being in the order of microvolts. Therefore, to increase the voltage, it is common practice to interconnect several THCs. Such an array is called TEM, and is presented in figure 2.12 b).

a)

b)

Figure 2.12 Representation of a) a Thermocouple and b) a Thermoelectric Module The yellow line in both figures depicts the electric current flow

The voltage difference created in a TEM is defined by equation 2.3, where 𝑛 is the number of THCs.

VTEM = n ∙ VTHC Equation 2.3

Following, some commercial TEG designs are presented.

a)

b)

c)

Figure 2.13 Thermoelectric Generators from: a) Marlow Industries [41] b) Micropelt [42] c) Everredtronics [43]

2 Literature Review

-15-

The environment and working conditions must be taken into account while designing TEGs, as they operate in cyclic temperature gradient that cause mechanical fatigue [36]. Materials have to be especially selected in order to produce TEGs, as they are also constrained by their price and availability.

Thermoelectric Generators Efficiency, Materials and Power Production

In 1911, the German scientist Edmund Altenkirch derived the thermoelectric efficiency, now simply known

as 𝑍 (thermoelectric figure of merit). The thermoelectric figure of merit can be non-dimensionalyzed by multiplying it by the absolute temperature to which the element is being subjected giving as result the

dimensionless figure of merit (𝑍𝑇). The larger the 𝑍𝑇 value, the better the thermoelectric material [44].

ZT = α2σTK⁄ Equation 2.4

In equation 2.4, 𝛼 is the Seebeck coefficient, 𝜎 is the electrical conductivity, and 𝐾 is the thermal conductivity. TEGs need materials that are good electrical conductors to allow a higher electrons flow, and bad thermal conductors to keep both sides of the TEG at different temperatures.

Selecting thermal and electrical conductivity to improve 𝑍𝑇 is not easy, as they are closely dependent to

each other as a function of several structural factors. In particular, 𝜎 and 𝐾 vary in a reciprocal manner,

making any improvement in 𝑍𝑇 difficult. In addition, the electrical conductivity and the Seebeck coefficient are inversely related [44]. The before mentioned relations can be seen graphically in figure 2.14. Nowadays, global R&D tasks are focused in tackling and braking these relations through doped materials, therefore

allowing a 𝑍𝑇 increase to new levels.

Figure 2.14 Typical Trade-Off Curve from Thermoelectric Materials [45]

electrical conductivity (𝜎), Seebeck coeffcient (S), and thermal conductivity (𝐾) The x axis representes the free-carrier concentration of the material

Thermoelectric materials can be categorized as organic and inorganic [44].

Inorganic: The earliest application of the thermoelectric effect was in inorganic materials, i.e. in metals. Even though metals have very high electrical conductivity, they also exhibit a very high thermal conductivity. Inorganic semiconductors have partially solved this problem thanks to their

variable resistances. The most widely used semiconductor for TEGs is 𝐵𝑖2𝑇𝑒3 which is a doped

alloy that exhibits a 𝑍𝑇 ≈ 1 at room temperature [44]. Nevertheless, TEGs made with 𝐵𝑖2𝑇𝑒3 have severe disadvantages, namely their inflexible shape, sensitivity to shocks, toxicity and expensive manufacturing processes.

Organic: Organic polymers are very attractive to be used for TEGs since they are light, flexible, poor thermal conductors, suitable for room temperature applications, and generally require relatively simple (and economic) manufacturing processes. Nevertheless, they are also characterized

for their low electrical conductivity, 𝑍𝑇 and stability, which has hampered their use in

thermoelectric applications [44]. otego’s activities focus in increasing the 𝑍𝑇 of organic materials and taking advantage of their capabilities in order to bring economically viable TEGs into the market.

2 Literature Review

-16-

Some common materials for the production of TEGs can be seen in Table 2-2:

Table 2-2 Comparison of Materials used for Thermoelectric Generators Inorganic materials taken from [46], organic materials from [47] and [48]

Material Type Material cost ($/kg) ZT

Bi2Te3 Inorganic 110 0,74

SiGe Inorganic 679 0,22

InGaZnO Inorganic 511 0,07

PEDOT:PSS Organic 0,34 0,01-0,2

PEDOT:TOS Organic - 0,1-0,3

As it can be seen in figure 2.15, 𝑍𝑇 would need to be in the order of 15 to be competitive with the Brayton

and Rankine cycle. Recent commercially viable 𝑍𝑇 values are achieved by using 𝐵𝑖2𝑇𝑒3 and are in the order of 0.5 to 1, and efforts are being made in research and development (R&D) to achieve values higher than 2. These values make TEGs marketwise viable mostly in energy harvesting for low power applications. This conclusion was achieved by Leßmann and Becker in their previous research works regarding market opportunities for otego, and is a foundation pillar for the present master thesis.

Figure 2.15 Thermoelectric Generators 𝑍𝑇 compared to Power Generation Efficiencies [45]

Printed Thermoelectric Elements

Printed thermoelectrics is a new TEG production process that has not yet found a market application, with

low amounts of R&D literature focusing in this production process being published in the last years.

In order to have a thick enough generator (which as seen in figure 2.12 is needed, otherwise no temperature

difference would exist), most attempts have been focused in the use of 3D printers [49]. Nevertheless, their

usage has not been effective.

A different printing methodology using 2D printers has been proposed in the last years with institutions like the Fraunhofer institute supporting its development [50]. Furthermore, 2D printing finds the use of organic thermoelectric materials especially useful due to their ability to be treated as fluid under certain circumstances.

2.2.2 otego

The most important application for TEGs has been in deep-space satellites and remote power generation

for unmanned systems, mainly because the aerospace market is highly sensitive to the reliability of the power

source and not so much to the price [45]. Inorganic TEGs have shown to be useful for this niche market,

but their several disadvantages hinder their success in other applications with cases of enterprises going to

2 Literature Review

-17-

bankruptcy because the business could not overcome them [51]. In order to avoid the restrictions imposed

by inorganic TEGs, otego focuses in the production of a new type of TEG.

Otego combines the concept of organic thermoelectrics with thermoelectrics printing to produce organic

thermoelectric generators (oTEGs). In 2012, otego’s R&D efforts produced a printed thermoelectric

material that fulfilled the technological requirements to be used as a TEG, marking the first breakthrough

for otego in the road of bringing oTEGs into the market.

To achieve the market integration of oTEGs in the mass market, otego’s first step is to develop a fully

automated production line for the oTEGs. The second step is to create a product that takes advantage of

the produced oTEGs, and is going to be supported through this thesis work.

otego’s oTEGs’ main advantages as compared to conventional inorganic TEGs are their flexible shape,

robustness, non-toxicity and, most important of all, economic manufacturing. Furthermore, otego has

patented both the production process and organic material. The current design developed by otego, together

with its advantages, can be seen in figure 2.16.

Figure 2.16 otego´s Outstanding Features [52]

The market opportunity for oTEGs, and specifically for otego, has been the focus of two research works,

i.e. the ones from Leßmann [53] and Becker [54]. In the following section, the results from these research

works will be summarized. As it was previously explained in section 1, the information presented will be

used as basis for the application of the methodology shown in chapter 3.

Otego’s Possible Markets

otego’s oTEGs could find a possible technical application in several markets where TEGs are already present, but the fact that technical requirements can be met does not mean that they are feasible markets in which otego should focus. Believing this would lead to the fallacy presented in section 2.1.1. To avoid falling in the fallacy, the research activities from Leßmann and Becker have focused in finding a possible optimal market for otego.

The first academic work was done by Leßmann, where he develops a thorough study regarding oTEGs’ market possibilities. His conclusions can be summarized as follows: [53]

The use of oTEGs as energy harvesters of body heat for medical applications showed negative results, mainly because of the small temperature differences between the skin and the ambient in everyday life situations, which leads to a very small power generation.

On the other hand, their use for the wearables market might be possible, as long as the wearables require low-power supply. If a wearable can properly work with low-power input, the use of the economic oTEGs can be very valuable for this price sensitive market. This area still needs R&D from both the wearables and oTEGs side, leaving it as a possible future market.

2 Literature Review

-18-

The automotive industry, although interesting at first, showed poor and uncertain results after a deeper analysis.

The use of oTEGs for the conversion of high quantities of heat into electric energy to increase the efficiency of power production plants seemed promising, but after a deeper research it was concluded that this area is impossible to tackle with today’s technology. Such a market area can only be considered as a future market.

Energy harvesting as power supply for sensors and actuators is the most promising market in which oTEGs can find an opportunity. Two main application areas were identified, i.e. wireless radiator thermostats and wireless sensor networks (WSNs). WSNs is the most attractive market entrance for otego as it is expected to have a high market growth, and through otego’s technological capabilities a higher added value can be offered to the customers. Therefore, the focus of this thesis will be in the WSNs area.

Wireless Sensor Networks

A WSN consists of spatially distributed devices, or nodes, that monitor physical or environmental conditions [55]. This broad definition can cover up almost any kind of application for WSNs that can be thought of, from measuring and regulating crop fields’ temperatures and humidity to monitoring the mechanical integrity of a part inside an automobile. Since WSNs are expected to be widely implemented, WSNs must offer specific qualities, i.e. the devices are meant to be small, with limited processing and computing resources, and most importantly, inexpensive compared to traditional sensors [56].

In the 2014 IDTechEx Conference edition on “Energy Harvesting and Storage Europe” that took place in Berlin, most expositors concluded that in order to bring WSNs into a widespread market, especially in the industrial area, WSNs need to cope with all the requirements of security, availability and reliability offered by cabled sensor systems [53]. For that, the evolution of energy harvesting systems (EHSs) will be vital, with a special focus on costs and reliability, as these are two major decision factors on the mass markets. Because of this reason, representatives of ABB saw in otego a big advantage due to its flexibility and dimensions [53].

ABB is already venturing in the WSNs powered by EHSs market by commercializing the WiTemp, a wireless sensor node that uses conventional TEGs as power source, shown in figure 2.17 a). Marlow Industries has shown a big interest in creating power devices for WSNs, introducing several pre-production R&D projects in the 2014 IDTechEx in Berlin. One of the most interesting concepts was the PowerStrap, seen in figure 2.17 b), which seeks to take advantage of heat losses in pipelines by using conventional non-flexible TEGs.

a) b)

Figure 2.17 a) WiTemp WSN Node [57] and b) PowerStrap EHS [58]

TEGs are not the only EHSs used to power up WSNs. There are several other EHSs used to power them up, each one with specific pros and cons. From the several EHSs available, the most important ones because of their market size are the electrodynamic, photovoltaic and piezoelectric. Product examples are the EH-Link from Lord MicroStrain that produces energy out of vibration and light, the customized solar PV asset tracking system created by PowerFilm Solar Inc., and the piezoelectric EHS from Advanced Cerametrics Inc., the Harvestor III Power module. All of these products are used as EHSs to power up WSNs, and can be seen in figure 2.18.

2 Literature Review

-19-

a) b) c)

Figure 2.18 a) EH-Link [59] b) Customized Assets Tracking System and [60] c) Harvestor III [61]

Through interviews with special partners in the IDTechEx, Leßmann found that they had special worries in the price of such EHSs. The interviewed emphasized that prices need to be low enough to raise the interest of possible customers, [53] an objective that has not been achieved by the EHSs present in the market.

A typical WSN node that includes energy harvesting as power source is shown in figure 2.19. The figure also depicts a way in which otego’s oTEG could be included inside a WSN as part of the energy harvesting device that offers power to the WSN.

Figure 2.19 Generic Wireless Sensor Network Node [62]

otego’s organic thermoelectric generator is also depicted as a possible energy harvesting device

otego in the Wireless Sensor Networks

Becker’s thesis focused in finding technology and market factors that affect otego’s incursion in the WSNs market. According to that thesis, four main factors affect otego’s future product success [54]. The four factors can also be presented as technological and market aspects that otego needs to consider while producing its first product, and are presented in the following points. otego should, therefore:

Use standard electronics and be able to vary the voltage produced according to customer needs

Include energy storage

Be used in pipelines, in order to take the most advantage of its flexibility

Focus in WSNs that measure temperature

3 Methodology

-20-

3 Methodology

As it was introduced in section 2.1, the lean startup is a methodology focused in the fast introduction of a product into the market while improving its chances to become a business success through constant customer feedback and iterations. The LSC is the main column for the implementation of such a methodology, which through time minimization inside the iteration loop aims to offer a real added value that the customer is willing to pay for.

The whole LSC is a very complex process, and therefore for this thesis only the “Building” action block inside the LSC will be studied, which is at the same time directly related with the “Idea” and the “Code”, as it can be seen in figure 3.1.. Through MA the “Idea”, this is the product and business ideas together with the entire market conditions surrounding it, is analyzed and condensed into a new and better “Idea” that has a better market focus. The “Build” action uses the condensed “Idea” that resulted from the MA and through the MVPP and BM constructs a “Code” that will be presented to the customer.

Figure 3.1 Market Analysis, Business Model and Minimum Viable Product Prototyping related to the Lean Startup Cycle

The present methodology chapter covers the three MA, MVPP and BM methodologies that combined arrive to the desired result, or “Code”. The lean startup methodology per se will not be covered, as the MA, MVPP and BM methodologies proposed already consider the iteration and time minimization concepts that are cornerstones from the lean startup.

The first part of the methodology covers the MA, which is useful to get all the information needed to start the following two steps after the MA, the methodology followed the logic of starting the MVPP design before starting the BM, and then iterating between them as it is suggested in figure 2.7.

3.1 Market Analysis through Modified Technology Utilization

Model

The concepts of Internet of Things (IoT), Industry 4.0 and energy harvesting are all ranked as disruptive technologies and markets [63] [64] [65] [66]. Since they are categorized as disruptive, there is little experience and knowledge about them, both in the technological and in the market points of view. Therefore, the TUM presented in section 2.1.1 could not be followed as it was presented. The objective of the TUM shifted from comparing different technologies to comparing different product configurations based in the same technology, as to get to know which product configuration offers the biggest added value to the customer, giving as result a modified TUM (MTUM).

Following, the steps to be developed in the MTUM are shown.

Steps 1: Product Configurations, Task and Market Characterization

In this step, the product configurations, task and market need to be characterized. The product configurations should be as differentiated as possible to avoid mixing concepts. Differentiating the product

3 Methodology

-21-

configurations is a hard task to do since the MA itself will be used to define them. Therefore, the product configurations should be at least slightly drafted, showing their most important content. Market is also an important factor to consider in this step, as it was not considered before in the original TUM.

Step 2: Derivation of Evaluation Criteria

This step asks for deriving criteria with which the different product configurations can be evaluated. As these product configurations are not truly defined yet, there is a lack of information regarding how the product configuration will fulfill the task. To overcome this problem, the criteria will also cover technology aspects that the product configurations needs to take into account. The technological aspects are not meant to be evaluated, but to be used as useful first-hand information about how the product configuration should be.

Step 3: Product Configurations Assessment

In this step the criteria from step 2 is used to assess the product configurations. A 1 to 10 scale is used in order to qualify the product configurations, 10 being that the product configuration completely fulfills customer expectations. The assessment must be conducted by consulting both technology experts and possible customers.

Step 4: Modified Task-Technology-Fit Conclusion and Customer Utilization

This final step consists on adding all the points assigned to each product configuration in step 3, according to equation 3.1.

𝑀𝑇𝑇𝐹𝑋 = ∑ 𝑇𝐸𝑖

𝑛

𝑖=1

Equation 3.1

In equation 3.1, 𝑀𝑇𝑇𝐹𝑋 is the overall modified Task-Technology-Fit (MTTF) value of the product

configuration 𝑋 and 𝑇𝐸𝑖 is the value given to the specific evaluation characteristic 𝑖 of the product

configuration 𝑋.

The product configuration with the highest MTTF is the one that has the highest chance to become a market success when introduced to the market, and therefore should be considered by the startup for future commercialization efforts.

The MTUM methodology is summarized in figure 3.2.

Figure 3.2 Modified Technology-Utilization-Model Methodology [21]

After the MA has been developed and a product configuration has been chosen, the second step on the methodology can be started, which is the design of the MVPP.

3 Methodology

-22-

3.2 Minimum Viable Product Prototyping

A logical follow up for the MA would be the business model design. Nevertheless, as the product configuration was just chosen in the previous step, no information about the possible stakeholders is known. Therefore, a rough configuration model for a prototype must to be proposed.

As explained before, an MVP asks for fast implementation and iteration to answer as many hypotheses about the market as possible, while rapid prototyping refers to the concept of proving that a product can be produced. This thesis proposes combining both concepts into what will be called an MVPP, which is before the MVP and closer to reality than a rapid prototype.

The MVP concept cannot be used directly in the conventional industrial B2B area, as industries such an area are conservative since any change inside their infrastructure is hard and capital intensive to develop. Even worse, once a conventional industrial B2B company has selected a product, it is hard to steer into new ones [33] Therefore, asking customers to pay for a product that they are not 100% sure that is convenient for their company cannot be expected to have good results.

The MVPP objective is to be shown to customers to get their feedback before the client is ready to buy an MVP. It will also be used as a prototype to be shown in promotional activities from the company.

The methodology proposed for the MVPP can be seen in figure 3.3.

Figure 3.3 Iterative Methodology Proposed for Minimum Viable Product Prototyping

As it can be seen, the methodology is a cycle, which reinforces the iterative principle of the LSC in which it is based. The cycle will usually start by defining the assumptions and goals, following the order presented in the next lines:

1. Define assumptions and goals: First, the goals and assumptions must be clearly stated in order to have a goal towards which the designing efforts will be targeted. Goals can be, for example, general ideas of how the MVPP should look like, as well as technological requirements that it should cover. Assumptions are specific technological and market characteristics that are believed to be positive for the commercialization of the product. Even though an MVPP could try to work with as many assumptions as possible, a set of the most important ones that are related to one theme or characteristic should be preferred. The result of this step is, therefore, a final draft of how the product should be.

3 Methodology

-23-

2. Sub-systemize the product: Once the goals and assumptions have been properly identified, the overall vision of how the product will look like has to be divided into sub-systems. By doing so, problems that affect the whole system can be tackled one by one in each of the sub-systems, making the design process easier.

3. Define critical sub-systems After the sub-systems have been identified, the process needs to be focused into the most critical ones. These sub-systems are the ones that need more attention while being designed, either because they will offer more information about the market once the MVPP is presented to customers, or because they are sub-systems that could make the whole system fail. While a knowledge on which are the goals and assumptions is primordial to categorize a sub-system as critical, other aspects like previous knowledge on designing could also be used to define them.

4. Design sub-systems To design the sub-systems many aspects have to be considered simultaneously, as goals and assumptions for the overall product must be taken into account. Furthermore, production procedures and prices from suppliers should be considered as it wouldn´t make sense developing an MVPP that is not economically viable. This step is expected to be iterative, optimizing each sub-system and the whole system through several design iterations.

5. Finish up a working physical prototype Once the sub-systems and the whole system are considered to be properly optimized, the production of the physical MVPP can be started. This is a crucial step, as from the very beginning it was stated that this methodology would consider high-technology startups that need to produce a physical product. The MVPP should be manufactured with real production procedures, reflecting real production costs.

MVPP? Once the prototype has been finished, ideally and if all the steps were followed, it should be ready to be presented to the public as a product that the customer can find desirable. Furthermore, the MVPP should also allow the team to answer the assumptions that were stated in the previous steps. If this is not truth, then the prototype can´t be considered an MVPP, and the whole cycle should be started again.

MVP? If the prototype can be defined as an MVPP, it could also be an MVP. The ideal way to test this would be by already offering it to customers. Nevertheless, as this might be hard to be achieved in the industrial sector, the best way to do so is by showing it in promotion activities as an already finished product that customers can start to buy. If no demand is found, then the product is an MVPP, as it was not able to rise enough interest from the customers.

6. Sell to customer In case that the prototype turns out to be an MVP, then a new methodology to get customer feedback must be applied. Such a methodology won´t be discussed in this thesis, as it is not its objective.

7. Get customer feedback Identifying that the MVPP is not an MVP is not a problem, as the MVPP is useful to be shown to customers in fairs and conventions, as well as in individual focused promotion activities. That is precisely where its biggest advantage relies, and the reason it was developed in the first place. With the MVPP, possible customer’s feedback can be gathered in order to start the iteration process again, defining new assumptions and goals. The main questions to answer in the new loop will be:

o Why was the MVPP not an MVP? o Why the functional product presented was good enough to work, but not good enough to

convince the customer to buy it?

3 Methodology

-24-

This methodology, as stated before in step 6, only covers the MVPP production, and once the MVP has been found, another product development loop should be used. Meanwhile, at the same time that this loop is being done, the BM methodology can also be started.

3.3 Business Modelling

The business modelling step in this thesis will be iterative, considering the results from the MA and the partial results from the MVPP. Iterative means that the BM will be enriched not only by the results given by the MA and MVPP, but also through their complete development process, while at the same time providing feedback for their realization.

The methodology followed for the business modelling was based in three main steps, i.e. VC analysis, BMD through ASP and BMC generation. In figure 3.4, the business modelling methodology and the individual objectives of each step can be seen.

Figure 3.4 Methodology Steps for Business Modelling

Market Value Chain

The first step in the methodology consists in designing the market value chain (MVC) of the entire market environment in which the company wants to participate. This MVC differentiates itself from Porter’s VC in the fact that, while Porter’s focuses in only the VC of the business itself, the MVC considers the whole market VC.

The MVC is based in Porter’s VC, with only some small changes done in order to represent, instead of business’ divisions, roles in the market. The roles of the MVC must cover all of the transactions of the market that is being studied, from beginning to end. These roles are as generic and broad as possible in the sense that a minimum amount of roles is preferred, in order to have a clear and simple MVC.

The adaptations done to create the MVC, based on Porter’s VC, are explained in the following lines. It is important to state that these changes are done for a conventional industrial B2B market, and may change for other markets.

The “Operations” block keeps being the same, as this is the constitutive, most important division of any manufacturing value chain.

“Inbound logistics” is now referred to as the “Suppliers” since it, just like inbound logistics, delivers business the raw materials needed to create the product.

3 Methodology

-25-

“Marketing and sales” now is shifted to go right after the “Operations”, as this activity is closer and more related to the business’ own efforts to sell the product. The sales activity now partly covers “Outbound logistics” done between the main business and some customers.

The “Outbound logistics”, which is now after “Marketing and sales” but before the “Customers”, is now referred to as the “3rd Party Sellers” that offer the product to the “Customers”. “3rd Party Sellers” are related to “Outbound logistics” since they are used to cover a wider range of customers and, therefore, increase the possibilities of success.

The final “Service” block with which Porter’s VC finishes is referred to as the “Customers” in this new MVC.

The MVC described is the one that will be used in this thesis work, and can be seen in the following figure.

Figure 3.5 Market Value Chain

Once the MVC analysis has been done, the following steps of the methodology are easier to develop, as the MVC works as a blueprint of how the business looks as part of the whole market and its relations with other players.

It is also recommended, in order to increase the clarity of how the business will work, to develop a value delivery model like the one presented by Metzger and Terzidis [20]. Such a model presents the most important relations and values created inside and outside the business, and can be therefore perfectly fitted with the MVC. The methodology to produce such a diagram is proposed in the paper from Metzger and Terzidis, and therefore only the diagram will be presented in the results section for this step of the methodology.

Business Model Design: An Activity System Perspective

As it was stated before, BMD is an iterative process that should be repeated as many times as possible until the one that creates more value has been found. To do so, the ASP is used as a methodology with which the basics of how a business is working can be fully understood.

Previously, in the literature review, the concepts of design elements and design themes were presented,

together with the classification of elements and themes done by Zott and Amit. In this section, those

concepts will be described as a methodology to create an ASP that can be represented as a diagram. The

resulting diagram will not be discussed here, but an example will be presented in the results chapter.

Seen as a methodology, the ASP is easier to be analyzed and developed in an iterative circle that starts with design elements and follows on with the design themes. By doing so, the way the business core is fulfilled (design elements) is clearly identified before the added value connections (design themes) are identified.

Inside the design elements methodology, first all the activities must be identified (content), followed by the way these activities support the business core (structure), and finally establishing who is responsible to do the activities, and where (governance).

Once all the design elements were identified, the design themes have to be established now, i.e. novelty, lock-in, complementarities and efficiency. In this case, it is not easy to establish which way is better to start, as they are all independent from each other. Nevertheless, it can be suggested to start with novelty and efficiency, as they are the easiest to identify, to keep with lock-in and then finish with complementarities, as these two are the hardest to identify. The design themes should be iterative in their own sub-cycle, as they are harder to identify than the design elements.

3 Methodology

-26-

Finally, once the design elements and themes have been identified, it should be contrasted with reality by having feedback from members inside the company, as well as with other stakeholders. Likewise, information from all the other previous methodology steps must be considered to develop this point. The iterative methodology of the ASP can be seen in figure 3.6.

Figure 3.6 Activity System Perspective Methodology

The ASP methodology should be followed as many times as needed inside the loop, until an “optimized” version has been achieved.

An easy way to see the results of the study of all of the elements previously described is by using a graphical diagram that condenses all of the information. The methodology from Zott and Amit does not suggest using any kind of diagram, and therefore a diagram that can be used is proposed as example in the results chapter.

Once all of these graphic representations have been done, it is only a matter of fitting the information into the building blocks to finish this section of the methodology with the most widely known and accepted representation of a business model, the BMC.

Business Model Canvas

Because of all the advantages it provides, the BMC is included as a part of the business modelling

methodology. Nevertheless, the methodology to produce it won´t be described, as it is completely based in

the methodology proposed by Osterwalder in his “Business Model Generation” book [67].

4 Results and discussion

-27-

4 Results and discussion

4.1 Market Analysis

After a wide study developed first by Leßmann for the entire range of possibilities to use otego’s oTEGs, and then by Becker focusing in the industry 4.0, it was concluded that otego has the biggest market possibilities by producing either an energy harvesting power device (EHPD) or a wireless sensor node with integrated energy harvester (WSEH). The reasoning to conclude this can be followed in section 4.1.1.

While big companies can and should have a wide range of products to offer, startups have a very limited amount of resources, and therefore it is better for them to focus on finding a single product in which they can offer more added value than others [68]. Because of this reason, even though both product configurations are technically feasible and seen as useful, otego needs to find the optimal product configuration for its market entry, and focus on it.

The results developed while using the MA methodology have as focus therefore using the MTUM in order to get to know which product configuration offers more value to the customer and has bigger success opportunities in the market. The methodology used is the one described in section 3.1.

4.1.1 Step 1: Product Configuration, Task and Market Characterization

Product Configuration and Task Characterization

Becker’s work consisted on a deep analysis on characteristics that define otego and the WSNs market. His work fully covers the task characterization for the MTUM, and therefore its results are not presented in this thesis work.

Furthermore, Becker’s work also roughly suggested ways in which otego could tackle the WSNs market with a product. After a deep analysis of his results, two main product configurations with which otego can tackle the WSNs market were identified:

The EHPD that can be connected as external power source to a WSN node

The WSEH that already uses otego’s oTEG as energy harvesting device

Based in Zahid and Ahmed characterization of generic WSN nodes, the product configurations proposed can be identified in a figure not shown here because of confidentiality reasons. Such product configurations are the ones to be analyzed by using the MTUM.

Market Characterization

WSNs is an expanding market that is expected to grow at a Compound Annual Growth Rate (CAGR) with high interest. A higher market growth is expected from the WSNs with energy harvesting systems as power source market. This shows that the market of WSNs powered by EHS will grow at a higher rate than the overall market of WSNs, meaning that other power sources will start to be slowly left out of market.

Inside the market of WSNs powered by thermal energy, the most attractive one for having the highest share and second highest CAGR is the one of industrial applications.

Table 4-1 shows how industrial sensing and automation applications can be divided in three main areas, i.e. security, control and monitoring. For security and control, the cabling high costs can be justified, e.g. the cabling and installation for an automation and sensing project can cover up to 80% of the project’s total

4 Results and discussion

-28-

system cost, and very well exceed 1,000 US$ per foot in regulated environments, [70] but for monitoring, the cost of traditional sensors is too high. Therefore, WSNs have found a big market opportunity in their implementation on monitoring of industrial facilities as industrial WSNs.

Table 4-1: Industry Sensing Applications and Corresponding Characteristics

Characteristic Security Control Monitoring

Purpose Human and installation

safety Process control

and quality Equipment monitoring

Automation level High Medium Partial to low

Required confidence High Medium Low

Energy intensity level High Medium Low

Costumer expected cost Expensive Expensive to economic Economic

Relevance Vital Quality Cost saving

All the previous information confirms Leßmann’s conclusion that the biggest market entry opportunity for otego is in the field of industrial WSNs, i.e. in the monitoring sector. Furthermore, by having a market introduction in the industrial sector, otego could transfer the knowledge into all the other market areas found in the scope of figure 4.1.

Figure 4.1 otego’s First and Future Market Approaches

Technology developments in otego’s oTEGs may not only open up other market areas inside the market of WSNs with thermoelectric EHSs, but also others that have not been covered by thermoelectrics because of the low ZT and high costs related to inorganic TEGs.

Both the EHPD and WSEH configurations have advantages and disadvantage in the market and technology that cannot be measured through a simple market characterization like the one that was just presented.

In order to deepen into the advantages and disadvantages, the MTUM methodology is now continued.

4.1.2 Step 2: Derivation of Evaluation Criteria

Evaluation criteria had to be developed to compare both product configurations with the MTUM. The evaluation criteria consisted of 5 market related hypotheses to compare product configurations, 4 technology related questions to give an insight regarding which technological features do customers find valuable, and 1 final question in which the interviewed was straight forward asked which product configuration did he find to be the best.

4 Results and discussion

-29-

The technological questions are not used for selecting the best product configuration as they can be used in both the EHPD and the WSEH design, but they are useful to get to know how the selected product configuration can best fit the tasks that the customer needs to solve. Likewise, the final question is not used for selecting the best product configuration, as it is not representative of real conditions in which the customer would actually buy the product, but it can be used to have an idea of what the customer thinks after the whole interview took place.

The market hypotheses, technology questions and final question are presented and explained in the following points.

Technology Related Questions:

a. Which temperatures are expected in the industry?

This question will allow the design to take into consideration the temperatures at which the industries work, as well as the temperatures present in their applications. Could it be that the oTEG needs an interface material that lowers the temperature?

b. What does flexibility mean?

Flexibility is a word that was widely used in the previous work from. Becker. What does it really mean? How does the customer see “flexibility”? How can otego offer a flexibility that the customer finds useful or worth paying for?

c. Which measurement frequency is needed?

This is another concept that is widely used in Beck’s work. Some R&D experts in WSNs talk about “real time measuring” as a constant need in the industry. What do real customers think about measurement frequency? Which measurement frequency is considered ideal? Is “real time” truly needed in the industry?

d. Does the product need to be intrinsically safe?

The final technology question is related to the concept of intrinsic safety. In the market, several EHPD configurations are intrinsically safe. Making a product intrinsically safe increases costs and, in the case of otego, would delay the production of the EHPD. Is this feature really needed? How does the industry see this concept?

Market Related Hypotheses:

1. There is an opportunity to implement a product configuration in already existing facilities

This hypothesis includes assessing the number of sensors that are already installed in industrial facilities, their maintenance needs, as well as other considerations that could affect the introduction of each product configuration in already existing facilities.

2. There is an opportunity to implement a product configuration in new facilities

This hypothesis looks for the possibility to implement a product in new facilities being built or that will be built in the future. The rate of construction of projects including the product configurations should be measured, but this is a number that depends a lot on the type of industry and that is quite blurry in disruptive technologies. Instead, the acceptance level to the idea of implementing a product configuration will be analyzed.

3. Monitoring is seen as different from controlling

Industrial sensors activities are divided in control and monitoring. Therefore, it is important to know if the industrial players believe that monitoring is both useful and a reason to spend money on.

4 Results and discussion

-30-

4. Price comparison will be done with similar devices

Most of the sensors that do not use wired power sources opt for batteries, as they are widely spread not only in the market but also in the customers’ mindset. Therefore, it is important to know if the product price will be compared with batteries, with other energy harvesters, or with some other indicators such as wiring or maintenance costs.

5. Technology is the decisive factor when buying industrial applications

This hypothesis measures how important is the technology for possible customers, in the sense of how exactly do the technological characteristics of the product have to fit with the technology requirements of the system. Is the technology fit completely vital for the devices, as to disregard the costs? On the other hand, are they able to shift the requirements of the system to make them fit with the technological specifications of the devices, in order to spend less capital?

Final question:

Which is your final recommendation for otego?

The final question is a straightforward question regarding which product configuration would the customers prefer. The question will be done at the end of the interview, after all of the previous points have been covered. The hypotheses and questions from before can be summarized in the Table 4-2.

Table 4-2 Evaluation Criteria used in the MTUM methodology.

MTUM evaluation criteria Technology related questions Market related hypotheses

a. Which temperatures are expected in the industry? b. What does flexibility mean? c. Which measurement frequency is needed? d. Does the product need to be intrinsically safe?

1. There is an opportunity to implement a product configuration in already existing facilities

2. There is an opportunity to implement a product configuration in new facilities

3. Monitoring is seen as different from controlling 4. Price comparison will be done with similar devices 5. Technology is the decisive factor when buying industrial

applications

Which is your final recommendation for otego?

Since no pointing evaluation will be considered for the technology related and final questions, the pointing scale that is presented in Table 4-3 only applies for the market related hypothesis.

Table 4-3 Punctuation Scale for the MTUM

4 Results and discussion

-31-

The conclusions regarding the product configuration are used for the hypotheses 1, 2 and 3, and the ones regarding the market opportunity are used in hypotheses 4 and 5.

4.1.3 Step 3: Technology Assessment

The way to assign points to the hypotheses and an answer to the technological questions was through interviews with experts in the field, possible final customers and other stakeholders. In total, 33 stakeholders were contacted. They were contacted either by previous relationships with otego, by participating in conferences and events, or by networking, acquaintances and internet research. Out of these 33 stakeholders contacted, 14 of them accepted to be part of an interview and 12 of them gave useful input. A list of the interviewed stakeholders can be seen in annex 1.

This section is divided in ten sub-sections, each of them representing one of the questions or hypotheses derived before. Each of these sub-sections will consist on a brief explanation of the value of such a question or hypothesis, important comments given by the interviewed, and either a final grade assigned to each product configuration in the case of the market hypotheses, or a recommendation in the case of the questions.

Finally, after showing an overview of the results, a last sub-section will analyze the results and develop a conclusion of which product configuration will be considered for the MVPP and BM.

4 Results and discussion

-32-

4.1.3.1 Which temperatures are expected in the industry?

This question focuses on finding a generalization on the temperatures that can be found in diverse industries. By having an approximation of these temperatures, it is possible to derive the requirements that the selected product configuration has to fulfil related to temperature. Positive numbers, therefore, would be inside a temperature range of 50 to 200°C, as otego’s oTEG can work without a problem in such a range, while producing a good amount of electrical power.

During the interview Spits, manager of the process engineering department at TATA Steel, stated that in the metallurgic industry there are present both machinery and pipes with surfaces that are at temperatures around 50°C to 80°C, with an ambient temperature of around 20°C. Bätz, head of department of electricity, instrumentation and automation at Outotec, and Wirtz, product engineer at Outotec, confirmed the statement from Spits by expressing that according to their experience the temperatures range in such an order. Bätz further commented that, with seasonal variations, the temperature differences between the surfaces and the ambient could reach higher and/or lower levels, as the process has to be always at the same temperature, while the ambient temperature varies according to the season. Therefore, seasonal changes would also mean a seasonal change of produced energy.

Higher temperatures were reached in the energy production industry where Egbert, Soltune’s founder, talked of temperatures around 200°C in the energy production cycle, and 50 to 120°C for the delivery of heat to households. These last numbers regarding households were confirmed by Huibers, co-founder of Octo. Therefore, otego can also be applied in the production and distribution of heat to households market.

For the case of the chemical industry, the interviewed stated that even though the temperatures are in fact between useful ranges for otego’s oTEG, insulations that have to be present in the facilities might become a problem. Norms are especially strict in the chemical industry, where any temperature gradient is seen as a waste and the best practices mandate that these surfaces must be insulated. This could become a problem for otego, since even though high temperatures of around 60°C can be reached in the surface, as the surface is insulated it is hard to take advantage of the temperature difference between the process and the ambient.

a) b)

Figure 4.2 Infrared Scanning in Pipings taken from a) [71] and b) [72]

After finalizing the interviews, it was clear that this technological aspect is positive in the industry, with most of the interviewed stakeholders stating that the temperature ranges are between the optimal ones for otego. It is concluded, therefore, that otego can be effectively mounted in most of the surfaces of industrial facilities to start producing energy, without the need of having extra elements to protect it from extreme temperatures.

4 Results and discussion

-33-

4.1.3.2 What does flexibility mean?

As seen in section 2.2.2, one of the most important features that otego can offer is its flexibility. Flexibility is also one of the characteristics that Becker’s thesis shows as most appreciated by the customers. However, what does “flexibility” mean? What is the “flexibility” that the final customers need? Is it the same flexibility that otego has in mind (i.e. mechanical flexibility)? How can otego fit its definition of flexibility with the one of the customer?

All of the interviewed stakeholders agreed that, for them, flexibility means that an energy harvesting device is able to control the voltage it produces, in order to be capable of powering up a diverse range of devices, no matter the brand or type. This, of course, focused in the direction of otego having an EHPD product configuration. Their main argument was that, in such a way, otego would be able to offer electric power to several devices in the ultra-low power range. Bätz went further on with this idea, stating that an ideal product from otego would be a separate device that fits any sensor in the market.

Another concept to be defined as flexibility is the communication. Flexibility in communication means that the information transmitted can be received by any kind of device, no matter which kind of communication protocol is used by the receiver. This answer, of course, relates to the WSEH product configuration.

Finally, two concepts that are related to both product configurations are modularity and bending ability.

Regarding the bending ability, all of the interviewed were surprised to see that otego’s oTEG was able to bend. Quadt said that he has not heard of any other TEG with such a characteristic, which makes him believe that the best option for otego is to take advantage of its bending ability, as it makes it possible to be presented as an added value feature for customers. Nevertheless, he couldn´t give any example of how can this bending feature be used.

As for the modularity, most of the interviewed confirmed that having a modular equipment is always useful so the product can be aligned to the requirements of the consumer. Modularity means that no matter which product configuration is selected, it has the ability to be interconnected with other products to have a wider range of applications. In the case of the EHPD, it means that several EHPDs can be interconnected to produce more power. In the case of the WSEH, it means that many nodes can be interconnected to produce more measurements.

The following figure shows the concepts in which otego’s expected flexibility can be categorized.

Figure 4.3 "Flexibility" Identified by Customers

4 Results and discussion

-34-

4.1.3.3 Which measurement frequency is needed?

During conversations in conferences and industrial fairs, most of the sensor producers focused in the constant need of having real time information. What this question tries to answer is, do sensor operators really need or even care if the measurement is in real time? If they don´t, which measurement frequency do they find most useful?

The answer to this technological question was quite surprising, considering the emphasis that sensor producers did on real time measuring.

Even though some of the interviewed stated that real time measuring and information sending is a useful concept, they are far from having such a need in their industries. Egbert further explains this point with his heating system. The heating system has a certain inertia so even if a change is instantaneous it won´t be noticed by any sensor at that precise moment. Therefore, it makes no sense for him to have a sensor that measures every millisecond if the change will be noticed only after three to five seconds. This system inertia principle was shared by most of the interviewed stakeholders.

The bigger a system resilience is to small changes in temperature, the lower the measurement frequency needs to be, as stated by Ecovat’s technical commercial officer van der Bosch. Van der Bosch set as example the heat storage systems produced by Ecovat. According to him, since the Ecovat heat storage system has a high resilience to change, it would be enough to perform measurements every couple of minutes in order to have a correct control of the process. This is truth only for the heat storage system, as the sensors measuring and sending information about the heat flow arriving to households would need to be done every couple of seconds. Every couple of seconds, though, is not yet real time.

The importance of knowing the measurement and information sending frequency relies on the fact that higher frequencies mean that the product will need to work more, therefore asking for more power from the power production device. If not enough power is produced, then the system will not work and the measurement and/or the information sending will not take place, causing the system to lack information. This information lacking could be reflected in a lack of monitoring ability, in the best case, or a lack of control and security, in the worst case.

According to the answers given by the interviewed, it is concluded that the frequencies needed by the customers are not in the range of real time.

4 Results and discussion

-35-

4.1.3.4 Does the product need to be intrinsically safe?

While benchmarking energy harvesting devices, it was noticed that two of otego’s main competitors, Perpetua Power with his Power Puck [73], and Perpetuum with his PMG [74], are very keen on showing that their energy harvesting devices are intrinsically safe. This raised the question: is it really needed for either an EHPD or a WSEH to be intrinsically safe?

The common understanding from most of the interviewed stakeholders was that a device that either powers up WSNs or that is a WSN itself would not need to be intrinsically safe. This intrinsically safe add-on was not seen as valuable by them and therefore represented only extra costs to the producing companies that did not lead to an increased customer satisfaction.

In fact, from all of the interviewed, only Wirtz stated that some of the sensors he works with needed to be intrinsically safe. This requirement is strictly related to the projects taking place in dangerous atmospheres. Nevertheless he also stated that if an intrinsically safe device is needed, other components will need to be wired, which would lead a WSN out of the question, as there would be already cables in the proximity to be used for cabling the sensors.

Spits supported Wirtz by stating that most of the regulations he has to follow focus not in the product being intrinsically safe, but in ensuring that the environments in which they work at are free of any explosive elements. Therefore, having products that are intrinsically safe would not be giving any added value.

Finally, it can be concluded from this technological question that, no matter if otego chooses the EHPD or the WSEH product configuration, the product would not need to be intrinsically safe.

a)

b)

Figure 4.4 a) Power Puck from Perpetua Power [73] and b) PMG from Perpetuum [74]

4 Results and discussion

-36-

4.1.3.5 There is an opportunity to implement a product configuration

in already existing facilities

This hypothesis is related to the approximate number of sensors in the industry and the rate at which they are either replaced or subjected to maintenance. The openness of customers to introduce wireless in their already existing facilities was also part of the research.

Bätz gave the most complete answer stating that the number of sensors varies a lot according to the plant size. According to his figures, small plants could have up to 10 or 20 sensing instruments, large plants could have up to a couple of hundred and, finally, very large plants like the aluminum refineries where he works could have up to several thousands. Sensors are very important to have a complete control of the system and the bigger the system the more sensors are needed.

This was confirmed by Wirtz who stated that at his division inside the metal processing plant he works at, in Latvia, there are around 200 to 300 sensors installed. Nevertheless, he added that all of them are wired for both data and power transmission.

Previous information may even be underestimating the overall number of sensors in a whole plant, as explained by Spits. He estimated a number of 100,000 sensors per industrial facility he has projects on. His projects, nevertheless, involve implementation of new optimization and control technologies, which explains why his numbers explode in comparison with the more conservative ones from Bätz and Wirtz.

Regarding infrastructure maintenance Kretzler, electronic technician at EnBW, stated that it is very rare the case in which a maintenance involving cabling change would be needed by one of the industrial sensors they have installed. In his opinion, most of the sensors and facilities have not had maintenance in the last 30 years. The same is the case for the sensors cabling, and he couldn´t even remember giving any maintenance to the cables present in the plant. Bätz shared the opinion by quickly stating that cabling has no maintenance costs.

Figure 4.5 Sensors Installed in a BASF Plant [52]

Egbert has estimated that in his micro solar-heating plants, each of which will produce up to 50 kW of heat, he will need to install 60 to 120 sensors, preferring wireless sensors, as they would help him save in installation costs.

As for Ecovat, around 200 sensors is the approximate number needed in the heat storage systems prototype installation, according to van der Bosch. He also pointed out that most of them will have to be cabled, as the system is placed underground, where the sending of wireless information will not be possible. Huibers estimates that his heat management software needs five sensors per household in order to give an accurate measurement of the amount of energy being sold to the customers.

4 Results and discussion

-37-

a)

b)

Figure 4.6 Ecovat a) Working Principle Diagram and b) Installation Process. Both pictures from [75]

It can be concluded that sensors are a vital part of the daily working environment, and therefore the amount of sensors in the production facilities is proportional to the size of such facilities.

For the case of well-established companies, their facilities usually have all the sensors they need already placed and, because of the high costs involved in their installation, they show no interest in changing from cabling to wireless. The only possibility they foresee to install WSNs is in new projects inside the plant that involve new infrastructure. As for an energy harvester, they would consider it to power up their already installed devices, in case that the cable has suffered some damage and the cabling costs were high.

Startups showed big interest, mainly because of the fact that otego is more economic than other solutions in the market. Nevertheless, the numbers they showed of possible interest in the sensors rely on future approximations, which may not develop in the next years. Therefore, such a market should be kept in view, but not be focused in a short-term scale.

As a conclusion, a grade of 7 was given to the EHPD configuration, as there is a big possibility to use it in already installed sensors where the cable has been damaged. Nevertheless, the fact that this does not happen often lowers the evaluation.

In the case of a WSEH configuration, it was found that it has a market opportunity for startups, but such is mainly based in the startup’s future approximations. Furthermore, established companies stated that if the cabling has almost no maintenance, sensors have no maintenance at all, meaning that no business would be interested in changing the sensors they have installed to WSNs. Therefore, for this hypothesis WSEH receives 4. The points given for each product configuration can be seen in Table 4-4.

Table 4-4 Hypothesis 1 evaluation for each product configuration

EH WSEH

Opportunity for a product to be implemented in already existing facilities

7 4

4 Results and discussion

-38-

4.1.3.6 There is an opportunity to implement a product configuration

in new facilities

While in the previous hypothesis the acceptance to implement a product configuration in existing facilities was evaluated, this one looks for implementing it in new facilities. As it can be already expected, this hypothesis will have a blurrier accuracy than the previous one, since it is dealing with future tenses and expectations. In order to avoid it, the amount of WSNs installed in the last years will be assessed, which can give an idea of the willingness of the market to implement the technology. This approach will also be useful in order to grasp the worries and needs of possible customers.

In the plants he is in charge of, Wirtz has installed an approximate of 2 or 3 wireless network nodes (compared to the 100,000 installed sensors he stated in the previous hypothesis, it means that only 0.3% of them are wireless). His decision to install WSNs was not because of their advantages compared to cabled sensors, but because the system constrains made it impossible to cable up the sensors.

On the other hand, metallurgic facilities such as the one from Bätz and Spits have worst numbers, with only one installed in the case of Bätz, and none in the case of Spits. Bätz has a clear reason to avoid WSNs, as he once installed one and it did not only missed data during the transmission, but also needed regular battery changes, which turned out to be costly and frustrating. “I have no trust in batteries anymore” was his conclusion. Because of that, Bätz made it clear that he would not install any more WSNs but after batteries can be avoided.

Startups, on the contrary, are more open to the installation of WSNs. Egbert showed a clear interest in implementing WSNs He also admitted that price is a big constraint for him.

Van der Bosch also thinks that WSNs could be the best option once the first characterization projects from Ecovat have been successful. Nevertheless, such a characterization process will need a couple of years to finalize.

All of the previously explained was confirmed by Lohmann, manager of remote systems group in Pepper + Fuchs. As he pointed out, their Wireless HART temperature transmitter doesn´t actually have a market yet, and works mostly as a prototype for consumers to have experience with it and get to know about the concept of WSNs. The sales they have had for this device are not even close to a mass market introduction, as he explained, without being able to hand in actual figures.

Figure 4.7 Wireless HART Temperature Transmitter Concept from P+F [76]

The EHPD configuration is assigned a note of 9, as it is quite clear that the industry players are keen to avoid using batteries, which opens up their willingness to try out energy harvesting technologies. They even hinted that as long as a well renowned company supports the use of energy harvesting, they think it is ok to use it to power up industrial sensors.

4 Results and discussion

-39-

As for the WSEH configuration, it receives a total of 4 points, as even though there is an interest coming from the industrial players in installing WSNs, they still prefer to buy them from big companies. Furthermore, big companies such as Pepper + Fuchs stated that, in case otego opted to produce his own WSN device, they would see no point in creating a relationship. This is a big drawback for the WSEH product configuration. The evaluation for each product configuration can be seen in Table 4-5.

Table 4-5 Hypothesis 2 evaluation for each product configuration

EH WSEH

Opportunity for a product to be implemented in new facilities

9 3

4 Results and discussion

-40-

4.1.3.7 Monitoring is seen as different from controlling

Monitoring is an important concept for the widespread of WSNs and industry 4.0. As opposed to the concept of controlling, monitoring means to have information that may not be vital for the functioning of the system, but that will be useful in order to improve its efficiency, life expectancy or any other positive parameter.

Nevertheless, sensing producing companies have no subdivision inside their websites for monitoring sensors, which indicates that for them there is no difference between control and monitoring.

This section focuses on knowing what the opinion of industrial consumers is. Do they see a difference between monitoring and controlling? If so, do they find it useful to invest in monitoring devices?

It arose as the main opinion of the big established companies that there is no difference between monitoring and control. According to them, a control sensor should be able to do the same as a monitoring sensor, and vice versa. Setting different advantages and disadvantages between control and monitoring may only bring more pain to the customers, as they would not only have to decide about the technical needs the sensor has to fulfil, but also about its classification as a monitoring or a control sensor.

Bätz made a strong comment against monitoring, stating that he “only goes for really needed data, or data that could optimize the process. Monitoring is not so important and its implementation is done only by customer request”. His comment showed that sensing is not useful unless its information is used in order to either control the process or produce economic savings. Therefore, if a sensor were labeled to be for monitoring purposes, then it would not be considered in the buying process.

The result for startups was more divided. On one side, Egbert stated that he only would need information coming from monitoring sensors in order to monitor and measure the energy consumption of the households. All the other aspects for the plant regulation would be made not by control, but by automation sensors. As he will spend big amounts of money for these automation sensors, it is best for him to save money through the concept of monitoring to measure the energy consumption of the households.

As for van der Bosch and Huibers, they believe that both controlling and monitoring are one concept, and the difference should not be the money paid, but the way the sensor is used. They also suggested that, if a price comparison is made, then it could be inferred by the customer that the quality is lower in the case of monitoring.

The most optimistic person was Tjalf, engineer in applied research at Bosch, who finds that monitoring is a needed concept for the widespread of Industry 4.0. He believes that monitoring and controlling should be therefore two different concepts sold at two different prices.

As final grade for this hypothesis, both the EHPD configuration and the WSEH got a 5. During the study, no big difference was found between both product configurations, and both got a low grade since none of the interviewed showed much interest in monitoring, while some even considered it as useless. The evaluation for each product configuration can be seen in Table 4-6

Table 4-6 Hypothesis 3 evaluation for each product configuration

EH WSEH

Difference between controlling and monitoring affects positively

5 5

4 Results and discussion

-41-

4.1.3.8 Price comparison will be done with similar devices

This hypothesis takes into account that, when considering whether to buy or not a product configuration, the price comparison will be made between similar devices. This is, the EHPD will be compared against other EHPDs in the market, and the WSEH will be compared against other WSEHs. In case that this hypothesis turns out not to be truth, then a possible price comparison must be identified.

It was surprising that none of the interviewed showed any interest in comparing the product configurations with other similar product configurations. Most likely, this is because of the energy harvesting and industry 4.0 being categorized as a disruptive technology. Therefore, the customers have no clear idea on how to compare the products with other options in the market.

Bätz preferred to emphasize that both of the product configurations would avoid cabling costs, as installation would need to be performed no matter which product configuration is used. He also stated that the cables to connect sensors can be quite expensive: depending on the type and length, the cabling factor can reach up to 1.5 or 2 times the cost of the sensor. Depending on the cost of copper at the moment, the price could increase even more.

Lohmann, on the other hand, preferred to compare the product price only with the cost of batteries and their replacements since, according to him, customers would be already considering buying batteries for their WSNs. However, would they really do so? As it could be seen in the hypothesis “There is an opportunity to implement a product configuration in new facilities”, Bätz stated that he had a quite uncomfortable experience with the use of batteries. As he confirmed: “The best way to jump away from the wired technology into the wireless one is by taking away the batteries, so that all the installation problems are solved”. This makes it clear that he would never compare energy harvesting devices with batteries, as batteries will always be a no-go for him.

Spits went for an approach that mixed both of the previous ideas, as he stated that not only the cable but also the installation costs should be considered. In both product configurations, a main advantage is that they are plug-and-play, so even though the post-installation process is the same, there would be savings in the pre-installation one, as cabling involves preparation and implementation as labor time.

Regardless of the cost comparison suggested, all of the interviewed stakeholders from well-established companies admitted that even though it would be representing savings, they actually didn´t believe that the cost savings will account as a decisive factor considering the total amount of money spent in the facility as a whole.

Bätz showed this example: Supposing that a line for metallic pellets production is 400 m long, if the cable costs 30 €/m it means that for cabling 24,000 € will be needed as initial investment. This amount can look as a great saving, but if the price is compared to overall plant costs, where tens of millions of Euros are spent, then such a saving will have a minimum value, as it only accounts for 0.24% of the total cost. “Plants represent very high costs, so small savings make no very big difference. Even though, savings are always interesting for the investors”, was the statement of Wirtz. This shows that otego, no matter which product configuration chooses, will have to be very careful in the way customer’s possible savings are shown.

For the case of startups, Egbert said that his company has two main needs, i.e. low costs and easy installation. His immediate choice for the sensor would be a simple PT-100 element because of its low price, but he knows that wiring costs will be high for the several elements he needs to install. Therefore, he sees an economic sensor from otego as a feasible solution for his problem. His decision problem is illustrated in figure 4.8.

4 Results and discussion

-42-

a)

b) Figure 4.8 a) Costly Wireless Sensor Easy to Install [77], and b) Cheap Cabled Sensors Hard to Install

With all of the previously explained, it becomes clear that the price comparison that the customer makes will follow two trends:

Customers will be able to make a comparison with existing technologies that are knowable to them, which in this case refers to wired technologies.

Customers will have few knowledge in the field, and the comparison will be done however otego shows it. This confirms the importance of the marketing section for otego.

As final grading, the EHPD received a grade of 7, while the WSEH receives a grade of 8, since both technologies can take advantage of a correctly promoted cost comparison where big savings are shown. Nevertheless, WSEH gets a slightly higher note considering that, since otego would be developing also the sensor lower production costs for the overall WSN can be achieved. The points received by each product configuration can be seen in Table 4-7

Table 4-7 Hypothesis 4 evaluation for each product configuration

EHPD WSEH

Price comparison is favorable for the product configuration

7 8

4 Results and discussion

-43-

4.1.3.9 Technology is the decisive factor when buying industrial

applications

In the previous hypothesis, a possible price comparison was established with other options that the customer may have. This hypothesis goes further by asking how important the technology for industrial buyers is. If a technology doesn´t entirely fulfil their needs, is it automatically rejected?

Almost all of the interviewed had the opinion that the technological factor was the most important one to be considered, as no matter the price, if the sensor couldn´t do a proper job, they wouldn´t even consider buying it.

As for identifying which technological factors are important, there were several opinions. Answers ranged from the sensor being compatible and resistant to the working environment to reliability and measurement quality and frequency.

Even in startups, which show a more price driven behavior, technological aspects remained as the main factor to be considered when buying a product.

While doing the interviews, all of the well-established industrial players admitted that they would prefer buying a WSN from a well-known and established sensing company. This opinion was more divided in the case of startups, but a tendency to prefer such kind of companies as source for their products remained. By choosing well-known companies, it is believed that the technological aspects of the product can be trusted, and will fulfill their needs.

Price turned out to be also important but only as a second factor once all the technological needs were fulfilled. This was truth mainly when comparing prices for technologies that have been already identified to fit the need.

Huibers finds that the savings in the installation costs would be the most promising part for otego, in case otego decided to produce the WSEH product configuration. Nevertheless, his preference of buying an economic sensor is only justified after their system has been correctly characterized with cabled sensors from a well-known company. The same opinion was shared by van der Bosch.

As grading conclusion, the EHPD configuration got a grade of 8, since it gives the possibility to work with well-established companies by creating EHPDs that fits their sensors. This type of relationship would give the consumer the possibility to use the so-wanted reliable sensors while lowering their installation expenses.

The case of the WSEH was given a grade of 5 since even though with this configuration the costs saved were bigger, the possible customers stated that they would show some level of distrust while buying a sensor from a recently stablished startup. This product configuration would also mean no partnership with well-established companies in the field, which is a big drawback. The evaluation for each product configuration can be seen in Table 4-8.

Table 4-8 Hypothesis 5 evaluation for each product configuration

EH WSEH

Technology is a decisive factor when buying industrial applications

8 5

4 Results and discussion

-44-

4.1.3.10 Which is your final recommendation for otego?

After finishing all of the previous questions in the interview, and once the interviewed had a clear view of the pros and cons that are given by both configurations as well as the technological and economic factors related to them, the final question was done: Which product configuration offers more value and is more attractive to you?

This can be considered as a bold and straight question, but it is useful to see the level of understanding of all the previous points discussed with the possible stakeholders, as well as their final interest in any of both product configurations. The question “Which product would you buy?” was not asked since this is not a real situation and any information related to it would not be valid for real case scenarios.

Five of the interviewed gave as final recommendation for otego to produce an EHPD that can be connected to power up several types of sensors, no matter the manufacturing company or power input requirements. Being able to give power to several sensors from different companies, otego would open up its market spectrum, which is beneficial for a company that is just starting business activities.

Lohman added “the technology would really need to be a no-brainer in order to be accepted in the market”, which showed that simplicity and plug-and-play are a very important characteristic in the product to be selected.

Simplicity is easier to be achieved when the company focuses in its core business, which in otego’s case is the production of oTEGs. The production of a WSEH implies that otego needs to cover more expertise areas, which would be detrimental for the quality of the final product [78].

With a different point of view, three of the interviewed stated that they would prefer otego being a sensor producer. In fact, these three turned out to be the startups, which are more price oriented than the well-established industrial companies. Therefore, it makes sense that a startup will try to have more savings with a product configuration that does not only save costs in the installation and cabling of the WSNs, but also in the WSNs themselves.

4 Results and discussion

-45-

4.1.4 Step 4: Conclusion

This step uses equation 3.1 in order to select the best product configuration for otego. The points assigned per hypothesis to each of the product configurations and the final MTTF score of each product configuration can be seen in Table 4-9.

EHPD WSEH

H1: Already existing facilities 7 4

H2: New facilities 9 3

H3: Control vs. monitoring 5 5

H4: Price comparison 7 8

H5: Technology factor 8 5

MTTF 36 25 Table 4-9 Points Assigned per Hypothesis (H) and Final MTTF for each Product Configuration

The graphical representation of Table 4-9 can be seen in figure 4.9.

Figure 4.9 Graphical Representation of Final MTTF Punctuation per Hypothesis

As it can be seen, the product configuration corresponding to the EHPD is the best option for otego’s market entrance. Such a configuration got a total of 35 points, from the 50 possible. The EHPD offers the advantage of being a simpler product configuration that requires less expertise in other areas than the oTEG production from the designing team, while remaining competitive. With the EHPD, otego can start having market presence and benefit of partnerships with well-established players in the industry.

This does not mean that the WSEH should be completely disregarded as market opportunity. In fact, during the interviews many market players showed interest in a WSEH product configuration in the future. However, precisely the “future” fact is the one that reduced this product configuration’s points in almost all of the hypotheses.

Finally, for the MA section of this thesis, it is concluded that the best option for otego is to begin its market entrance with the EHPD product configuration. The EHPD product configuration will be then considered for the following methodology sections, i.e. the MVPP and the BM.

4 Results and discussion

-46-

4.2 Minimum Viable Product Prototype

otego had already developed prototypes in order to show the public how do oTEGs work, and in which way they can be used, as seen in annex 2. Nevertheless, those prototypes are not designed to be a real life, tangible solution for the needs that customers have in the industrial sector. This thesis section will explain the process of developing a MVPP for the best product configuration found in the MA, which turned out to be the EHPD.

The methodology shown in figure 3.3 on section 3.2 will be the basis for this chapter. Because of time-constraints, only the critical sub-systems will be designed and optimized. This is considered to be aligned with the objectives of the thesis, as designing critical sub-systems is the most energy and time intensive step of the design activity.

The following sections will not follow the same order as the methodology laid out in figure 3.3. As steps one, two and three are tightly related, they are covered in only one section called “Pre-design activities”.

4.2.1 Pre-Design Activities

Define assumptions and goals

The assumptions and goals for the MVPP were defined considering the results from the MA from the previous section. After a careful distillation of the results, it was concluded that the MA could be fitted into four basic kinds of assumptions regarding what the customer finds valuable that are to be tested by the MVPP.

The customer finds it valuable that:

1. The EHPD doesn´t have an insulation 2. The EHPD has the ability to be bendable 3. The EHPD is a plug & play product 4. The EHPD uses standard components

All of these assumptions must be tested by the EHPD through its design. How the assumptions are related with the technological questions and market hypotheses from the previous MA can be seen in figure 4.10.

Figure 4.10 MVPP Assumptions related to Questions and Hypothesis from MTTF

4 Results and discussion

-47-

After a thorough discussion with both the technology and business team, three main goals were settled for the MVPP.

a) Be as simple as possible b) Be inexpensive c) Use standard components and production processes

The assumptions and goals will lead the technological development of all of the sub-systems inside the EHPD, even though they might not be mentioned.

Define sub-systems

Designing is not a task isolated from environmental influences that takes place only one time without any traceable origin. A design takes an initial idea, or several, as inspiration and then builds on them. In the case for the EHPD design, there were several inspiration sources, most of them coming from previous ideas developed by otego’s team.

The most influential idea in the MVPP design task was a previous prototype made by otego’s team, which is not functional and doesn´t include oTEGs, but is used to show people how the flexibility factor could work in a possible application. Such a design is shown in figure 4.11. The prototype simulates a wearable power source, where the mini-USB cable could power up different devices, and the metallic sheet on top idealizes a heat sink.

Figure 4.11 otego’s First Prototype

This was the initial inspiration for the EHPD, and from it, a draft of the final EHPD was developed. In annex 3 several design iterations can be seen. All of them contributed in a higher or lower degree to the establishment of the final draft design, which can be seen in figure 4.17 (not shown here version for confidentiality reasons).

It was decided that the EHPD would be divided into three sub-systems:

Heat sink

Attachment method

Cabling and electronics

The heat sink by its own represents the biggest bottleneck in the design and production, as up until now there are not easily recognized heat sinks that show the ability to be flexible. As for the attachment method, it also has the requirement of being flexible otherwise the advantage of having a flexible heat sink would vanish. After conducting more design-focused meetings with both the technology and business teams in otego, it was decided that the critical sub-systems of the overall design were, as explained before, the heat sink and the attachment method. The electronic and cabling design were designated to be non-critical,

4 Results and discussion

-48-

therefore leaving them for other design processes, as time-constrains in this thesis work allowed only to design critical sub-systems.

In the following section, the process and results of the designing activity for the sub-systems are shown.

4.2.2 Heat Sink and Attachment Method Design

LeBlanc et al had already mentioned that one of the major barriers to economical thermoelectric power generation results from system costs for heat exchangers and ceramic plates, which are used as heat sinks in TEGs [46]. Furthermore, the heat sink design in the specific case for otego rises one extra constraint, as it needs to be mechanically flexible in order to cope with the flexibility expected from the customer.

The steps in the design are not shown here version for confidentiality reasons.

Finally, it can be concluded that the design phase of the critical sub-systems was successful, as the otego team found the design to be useful, purchase requisitions were made to have the physical components, and the possibility to develop a prototype is being thought of.

In the following section, the business modelling of the EHPD will be explained. Even though the results are presented once the total results of the design have been reported, it is important to remember that the process was done at the same time.

4 Results and discussion

-49-

4.3 Business Modelling

After the general sub-systems of the entire product configuration have been selected, the business modelling step can be started. This step of the methodology, just like the previous one, consisted of several iteration steps, which were retrofitted while the MVPP was being designed. Therefore, this step was not started when the previous design step was finished, but at the same time. In order to condense the information, only the results from each one of the methodology steps is presented.

4.3.1 Market Value Chain Definition

The MVC in which otego takes part can be seen in figure 4.12 (not completely shown because of confidentiality reasons):

Figure 4.12 otego’s Market Value Chain

Following, each one of the elements inside the value chain is explained:

Component manufacturer: The Component Manufacturer produces the components that are needed so the EHPD can become a final product. For otego, the component manufacturers produce the heat sink, the attachment strap, the electronics and the cabling manufacturers. The fact that they do not offer a higher added value besides the standard components is an advantage for otego, as this way the manufacturers have a low supplier bargain power. otego enters into this category as well, as it will be producing its own oTEGs that are used for the production of the EHPD.

Installer: The Installer is the one who pays for the installation, either if it is part of the same business as the Operator (same or different divisions inside the same company), or in a different business (the Installer is specialized in project consulting and the Operator hire the Installer to do a project). The Installer can also be either an already established company or a startup. An Installer offers cost-effective facilities to the Operator, while receiving a capital revenue. The Installer is the one that pays for the EHPD, and therefore is a vital part of the process.

Operator: The Operator is the final link in the VC. He uses the whole system installed by the Installer in order to produce goods or services for other companies or individuals that are not considered in this study, as they are not directly related with the EHPD. It is important to keep them satisfied since even though they might not be the ones who directly pay for the EHPD, their opinion is very valuable for the Installer.

The rest of the components are not described in this version because of confidentiality reasons

4 Results and discussion

-50-

With the information explained before, the value delivery model based in the paper published by Metzger and Terzidis can be developed, making individual roles fit with the chain links from the MVC, and is presented in figure 4.13 (not completely shown because of confidentiality reasons).

Figure 4.13 otego's Value Delivery Diagram Combined with Market Value Chain

4.3.2 Activity System Perspective

Once the MVC has been identified, and the most important roles fitted into it, the process of using the ASP for business modelling is the next step.

First, a business core needs to be identified, so from this business core, all the design elements can be identified. After considering all of the previous work, it was concluded that otego’s business core is “Supply economic EHPDs to lower sensor installation costs”.

Once a defined business core has been stated, the design elements and themes are identified, as can be seen in figure 4.14, and the design themes in figure 4.15 (both of them not completely shown because of confidentiality reasons). The explanation of the design elements and design themes is also not shown in this version of the thesis because of confidentiality reasons.

After developing the MVC and the ASP, the last step is transferring all of the knowledge acquired about otego into the BMC, which will be useful for otego to identify further opportunities, determine if there is any way the business model can be improved and present the business model to investors or compare itself with competitors.

4 Results and discussion

-51-

Fig

ure

4.1

4 D

esig

n E

lem

ents

Dia

gram

fro

m t

he

Act

ivit

y Sys

tem

Per

spec

tive

4 Results and discussion

-52-

Fig

ure

4.1

5 D

esig

n T

hem

es D

iagr

am f

rom

th

e A

ctiv

ity

Sys

tem

Per

spec

tive

4 Results and discussion

-53-

4.3.3 Business Model Canvas

In this section, the BMC developed based in all of the previously presented studies is concluded, and can be seen in figure 4.16 (not completely shown because of confidentiality reasons). The constitutive blocks and interactions of otego’s BMC are explained in the following lines, and just like in the sections before, only the results will be presented, leaving aside the iteration steps.

Only the channel, key activities, key resources and cost structure are partially explained in order for the reader to have an idea of the business without breaking confidentiality with the company.

Channels

otego has several channel options that can be used to construct the customer relationships.

o For the personal assistance customer relationship, otego must use face-to-face contact such as company visits for personal marketing and sales, or participation in fairs, conferences and other events. Through this first presentation, otego will construct either a deeper personal assistance or a self-service relationship. Mailing and phone can also be used for personal assistance with customers.

o For the self-service relationship, otego will hand in information and answer frequently asked questions (FAQ) through the webpage and documentation shared once a sale has been done.

Key Activities

otego’s key activities are the same as the sub-activities inside otego from the ASP.

Key Resources

otego’s key resources are classified as consumables, durables and non-tangibles.

Cost Structure

The cost structure is closely related to the before mentioned key resources. It can be divided in CAPEX and OPEX.

4 Results and discussion

-54-

Fig

ure

4.1

6 o

tego

’s B

usi

nes

s M

od

el C

anvas

5 Future Work

-55-

5 Future Work

Shortening the time-to-market for business-to-business startups in the conventional industrial area was the

problem to tackle through the development of this thesis, being the concept of fast iterations of major

importance. This thesis successfully designed the critical sub-systems from the most value producing

product configuration for a start-up. Nevertheless, in order to finish the design process, the non-critical

sub-systems still need to be designed.

Likewise, even though iteration is the major concept for the thesis, it was not possible to show the product

to different stakeholders and get their feedback, which is the first step to begin an iteration. This will have

to be done once the non-critical systems are designed and the final minimum viable product prototype has

been physically developed.

Furthermore, even though the business model proposed in this section was done in close relation with

stakeholders, it must be applied and tested in the real word.

Therefore, it is proposed that the design of the non-critical sub-systems, the physical construction and the

presentation of the minimum viable product prototype previously described are done in future work,

together with a study and possible iteration regarding the implementation of the business model that was

proposed.

For now, the results found in this thesis work will serve otego as decision-making information with which

their short and medium-term strategy can be defined. By finishing the work proposed, it is expected that

not only otego will be able to finish a minimum viable product prototype with a feasible business model,

but also the methodology will be confirmed as useful for business-to-business startups that want to enter in

the conventional industrial market.

6 Conclusion

-56-

6 Conclusion

In this thesis, a methodology based in the concept of the lean startup, but focused in conventional industrial business-to-business startups was developed.

Through the methodology, the business case of a young German spin-off called otego was studied.

The lean startup methodology developed in this thesis consisted of three main steps: market analysis, minimum viable product prototyping and business modelling.

With the market analysis (based in a modified technology utilization model) the best product configuration was found, which turned out to be an energy harvesting power device. The product configuration selection did not start from zero, as it was based in two important research works developed by otego employees. These works were useful in providing this thesis both with a primary market orientation for the market analysis, i.e. the industrial market, as well as with core elements to develop such a market analysis.

In the minimum viable product prototyping step of the methodology, the critical sub-systems from the product configuration chosen in the market analysis were defined and designed, which turned out to be the heat sink and the attachment method. At the same time, and through the business modelling methodology proposed, which included market value chain definition, activity system perspective and business model canvas, a feasible business model was developed for the startup. The way both steps of the methodology affected each other supported the iteration concept that is central for the lean startup.

The methodology can be considered successful in providing a first market approach for startups. By using it, startups can start designing a minimum viable product prototype to show to possible partners, investors and customers, so they have a clear idea of how the invention wants to be turned into a successful innovation.

Furthermore, the minimum viable product prototype designed has the potential to turn, after a process of iterations, into a minimum viable product that is ready to be sold to the customer. This objective has been started, as since the very beginning of the design process communication was established with possible components producers, ensuring that the prototype is not just a technically but also an economically viable possible product.

The business model canvas is based both in information from diverse stakeholders and in the minimum viable product, which ensures that it is close to reality. Therefore, the business model canvas is considered to be a successful a first iteration that offers otego information to develop a market strategy, as well as a real tool to both promote the business and compare it with competitors.

By using this methodology, the overall market integration time is expected to drop, as the steps developed within this thesis took five months, compared to the years a startup can take to develop its first market entry product in the conventional industrial business-to-business market. Even better, by using this methodology, the market feasibility was also studied, increasing the chances of otego to become a successful player in the market when its minimum viable product is presented to the public.

7 Bibliography

-57-

7 Bibliography

[1] J. Magretta, "Why business models matter," Harvard Business Review, May 2002. [Online]. Available:

https://hbr.org/2002/05/why-business-models-matter. [Accessed 28 June 2016].

[2] P. Fernandes, "What is entrepreneurship?," Business News Daily, 21 March 2016. [Online]. Available:

http://www.businessnewsdaily.com/2642-entrepreneurship.html. [Accessed 28 June 2016].

[3] B. Nelson, "The real definition of entrepreneur - and why it matters," Forbes, 5 June 2012. [Online].

Available: http://www.forbes.com/sites/brettnelson/2012/06/05/the-real-definition-of-

entrepreneur-and-why-it-matters/#5e978a4c71ae. [Accessed 28 June 2016].

[4] R. Shah, Z. Gao and H. Mittal, "Intrapreneruship," in Innovation, Entrepreneurship, and the Economy in the

US, China, and India, United Kingdom, Academic Press, 2015, pp. 273-289.

[5] W. Buekens, "Fostering Intrapreneurship: The challenge for a new game leadership," Procedia Economics

and Finance, pp. 580-586, October 2014.

[6] C. Serinkan, K. Kaymakci, G. Arat and C. Avcik, "An empirical study on intrapreneurship: in a service

sector in Turkey," Procedia - Social and Behavioral Sciences, pp. 715-719, 10 October 2013.

[7] E. Fries, The Lean Startup, New York: Crown Publishing, 2011.

[8] D. Semerad, "Seven ways to avoid becoming another tech startup statistic," ForbesCommunityVoice,

11 May 2016. [Online]. Available: http://www.forbes.com/sites/theyec/2016/05/11/seven-ways-to-

avoid-becoming-another-startup-statistic/#6a773fe274c2. [Accessed 30 June 2016].

[9] S. Blank, "Why the Lean Start-Up changes everything," Harvard Business Review, May 2013. [Online].

Available: https://hbr.org/2013/05/why-the-lean-start-up-changes-everything. [Accessed 30 June

2016].

[10] M. Chui, "Disruptive entrepreneurs: An interview with Eric Ries," McKinsey & Company, April 2014.

[Online]. Available: http://www.mckinsey.com/industries/high-tech/our-insights/disruptive-

entrepreneurs-an-interview-with-eric-ries. [Accessed 30 June 2016].

[11] L. Carlozo, "Why web entrepreneurs are leaning towards lean startup," Reuters, 20 November 2012.

[Online]. Available: http://www.reuters.com/article/us-web-startup-idUSBRE8AJ19J20121120.

[Accessed 30 June 2016].

[12] E. Rasmussen and S. Tanev, "Lean Start-Up: Making the Start-Up more succesful," in Start-Up

Creation, Denmark, Woodhead Publishing, 2016, pp. 39-56.

[13] The Lean Startup Methodology, 2016. [Online]. Available: http://theleanstartup.com/principles.

[Accessed 1 June 2016].

[14] C. Elverum and T. Welo, "On the use of directional and incremental prototyping in the development

of high novelty products: Two case studies in the automotive industry," Journal of engineering and

technology management, no. 38, pp. 71-88, 2015.

[15] J. Demers, "What´s the secret to startup success? Timing," Entreprenuer, 20 July 2015. [Online].

Available: https://www.entrepreneur.com/article/248536. [Accessed 28 June 2016].

7 Bibliography

-58-

[16] B. Watts, "How timing can make or break a startup," Fastcompany, 18 September 2015. [Online].

Available: http://www.fastcompany.com/3051201/hit-the-ground-running/how-timing-can-make-

or-break-a-startup. [Accessed 28 June 2016].

[17] G. Pascal-Emmanuel, "10 brilliant startups that failed because they were ahead of their time," Business

Indsider, 4 May 2011. [Online]. Available: http://www.businessinsider.com/startup-failures-2011-

5?op=1&IR=T. [Accessed 28 June 2016].

[18] R. Hartelt, F. Wohlfeil and O. Terzidis, "Process model for technology-push utilizind the task-

technology-fit approach," in 19th Interdisciplinary Entrepreneurship Conference, Kassel, 2015.

[19] T. Roemer, "MIT Open CourseWare," 2006. [Online]. Available: http://ocw.mit.edu/courses/sloan-

school-of-management/15-783j-product-design-and-development-spring-2006/lecture-

notes/cls4_cstmr_ned.pdf. [Accessed 1 July 2016].

[20] J. Metzger, N. Kraemer and O. Terzdis, "Value Delivery Architecture Modeling - A new approach for

Business Modeling," systemics, cybernetics and informatics, vol. 4, no. 13, pp. 45-50, 2015.

[21] F. Wohlfeil, O. Terzidis and R. Hartelt, Process Model for Technology-Push utilizing the Task-Technology-Fit

approach, Karlsruhe: ResearchGate, 2015.

[22] V. Blagojevic, "The ultimate guide to minimum viable products," Scale my business, May 2013.

[Online]. Available: http://scalemybusiness.com/the-ultimate-guide-to-minimum-viable-products/.

[Accessed 5 July 2016].

[23] C. Bank, "10 massively successful minimum viable products," speckyboy, 1 October 2014. [Online].

Available: https://speckyboy.com/2014/10/01/successful-minimum-viable-products/. [Accessed 5

July 2016].

[24] Intel Corporation, "50 years of Moore´s law," 2016. [Online]. Available:

http://www.intel.com/content/www/us/en/silicon-innovations/moores-law-technology.html.

[Accessed 27 June 2016].

[25] C. Gonzalez-Zapatero, J. Gonzalez-Benito and G. Lannelongue, "Antecedents of functional

integration during new product development: The purchasing-marketing link," Industrial Marketing

Management, no. 52, pp. 47-59, 2016.

[26] A. Ovans, "What is a business model," Harvard Business Review, 23 January 2015.

[27] J. Heikkilä, M. Heikkilä and H. Bouwann, "Business Model Agility: Turning ideas into business," 28th

Bled eConference, pp. 44-57, 7 June 2015.

[28] J. Metzger, N. Kraemer and O. Terzidis, "A systematic approach to business modeling based on the

value delivery modeling language," in Complexity in Entreprenuership, Innovation and Technology Research,

Switzerland, Springer International Publishing, 2016, pp. 245-266.

[29] B. Diehl and M. Nikolou, "From business models to business plans," 11 November 2013. [Online].

Available: http://www.sbs.ox.ac.uk/sites/default/files/Entrepreneurship_Centre/Docs/diehl-

nikolou.pdf. [Accessed 5 July 2016].

[30] ESPRIEX, "Business Model Canvas," ESPRIEX, 2010. [Online]. Available:

http://espriex.co/business-model-canvas. [Accessed 10 July 2016].

[31] P. Lingdren and O. Horn Rasmussen, "The business model cube," Journal of Multi Business Model

Innovation and Technology, pp. 135-182, 2013.

7 Bibliography

-59-

[32] Management Technology Policy, "Decision Support Tools: Porter's Value Chain," University of

Cambridge, [Online]. Available: http://www.ifm.eng.cam.ac.uk/research/dstools/value-chain-/.

[Accessed 21 July 2016].

[33] C. Zott and R. Amit, "Business Model Design: An Activity System Perspective," Long Range Planning,

no. 43, pp. 216-226, 2010.

[34] Strategyzer, "The Business Model Canvas," [Online]. Available:

http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf.

[Accessed 20 July 2016].

[35] Ferrotec, "Thermoelectric Modules," Ferrotec, 2016. [Online]. Available:

https://thermal.ferrotec.com/technology/. [Accessed 6 August 2016].

[36] AlphabetEnergy, "How Thermoelectric Generators Work," 2016. [Online]. Available:

https://www.alphabetenergy.com/how-thermoelectrics-work/. [Accessed 23 May 2016].

[37] II-IV Marlow, Inc., "How do thermoelectric coolers work?," II-IV Marlow, Inc., 2016. [Online].

Available: http://www.marlow.com/resources/general-faq/6-how-do-thermoelectric-coolers-tecs-

work.html. [Accessed 27 July 2016].

[38] S. LeBlanc, "Thermoelectric generators: Linking material properties and systems engineering for waste

heat recovery applications," Sustainable materials and technologies, no. 1-2, pp. 26-35, 2014.

[39] California Institute of Technology, "Brief history of Thermoelectrics," [Online]. Available:

http://thermoelectrics.caltech.edu/thermoelectrics/history.html#top.

[40] S. Kasap, "Thermoelectric Effects in Metals: Thermocouples," 6 November 2001. [Online]. Available:

http://www.kasap.usask.ca/samples/Thermoelectric-Seebeck.pdf. [Accessed 17 March 2016].

[41] Marlow industries, "TG12-2.5-01LS Power Generators," 2016. [Online]. Available:

http://www.marlow.com/power-generators/standard-generators/tg12-2-5-01ls.html. [Accessed 30

May 2016].

[42] Micropelt, "TGP-651 v3.0 Preliminary Datasheet," 2014. [Online]. Available:

http://micropelt.com/downloads/datasheet_thermogenerator_package.pdf. [Accessed 30 May

2016].

[43] Everredtronics, "Thermoelectric Generator/ Seebeck generator-TEG Modules," 2016. [Online].

Available: http://everredtronics.com/EN/TEM/thermoelectric.generator.html. [Accessed 30th May

2016].

[44] M. Hamid Elsheikh, D. Abdulamee Schnawah, M. F. Mohd Sabri, S. B. Mohd said, M. Haji Hassan,

M. B. ALi Bashir and M. Mohamad, "A review on thermoelectric renewable energy: Principle

parameters that affect their performance," Renewable and Sustainable Energy Reviews, no. 30, pp. 337-355,

2014.

[45] A. Shakouri, "Recent developments in semiconductor thermoelectric physics and materials," Annual

Review of Materials Research, pp. 399-431, 2011.

[46] S. LeBlanc, S. Yee, M. Scullin, C. Dames and K. Goodson, "Material and manufacturing cost

considerations for thermoelectrics," Renewable and Sustainable Energy Reviews, no. 32, pp. 313-327, 2014.

7 Bibliography

-60-

[47] O. Bubnova, Z. Khan, A. Malti, S. Braun, M. Fahlman, M. Berggren and X. Crispin, "Optimization

of the thermoelectric figure of merit in the conducting polymer poly (3,4-ethylenedioxythiphene),"

Nature materials, pp. 429-433, 1 May 2011.

[48] Kwok, "Thermoelectric power and ZT in conducting organic semiconductor," vol. 3, no. 41, pp. 476-

479, 2011.

[49] M. Dansie, "3D printed thermoelectric generators," Revolution green, 27 July 2013. [Online].

Available: http://revolution-green.com/3d-printed-thermoelectric-generators/. [Accessed 3 August

2016].

[50] L. Stepien, "Material development for printed flexible thermoelectric generators," 2013. [Online].

Available:

http://www.iws.fraunhofer.de/content/dam/iws/en/documents/publications/annual_report_articl

es/JB_IWS_2013_en_S60-61.pdf. [Accessed 15 July 2016].

[51] Insolvenz Portal, "Micropelt erneut insolvent," Insolvenz Portal, 21 December 2015. [Online].

Available: https://app.insolvenz-portal.de/Nachrichten/micropelt-erneut-insolvent/11894.

[Accessed 15 July 2016].

[52] otego, Smart energy from hot and cold, Karlsruhe: Frederick Leßmann, 2015.

[53] F. Leßmann, Identifizierung und Bewertung von Anwendungsfeldern organischer thermoelektrischer

Generatorn, Karlsruhe: Karlsruher Institut für Technologie, 2014.

[54] J. Becker, Eine autarke Energieversorgung für die Industrie 4.0 - Untersuchung der

Wertschöpfungskette und Entwicklung eines Konzepts für die Integration einer disruptives

Technologie, Karlsruhe: KIT, 2016.

[55] National Instruments, "What is a Wireless Sensor Network?," 5 May 2012. [Online]. Available:

http://www.ni.com/white-paper/7142/en/.

[56] J. Yick, B. Mukherjee and D. Ghosal, Wireless sensor network survey, 52 ed., ELSEVIER, 2008, pp. 2292-

2330.

[57] ABB, "Temperature Measurement Solutions," [Online]. Available:

https://library.e.abb.com/public/c6edbca74bc2000bc1257e15005c0ac2/PB_TEMPERATURE-

EN_REV_A.pdf. [Accessed 16 July 2016].

[58] Marlow Industries, "EverGen PowerStrap," Marlow Industries, [Online]. Available:

http://www.marlow.com/power-generators/evergen-power-strap.html. [Accessed 16 July 2016].

[59] Lord MicroStrain, "EH-Link," Lord MicroStrian, 2016. [Online]. Available:

http://www.microstrain.com/wireless/eh-link. [Accessed 19 July 2016].

[60] PowerFilm Solar, "Solar Powered Asset Tracking," PowerFilm Solar, 2016. [Online]. Available:

http://www.powerfilmsolar.com/custom/solar-powered-asset-tracking/. [Accessed 19 July 2016].

[61] Advanced Cerametrics Inc., "Harvestor III Power Module," Advanced Cerametrics Inc., 2013.

[Online]. Available: http://www.advancedcerametrics.com/products/energy-harvesting/harvestor-

3-power-module/. [Accessed 19 July 2016].

[62] K. Zahid, W. Ahmed, U. Mashad, S. Harikrishnan and R. Harikrishnan, "Energizing wireless sensor

networks by energy harvesting systems: Scopes, challenges and approaches," Renewable ans Sustainable

Energy Reviews, pp. 973-989, 38 July 2014.

7 Bibliography

-61-

[63] National Intelligence Council, "Disruptive Civil Technologies: Six technologies with potential impact

on US interests out to 2025," April 2008. [Online]. Available: https://fas.org/irp/nic/disruptive.pdf.

[Accessed 31 May 2016].

[64] R. Bouter, "Industry 4.0: Factory to Smactory, disruption meets the manufacturing industry,"

Sogetilabs, 18 January 2016. [Online]. Available: http://labs.sogeti.com/industry-4-0-factory-to-

smactory-disruption-meets-the-manufacturing-industry/. [Accessed 30 May 2016].

[65] Capgemini Consulting, "Industry 4.0 - The Capgemini Consulting View," 2014. [Online]. Available:

https://www.de.capgemini-consulting.com/resource-file-access/resource/pdf/capgemini-

consulting-industrie-4.0_0.pdf. [Accessed 30 May 2016].

[66] Frost & Sullivan, "Energy harvesting innovations disrupting key applications (technical insight)," Frost

& Sullivan, 30 June 2015. [Online]. Available: https://store.frost.com/energy-harvesting-innovations-

disrupting-key-applications-technical-insights.html. [Accessed 6 July 2016].

[67] A. Osterwalder and Y. Pigneur, Business Model Generation, USA, 2009.

[68] E. Portnoy, "Doing everythigng is not a startup strategy," Forbes, 7 May 2014. [Online]. Available:

http://www.forbes.com/sites/eliportnoy/2014/05/07/doing-everything-is-not-a-startup-

strategy/#2ea7dd3530c7. [Accessed 11 July 2016].

[69] Not shown because of confidentiality reasons.

[70] G. Zhao, Wireless Sensor Networks for Industrial Process Monitoring and Control: a Survey, 1 ed., vol. 3,

Macrothink Institute, 2011.

[71] GraybaR, "Using infrared cameras to find pipe blockages," GraybaR, 3 June 2015. [Online]. Available:

http://www.graybarindustrial.com/using-infrared-cameras-to-find-pipe-blockages/. [Accessed 10

July 2016].

[72] InterNACHI, "Thermal imaging, infrared cameras and energy audits," InterNACHI, 1 February 2011.

[Online]. Available: https://www.nachi.org/forum/f58/clogged-steam-pipe-56725/. [Accessed 11

July 2016].

[73] Perpetua Power Source Technologies, Inc., "Reliable Power For Wireless Sensors," 2016. [Online].

Available: http://perpetuapower.com/. [Accessed 1 June 2016].

[74] Perpetuum, "PMG17 Vibration Energy Harvester," Perpetuum, 21 October 2013. [Online]. Available:

http://www.perpetuum.com/resources/Vibration%20Energy%20Harvester_Data%20Sheet_21Oct

13.pdf. [Accessed 11 July 2016].

[75] Ecovat, "Ecovat: Smart Storage - Smart Business," 2016. [Online]. Available:

http://www.ecovat.eu/?lang=en. [Accessed 2 June 2016].

[76] Pepperl+Fuchs, S.A., "WirelessHART: Tecnología de radio en ingenieía de procesos," 2016. [Online].

Available: http://www.pepperl-fuchs.es/spain/es/3869.htm. [Accessed 6 Juni 2016].

[77] Pepperl+Fluchs, "WirelessHART Temperature Converter," Temperature converter, 2016. [Online].

Available: http://www.pepperl-fuchs.com/global/en/classid_2977.htm#js-mod-tabbersystem-

jumper-0. [Accessed 1 June 2016].

[78] F. Grönkvist, "How to keep product costs down as a startup importer," global sources, 8 June 2016.

[Online]. Available: http://www.globalsources.com/NEWS/SIC-how-to-keep-product-costs-down-

as-a-startup-importer.HTM. [Accessed 3 August 2016].

7 Bibliography

-62-

[79] Zac, "Operable bridge," 2014. [Online]. Available: http://zacharymollica.ca/project/bridge/.

[Accessed 21 July 2016].

[80] KayTa Design, "Stacked Fin Heat Sink," KayTa Group, 2015. [Online]. Available:

http://www.kaytagroup.com/products_detail/&productId=107.html. [Accessed 21 July 2016].

[81] Zheng, Liu, Yan and Wang, "A review of thermoelectrics research - Recent developments and

potentials for sustainable and renewable energy applications," Renewable and Sustainabel Energy Reviews,

no. 32, pp. 486-503, 2014.

[82] Kieback&Peter, "en:key Energieautarke Einzelraumregelung," [Online]. Available:

http://www.enkey.de/fileadmin/media-en-key/pdf/130626_Flyer_enkey_einfach_effektiv_v7.pdf.

[Accessed 16 July 2016].

[83] Micropelt, "Self-powered intelligent thermostatic radiator valve (iTRV)," [Online]. Available:

http://micropelt.com/downloads/itrv_booklet.pdf. [Accessed 17 July 2016].

[84] K. Bhasin, "This is the difference between "Invention" and "Innovation"," Business Insider, 2 April

2012. [Online]. Available: http://www.businessinsider.com/this-is-the-difference-between-

invention-and-innovation-2012-4?IR=T. [Accessed 31 July 2016].

[85] T. Strokes Jones and R. Richey, "Rapid prototyping methodology in action: A developmental study,"

Educational Technology Research and Development, vol. 2, no. 48, pp. 63-80, 2000.

-i-

Annex 1: List of Interviewed Stakeholders

-ii-

Annex 2: Previous otego’s Prototypes

First working prototype developed by otego Non-working prototype to illustrate how otego could

be integrated in a WSN

Working prototype to show how otego could be integrated in a WSN

-iii-

Annex 3: Design Iterations Previous to Final Draft Design

Not shown because of confidentiality reasons

-iv-

Annex 4: First Heat Sink Design

Not shown because of confidentiality reasons

-v-

Annex 5: Strap Design

Not shown because of confidentiality reasons

-vi-

Annex 6: Final Heat Sink Design

Not shown because of confidentiality reasons

-vii-

Annex 7: Governance Diagram from the Activity System

Perspective

Partially shown because of confidentiality reasons