Anders Flodstrom, vice-chair EIT, Industrial Technologies, Aarhus June 19, 2012

1. Valley of Death Anders Flodstrom, vice-chair EIT, Industrial Technologies, Aarhus June 19, 2012

2. Productivity • The obvious – low salaries do not mean high productivity • Effectiveness and Innovation • Robert Solow and Paul Romer • Innovation can be anything that improves function and the perception of function – real or not

3. Common Sense and socio-economic analysis • Ray Bradbury - the need for a vision! • Impact – public good and commercial value • Innovations – social, business, technological, .. • Competent people – creativity, risktaking, values, ..

4. Grand societal challenges • No longer scientific or technology challenges, instead problems created by us – to be solved by us • New infrastructures, business innovations, business and public good in synergy • New legal entities? Present healthcare and schooling debate! Innovation procurement? • Horizon 2020 and Innovation Union, ERC and EIT

5. Grand challenges – a few! • Demography - not only ageing or longevity • Logistics - not only urbanization – take the train to China • Genetics and proteomics - not only pharmaceuticals • Carbon - not only energy and climate • Learning or human enhancement - not only teaching - neurology, computer science and nanotechnology • Reindustrialization of Europe

6. The Role of Technology • Policies, regulations and legislation • Contemporary technology and new systems solution • New often science based technology

7. Europe is old and getting older • Population as compared to Middle East, Africa, India and Pakistan • Companies as compared to US, China and India

8. Nobel, Citroen, Siemens, Reuter, Merrieux - history? Boyer, Gates and Zuckerberg - US-reality! • HOW TO MOTIVATE KIDS TO SET UP GARAGE COMPANIES IN EUROPE? wanted • One definition of entrepreurial innovation: “A Grapefruit is a lemon who took a chance”

9. US: approx. 21% EU: approx. 2% Age distribution of companies’ contribution to innovation: Europe v. US and others Bruegel policy brief March 2009 Reinhilde Veugelers

10. Biotech as an example: EU has strong assets to support a strong entrepreneurially driven industry HOW TO CAPITALIZE ON THE ASSETS? • High level of education • Solid academic base • Top science at many historical power houses of research: EMBO, Pasteur, Karolinska, Cambridge, Oxford, Max Planck, VBC etc.. • Increasing number of Centers of Excellence • Long tradition of pharmaceutical development and industry • Excellent clinical institutions with the potential to carry out studies • Growing interaction between the national bio-medical scenes • Scientific output in biotech is even larger than in the USA

11. Biotech example: Does European biotech exploit its chances? No. of employees • 63,000 • 172,000 Average Investment per year • EUR 6 bn • EUR 18 bn Public listed • <10% • >30% Total value ofcompanies • EUR ~30,000 bn • EUR ~300,000 bn CREATING VALUE - CREATING JOBS Europe USA Europe Bio Report for 2007

12. The Ways to increase Innovation • New R&D • Improved processes for turning R&D into innovations and innovations into business • Universities will not alone solve the productivity crisis • Slovenia • Much more emphasis on Companies and especially SMEs and their innovation processes

13. Where will it happen – in the companies! • New products rule the market • Innovation is a driver of productivity • Industry needs to become more entrepreneurial • EU and national industrial researchand innovation programs are driven to a very high degree by universities and research institutes • EIT will make a difference through stakeholders integration

14. Value Systems • Research for research – the result is more funding. Measured by citations and prizes! • Research for innovation – the result is society and business impact. How to measure? • From scientific goals to grand challenges • Is it real or a fake • Open innovation

15. SIA for EIT • Knowledge Triangle • Entrepreneurship • Stakeholder Integration • Cohesion • Smart Investor

16. EIT Label • Competencies for the Future • Creativity, Innovative, Entrepreneurial, • Taking calculated risks • Values - Intergenerational fairness • Geographical and sectorial mobility

17. Stakeholder integration • Legal entities – CEO and common Board • Networks and colocation centers • Research and innovation – universities, research institutes, companies; SMEs and major, production and services; veture capitalists • Higher education – universities, labor market and students

18. NewMember States • Regional Innovation Communities • EIT Label Educations • Regional Colocation Centres • Scholarship Schemes • Researcher Sharing • From Aid to Intelligence

19. Major Changes • New innovation/business infrastructure for Europe – not a new research or higher education infrastructure • Knowledge triangle • Investing not funding! • Catalyst – Carrier model • Educational programs for creativity, innovation and entrepreneurship

20. KICs • Climate KIC – climate mitigation and adaptation – new industry • KIC Innoenergy – sustainable energy – major companies industry • ICT Labs – future ICS ( Information Communication Society) – open innovation • 400 million € and 2500 “staff” and 1500 students

21. New KICs • Healthcare - divided • Natural resources management • Food 4 Future • Mobility and smart cities • Added value manufacturing - reindustrialization • Security and safety – divided • ??? +++

22. Horizon 2020 • 3 billion euro • Two Waves new KICs; 3 + 3 or all at once • 2014 and 2018 • Shared equally between existing KICs, Climate KIC, KIC Innoenergy, ICT Labs, and the new ones

23. Timeline • Right now; draft proposal from EP and EC (Denmark) • Autumn; decisions on themes (Cyprus) • December; GB decisions on Call for proposal • Early spring 2013; decision on budget (Ireland) • Winter 2013; new KICs