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PROMISE Open Workshop “Closed-Loop PLM” ••• 1 Why did the EU invest in PROMISE? Arian Zwegers DG Information Society and Media

20080702 Why investing in PLM research?

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Presentation on the reasons to invest in project PROMISE, given at the "Closed-Loop PLM" workshop, Athens (Greece), 2 July 2008

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Page 1: 20080702 Why investing in PLM research?

PROMISE Open Workshop “Closed-Loop PLM” ••• 1

Why did the EU invest in PROMISE?

Arian ZwegersDG Information Society and Media

Page 2: 20080702 Why investing in PLM research?

PROMISE Open Workshop “Closed-Loop PLM” ••• 2

Overview

• Why investing in EU ICT research?– Trends in business and ICT– ICT market in EU– ICT research in EU– Framework Programmes

• Why investing in PROMISE?– Product Lifecycle Management (PLM)– Radio Frequency Identification (RFID)

• Future Research?

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PROMISE Open Workshop “Closed-Loop PLM” ••• 3

Business and ICT transformations

1960 1970 1980 1990 2000 2010Mainframes mini-computers PC client-sever Internet Convergence

Company levelinformation& automation

Automated Support; Costs

DepartmentalEmpowerment

Speed; Logistics

PersonalFreedom

BusinessProcessRe-engineering

Pervasive global& integrated groups

Supplychains

Anytime, anywhere; Platforms and ecosystems

Globalisation, customisation, outsourcing

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PROMISE Open Workshop “Closed-Loop PLM” ••• 4

Trends in Business and ICT

Business/social trends• Outsourcing• Open Innovation• Ecosystems• Compliance• Prosumer• Democratisation of content exchange

ICT trends• Convergence• Broadband adoption• Consumerisation of technology• RFID• Virtualisation• SaaS

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PROMISE Open Workshop “Closed-Loop PLM” ••• 5

ICT: The Innovation Motor No. 1

In medical technologies ICT is the foundation for more than 90% of all innovations. The driver of more than

90% of all innovations in logistics is ICT.

More than 90% of all recent innovations in the automotive sector are based on ICT.

Adapted from: Prof. Wahlster, DFKI

ICT is a main driver of innovations in the networked home environment.

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Increasing awareness of ICT contribution

• Significant contribution ICT to productivity and growth

• Direct contribution ICT sector to GDP, indirectly by take-up and exploitation in other sectors

• ICT improves quality of life of citizens

• ICT is one of the key ingredients of sustainable development

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PROMISE Open Workshop “Closed-Loop PLM” ••• 7

US, 28.3%

Japan, 14.1%

Rest of World, 24.2% Europe,

33.4%

Office equipment, 1.3%

Computer hardware, 12.2%

End-user communications equipment, 4.2%

Carrier services, 44.1%

Datacom and network equipment,

6.4%

Software, 11.1%

IT services, 20.6%

ICT Market, 2006 By region and by product

Total value = € 2,033 billion

Total value = € 680 billion

Source: EITO, 2007

• Europe is world’s largest ICT market• Europe has a large software and services

market

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PROMISE Open Workshop “Closed-Loop PLM” ••• 8

Top100 suppliers serving the Western European Software & IT

Services market (2004)

By number of companies (in %, 2004)1 By revenue (in % of Top 100 revenue, 2004)

4

36

63 4 5

10

13

20

FR

IT

US/Canada

DE

SE

AsiaUK

NLRoE

61% of companies come from

Europe

These Euro-pean compa-nies account for only 43% of the overall

Top 100 companies’

revenues

3

54

33

11

13

10

1 1

UK

FR

DE

NLITSE RoE

US/Canada

Asia

By number of companies (in %) By revenue (in %)

• 60% of suppliers come from Europe• 43% of revenues stay in Europe

Source: PAChttp://cordis.europa.eu/fp7/ict/ssai/study-sw-and-serv-2006_en.html

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R&D Expenditure as % of GDP

Source: Eurostathttp://epp.eurostat.ec.europa.eu/cache/ITY_OFFPUB/KS-NS-05-002/EN/KS-NS-05-002-EN.PDF

0.33

0.97

1.11

1.31

1.35

1.87

1.93

1.99

2.19

2.50

2.68

2.76

3.15

3.51

4.27

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5

Cyprus

Hungary

Spain

China

Czech Republic

UK

EU25

EU15

France

Germany

Korea

US

Japan

Finland

Sweden

• Other regions spend more on R&D than Europe• Large differences within Europe

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PROMISE Open Workshop “Closed-Loop PLM” ••• 10

R&D expenditure by industry

Source: Financial Times, 21 March 2005

• EU’s R&D by businesses• Top 50 spenders in the world

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ICT R&D expenditure

• Europe is spending less than other regions in ICT R&D

• Public ICT Spending is fragmented across Europe

Framework Programmes

29.2

93.3

48.8

European Union USA Japan

0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2%

France

Germany

United Kingdom

Spain

The Netherlands

Sweden

Finland

European Union

United States

Japan

Annual ICT R&D Expenditure (% GDP)Spending on ICT R&D in 2000 (in Billion Euro)

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PROMISE Open Workshop “Closed-Loop PLM” ••• 12

Europe and Product Innovation Value Disciplines

CRM

SCM

PLM

e.g. IBM e.g. Dell e.g. AppleAdapted from: Treacy and Wiersema

• Customer Intimacy (“best total solution for customer”)– Service oriented culture– Segmenting and targeting markets, tailoring the offerings

• Operational Excellence (“best price, lowest costs”)– Optimal use of operational facilities (high fixed costs,

capital-intensive)– Reliable products or services with minimal difficulty or

inconvenience• Product Leadership (“best product”)

– Speed and innovation are key– Leading-edge products and services

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PROMISE Open Workshop “Closed-Loop PLM” ••• 13

Product Lifecycle Management

49%

43%

34%

31%

Demand for shorter product lifecyclesGlobalisation of markets and/or supply chains

More complex design or a decentralised design environmentMore complex products

10.511.3

12.613.5

14.7

16.0

2005 2006 2007 2008 2009 2010

Four forces driving installation of PLM solutions

World PLM market (sales in B$)

Sources: Aberdeen Group, 2006;AMR Research, 2006

• PLM: an answer to industry needs• Increasing PLM market

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PROMISE Open Workshop “Closed-Loop PLM” ••• 14

People Society

Industry

Secure & Safety

Reliable

Comfortable Recycling

EfficientProduction

ProductQuality

Ecology & Environment

WasteReduction

ProductInnovation

AssetOptimum

OperationEfficiency

RecyclingRetailLogisticsProduction

EXPECTATIONEXPECTATION

Traceability (RFID)Traceability (RFID)

UbiquitousUbiquitous

‘Better’ Lifestyle and Society

Convenient

CONTRIBUTION

More

More

EXPECTATIONEXPECTATION

Matching expectations and contributions

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PROMISE Open Workshop “Closed-Loop PLM” ••• 15

People Society

Industry

Secure & Safety

Reliable

Comfortable Recycling

EfficientProduction

ProductQuality

Ecology & Environment

WasteReduction

ProductInnovation

AssetOptimum

OperationEfficiency

RecyclingRetailLogisticsProduction

EXPECTATIONEXPECTATION

Traceability (RFID)Traceability (RFID)

UbiquitousUbiquitous

‘Better’ Lifestyle and Society

Convenient

CONTRIBUTION

More

More

EXPECTATIONEXPECTATION

Matching expectations and contributions

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From RFID to an Internet of Things

• Real world objects have an individual digital presence

• Vision of a future where each item or thing is networked and can communicate information about itself or from itself to other objects and to computer systems

• Applications– SCM, PLM– Food traceability, drug compatibility, …– Health and environment applications– Smart home– Smart electricity consumption control

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PROMISE Open Workshop “Closed-Loop PLM” ••• 17

Possible example? Responsibeer safety system

Sources: Wired, 2007

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Future research? Future Internet

Sources: 3GPP, 3GPP2, Qualcomm, WiMAX Forumhttp://www.alexandria.unisg.ch/EXPORT/DL/38496.pdf

http://www.itu.int/osg/spu/publications/internetofthings/Second Life

Internet of Services, Service Web

Networks of the Future

3D Internet

Internet of Things

Trust

Security

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PROMISE Open Workshop “Closed-Loop PLM” ••• 19

Conclusions

• ICT is getting increasingly important

• European ICT market largely dominated by non-EU players

• Europe is spending less in ICT R&D than other regions

• Opportunities in product innovation• Contribution by PROMISE• Towards an Internet of Things?

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For More Information ...

PROMISEhttp://www.promise-plm.com/http://www.promise.no/

FP7http://cordis.europa.eu/fp7/http://cordis.europa.eu/fp7/ict/

Future Internethttp://www.future-internet.eu/

[email protected]

PROMISEhttp://www.promise-plm.com/http://www.promise.no/

FP7http://cordis.europa.eu/fp7/http://cordis.europa.eu/fp7/ict/

Future Internethttp://www.future-internet.eu/

[email protected]