Industry-University Research Collaborations: Report of a Workshop (1997)

Hoechst-Celanese Corporation entered into partnerships with Rutgers, the University of North Carolina, and North Carolina State University in 1991, after company and university officials found that they had a mutual interest in conducting basic, discovery research in such areas as neuroscience, animal health, polymers, and technology management. The objective of the partnerships is to foster an environment conducive to moving forward aggressively, rather than incrementally, in areas of basic research relevant to the company's core business. Hoechst-Celanese started with an investment of $1 million at each of the partner schools in order to gain strategic access to a knowledge base in leading-edge science that could not be developed and maintained internally. Hoechst-Celanese also seeks to generate concepts that can be transformed into commercially viable products or processes, to set up flexible mechanisms to explore a wide range of interests while leveraging risk, and to subject its research to independent evaluation by a third party. Each of these objectives is served by partnering with academic investigators. Most importantly, Hoechst-Celanese wants to build a comprehensive system of interaction with the partner schools that will enable it to find new business and technology ideas that are not obvious in isolation, but rather depend on the synergy of partners and their varied perspectives. In choosing partners, Hoechst-Celanese considered such factors as proximity and its ability to form a relationship with university researchers.

Of course, working arrangements with Hoechst-Celanese promise specific benefits to the participating universities, too. Those benefits include a research thrust that focuses on productive and applied outcomes, increased financial and educational resources, and a real-world perspective on the imminent job market of the 21st century. The company and its partner schools both benefit from the program's ability to generate interdisciplinary interactions among different university departments. Often, the external catalyst provided by a corporate sponsor can foster bridging between academic departments that typically vie for resources.

Three levels of interaction characterize these partnerships between Hoechst-Celanese and its academic affiliates. The first strategic set of interactions occurs at the executive level, as key officials at the universities and the company meet to gain understanding of one another's intent, capabilities, and structure. The second level of interaction is exploratory; project managers

from Hoechst-Celanese meet with university department heads and senior investigators to identify common research interests. These interactions are instrumental in utilizing broad university resources to discover unforeseen opportunities. The third set of interactions occurs at the program level, when company and university researcher teams carry out a defined piece of research. To facilitate program-level interactions, the company has established networking groups at the partnership schools so that company and university researchers can provide continuous feedback to one another. Members of the partnerships assert that each of these three levels of interaction adds value to the partnership and facilitates creative synergy. Together, they constitute a flexible management structure that allows the parties to meet emerging needs.

The partnership infrastructure includes an allocation process by which a joint committee identifies pertinent areas of research interest, requests proposals from faculty, and selects proposals to fund. Company grants support workshops, educational programs, research contracts, and consulting arrangements. To foster an atmosphere of mutual trust, the parties agree to deal with intellectual property rights in a blanket agreement under which deliverables developed within the partnership belong to the university, and the company has the right of first refusal to commercialize those products. In this way, university researchers and company scientists can disseminate research results without compromising valuable patent rights.

The MIT Media Laboratory (the Lab) was created in 1985 to perform exploratory, pre-competitive research in new information technologies arising from the merging of the broadcast, publishing, and computer industries. The Lab focuses on leading-edge concepts such as advanced digital television, holographic imaging, computer music, electronic publishing, artificial intelligence, autonomous agents, and the human/machine interface. The Lab conducts a broad range of interdisciplinary research with the support of approximately 125 sponsors. About 60 percent of these sponsors participate in one of three multi-sponsor consortia: News in the Future; Television of Tomorrow; and Things That Think.

The Lab operates on a budget of approximately $23 million per year. In 1994-95, approximately 85 percent of its contract research funding was provided by more than 100 corporate sponsors worldwide, representing industries ranging from telecommunications to finance. The balance of funding primarily came from various federal agencies. Several sponsorship vehicles sustain the Lab's operating budget, including endowment funding, contract research, major equipment donations, and consortia.

Corporate sponsors of the Lab initially entered into these partnerships with hopes the venture would yield benefits traditionally

associated with industry-university collaborations, as well as benefits unique to the Lab's particular management, structure, and programs. Traditional benefits include the exchange of financial support for access to the cutting-edge research normally associated with leading universities, and to the strategic vision of scholars. Such access supports corporate recruiting efforts and leads to consulting arrangements with key faculty in areas critical to industrial research. In the immediate case, some corporate sponsors have been motivated in part by the personal charisma and strategic vision of the Lab's director, and to other scholars drawn to this creative environment.

Interactions between the Lab's staff and the sponsor's personnel occur both through formal meetings and via informal exchanges of information. The Lab is an open intellectual environment that encourages the sharing of discoveries and the practical application of inventions; it allows all major sponsors the opportunity to share in all of the intellectual property it generates under terms that are based on the scale and nature of their support, ranging from royalty-free, non-exclusive world-wide licenses, to royalty-bearing licenses with negotiable terms. The Lab's programs in media arts and sciences attract students from a variety of backgrounds in technical fields and the arts.

Corporate sponsors note that research programs benefit from their partnerships with the Lab: they testify that the Lab's activities are highly relevant to their core businesses; that the Lab's leadership is creative and influential in the technical community and with policy-making government agencies; that interactions with the Lab's researchers are intellectually stimulating to their staffs; and that the Lab is very effective in providing a forum for industrial and academic research leadership to meet to discuss long-range trends and to focus on critical issues.

Recent economic pressures that have had an impact on the resources of most industrial research organizations also have affected industry-university partnerships like this one. With smaller research staffs and reduced capital equipment budgets, the corporate research laboratories affiliated with MIT hope to compensate for diminishing resources by contracting with the university for projects having shorter-term, specific goals, and by making use of special facilities. Unable to maintain active programs in all technical fields important to their businesses, they also view the Lab and other university partners as potential sites for shared, pre-competitive research.

At the same time, recent economic pressures on industrial research have led to higher expectations both from their staffs and from university partnerships. The Lab's corporate sponsors note lower than expected transfer of industrially-applicable knowledge from the Lab and fewer than expected opportunities to acquire intellectual property relevant to their businesses. The Lab's management, in turn, cautions that some companies may not be taking full advantage of the opportunities available.

The partnership between Cabot Corporation, Pennsylvania State University (Penn State), and the Commonwealth of Pennsylvania's Ben Franklin Program was formed in 1991 to develop an enabling technology for production of fine particle barium titanate powders used in the production of electronic components. Unique low-fire properties of these compounds were discovered during the course of unsponsored research at Penn State. The company needed to carry out further R&D activity in order to find a way to add fluxes that would enhance the product's performance in such applications as thick film capacitor inks, multichip modules, and multilayer capacitors.

Cabot sees the partnership as a way to develop a line of differentiated products at relatively low costs, thereby enhancing the company's business opportunities and expanding one of its divisions. The partnership also represents a means of sharing the risks of new technology development, of utilizing external resources in a cost-effective manner, and of gaining additional market awareness of emerging technologies. In addition to these generic expectations, Cabot seeks to take advantage of Penn State's strong reputation in the field of electronic ceramics. For Penn State, the partnership presents a source of research funds and support for graduate student research, and an opportunity to learn about industry's needs and about intellectual property issues. For the state of Pennsylvania, benefits include job creation, increased revenues, and economic development.

Cabot Corporation runs the program as a small business operating with limited resources. The company makes decisions concerning strategic selection and use of critical resources. Its contribution to the partnership includes project direction, funding, and in-kind research services. The actual research is carried out in Penn State's Center for Dielectric Studies, which has a strong reputation in the field of electronic ceramics. In addition to scientific expertise, Penn State also provides specialized equipment as well as market information and contacts. The State of Pennsylvania, through the Ben Franklin Program, provided the matching funds that ultimately persuaded Cabot to go ahead with the project.

The program's focus on deliverables, and on frequent and strong personal interaction between the participants, are fundamental to the perceived success of the partnership and to the satisfaction of those involved. The parties devise a project plan that assigns specific tasks and sets forth milestones and timetables. Graduate students serve as the primary researchers on the university side and they are involved in all levels of communication between partner organizations. In terms of effects on education, the partnership process enhances the competence

of university researchers for collaborating with private partners as they learn what is important to industry, including intellectual property, confidentiality of proprietary information, responsiveness, timing, accountability, and presentation skills.

The central thrust of the University of Rochester's Electronic Imaging Center (the Center) is toward imaging in the information age. The Center, founded in 1992, is part of the National Science Foundation's Cooperative Research Centers Program. The long-term vision of its founders is to develop a leading national center for all phases of electronic imaging systems. The research performed at this center consists mainly of fundamental, discovery research in electronic imaging. For the industrial partners, which include Eastman Kodak, Xerox, and 3M, incentives for entering into partnership agreements with the Center include strategic access to an incubator of pre-competitive technologies. Participation also enables diffusion of new ideas into these companies, enhances corporate R&D efficiency, invigorates corporate research staffs, and provides assistance to small companies.

Governance of the Center includes five entities: the Center's management team; a Policy Committee from the University; the Industrial Advisory Board*; the National Science Foundation; and the New York State Science and Technology Foundation. The Center has four major divisions: research, technology, business innovation, and community outreach. The business innovation team carries out marketing research studies for proposed new products, finds new market niches for existing technologies, and identifies prospective commercial markets for military technologies. The community outreach group focuses on facilitating interactions in the field through conferences, symposia, and other educational activities.

A strategic plan for the Center's work is developed in conjunction with the Industrial Advisory Board. Areas of research emphasis are selected by the faculty after discussions with representatives from the Center's corporate sponsors, and related plans remain valid for five years, during which time they are revised in accordance with emerging technological trends. Currently, the research portfolio includes nine primary themes: electronic imaging systems; digital video; image quality; image processing; color; imaging through turbulence; automatic object recognition; visualization and display; and optomechatronics.

Once a research strategy and areas of emphasis are identified, the research is implemented through teams of triplets, consisting of a faculty investigator, a graduate student or post-doctoral fellow, and an industrial researcher. The purpose of the triplet model is to reduce time to market: partners agree that this system gives the faculty member autonomy and responsibility for technology transfer; encourages the student or post-doctoral student to stimulate interaction between faculty and industry representatives; and recognizes the industry partner as the primary evaluator of progress and success.

Broadly construed, the Center's strategy revolves around three goals: to contribute to economic development of the region; to carry out relevant fundamental research; and to enhance the educational missions of the University. The Center's benefits to education include: enhancing the university's ability to attract and to educate high-quality students; demonstrating an orientation toward problems relevant to industry; offering faculty and students the advantage of interacting with industry; and continuing education for scientists in imaging science.