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Linkages between the MS&E
and End-User Communities
THIS CHAPTER PRESENTS ~ TRYSTS of the five main types of linkages be-
tween the MS&E R&D and end-user communities industry-industry;
industry-university; industry-national laboratory; industry-government;
and government-research institution. University-national laboratory linkages are
not discussed in this chapter because the sole reason for their interaction is to
augment their multidisciplinary programs with additional expertise.
The number of interactions and collaborations that can be envisioned be-
tween the various segments of the MS&K R&D and end-user communities is
nearly boundless. Nevertheless, focusing on the simplest form of each linkage
can reveal specific strengths and weaknesses. Thus, this chapter will examine
each type of linkage as a one-on-one interaction. The chapter will conclude with
a discussion of consortia, which is the main mechanism currently used for joint
ventures and interactions with participation from multiple segments of the MS&E
and end-user communities.
INDUSTRY-INDUSTRY LINKAGES
Interactions among industries form the basis of all business. Since the objec-
tive of this report is to strengthen the connections among the MS&E and end-user
industries, the discussion in this section focuses primarily on MS&K R&D link-
ages among industries.
The committee divided the typical user chain for the materials production
cycle into four main sections to simplify the description of linkages between
materials-based industries (Figure 3-1~. The first section, materials suppliers,
includes companies that produce the raw or semifinished materials used in the
44
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LINKAGES BETWEEN THE MS&E AND END- USER COMMUNITIES
Extraction
- iron ore
- bauxite .
- crude oil
- natural gas
Synthesis
- iron
- alumina
- polyethylene
~_
Parts fabrication Systems integration
- casting ~ - dashboard assembly
- molding =ssembly
Original equipment manufacturer
- automakers
- computer manufacturers
- jet engine manufacturers
~_
End-use
- transportation
- entertainment
- shelter
~,
Disposal
- reuse
- recycle
- landfill
1 reuse
:/blending Materials
+ - steel suppliers
- aluminum
- molding compound
J '
-
recycle
45
Parts
suppliers
Original
equipment
manufacturers
Consumers
Disposers/
recyclers
FIGURE 3-1 Typical user chain for materials production cycle, from raw material
to the ultimate destiny of all materials.
fabrication of subcomponents or parts for finished products (e.g., Oremet or
Carpenter Technology for the jet-engine industry; Alcoa for the automotive in-
dustry; Shipley or Ciba-Geigy for the integrated circuit fabrication industry).
These companies may be involved in the extraction, synthesis, or refining/
blending processes shown in Figure 3-1. The second section, parts suppliers,
includes companies that produce the parts used in the assembly of the final
product or its subcomponents (e.g., Howmet or Ladish for the jet-engine indus-
try; Eaton or Budd for the automotive industry; Intel or Motorola for the com-
puter-component industry). This section is shown in the parts fabrication segment
of Figure 3-1. The third section, original equipment manufacturers, includes both
assemblers of major subcomponents (e.g., Lucas or Bendix for the jet-engine
industry; Delphi or Nippondenso for the automotive industry; ReadRite or Seagate
for the computer-component industry) and the main assemblers and distributors
of final end-use products (e.g., GE, Pratt and Whitney, or Rolls-Royce for the jet-
engine industry; Ford or Honda for the automotive industry; Compaq, Apple, or
IBM for the computer industry). This section encompasses the systems integra-
tion and OEMs boxes in Figure 3-1. The fourth section, disposers/recyclers,
includes disassemblers, recyclers, and disposers of the final products at the end of
their service life (e.g., Huron Valley Steel drains, disassembles, separates, shreds,
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MATERIALS SCIENCE AND ENGINEERING
and recycles cars for the automotive industry).] This section encompasses the
disposal box of Figure 3-1.
Materials Suppliers
Primary materials suppliers (e.g., steel, aluminum, and plastic resins) supply
raw and processed materials to both parts suppliers (at all tiers) and OEMs.
Generally, materials suppliers sell their products to many industries and are,
therefore, not commercially dependent on any one business for their livelihoods.
In the past, primary materials suppliers were only involved peripherally in the
design process. As the competition for primary materials has intensified, how-
ever, they have become increasingly involved in developing their own design
activities. Many materials suppliers are now being driven further up the value
chain of the materials production cycle and have become involved in the OEM's
product development and design processes. This is especially true for new mate-
rials concepts, for which the supplier infrastructure might not be able to meet the
needs of industry or for which prospective suppliers may have underestimated the
challenges of scaling up an unproven technology.
In many cases, primary materials suppliers are supplemented by specialty
materials suppliers, which produce more advanced materials. Specialty materials
suppliers can often be classified as "value-added distributors." For example, jet-
engine alloys require specialty materials suppliers because they are a complex
and carefully controlled combination of many elements combined by special
processes and equipment. Although proprietary alloys are frequently developed
by OEMs, specialty metals companies melt and combine the ingredients that go
into a jet-engine alloy and perform a host of additional value-added activities to
ensure the quality and integrity of the alloys. Similar specialty materials produc-
ers are involved in other industry supply chains, even though the supplier, not the
OEM, usually develops the materials. For example, compounding companies that
supply materials to the molded-plastic component industry combine constituent
ingredients to create customized plastic compounds. Producing and supplying
polymer compound materials for the electronics industry is a $4.0 billion busi-
ness (e.g., Shipley formulates photosensitive polymers used to pattern integrated
circuits, Ciba-Geigy supplies polymers used in printed wiring boards).
The sources of materials/processes innovation vary from industry to indus-
try. For example, materials innovations in the jet-engine industry originate pre-
dominantly in the OEM's laboratory. Each innovation is considered proprietary
and is a carefully guarded secret because of its potential competitive advantage,
1 Similar disposal companies do not exist for the computer or jet-engine industries. OEMs in the
computer industry recycle some materials, but most systems currently end up in landfills. Jet engines
are too valuable to be junked entirely. Most engines are rebuilt piecemeal during repair using re-
placement parts. The parts suppliers usually recycle the materials from old parts.
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LINKAGES BETWEEN THE MS&E AND END- USER COMMUNITIES
47
which could translate directly into increased market share. The automotive indus-
try, however, relies heavily on materials suppliers for materials/process innova-
tions. These firms range in size from small, niche enterprises to very large corpora-
tions (e.g., Alcoa). In the automotive industry, suppliers market their innovations
by developing ties with OEMs and parts suppliers and publicizing the potential
advantages of their innovations. Materials suppliers must present material proper-
ties in terms that are relevant and understandable to designers, who are most likely
to decide which materials will be used (Buch, 1998~.
Recommendation 3-1. Materials suppliers should collaborate with end users to
determine the type of data most useful for product designers in assessing new
materials/processes and determining their suitability for incorporation into a prod-
uct. Materials suppliers should be responsible for conducting performance tests
to reduce the redundant materials testing by many industries.
The factors that limit the ability of the materials-supply industry as a source
of innovation are similar to the problems facing parts suppliers (e.g., large capital
investments, limited resources, equipment manufacturer's need for multiple sup-
pliers). The problem is exacerbated, however, by three factors. First, the profit
margins for many materials innovations are minimal, at best. The initial produc-
tion volumes for advanced materials are usually limited, and alternate markets
that could provide large returns on investment are rare. Thus, many potentially
useful materials are not developed beyond Phase 1 because it is simply not cost
effective for a materials supplier to use its limited resources to develop and
market them. Second, materials suppliers for OEMs that usually develop their
own materials (e.g., jet engines) must circumvent the "not-invented-here" fears
latent in those industries (Maurer, 1998~. The ability of end users to exploit new
technologies is limited because even seemingly insignificant changes in materials
(e.g., the presence of trace elements in bulk materials or a change in surface
treatments) can disrupt a production process or reduce the efficiency of a system
and present very real risks. Third, most materials suppliers cannot overcome "the
tyranny of existing infrastructure" (Bridenbaugh 1998~. Most industries are based
on the design of subsystems and parts, all of which have their own needs for
materials and their own supply chain. The complexity of the supply chain makes
it difficult to implement a change.
Recommendation 3-2. Materials-supply companies should be encouraged to
conduct materials/process R&D. Three potential methods that should be investi-
gated are: mechanisms for larger original equipment manufacturers to assist and
encourage materials suppliers to conduct R&D (e.g., guarantees to use the new
technology); government programs, such as the Advanced Technology Program,
to help defray some of the costs of industrial R&D; and tax incentives to encour-
age investments in R&D and reduce the risk to the supplier companies.
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MATERIALS SCIENCE AND ENGINEERING
Parts Suppliers
The linkages between OEMs and part suppliers are generally considered to
be the strongest in the materials-production cycle. Parts suppliers are usually
purveyors of particular manufacturing technologies that convert the semifinished
materials produced by the materials suppliers into finished components ready for
installation into final products. Parts suppliers are predominantly contracted by
OEMs to make specific parts and subassemblies according to approved specifica-
tions and procedures. For example, Howmet, the jet-engine parts supplier, buys
components of a superalloy material from materials suppliers and casts the mate-
rial into single-crystal turbine blades for GE Aircraft Engines and Pratt and
Whitney for insertion in their engines.
For many advanced technologies, linkages between OEMs and parts suppli-
ers are predominantly technological oligopolies, with a steady-state number of
suppliers for most mature industries of approximately three. Although no deliber-
ate attempts are made to limit the number of suppliers, OEMs tend to have
difficulty supporting and managing more than three; fewer than three leaves
OEMs at too great a risk of supplier shutdowns or disruptions. In the jet-engine
supply chain, for example, there are typically no more than three superalloy
producers, titanium producers, forgers, and foundries servicing the industry. The
suppliers are almost entirely dependent on the OEMs for their survival and are
responsible for producing a significant fraction of the technological content and
the majority of the weight of the OEM's product.
Although parts suppliers would seem to enjoy certain privileges and oppor-
tunities to profit from this arrangement, there is little evidence that they have
benefited. Instead, the suppliers to the jet-engine producers, for example, seem to
exist in an unhappy state of "life support," desperate to diversify in "good times"
and fiercely competitive in down times. One reason for this is that OEMs are
being increasingly pressured by product end-users who demand greater value in a
competitive marketplace. This pressure is felt throughout the supply chain.
Because parts must meet precise specifications defined by the OEMs, the
strongest links in the relationship tend to be between the design and engineering
elements of the OEMs and the corresponding elements of parts-supplier organi-
zations. In the electronics industry, for example, an enormous amount of infor-
mation is exchanged between the magnetic-head or chip-manufacturing indus-
tries and their parts suppliers to ensure that the suppliers' products meet the needs
of the OEMs. The high level of standardization of many features (e.g., inputs,
outputs, and performance indicators) strengthens this relationship.
Although linkages between OEMs and parts suppliers are strong, the con-
flicting needs for new, yet totally reliable, technologies can strain the relation-
ship. OEMs generally do not consider themselves developers of supplier infra-
structures for new materials/processes. In fact, because of economic concerns
and potential liabilities, most OEMs have instituted rigid purchasing systems
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LINKAGES BETWEEN THE MS&E AND END- USER COMMUNITIES
49
with known and approved parts suppliers and are skeptical of technologies and
suppliers that do not have track records of supplying high-quality parts in high
volume.
A discontinuous (i.e., revolutionary) technological change is more problem-
atic than a continuous (i.e., evolutionary) technological change because incum-
bent suppliers often cannot incorporate the new technologies and produce the
new components. Although the configuration of the overall supply network does
not substantially change, a discontinuous change in technology often means that
incumbent suppliers must be replaced with new, equally reliable suppliers. OEMs
often delay incorporating a new technology until the technology and supplier
infrastructure has been developed for other products. For example, the use of
engineered plastic components for interior/exterior trim on passenger cars
and trucks was delayed while the supply industry gained experience with other
industries.
Mature industries (e.g., the jet-engine and automotive industries) also have
greater difficulty incorporating new technologies than developing industries (e.g.,
the computer industries). The opportunities for implementing substantial changes
in developing industries are numerous as the technology matures and efficiency
increases. Once industries become more established and materials/process tech-
nologies have been optimized, however, OEMs tend to become assemblers and to
reduce R&D on new technologies in favor of evolutionary process improve-
ments. Note the similarities, for instance, between the first 30 years of progress in
the automotive industry, when great leaps in technology were made and new
records for production and vehicle speed were constantly being set, and the
computer industry over the past 30 years. As the automotive industry matured,
however, increases in speed and efficiency have become much more difficult to
attain.
OEMs urge subassembly and parts suppliers to conduct R&D in technolo
gies for incremental improvement in processes to improve the performance of
their products and reduce their costs. On the one hand, parts suppliers are often
reluctant to conduct joint R&D projects with OEMs because of the problems
involved in convincing OEMs to incorporate new techniques into their products.
On the other hand, suppliers are also reluctant to conduct R&D on their own.
First, industry's demand for supplier-base reliability can best be met by a small,
but not single-source, supplier base. Thus, any innovation a supplier discovers
might have to be shared with competitors to ensure that sufficient sources are
available to OEMs. Second, OEMs are usually under no obligation to adopt a new
technology once it has been developed, thus increasing the risk to the parts
supplier. Third, supplier industries usually have large capital investments in pro-
cessing technology, which increases the costs of introducing new technologies
into the market and retards innovation. Because of the high cost of capital equip-
ment, the implementation of new processes and materials can only be accom-
plished if they can be used on the existing manufacturing tool set. If higher levels
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MATERIALS SCIENCE AND ENGINEERING
of systems integration are required and product liability is increased, this technol-
ogy lock-in becomes even more entrenched. For example, the consumer electron-
ics industry has fewer problems with technology lock-in than the jet-engine in-
dustry because of the higher modularity of computer systems and the lower
liability in the event of failure. Finally, if the time required to test and certify a
new material/process approaches the limits of the patent-protection period, a
company may not have time to recoup its R&D investments before its competi-
tors can legally exploit the technology. Thus, the parts-supply industry tends to
be biased toward technologies that are more developed and can be implemented
quickly.
Recommendation 3-3. Parts-supply companies should be encouraged to conduct
materials/process R&D. Three potential methods that should be investigated are:
mechanisms for larger original equipment manufacturers to assist and encourage
parts suppliers to conduct R&D (e.g., guarantees to use the new technology);
government programs to help defray some of the costs of industrial R&D; and tax
incentives to encourage investments in R&D and reduce the risk to the supplier
compames.
Recommendation 3-4. Consideration should be given to extending the period of
patent protection, especially for applications that require extended certification
periods.
Industrial Research Organizations
Many of the companies in the industrial sectors that were studied in prepara-
tion for this report (i.e., jet engines, automobiles, and computer-chip and
information-storage computer components) conduct internal R&D to provide
competitive advantages for their future products. The committee found that the
industries represented at the workshops sponsored very little Phase 0 MS&E
research and that most of their funding was directed toward meeting their short-
term needs. Although this focus on development rather than research may shorten
the time from invention to product implementation and may lead to evolutionary
product improvements, it does not provide the innovative impetus for the devel
opment of revolutionary products for the future.
This has not always been the case. For example, in the recent past, strong basic
MS&E research was conducted at large industrial laboratories, such as AT&T (Bell
Laboratories) and IBM. This basic research provided much of the technology and
materials for the semiconductor and information-storage industry to grow into
economic powerhouses. The current electronics industry is an outgrowth of basic
research conducted at Bell Laboratories that led to the invention of the transistor in
1948 and the fabrication of the first integrated circuit at Texas Instruments in 1955.
These developments also resulted in the formation of new tooling and materials
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LINKAGES BETWEEN THE MS&E AND END- USER COMMUNITIES
51
companies to provide production infrastructure and an increase in academic re-
search. The research conducted at industrial laboratories was necessarily multi-
disciplinary and provided industry with strong patent portfolios to protect their
innovative products. It also provided in-house sources of expertise that could
quickly address and solve fundamental problems encountered during implementa-
tion and accelerated the introduction of new technologies.
Many industrial participants at the workshops recognized that the downsizing
of corporations and refocusing on the short-term horizon of stock markets in the
1980s and 1990s had substantially affected the ability and willingness of industry
to fund exploratory research. The trend has been for industry to reduce long-term,
in-house R&D and to look to academia to fill the void. Industry has also become
more involved in industrial consortia to pool research dollars and share results.
Although some of these consortia have a long-term vision, most of them are still
focused on short-term goals. Relying on university research and consortia also
has some drawbacks: the coordination of collaborative projects, the communica-
tion of results, and the negotiation of intellectual property rights can be time
consuming, problematic, and contentious.
Recommendation 3-5. Industries should establish funding mechanisms and im-
prove its methods of communication and collaboration to support precompetitive,
long-term, high-risk research at industrial laboratories, with the participation of
academic researchers and suppliers.
Recycling and Disposal
Linkages between the OEMs and the firms that refurbish or recycle products,
assemblies, subassemblies, components, and materials are becoming increasingly
important both economically and technologically as so-called "take-back"
regulations spread from Europe to the United States. Take-back regulations re-
quire that manufacturers take back their products after consumers are through
with them and refurbish and reuse the components or recycle the materials. These
regulations will increase the flow of used materials back into the economy and
will raise a number of new challenges, such as designing materials so that they
can be easily reused. For example, the inclusion of heavy-metal stabilizers and
polybrominated fire-retardants in the molding resins used in current computer
casings inhibits the recycling of the material when the product is returned.
Because of the scale and complexity of current economic and technological
systems, MS&E and end-user communities will have to be more aware of, and
concerned about, life-cycle patterns of material use beyond simple disposal and
recycling. Material technologies that are useful and benign at a small scale or in the
context of a laboratory pilot process can have social, economic, and environmental
implications in practice that must be taken into account by materials professionals.
Regulatory initiatives focused on specific materials or applications can disrupt
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MATERIALS SCIENCE AND ENGINEERING
product and process designs that would otherwise be economically and techno-
logically feasible, resulting in potentially substantial economic penalties.
The scope and potential impact of regulatory initiatives varies widely. For
example, several European countries are considering bans on polybrominated
fire-retardants in plastics, which is an important but specific material application.
At the same time, they are being urged by environmental groups to ban the
commodity plastic PVC altogether. Materials professionals, particularly those
working for or collaborating with industrial interests, must be aware of these
types of potential changes for new materials and designs to be economically
viable. More important, the MS&E community should bring its expertise to bear
on social and legal decisions involving materials choices and technologies.
In the highly evolved, complex, service-dominated economies characteristic
of developed countries today, it is becoming increasingly important for materials
professionals to be sensitive to the social, economic, and environmental context
within which materials and products are designed, produced, used, and managed
at the end of their life cycles. Fortunately, the developing field of industrial
ecology is based on a life-cycle, systems-based view of materials from initial
acquisition; to formulation, processing, and manufacturing; to distribution as a
material or part of a product; to operational use; to recycling as part of a refur-
bished product, assembly, subassembly, component, or material; and, eventually,
to disposal as waste. The failure to consider all stages of the material life cycle
can result in a technology that may be desirable, technically suitable, or manage-
able at a small scale or in certain uses but that may have substantial social costs at
a larger scale or in actual commercial use. Two illustrations are the use of arsenic
and silver in the United States (see Box 3-1~.
The MS&E community can also make significant contributions to the rational
selection and use of materials in the recycling stage of the life cycle. First, the
MS&E community can help end-users and the public understand when recycling is,
in fact, a good idea, and how optimal networks can be designed. For example, it
would be environmentally wasteful (in terms of transportation energy consumption
and emissions) if the use of refillable glass bottles results in empty glass containers,
which are quite heavy on a volumetric basis, being shipped long distances for
refilling. Similarly, shipping lightweight plastic containers long distances for mate-
rials recovery to meet a recycling requirement would also be wasteful because
significant transport resources would be used for minimal material recovery. There-
fore, although materials recycling may be a good idea in general, specific circum-
stances of recycling determine whether or not it is advisable.
Optimal recycling also requires knowledge of available technologies, for
which the expertise of the MS&E community is invaluable. In general, many
recycling technologies are fairly primitive, reflecting the fact that virtually all
R&D has been directed toward the front end (e.g., material processing, selection,
and use) rather than the end-of-life materials management. Thus, for example, the
material content of a personal computer from the circuit board and chips to the
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LINKAGES BETWEEN THE MS&E AND END- USER COMMUNITIES
53
solders to the plastic and metal components of the case and ancillary assem-
blies has been carefully selected and designed. The end-of-life fate of a per-
sonal computer, however, is usually simple disposal in a landfill or, at best,
shredding of the product in a hammer mill, followed by secondary smelting of the
materials stream to recover metals. As the high social costs of this primitive
treatment of materials and products at the end of life, ranging from the waste of
potential material streams to toxic effects on humans and ecosystems, are real-
ized, the incentives for the development of more efficient end-of-life material
management technologies will grow. The MS&E community will be a critical
contributor to the development of these technologies.
Knowledge of industrial ecology is no longer a luxury but a necessary com-
ponent of technology development that must pervade all of the linkages in the
value chain for the materials-production cycle (see Figure 3-2~. Industrial ecol-
ogy is not yet widely taught as part of the traditional MS&E curriculum, however.
This deficiency is partly a reflection of the time lag between the rapidly changing
social and industrial climate and the traditional MS&E academic focus on the
purely scientific and technological dimensions of materials. Industrial ecology is
still a young field, and industrial and academic MS&E professionals could make
valuable contributions to its development.
Recommendation 3-6. To ensure the appropriate design, production, use, and
end-of-life management of materials and products in the future, industrial ecol-
ogy should be made an integral part of the education and expertise of both MS&E
researchers and product designers.
INDUSTRY-UNIVERSITY LINKAGES
The committee found that the linkages and interactions between industries and
universities were critical. Barriers to effective interaction range from differences in
ultimate objectives to product cycle times. In this section, the committee describes
the differences in the fundamental principles of industry and universities.
The role of universities in industrial research has become increasingly impor-
tant. Universities conduct a broad spectrum of R&D throughout Phase 0, Phase 1,
and Phase 2 of the materials/process development timeline and even assist in Phase
3 development as subcontractors or entrepreneurs (e.g., research parks, campus-
based industrial-segment research centers, start-up companies, consultants). For
example, university researchers have been instrumental in developing process-
modeling systems to optimize materials production (Olson, 1998~.
The committee found that the relationships between industry and universities
are in the midst of a fundamental readjustment. First, industries have been reduc-
ing their long-term, in-house basic and applied research in favor of short-term
development. As a result, industry has increasingly looked to universities as a
source of long-term research. Second, universities are apparently increasing their
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MATERIALS SCIENCE AND ENGINEERING
BOX 3-1
Arsenic and Silver-Laced Water
Every material has a life cycle. Ingredients are formulated, processed, and
manufactured into high-tech and low-tech materials or directly into products. These
are distributed, sold, and otherwise used until they can no longer serve their orig-
inal purposes. They are then refurbished, recycled, or used for some other pur-
pose. Sooner or later, the materials end up as refuse to be discarded or managed
as waste.
Materials scientists used to be concerned almost exclusively with the early
phases of a material's life cycle. Keeping costs down while maintaining marketable
quality were the major goals. But the latter phases of the materials life cycle have
been slowly infiltrating the general mind-set of the materials community. Creating
new, affordable, more capable materials is no longer enough. New drivers to min-
imize negative social, economic, and environmental consequences of materials
throughout their life cycles have become part of the equation. The following exam-
ples suggest the new kinds of cognitive skills necessary to adapt to the cradle-to-
grave perspective.
For the past 30 years, the United States has used about 20,000 metric tons of
arsenic annually about two-thirds of the world's arsenic consumption. In the past,
the major uses of arsenic, including pesticides and drying agents, were dispersive,
and the arsenic was essentially unrecoverable. Now, the toxic metal is heavily
regulated, and its use in obviously dispersive applications has been considerably
curtailed.
Still, arsenic-bearing compounds have been widely dispersed into the environ-
ment through an unexpected channel. Each year, 5 billion board feet of pressure-
treated wood are protected from termite damage and dry rot using chromated
copper arsenate, which accounts for 90 percent of worldwide arsenic demand.
These agents have almost completely replaced organic wood preservatives like
creosote.
On small scales, arsenic compounds would not be troublesome. But arsenic-
based preservatives have become the lumber industry's standard. Every year,
15 cubic miles of arsenic-containing materials diffuse across the landscape in the
form of architectural framing, decks, and hundreds of other structures. As a result,
a toxic metal continues to be dispersed throughout the environment, and there
appears to be no simple or inexpensive way to recover it.
pursuit of industrial funding, either because of an overall decrease in government
funding for MS&E R&D or because of the general reallocation of government
R&D funding to other important fields (e.g., biomedical research) or because of a
general increase in the number of MS&E researchers applying for grants (which
has increased the competition for government funds). Of course, the pursuit of
industrial funding by universities could also reflect a genuine desire on the part of
university researchers to see the results of their Phase 1 and Phase 2 research
implemented. In any case, universities are focusing more on short-term industrial
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MATERIALS SCIENCE AND ENGINEERING
Policy for Interaction
The third weakness in industry-university linkages is the lack of a standard
policy and procedure for interaction. Universities devote considerable time and
resources to establishing links with industry and developing contracts that in-
clude intellectual property rights and the licensing of new technologies. How-
ever, no standards have been developed defining the responsibilities of all parties
and eliminating the need to reinvent contracts and contacts with each new project.
Recommendation 3-9. Standard university-industry contracts for sharing intel-
lectual property rights and licensing new technologies should be developed. These
contracts should clearly define the responsibilities of all parties. Standard
contracts would reduce the time and legal costs required to establish industry-
university research programs. To ensure that standards were acceptable and equi-
table to all parties, they should be approved by industry, academia, and govern-
ment (e.g., professional societies, academic deans of research, and high-level
government funding organizations).
Industry Access to Research Results
The fourth weakness in industry-university linkages is the inaccessibility of
many university research results. As described in Chapter 2, the results of most
basic research programs are disseminated via academic conferences and journals.
However, the number of experts in industry who can evaluate this information and
assess innovations is decreasing as industrial basic research declines. The remain-
ing industry researchers have less time and fewer resources to keep abreast with
new developments than they had in the past. Therefore, technological innovation
might not attract their attention, and promising innovations may be overlooked.
Recommendation 3-10. Industry should establish methods for identifying and
assessing materials/process developments from universities and disseminating
the results to industry.
One possible method for improving industry's access to university research
is through the development of a nonindustrial, worldwide-web-based research
clearinghouse that could make the results of independent research easily search-
able and thus more accessible to industry. However, this method would not
address industry's problem of the lack of expertise and resources to assess this
information. An alternative method might be for consulting companies to assess
research results in a given field and bring the consequential innovations to the
industry' s attention. One advantage of this method would be that linkages could
be established before the research results were published when industry could
take full advantage of the innovation.
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LINKAGES BETWEEN THE MS&E AND END- USER COMMUNITIES
TABLE 3-1 Characteristic Time Scales for Academia and the Automotive
Industry
59
Academia
Automotive Industry
2 years: capital budget cycles
2 years: Masters of Science project
3 years: typical government grant (5 years
for centers of excellence and NIST's
Advanced Technology Program)
5 years: Ph.D. project
6 years: tenure probation period
Lifetime: disciplinary focus (tenure outcome)
1 quarter: shareholder profit expectations
1 year: budget cycle
1-3 years: typical automotive grant to
university (l-year grants renewable at
automaker option)
2 years: typical Phase 3 horizon
3 years: sign-off to production
4-10 years: typical production run
Differences in Time Scales
The fifth weakness in industry-university collaboration is the frustration
caused by differences in time scales and process cycles (e.g., Table 3-1~. The
critical and most variable delay is in moving from material concept development
(Phase 1) to product integration and sign-off (start of Phase 4, end of Phase 3~.2
As Table 3-1 shows, an industrial concept, such as a new vehicle concept, is
developed over the two-year period before sign-off, and during this period the
most intensive consideration is given to new technologies (e.g., the use of tailor-
welded blanks or hydroformed tube chassis). Although production tooling and
procedures must still be developed, all of the technologies used in the vehicle
must be ready for implementation at sign-off, with complete economic justifica-
tions and selection of suppliers. Even if an attractive new technology appears
within a month or two after sign-off, it usually cannot be included in the product.
Universities, however, cannot operate on a two-year cycle and still educate
students. Unlike industry, whose primary research objective is to develop new
2 For some purposes, such as patent lifetime and cost recovery considerations, it may be useful to
include the time from Phase 4 to production (or profit making). From this perspective, the typical
product production lifetime and time to sign-off-for-production are both relevant. A production-
ready process will remain on the shelf until a new product passes sign-off and the product enters
production. This factor is actually less important in the automotive industry than in the aerospace
industry, because of the many product lines that must be redesigned and produced, perhaps an
average of one per year for each manufacturer. In the jet turbine industry, however, it may be many
years between new product sign-offs. In the electronics industry, however, most of the technology is
developed in response to a market pull, as embodied in an industry road map, so much of the new
material/process comes to Phase 3 quickly.
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technologies or improve existing ones, university graduate students are required
to teach and be taught as well as to conduct research. Students are also largely
unknowns as they enter graduate programs, and most projects rely on the work of
a small number of students (so there is little statistical evening). Furthermore,
projects must be considered, designed, proposed, and developed before the stu-
dent arrives on campus so equipment can be designed and materials and supplies
ordered. The longest step in the preproject timeline is usually project design,
proposal writing, and consideration of the proposal by funders of the project.
Recommendation 3-11. Industry should develop mechanisms to coordinate
industry-sponsored research with university research cycle times without com-
promising university or industrial missions and timelines.
Differences in Objectives and Reward Schemes
The sixth weakness in industry-university linkages is differences in motiva-
tion. An academic R&D program requires not only funding and equipment but
also a consensus that it fits into the academic culture and is in keeping with the
educational mission of the university. A common problem encountered by uni-
versities is evaluating junior faculty members engaged in industrial R&D. Tenure
appointments are generally based on the publications of the candidate and the
evaluations of recognized faculty members at other institutions. Industry-
imposed limitations on publishing the results of research in the open literature or
on collaborating with other faculty members puts junior faculty members at a
disadvantage for tenure.
Recommendation 3-12. Academic administrators should consider the value of
industrial (and other nonacademic) interactions typical of industrial research in
their faculty evaluations.
Relationships between industry and universities also have an educational com-
ponent. Industry relies on universities to educate technical and management per-
sonnel. Therefore, industry is concerned that the current MS&E curriculum is
turning out graduates with narrowly focused knowledge of materials that are cur-
rently of little economic consequence instead of graduates with a broad general
knowledge of the materials that are the mainstays of industrial competitiveness.
Better communication between industries and universities could help determine an
appropriate balance between materials innovation and industrial relevance.
Recommendation 3-13. Industry and universities should develop mechanisms to
increase personal interactions and communications and to determine an appropri-
ate balance of training and education to ensure the continued success of the
MS&E R&D community, as well as satisfying the needs of industry.
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Potential mechanisms for increasing personal interactions include (1) increas-
ing adjunct professorships for industrial scientists and engineers; (2) encouraging
joint research projects; (3) increasing the flexibility of exchange programs between
universities and industry to allow representatives of either community to spend as
much time as necessary and appropriate (e.g., from single day visits to full year
sabbaticals); (4) organizing seminars and workshops to introduce university faculty
members to the complexities, intricacies, and economics of manufacturing; and
(5) enabling students to conduct research in industry (e.g., cooperative programs
that provide both undergraduate and graduate students with opportunities to work
in industry prior to graduation).
Mechanisms to Improve University-Industry Interactions
Industry and universities are reexamining their relationships. University pro-
grams that have revised their research agendas based on the problems identified
by their industrial partners are finding it easier to find industrial partners, secure
funding, and, presumably, facilitate the adoption of research results. This new
market-driven research agenda is in stark contrast to the more traditional, inde-
pendent, idea-driven research of single-investigator, university laboratories. In
the traditional climate, which works extremely well for developing basic knowl-
edge and preparing students for careers in basic or academic research, students
conduct curiosity-driven research in relative isolation, using university labora-
tory space and equipment, and with minimal concerns about the practical applica-
tion of their work.
The center of excellence is a new model for university research that is rap-
idly gaining acceptance. Centers of excellence, in sharp contrast to the traditional
model of university research, have a clear research focus, involve collaboration
by several faculty members (often from different disciplines), provide shared
facilities, and have proactive industrial outreach programs. Interdisciplinary teams
are better able to meet the needs of industry for relevant university research. The
advantages of a center of excellence over the traditional model include: (1) it
creates a critical mass for the rapid exchange of information; (2) it identifies
industry segments interested in specific research projects; and (3) it provides
investigators with greater access to the increasingly expensive and sophisticated
equipment required for materials research. A center of excellence provides indus-
try with a single location from which to anticipate relevant research results and a
pool of recruitable students with immediately applicable skills and experience
working in teams. Centers are also better able to respond to multidisciplinary
federal research initiatives that require industrial outreach (e.g., the National
Science Foundation's Materials Research Science and Engineering Centers and
Science and Technology Centers Program).
Centers of excellence commonly recruit industrial participants using an
established fee structure and a common intellectual property agreement.
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Membership in a center provides industry with access to the output of all of the
research performed at the center, which may have a research budget 10 to 100
times the membership fee. Research results can be shared with industrial mem-
bers through activities such as on-campus research reviews and workshops, fac-
ulty visits to member sites, and student internships in industry. Participation in
research programs supported by industrial consortia can provide a venue for
university/industry collaborations and facilitate efforts by new faculty to estab-
lish research programs by providing them with access to well equipped facilities.
Recommendation 3-14. Universities should consider establishing centers of ex-
cellence as a mechanism for "marketing" their research, promoting customer-
oriented research at their universities, improving the chances of successful tech-
nology transfer, and improving linkages to industry.
INDUSTRY-GOVERNMENT LABORATORY LINKAGES
Government laboratories also play an important role in industrial research
because they conduct a broad spectrum of R&D throughout Phases 0, 1, 2, and 3
of the materials/process development timeline. The committee found that the
relationship between industry and government laboratories has changed substan-
tially in recent years.
Changes in government policy since the end of the Cold War have resulted in
significant changes in government laboratories. For example, U.S. Department of
Defense (DOD) laboratories previously conducted a great deal of MS&E re-
search related to the development of new weapons platforms and equipment (e.g.,
new stealth fighter planes). Since the end of the Cold War, however, DOD has
been more concerned with maintaining current capabilities then developing new
ones and now relies on industry to lead materials production and R&D.
The same is true of the U.S. Department of Energy' s (DOE) national laborato-
ries. At the end of the Cold War, the three large DOE defense laboratories (Los
Alamos, Lawrence Livermore, and Sandia) were directed by the government to
refocus their research programs on industry needs. The national laboratories faced
many of the same barriers to working with industry as universities (e.g., different
motivation, intellectual property rights issues, and cumbersome contracting proce-
dures). Nevertheless, over a period of five or six years, many cooperative R&D
projects were initiated. At the same time, the seven multiprogram civilian DOE
laboratories increased theirindustrial cooperation. In the mid-199Os, the three DOE
defense laboratories redefined their defense missions, focusing on the stewardship
of nuclear weapons and nuclear nonproliferation. At about the same time, the
federal government decreased its support for cooperative work with industry.
Most of the research previously conducted at the DOE weapons laboratories
was not directly relevant to industry. Industrial representatives at the three work-
shops suggested that an increase in short-term research at federal laboratories
would be beneficial for both industry and the laboratories (for much the same
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reasons as for university laboratories). However, most also believe that the labo-
ratories should continue to conduct some long-term R&D to maintain the innova-
tion pipeline. In addition, they recommended that the peer-review process for
DOE laboratories be augmented to ensure the quality of the research and the
applicability of results to the needs of industry.
Like their university counterparts, laboratory representatives expressed their
concern that the general trend toward short-term research and greater alignment
with industry would move the laboratories away from their main mission of long-
term research.
Recommendation 3-15. The federal government should continue to encourage
interaction and communication between federal laboratories and industry and to
establish partnerships, in keeping with laboratory missions, in areas that will
benefit industry.
Potential mechanisms for increasing personal interactions include fostering
more joint research projects; increasing the flexibility of exchange programs
between government laboratories and industry; and organizing seminars and
workshops to introduce government laboratory personnel to the complexities,
intricacies, and economics of commercial manufacturing.
Most industry representatives at the jet-engine workshop were extremely
concerned about changes in the DOD laboratories. For example, the domestic jet-
engine industry has been closely linked with, even reliant on, basic materials/
process R&D conducted and funded by the Air Force. Most major improvements
in the efficiency of jet engines have resulted from DOD initiatives funded and/or
conducted by the Air Force, which also provided the basis for implementation,
reliability testing, and scale-up. In a dramatic reversal of roles, the Air Force now
relies on industry to lead materials/process research initiatives. The industry,
however, which has just emerged from an extended period of low profitability,
severe downsizing, and reorganization, cannot support these initiatives. Industry
representatives feared that, without the support of the Air Force, no long-term
research would be conducted and that the competitiveness of the domestic jet-
engine industry would suffer. In short, the jet-engine industry believes it is in the
national interest for DOD to continue to support basic materials/process research
and to remain closely linked with the domestic industry, while DOD representa-
tives believe that industry should assume greater responsibility for long-term
research because it would be in its own best interest.
INDUSTRY-GOVERNMENT LINKAGES
The relationship between government and industry is extraordinarily com-
plex, but there are three main methods by which government affects industry:
direct funding of R&D; business regulation; and environmental regulation. Gov-
ernment regulation of business (e.g., liability, international trade, antitrust, and
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tax legislation) is beyond the scope of the committee's charge and expertise and,
therefore, is not discussed further. This section focuses on the effects of environ-
mental regulation on industrial materials and process development.
Environmental regulations can compel industry (1) to modify or replace an
existing manufacturing process or production facility to reduce harmful emis-
sions or (2) to modify or augment a product design to improve safety or reduce
harmful emissions. Either of these changes can cause manufacturing delays and
add to the cost of materials implementation. More important, however, replace-
ment technologies must not only satisfy government regulations but must also
maintain required quality and performance levels. Regulatory changes also affect
government operations. For example, continued changes in standards and regula-
tions can cause backups in permit approvals, which can slow the implementation
of new technologies.
Although, in general, industry is opposed to government interference in
commerce, the committee found that industrial participants in the workshops did
not believe that product regulation was a major deterrent to industrial competi-
tiveness because all companies must comply equally with new regulations. In
fact, regulation can stimulate innovation by motivating companies to conduct
cooperative, precompetitive research and by helping them overcome the cost
barriers that limit the introduction of new materials/processes. Government regu-
lation can also limit liability in certain industries. In the aerospace industry, for
example, industry and the Federal Aviation Administration (FAA) tend to see
their relationship as a partnership with respect to the introduction of new materi-
als and processes. By working closely with the FAA, the aerospace industry can
ensure that safety issues and liability concerns are fully addressed.
Recommendation 3-16. Government regulatory agencies and the industries they
regulate should attempt to change the current regulatory climate to mutually
constructive cooperation and goal setting to promote the adoption of new materi-
als that further societal goals.
Many government agencies fund Phase 0 and Phase 1 materials/process
R&D. For example, the National Science Foundation funds basic research and
education in science and engineering, principally in academia. DOE and DOD
have similar programs to fund Phase 0 and Phase 1 R&D. In the past decade, as
federal programs have focused more on the development of precompetitive tech-
nologies (e.g., improving automotive fuel economy and reducing pollution), more
funding has been used for Phase 2 R&D. Many state governments have also
established programs to support technology areas as a way of attracting new
high-technology businesses to their states.
The Technology Reinvestment Program of the Defense Advanced Research
Projects Agency (DARPA) was a four-year program to shift DARPA's defense-
oriented manufacturing research to a more commercial-industry-oriented
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program. The program was managed jointly by DARPA, the National Science
Foundation (NSF), and DOE. The program recognized that DARPA would be
less able to support and implement cutting-edge manufacturing technology re-
search as defense budgets decreased.
The Advanced Technology Program (ATP), sponsored by the National Insti-
tute of Standards and Technology, is intended to benefit the U.S. economy by
stimulating the development of innovative technologies at the preproduct stage.
Joint ventures must account for at least half of the project costs, and single compa-
nies are required to pay all of their indirect costs. Universities may participate
in joint ventures or as subcontractors. Funding for ATP has averaged around
$200 million per year for the past five years. ATP has established 17 focused
programs, seven of which are principally oriented toward materials or processing.
DOD supports manufacturing technology through the Manufacturing Technol-
ogy Program (ManTech), which supports 15 centers of excellence in manufactur-
ing fields ranging from apparel to electro-optics. ManTech also funds the Best
Manufacturing Practices Center of Excellence to make the results of R&D at the
centers and other defense-related industry knowledge available to industry at large.
The Partnership for a New Generation of Vehicles (PNGV) is a partnership
of 20 federal laboratories and Chrysler, Ford, and General Motors to improve
U.S. competitiveness in automotive manufacturing through the evolution of an
environmentally friendly car with triple the fuel economy of today' s midsize car.
Seven agencies and the automakers jointly fund PNGV, and DOE directs the
program. Materials and manufacturing are main areas of investigation.
Four programs of the NSF Directorate of Engineering are noteworthy for
their interaction with industry. Industry/university cooperative research centers
(I/UCRCs) leverage a modest investment by NSF into a focused cooperative
research program with industry support. More than 25 I/UCRCs have been estab-
lished in the past 15 years. They represent one of the best examples of industry-
university interaction and cooperation. State/industry university cooperative re-
search centers (S/IUCRCs) extend the I/UCRC model, focusing on state or
regional economic development, often including proprietary projects with both
industry and state support. Engineering research centers (ERCs) represent an
integrated university-industry focus on complex engineered systems. Two exist-
ing ERCs, at Purdue and Ohio State, focus on manufacturing. The Grant Oppor-
tunities for Academic Liaison with Industry (GOALI) program brings individual
engineering faculty members and industry into close working contact. The
GOALI program provides funding for industry engineers to work in academia on
collaborative projects.
The Industries of the Future (IOF) Program was established to help the DOE
Office of Industrial Technology leverage government and private funding by
focusing research on industry-developed visions and technology road maps (NRC,
l999b). The objective of the IOF program is to improve government-industry
partnerships, ensure the relevance of research projects, encourage industry
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participation, and facilitate the commercialization of new technologies. The long-
term goals are a 25-percent improvement in energy efficiency and a 30-percent
reduction in emissions for the IOF industries by 2010 and a 35-percent improve-
ment in energy efficiency and 50-percent reduction in emissions by 2020 (OIT,
1997).
The New York State Science and Technology Foundation is a public corpo-
ration that administers a range of financial- and technical-assistance programs
designed to stimulate economic growth and job creation in New York through the
transfer of technology from the laboratory to commercial application. One of its
three main endeavors is the Centers for Advanced Technology program, which
encourages new and high-technology product and service development through
R&D, technology transfer between universities and industry, and education and
. .
training.
All of these Phase 2 government/industry/university cooperative programs
require significant industry matching funds. Their overall focus is primarily based
on meeting industry goals and objectives.
Recommendation 3-17. Federal and local governments should expand their pro-
grams to fund joint industry-university research programs to enable new tech-
nologies to make the transition from the laboratory to industry. These programs
should focus on involving both original equipment manufacturers and suppliers
in the selection and management of research projects.
CONSORTIA
The formation of consortia to conduct precompetitive research is a relatively
recent phenomenon that started in 1984 with passage of the National Cooperative
Research Act. The original objective was to provide a mechanism to enable product
manufacturers to coordinate their Phase 0 and Phase 1 precompetitive research in
response to foreign competition without violating antitrust laws. Since then, the
missions of most consortia have been expanded to include: (1) conducting joint
Phase 0 and Phase 1 research on high-risk, precompetitive technologies; (2) obtain-
ing government funding; (3) developing technology road maps; (4) maximizing the
value of university research; and (5) acting as industry spokesgroups.
Consortia, which can include major suppliers and manufacturers, applicable
university programs, and relevant government laboratories and agencies, are
funded by contributions from major participants. Consortia generally have four
types of members:
.
full industrial members, who pay dues in the tens or hundreds of thou-
sands of dollars and generally have full and immediate access to R&D
results, as well as full participation in decision-making processes
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· partial industrial members, who pay dues in the tens of thousands of
dollars or less and generally have limited access to the R&D results
· research members, who conduct the R&D
governmental agencies, which provide a large share of the funds for R&D
.
For rapidly changing, high-profit industries, research may be funded exclusively
by industry. The electronics industry, for example, has established several industry-
funded consortia to develop visions of the near future and fund R&D projects.
Consortia accomplish their objectives in two ways. First, they provide neu-
tral territory on which competing industries can meet to identify, develop, and
maintain the research initiatives most important to their competitiveness. Second,
they serve as links among industries and research institutions to ensure that short-
term and long-term research initiatives are effective and efficient. The main
mechanism by which consortia operate is through industry road maps, frame-
works for setting priorities in materials research. Road maps have been very
useful for establishing goals and priorities that have led to the development of
advanced technologies in newer industries, such as electronics. Some advantages
of road mapping are listed below:
Road maps are high-level mechanisms for identifying and disseminating
information about the problems, challenges, and opportunities in a given
field.
Road maps help define the issues facing industries and identify gaps in
technology.
Road maps are communications tools that enable all segments of an in-
dustry (e.g., researchers, suppliers, systems integrators, and recyclers) to
contribute to the industry' s development.
Road maps bring all segments of the industry into the development pro-
cess from fundamental R&D to final assembly in a coordinated way.
Road maps must be sufficiently detailed so that each segment understands
the R&D areas to be pursued.
Road maps based on the input of industries, suppliers, academia, and
government represent a consensus on R&D goals and directions. They
also provide a way of leveling the playing field among researchers and
industries, lowering the overall risk, and ensuring that a market will exist
for innovation.
Road maps are tools for helping funding agencies determine which projects
to fund.
The process of developing industry road maps encourages the participation
and interaction of experts across institutions and disciplines, which fosters under-
standing and communication between materials experts and product designers,
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both within and across
opportunities."
MATERIALS SCIENCE AND ENGINEERING
.
industries and research institutions, and minimizes "missed
Recommendation 3-18. The MS&E communities should promote the use of
road maps (1) to identify the issues facing industries and the gaps in the technol-
ogy; (2) to serve as a means of communication for all segments of an industry to
contribute to the industry's development; (3) to serve as an organizational mecha-
nism to coordinate all segments of an industry; (4) to provide integrative struc-
tures through which all segments can "buy into" the goals and research directions
of the industry; and (4) to provide funding agencies with the information neces-
sary to manage their research budgets.
The development and implementation of road maps are not free of risk,
however. First, an industry that simply follows the schedule stipulated in a road
map will not survive. To control or increase its market share and maintain its
competitiveness, a company must attempt to preempt its competitors by introduc-
ing new technologies before the dates established on the road map. Because of
the constant pressure to beat the deadline, road maps are usually obsolete within
two years. Thus, road maps must be treated as living documents rather than set
guidelines. Unless consortia vigilantly maintain and update their road maps, the
competitive advantage they provide will be lost.
Second, road maps could lead to technology lock-in. By necessity, road
maps are mainly concerned with evolutionary R&D and cannot identify or sup-
port revolutionary innovations. Industry must be careful not to eliminate revolu-
tionary research in the name of efficiency and leave themselves vulnerable to
competitors developing leapfrog technologies. Once the industry recognizes the
limitations of a road map, however, revolutionary ideas can be developed by
veering off the incremental course set by the road map and envisioning leapfrog
technologies based on completely different paradigms. The most effective way to
avoid technology lock-in is to use road maps to forecast and prioritize needs, not
solutions.
Third, road maps can only be truly successful if the participants remain
involved and provide conduits for the transfer of results. Road maps must also
clearly define precompetitive and proprietary interests to ensure that companies
have a basis on which to compete once the R&D stipulated in the road maps has
been completed.
Representative terms from entire chapter:
materials suppliers
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