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4
Priorities
"Forward, the Light Brigade!"
Was there a man dismayed ?
Not though the soldiers knew
Someone had blundered:
Theirs not to make reply,
Theirs not to reason why,
Theirs but to do and die:
Into the Valley of Death
Rode the six hundred.
From "The Charge of the Light Brigade"
Alfred Lord Tennyson (1809-1892)
THE PURPOSE OF THIS CHAPTER iS to highlight the committee s most important
findings and recommendations. The fundamental focus of this report is
the importance of materials advances in the development of marketable
products. The committee found that, although in some cases the introduction of a
new material has revolutionized an industry (e.g., silicon chips for the electronics
industry, optical fibers for the telecommunications industry, and titanium for the
aerospace and aircraft industries), the vast majority of materials advances have
been evolutionary. In either case, it has taken from 10 to 20 years for typical
material advances to be widely used. As a result of these long development times,
patent protections often expire before the material/process innovators realize
significant revenues or even recoup their original investments. This has discour-
aged the development of innovative materials.
An idealized commercialization process and the many linkages necessary for
materials and processing advances to make the transition from the laboratory to
the marketplace were discussed in Chapters 2 and 3 of this report. Chapter 2
introduced a conceptual schema for the analysis of the materials development and
commercialization process, which includes the following notional phases:
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MATERIALS SCIENCE AND ENGINEERING
· Phase 0. knowledge-base research
· Phase 1. material concept development
· Phase 2. material/process development
· Phase 3. transition to production
· Phase 4. product integration
Phase 2 is typically the most difficult phase of the development cycle to
navigate successfully. The primary objective of Phase 2 R&D is to scale-up
production from the laboratory to the prototype level so that the business risks
involved in the application of a material/process innovation can be quantified.
Phase 2 ends when the innovation has been shown to have both the potential for
being scaled up to production level and economic advantages and when an indus-
trial enterprise decides to investigate integrating the technology into a product. In
many cases, Phase 2 represents the transition from "technology push" (i.e., re-
search priorities are established by the MS&E community based on technological
attractiveness and perceived applicability) to "product pull" (i.e., industry needs
and priorities are the primary criteria for further development). Some have de-
scribed Phase 2 as "the valley of death."
Recent experience has left the user community as well as the R&D commu-
nity frustrated. Many in the user community are of the opinion that materials
R&D has been misguided and preoccupied with exotic but impractical technolo-
gies. Many in the MS&E community feel that the fruits of their research have not
been adopted and that the user community is overly conservative. At the root of
these feelings are technologies that have not made the transition from technology
push to product pull.
The importance of Phase 2 R&D and the substantial differences between
Phase 2 and traditional Phase 0 and Phase 1 research are gaining recognition with
funding agencies, universities, government laboratories, and industry. Over-
coming the barriers to Phase 2 R&D is the most promising way to shorten the
time to market of laboratory innovations.
The committee identified the following principal barriers to the smooth pas-
sage through Phase 2 R&D:
· high development costs
· high technical and business risks
· inadequate communications and education
Any successful innovation must be a cost-effective solution to a real prob-
lem. Therefore, the MS&E community must have a good understanding and
appreciation of costs in the materials selection process. Focus on technological
innovation without regard to cost is unlikely to lead to success. Historically,
funding for Phase 2 research has been inconsistent. Although the highest costs of
new materials have been associated with process definition and testing, funding
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often stops before these stages have been reached. The funding gap may result
from uncertainty among the MS&E community, industry, federal and state fund-
ing agencies, and entrepreneurs over who is responsible for the identification and
funding of Phase 2 R&D programs.
Because of the high cost of testing new materials, many materials advances
have never been exploited. The use of modeling and simulations to provide
preliminary assessments of materials and component performance could help
alleviate this problem. However, extensive databases and knowledge-base sys-
tems will be essential to effective modeling and simulation.
Economic pressures compel manufacturing enterprises to evaluate the techni-
cal and business risks associated with every new technology. As a consequence,
mature industries are more likely to fund incremental R&D, for which the risks are
better understood. Revolutionary changes are most likely to come from entrepre-
neurs who are willing to accept higher risks in search of high returns. Different
industries perceive risks differently. In the electronics industry, for example, risks
are predominately associated with commercial considerations. In the automotive
industry, risk may be associated with product safety or the potential for huge
recalls. In the jet-engine industry, safety is paramount, and no company will intro-
duce a new material or process unless it has been proven to have a positive or, at
worst, a neutral effect on safety. The cost of running long-term, expensive tests to
verify product reliability is a major barrier to innovation. Risk assessments and
evaluations of all performance criteria can cost tens of millions of dollars, and these
costs are major impediments to the introduction of new materials.
In the opinion of the committee, universities are producing MS&E graduates
who are technically well educated, but whose focuses are too narrow for the
current business climate. Educators should ensure that MS&E researchers and
graduates can communicate effectively with producers and designers so that their
ideas can be successfully brought to market. Researchers and engineers must
understand that producers are looking for simple, robust processes, continuity of
demand, and the potential for profit; designers think in terms of life-cycle cost,
risk management, and consistent and reliable suppliers.
One way to improve the preparation of MS&E researchers and graduates is
to involve research universities, in partnership with industrial researchers, in
Phase 2 R&D. However, this has been difficult for the following reasons:
· the multidisciplinary nature of Phase 2 R&D and the wide spectrum of
expertise required to complete material/process developments
· the lack of access to industrial-scale equipment
· the evaluation of academic researchers based on refereed publications and
invention disclosures
· the incompatibility between industry funding and planning cycles and the
time frames required for graduate students
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MATERIALS SCIENCE AND ENGINEERING
Recommendation 4-1. The MS&E and user communities should focus their
efforts on strengthening linkages to bridge the Phase 2 "valley of death" of
technology development.
Although there are major differences between industries, some general ap-
proaches can be taken to improve Phase 2 R&D. The key to bridging the valley of
death is to establish an environment in which innovations are desired and antici-
pated by those who will use them and business considerations are addressed early
in the development process by the MS&E researchers. Focusing on the following
areas will improve the chances that materials and processing innovations will be
successfully commercialized:
· improving Phase 1 linkages (setting the stage for product pull)
· establishing the potential of an industry for Phase 3 and Phase 4 R&D
(getting down to business)
SETTING THE STAGE FOR "PRODUCT PULL"
Even though some innovations have succeeded without a clearly defined need,
the committee found that commercialization is much more likely to succeed if
product needs drive the innovation. Phase 1 researchers must become more aware
of user needs and consider them in designing their research programs, thus estab-
lishing a "product pull" (i.e., setting research priorities based on product needs).
Consortia
Many industrial research laboratories have decreased their support for Phase
0 and Phase 1 MS&E research, directing more of their activities toward meeting
short-term needs. Although this change in focus could shorten the time for prod-
uct implementation and lead to evolutionary product improvements, it provides
no incentive for revolutionary innovations. To compensate for this lack of incen-
tive, industry has turned to academic researchers and consortia to pool research
resources and share results. Consortia, with or without government participation,
provide a mechanism for sharing the risks and costs of developing new processes
and materials. Consortia provide neutral ground where competing industries can
meet to identify, develop, and maintain the research initiatives most important to
their competitiveness. Consortia can also serve as links among industries and
research institutions to ensure that short-term and long-term research initiatives
are effective and efficient.
Industry Road Maps
Industry road maps are the primary mechanisms for establishing research goals
and priorities for materials research early in the development process. Road maps
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have been very effective for the development of advanced technologies in newer
industries, such as electronics, and are especially important for the development of
complex products. The road map development process facilitates linkages between
experts across institutional and disciplinary boundaries. Road maps are valuable for
the MS&E community because they can (1) identify issues facing industries and
gaps in technology; (2) be used as communication tools to allow all segments of an
industry to contribute to the industry's development; (3) act as organizational
mechanisms for bringing all segments of an industry into the development process;
(4) serve as integrative structures through which all segments of an industry can
reach consensus on goals and research directions; and (5) provide funding agencies
with the information necessary to manage their R&D budgets.
Centers of Excellence
The center of excellence is a new model for university research that is rap-
idly gaining acceptance. Centers of excellence, in sharp contrast with the more
traditional model of university research, have a clear research focus, involve
collaboration by several faculty members often from different disciplines, pro-
vide shared facilities, and have proactive industrial outreach programs. An effec-
tive center of excellence (1) creates a critical mass for the rapid exchange of
information; (2) identifies industry segments interested in specific research
projects; and (3) provides investigators with greater access to the increasingly
expensive and sophisticated equipment required for materials research. A center
of excellence provides industry 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.
Recommendation 4-2. The following three primary mechanisms should be given
priority to establish product pull in the early stages of technology development
(during Phase 1 and, perhaps, as early as Phase 0~:
· consortia and funding mechanisms to support "precompetitive" research
(Recommendation 3-5)
· industry road maps to set priorities for materials research (Recommenda-
tion 3-18)
· university centers of excellence to coordinate multidisciplinary research
and facilitate industry-university interactions (Recommendation 3-14)
GETTING DOWN TO BUSINESS
The successful commercialization of materials and process advances is gen-
erally driven by one of four end-user forces: (1) cost reduction; (2) cost-effective
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improvement in quality or performance; (3) societal concerns, manifested either
through government regulation or self-imposed changes to avoid government
regulation; or (4) crises. Without at least one of these drivers, industries that use
materials have little motivation to implement technological advances. However,
the importance of these driving forces varies greatly with the industry and the
situation. Mature industries generally do not have rapidly growing markets and
are primarily competing for market share. For these industries, reductions in cost and
incremental advantages in perceived or actual performance may represent success
(e.g., automobiles). In contrast, technological advances can create large new markets
or substantially increase existing markets for newer, rapidly changing industries (e.g.,
computing). Even when compelling driving forces for change are present, the techno-
logical and business risks may be obstacles to commercialization.
Product/Property Data
In the past, primary materials suppliers were only involved peripherally in
the design process. As the competition for primary materials has intensified,
however, they have become increasingly involved in developing their own design
activities. This is especially true for new materials concepts, for which the sup-
plier 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. Materials suppliers must collaborate with end-user indus-
tries to determine the type of data required for product designers to assess a new
material/process and to present the material properties in terms that are relevant
and understandable to designers. The committee believes that the precompetitive,
cooperative development of product and property data will improve the useful-
ness of results to product designers. The sharing of basic materials property data
might require a review of antitrust legislation and a neutral body (such as the
National Institute for Standards and Technology or the American Society for
Testing and Materials) as a clearinghouse. Tests and methods should be standard-
ized as much as possible to minimize duplication.
Research Infrastructure
Factors that limit the materials and parts supplier industries as a source of
innovation include (1) initial market sizes and profit margins too small to produce
adequate return on investment, (2) unwillingness of OEMs to adopt technologies
invented by others, and (3) the difficulty in implementing changes to existing
supply chains and infrastructure. The research infrastructure for materials and
parts supply companies could be improved by the development of mechanisms
for larger OEMs to assist and encourage materials supply companies to conduct
R&D (e.g., guarantees to use the new technology); government programs, such as
ATP, that would help defray some of the costs of industrial R&D; and modifica-
tions to the tax code that would permit deductions for R&D expenditures and
reduce the risk to the supplier companies.
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Patent Protection
If the time required to certify a new material/process approaches the limits of
the patent-protection period, a company may not have time to recoup its R&D
investment before its competitors can legally use the technology. Because of this,
industry tends to be biased toward technologies that can be implemented quickly
and leaves more time to accrue profits and recoup R&D investments.
Industrial Ecology
The MS&E community and product designers are increasingly turning to the
developing field of industrial ecology to assess the social, economic, and envi-
ronmental context within which materials and products are designed, produced,
used, and managed at the end of their life cycles. This systems-based view of the
material includes (1) acquisition; (2) formulation, processing, and manufactur-
ing; (3) distribution as a material or component of a product; (4) use; (5) recy-
cling as part of a refurbished product, assembly, subassembly, component, or
material; and (6) eventual disposal or management of the product as waste.
Regulatory Climate
To comply with environmental regulations, industry may have to (1) modify
or replace an existing manufacturing process or production facility to reduce
harmful emissions or (2) modify or augment a product design to improve safety
or reduce harmful emissions. These changes do not generally give any particular
company a competitive advantage because they all must comply. In fact, regula-
tions can spur innovations by helping companies bypass the cost barriers for the
introduction of new materials/processes and encouraging companies to conduct
cooperative, precompetitive research.
Recommendation 4-3. The following developments should be given priority to
improve the transition of materials advances from Phase 2 to production imple-
mentation:
· collaboration with end-user industries to identify the type of data required for
product designers to assess new materiaVprocesses (Recommendation 3-1)
· investigation of methods to improve the research infrastructure for mate-
rials suppliers and parts suppliers (Recommendations 3-2 and 3-3)
· extension of the patent protection period, especially for applications that
require lengthy certification periods (Recommendation 3-4)
· development of industrial ecology as an integral part of the education
and expertise of both MS&E researchers and product designers (Rec-
ommendation 3-6)
· development of a regulatory climate based on constructive cooperation
and goal setting to promote the adoption of new materials that achieve or
enhance societal goals (Recommendation 3-16)
Representative terms from entire chapter:
product designers
