Transcript FOUNDING OF THE UNIVERSITY

© Professor Otto C C Lin
June 2003
National Innovation System and
the Role of National Institute
Prof Otto C C Lin
The Hong Kong University of Science & Technology
Clear Water Bay, Kowloon, Hong Kong
[email protected]
Tsing-Tech Innovations, Ltd
New World Centre, Tsim-sha-Tsui, Kowloon, Hong Kong
[email protected]
c:ppt/02_ShanghaiOct
Six Countries Programme Conference, Canada
June 5-6, 2003
1
© Professor Otto C C Lin
June 2003
Outline
1.
From science to industry: the myths
2. The Innovation process and the players
c:ppt/02_ShanghaiOct
3.
The national innovation system
4.
A case study of Taiwan:
5.
The roots of hi-tech industry
6.
The way forward
2
© Professor Otto C C Lin
June 2003
Hi-Tech Industry
Technology
Science
c:ppt/02_ShanghaiOct
3
© Professor Otto C C Lin
June 2003
Hi-Tech Industry
National Vision
Strategy
Policy Commitment
R&D Funding
Taxation & Banking
Legal System
Regional Planning
c:ppt/02_ShanghaiOct
Physical Infrastructure
Basic Sciences
Education & Skilled Workforce
Entrepreneurship
Venture Capital
Social Support
Project Management
4
© Professor Otto C C Lin
June 2003
The Research to Commercialization Process
Basic
Research
Research
Science
c:ppt/02_ShanghaiOct
Applied
Research
Product &
Process
Development
Development
Industrial Technology
Mid-stream R&D
Pilot
Production &
Field Trial
Manufacturing
Sales &
Services
Commercialization
5
© Professor Otto C C Lin
June 2003
Research
Commercialization
Difference
•
•
•
•
•
•
Similarity
• Excellent People
• Excellent Management
c:ppt/02_ShanghaiOct
Mission
Jobs/Outputs
Criteria Success
Talents needed
Rewards system
Risk
6
© Professor Otto C C Lin
June 2003
The Innovation Process: Creating Wealth from Knowledge
Developing Industrial Technology
Scientific
Research
Applied Research
Product Development
Process Development
Pilot Production
Technology Diffusion
Product
Commercialization
Nurturing Business Environment
Policy / Planning / RD Funding
Taxation/Legal Systems
Infrastructure
Skilled Manpower
VC Funding / Entrepreneurship
Social Support and Stability
c:ppt/02_ShanghaiOct
7
© Professor Otto C C Lin
June
2003
March
2002
National Innovation System: the Players
Developing Industrial Technology
INSTITUTE
UNIVERSITY
Nurturing Business Environment
BUSINESS
INDUSTRY
GOVERNMENT
c:ppt/02_ShanghaiOct
8
© Professor Otto C C Lin
June 2003
The National Innovation System: The Dynamics
Technology Development
INSTITUTE
UNIVERSITY
Scientific
Research
c:ppt/02_ShanghaiOct
BUSINESS
GOVERNMENT
Product
Commercialization
9
© Professor Otto C C Lin
June 2003
National Innovation System: The Role of the Institute
Focus
Funding
Industrial Technology
Basic
Research
Applied
Research
Product & Process
Development
Technical
Pilot
Production
Manufacturing
Services
Government
UNIVERSITIES
Institute ??
INDUSTRIES
Business
c:ppt/02_ShanghaiOct
10
© Professor Otto C C Lin
June 2003
National Innovation System: USA
Focus
Funding
Industrial Technology
Basic
Research
Applied
Research
Product & Process
Development
Technical
Pilot
Production
Manufacturing
Services
Government
UNIVERSITIES
NATIONAL INSTITUTES
NATIONAL LABORATORIES
INDUSTRIES
Business
c:ppt/02_ShanghaiOct
11
© Professor Otto C C Lin
June 2003
The Economic Growth of Taiwan
14,634
Per Capital GNP, US$
14000
12872
11597 12396
12000
10370
13,359
13,248
12,323
10852
10000
8111
8982
8000
6379 7626
6000
3993
4000
2344
2000
154
0
217
695
345 443
920
304 389 522
1132
1577
5298
2653 3167
2699 2823
3297
1920
964 1301
00
20 9
9
19 8
9
19 7
9
19 6
9
19
95
19 4
9
19 3
9
19 2
9
19 1
9
19 0
9
19 9
8
19 8
8
19 7
8
19
86
19 5
8
19 4
8
19 3
8
19 2
8
19 1
8
19 0
8
19 9
7
19 8
7
19 7
7
19
76
19 5
7
19 4
7
19 3
7
19 2
7
19 1
7
19 0
7
19 9
6
19 8
6
19
66
19 5
6
19 4
6
19 2
6
19 0
6
19
Year
c:ppt/02_ShanghaiOct
12
© Professor Otto C C Lin
June 2003
THE STRATEGY: A Case Study of Taiwan
A Developing Human Resources
B Acquiring Foreign Technologies
C Establishing Indigenous Technology Capability
D. Converting Science / Technology to Industry
Ref: O. C. C. Lin, in “Behind East Asian Growth: the political and social
foundation of prosperity ,” Editor, H.S. Rowen. Rutledge, 1998
c:ppt/02_ShanghaiOct
13
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
14
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
15
© Professor Otto C C Lin
June 2003
National Innovation System : Taiwan
Focus
Funding
Government
Industrial Technology
Basic
Manufacturing
Research
Applied
Research
Product & Process
Development
Pilot
Production
Technical
Services
Academic
Sinica
Universities
Industrial Technology Research Institute (ITRI)
• Micro-Electronics
• Opto-Electronics
• Computer &
Communications
• Materials
• Aerospace
• Energy
• Pollution Control
• Chemicals
• Industrial Safety
• Machinery
• Industrial Standards
INER, FIRDI, MIDC, CBD, III, TL, CPC
ITRI
All
SCIENCE-BASED INDUSTRIAL PARK
(Host for Hi-Tech Companies)
Business
c:ppt/02_ShanghaiOct
Industrial Companies
16
© Professor Otto C C Lin
June 2003
Industrial Technology Research Institute (ITRI)
• Founded in 1973
• A statutory national institute established by law
• A non-profit R&D corporation under the auspices of
the Ministry of Economic Affairs (MOEA)
• The technical arm of the government’ s industrial
policies
• A partner to local industries
c:ppt/02_ShanghaiOct
17
© Professor Otto C C Lin
June 2003
ITRI Missions
To spearhead the development of high-tech
industry in Taiwan
To upgrade the competitiveness of
traditional industries in the global market
c:ppt/02_ShanghaiOct
18
© Professor Otto C C Lin
June 2003
ITRI: Scope of R&D Activity
ELECTRONICS
• VLSI Fabrication
• IC Design
• Flat Planel Display
• Microwave Technology
• Electronics Packaging
MATERIALS
CHEMICALS
• Material Design
• Material Application
• Material Reliability Improvement
• New Material
• Chemical Engineering Process
• Applied Chemistry
• Speciality Chemicals and Pharmaceuticals
• Polymera and Fibers
COMPUTER &
COMMUNICATIONS
• Computer
• Communication
• Consumer Electronics
ENERGY & RESOURCES
• Energy Conservation
• Systems Design
• Resource Application
• Environment Engineering
ITRI
OPTO-ELECTRONICS
MACHINERY
• Optical Information
• Electro-Optical Components & Materials
• Optical Components & Systems
METROLOGY
• National Measurement Standards
• Laboratory Accreditation
• Industrial Quality Assurance &
Service
• Measurement Technology &
Instrumentation
c:ppt/02_ShanghaiOct
INDUSTRIAL
SAFETY
& HEALTH
• Chemical Accident
Prevention
• Industrial Hygiene
• Engineering Safety
INDUSTRIAL
POLLUTION
CONTROL
• Treatment & Control
• Waste Reduction &
Reuse
• Pollutant Analysis &
Monitoring
• Automation
• Precision Machinery
• Power Machinery
• Precision Parts & Components
AEROSPACE
• Quality Assurance
• Aviation System & Components
• Inspection/Testing
• Market & Technology
Information
19
© Professor Otto C C Lin
June 2003
Impacts of ITRI Technology
I. Establishing New Technology / Industry
•
•
•
•
•
•
•
c:ppt/02_ShanghaiOct
VLSI
Computing
Communication
Materials
Sp. Chemicals
Automation
Opto-Electronics
• IC: CMOS
DRAM/SRAM
• PC
• Peripherals
• Telecom, ISDN
• PLC
• Auto Engine
• ELE Components &
Parts
20
© Professor Otto C C Lin
June 2003
Taiwan IC Company Family Tree (Ref: Dr. F.C. Tseng, 2002)
1980 : First IC Co.
UMC
• Team
• 3.5μm , CMOS
• Team
• 2μm , CMOS
• 6-inch Fab.
TSMC
1987 : First Foundry
• IC Products
RCA
7μm , CMOS
(3-inch Fab.)
• Team
• 2μm , CMOS
ERSO
/ITRI
1974 :Technology
Transfer
• IC Products
• Team
• 0.5μm , CMOS
Winbond
1987 : First IDM
Vanguard
1994 :First DRAM
• 8-inch Fab.
•SRAM/DRAM
Products
TI
c:ppt/02_ShanghaiOct
IPR
DRAM Tech.
TI-Acer
1992 :First JV DRAM
21
© Professor Otto C C Lin
June 2003
Taiwan IC Outperform WW IC
$M USD
Taiwan Product Production Value
Taiwan Growth Rate
100%
18,000
16,000
Worldwide Growth Rate
14,000
80%
12,000
60%
10,000
40%
8,000
20%
6,000
0%
4,000
-20%
2,000
-40%
Bart Chart: Taiwan IC Revenue
Line Chart: Annual Growth Rate
120%
0
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
(e)
(f)
Source: ITIS/IEK, Nov-2001; SIA, Jan-2002
c:ppt/02_ShanghaiOct
22
© Professor Otto C C Lin
June 2003
Transactions and Interlinkage
IP
IP verifications
IP Integration
Flip Chip & CSP
Foundry
Fabless
Assembly &
Test
Transaction
Design
Infrastructure
Confidential-Security C
Design Services
Tr us t The Lea der . Tr us t TSMC.
23
March 2002
c:ppt/02_ShanghaiOct
23
© Professor Otto C C Lin
June 2003
Foundry Business Model
IDM/ASIC
IDM/ASIC
Fabless Co.
System
Design
IC Design
IDM/ASIC
System
Design
IC Design
IC Design
System/IC
Design
Fab
Assembly
& Test
c:ppt/02_ShanghaiOct
System Co.
System
Design
System
Design
IP
IC
Design
IC
Design
Design
Services
Fab
Foundry
Fab
Assembly
& Test
Before 1986
Fabless Co.
Contract
Assembly
& Test
1990s
Assembly
& Test
Assembly
& Test
After 2000
24
© Professor Otto C C Lin
June 2003
Outlook Taiwan IC Industry
M US$
40,000
IC Testing
IC Package
35,000
30,000
IC Design
IC Fab
23%
23%
36%
31%
2001-2004 CAGR= 31%
34,721
25,332
25,000
18,056
20,000
15,558
15,000
10,000
5,000
2001(e)
2002(f)
2003(f)
2004(f)
Source: ITIS/IEK, Mar-2002
c:ppt/02_ShanghaiOct
25
© Professor Otto C C Lin
June 2003
Fabless Industry Growth
• Numerous Fabless Companies Were Formed Since 1987
– Taiwan
• From 10 to over 200
• Many successful IPOs: VIA, Acer Lab, SIS, Realtek,
Sunplus etc.
– US
• Several hundreds
• Many successful IPOs: Cirrus, Trident, ISSI, S3, nVidia,
ATI, Broadcom, Oak, ESS, C-Cube, Mosys, Altera, PMCSierra etc.
– China
• Emerging with more than 100 companies
c:ppt/02_ShanghaiOct
26
© Professor Otto C C Lin
June 2003
Taiwan IC Key Success Factors
(Ref.Dr. F. C. Tseng, 2002)
1. Insightful Government Policies and Effective Execution
–
–
Industry Policies
•
Strategic Industries
•
ITRI
Financial Policies
•
Government VC arms
•
IPO for hi-tech companies
2. Successful Commercialization
.
Tax shelters and RD incentives
c:ppt/02_ShanghaiOct
•
Shielded from government bureaucracy
•
Science park
27
© Professor Otto C C Lin
June 2003
Taiwan IC Key Success Factors
(Ref: Dr. F. C. Tseng, 2002)
3. Good Model of Innovation
– Technology
• Continued own development to be among the leaders
– Business Model
• Foundry/Fabless model
– Human Resources
• Many local universities and technical institutes.
• Thorough training in fundamentals
• Advanced degrees in US universities
• RD/management experiences in leading SC companies
c:ppt/02_ShanghaiOct
28
© Professor Otto C C Lin
June 2003
Notebook PC Consortium
Project Management
The Team
Project Leaders
Motherboard (Hitran)
Components (King Tel)
CCL
EMI / Battery (Wiso)
Mechanical Design (Tek Star)
ITRI
CCL
TEAM A
Software (Cal Roc)
Testing (CCL)
PARTNERS
Reliability (CCL)
System Integration (CCL)
Promotion (TEAMA)
c:ppt/02_ShanghaiOct
29
© Professor Otto C C Lin
June 2003
NOTEBOOK
PC
PRODUCTION
25000
22262
22500
19238
KPCS
17500
SHI PMENT,
20000
12500
Worldwide
15000
5000
2500
0
14661
8919
4318
3
5
4
7
2824
22
1990
c:ppt/02_ShanghaiOct
14453
11807
10000
7500
15543
494
861
11073
5161
6088
2592
1291
3781
4625
Taiwan
*
1991
1992
1993
1994
1995
1996
1997
Reference: MIC / IDC
* Estimated for 2000
1998
1999
2000
Ye a r
30
© Professor Otto C C Lin
June 2003
CD-ROM/DVD-ROM Production Scale Forecast
World v.s. Taiwan
The Taiwanese forecast volume will reach 45 Million units, at 40% world market share
c:ppt/02_ShanghaiOct
31
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
The Industrial Strength
32
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
33
© Professor Otto C C Lin
June 2003
Impacts of ITRI Technology
II. Upgrade Existing / Traditional Industry
•
• Material
 •
• Manufacturing
•
• Quality - EHS
•
•
•
• Design
c:ppt/02_ShanghaiOct
Sporting: Bicycles, Tennis rackets, Golf clubs
Plated Plastics
Machine Tools / Parts
Fashion Fabrics
Pharmaceuticals
Green processes
34
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
35
30
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
36
31
© Professor Otto C C Lin
June 2003
Composite Materials Technology
CAD
Design
Polymer
Matrix
Fibre
Reinforcement
Processing
New
Product
Metal
Parts
c:ppt/02_ShanghaiOct
Materials
Joining
Fabrication
NonDestructive
Evaluation
Performance
Testing
37
© Professor Otto C C Lin
June 2003
ITRI: Characteristics of Projects
•
•
•
•
•
•
•
c:ppt/02_ShanghaiOct
Specificity
Niche Advantage
Market Orientation
Economic Feasibility
Industry Participation
Transfer Mechanism
Championship
38
© Professor Otto C C Lin
June 2003
ITRI: Technology Diffusion
•
•
•
•
•
•
c:ppt/02_ShanghaiOct
Technology Licensing
Contract Services
Technology Spin-off
Strategic Alliances
Workshops and Training Programs
Technical Publication
39
© Professor Otto C C Lin
June 2003
ITRI: Technology Output
Item
1994
1995
1996
1997
1998
Technology
Transferred to
Industry
Technologies
264
280
304
332
340
Companies
452
418
465
499
510
Services Contracts
Number
904
1,004
1,019
1,019
1,050
General Services to
Industry
Companies
20,177 27,061
26,253 27,811
28,000
Patents Granted
Number
368
381
447
548
560
Technology
Conferences and
Training Programs
Cases
898
880
830
957
957
Attendees
52,074 59,492
c:ppt/02_ShanghaiOct
56,572 68,918
69,000
40
© Professor Otto C C Lin
June 2003
ITRI: Intellectual Property Rights Patents Awarded and Inventions
Number of Patents and Inventions
600
548
500
446
Patent
400
274
300
328
291
186 188
100
15
8
27
14
37
20
59
41
78
134
381
277
178
200
0
368
223
229
Inventions
51
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
Year
c:ppt/02_ShanghaiOct
41
© Professor Otto C C Lin
June 2003
ITRI: Contributions to Taiwan
c:ppt/02_ShanghaiOct
1.
Establishing new high-tech industries
2.
Upgrading traditional industries
3.
Developing human capital
4.
Protecting the environment &
increasing industry safety
42
© Professor Otto C C Lin
June 2003
Structural Change of Manufacturing Industry:
Taiwan (1986 - 1998)
1986
1995
1998
39.4
28.6
27.5
Capital Intensive
35.5
37.7
35.8
Labour Intensive
40.4
26.8
23.6
Technology Intensive
24.1
35.5
40.7
12.9
20.6
238
(7.73M)
(9.04M)
(9.17M)
0.6
1.02
1.34
Manufacturing, as %GDP
As % of Manufacturing:
Technology Manpower % of
(Total Employment)
R&D, as % Sales
Source: Cheng Sun, “Development of Knowledge Economy in Taiwan” (Chinese) 2001, Sun Min Books, Taipei, 2001
Data from (MOEA & NSC)
c:ppt/02_ShanghaiOct
43
© Professor Otto C C Lin
June 2003
Shares of Taiwan’s Manufacturing Enterprises 1971-1996 (Unit: %)
c:ppt/02_ShanghaiOct
Employment size (persons)
By number of enterprises
1971
1976
1981
1986
1991
1996
1-99
100-499
>500
95.43
95.26
95.93
96.03
97.58
98.07
3.82
4.10
3.54
3.54
2.12
1.67
0.75
0.64
0.53
0.43
0.30
0.26
By persons engaged
1971
1976
1981
1986
1991
1996
35.62
38.55
41.66
47.86
56.48
57.94
28.25
30.20
28.80
28.09
21.30
19.21
36.13
31.25
29.54
24.05
22.22
22.85
By value added
1971
1976
1981
1986
1991
1996
21.59
28.25
30.87
35.01
40.94
41.35
20.52
27.85
26.40
26.73
21.79
19.63
57.89
43.91
42.73
38.26
37.28
39.02
Data Source: Industrial & Commercial census, Executive Yuan, Taiwan, ROC, 1954-1996
Reference: M-W Hu, Futures 35 (2003) 379-392
44
© Professor Otto C C Lin
June 2003
c:ppt/02_ShanghaiOct
45
© Professor Otto C C Lin
June 2003
46
c:ppt/02_ShanghaiOct
Source : Lee, Miller and Rowen, “ The Silicon Valley Edge”, 2000
© Professor Otto C C Lin
June 2003
The Features of the Silicon Valley Habitat
•
•
•
•
•
•
•
•
•
•
Knowledge intensity
High quality and mobile work force
Result Oriented meritocracy
Climate that rewards risk-taking and tolerates failure
Favorable government policies
Open business environment
University-Institute-Industry interactions
Collaboration : business, government and non-profits
High quality of life
Specialized business infrastructure
Ref: Lee, Miller, Hancock, Rowen, “The Silicon Valley Edge,” Stanford University Press, 2000
c:ppt/02_ShanghaiOct
47
© Professor Otto C C Lin
June 2003
The Roots of
Hi-Tech Industry
Resources
Knowledge
Capital
Leadership
c:ppt/02_ShanghaiOct
Network
Infrastructure
Human
48
© Professor Otto C C Lin
June 2003
The Roots of High Tech Industry
LEADERSHIP
RESOURCES
KNOWLEDGE
RESCOURCES
HUMAN
RESOURCES
• National vision
• Basic research
• R&D support
• Technology capacity
•
•
•
•
• Strategy content
• Policy commitment
Education
Training & Re-education
Entrepreneurship
Project management
CAPITAL
RESOURCES
INFRASTRUCTURE
RESOURCES
NETWORK
RESOURCES
• Taxation
• Banking practices
• Venture capital
•
•
•
•
• Globalization culture
• Regional planning
• Marketing Channel
c:ppt/02_ShanghaiOct
Physical infrastructure
Legal system
Social support
Effective governance
49
© Professor Otto C C Lin
June 2003
The Changing World!
Three axes of change:
* Technology
* Globalization
* Democracy
c:ppt/02_ShanghaiOct
50
© Professor Otto C C Lin
June 2003
New Environment: Science,Technology, Society
* Accelerated speed of change
* Ubiquity of personal computer
* Internet and wireless technologies
* Overlapping manufacturing and service
* Compressed and transformed “middleman” trade
* Prominence of small and medium enterprises
* Globalization based on localization
* Competition and cooperation
* Life time learning and continued education
* Participative management
c:ppt/02_ShanghaiOct
51
© Professor Otto C C Lin
June 2003
The old vertical computer industry, circa 1980
sales and
distribution
application
software
operating
systems
computer
chips
IBM
DEC
Spery
Univac
Wang
The transformation of the computer industry
c:ppt/02_ShanghaiOct
FROM Only the paranoid Survive, by Andrew S. Grove, © 1996 by Andrew S. Grove
Used by permission of Doubleday, a division of Random House, Inc.
Source : Lee, Miller and Rowen, “The Silicon Valley Edge”, 2000
52
© Professor Otto C C Lin
June 2003
The new horizontal computer industry, circa 1995
sales and
distribution
Retail
Stores
application
software
operating
systems
computer
chips
Superstores
Word
DOS and Windows
Compaq
Dell
Intel Architecture
Dealers
Word Perfect
OS/2
Mac
Packard
Bell
HewlettPackard
Motorola
Mail Order
Etc.
UNIX
IBM
Etc.
RISCs
The transformation of the computer industry
c:ppt/02_ShanghaiOct
FROM Only the paranoid Survive, by Andrew S. Grove, © 1996 by Andrew S. Grove
Used by permission of Doubleday, a division of Random House, Inc.
Source : Lee, Miller and Rowen, “The Silicon Valley Edge”, 2000
53
© Professor Otto C C Lin
June 2003
Concluding Remarks
•
•
•
•
•
•
c:ppt/02_ShanghaiOct
Establish a national innovation system with
clear goals and responsibility for the players
Nurture the roots of hi-tech industry
Strengthen national institute as linkage
Improve effectiveness of national institute by
project selection, project management, and
technology diffusion
Enable SMEs to take lead in innovation and
technology entrepreneurship
Re-educate people for creativity & innovation
54
© Professor Otto C C Lin
June 2003
Thank You!
[email protected]
[email protected]
c:ppt/02_ShanghaiOct
55