Source: Construction Products Europe

Emission trading to ignite the renovation wave

The Emission Trade System is the most impactful green project of the EU, accounting for almost 43% of the realized GHG reduction over the past 16 years. The ETS sets a cap on the total emitted GHGs per sector in scope, which are the most energy-intensive industries, including building materials production. By decreasing the cap gradually, companies are progressively more incentivized to decrease their footprint as the cost of buying the same volume of emission rights rises. This is how True Pricing is materialized (see ‘6 leverages for the circular paradox’). Depending on GHG abatement cost and company strategy, each player decides whether to invest in energy efficiency or additional emission rights.

Building material producers have been in the scope of ETS since the start, leading to ongoing production process decarbonization and to the adoption of new technologies (see for instance CCU/CCS). The challenge for construction is to expand the efforts to what happens downstream of building material production. One of the ongoing reflections in the EU Commission is to roll out a similar trading system to the building owners, to accelerate the renovation wave (retrofitting insulation, heating systems, doors and windows etc…) and decarbonize ‘assets in use’. For residence owners, this will further emphasize the importance of prioritizing the right renovation in terms of expected CO₂ reduction per euro invested. The potential rollout of this trading system will highly depend on how social impact can be managed (‘Leave no one behind’), as there is a risk of over-soliciting investment pockets that are already depleted by the current economic crisis.

Nonetheless, one way or another, a serious renovation wave is imminent and this opens up promising business model innovations such as Knauf Energy Solutions.

Illustration of the Knauf Energy Solutions impact on an asset owner over time, from making the initial retrofit choices (‘Maximize ROI’) over verification after the intervention and towards further ROI increase
Source: www.knaufenergy.com

With this solution, Knauf – a market leader in drywall gypsum boards and insulation materials – expands into energy efficiency services for asset owners with a technology breakthrough – the so-called ‘negaWatt hour meter’. Based on intelligent assets and data science, Knauf guarantees the realization of predicted energy cuts per invested euro.
This example demonstrates how traditional building material producers can valorize knowledge and technology to shift from conventional seller-buyer transactions towards genuine service models with higher expected customer lifetime value. Note that Knauf operates the field services and interventions, hence intensifying the direct connection with the owners.

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Innovating during inflationary times is tough but a thorough scan of your current product portfolio or innovation roadmap will help you navigate more successfully through these uncertain times. As this might not be enough, we recommend innovation and R&D leaders to gear up their teams and focus more on pricing, to install tools and accommodate the new environment, and finally to adjust product features to the new buying behavior. Here are 4 ways to re-strategize innovation and put your company in the driving seat to shape the future.

Develop the art of price setting during your development process

An analysis can plot your current price positioning in the market and evaluate if there’s still room to increase prices without losing market share and volume. Of course this should be an investigation of customers’ willingness to pay relative to comparable products, allowing you to evaluate the consequences of price changes in volume and margin. It will ensure your customer relationships and balance them with an increase in profits. It’s also important that you check the cross-elasticity with your biggest competitor product. Why? A price increase in your product might lead to a large volume switch to a substitutable product from a competitor.

You might also want to re-adjust the planned innovation portfolio as not every planned product might have the same price elasticity and therefore not every product you had in mind will be eligible for a similar price increase. Does every product have the same price elasticity, resulting in a -1% volume change when a +1% of price change is implemented? You can either stop some projects, or reconsider the features compared to intended price levels. Now more than ever, adjusting your innovation portfolio is a profitable strategy to consider.

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Reorienting innovation to do more with less

Few people have faced the challenge of leading a company through a crisis. The current situation presents a perfect storm, combining inflation and climate change with shortages in materials, energy and talent. Innovation has proven to be the best way to rebound from a crisis time and time again. Will this be the case now too?

Although the challenges are hard, new methodologies and technologies are constantly popping up. Digital and climate-neutral technologies, as well as innovation tools and strategies, offer tremendous opportunities to do more with less. The question remains: how do you organize innovation, set out new priorities and apply these new technologies to claim innovation leadership?

3 days, 12 webinars and one-on-one meetings

How can you guide your company through the current crises with innovation? Because there are many different opportunities, the InnoDays event includes 12 webinars with 3 main themes. In addition, you can meet and connect with the speakers and other interesting participants using Conversation Starter.

Tuesday 15 November • Innovation for crisis rebound
Adjust your strategies to boost your capacity to innovate and do more with less

• New business creation to overcome inflation & sustainability needs
• Installing a shock-resilient innovation culture
• Innovation via reduction: a pathway to a great outcome?
• Minimizing the valley of death – the economics of emotions

Wednesday 16 November • Climate-conscious change
Eliminate your carbon footprint with new technology and open innovation

• The evolution and potential of direct carbon capturing
• Sustainable design to reduce company value chain emissions
• The quintuple helix: innovation through public & environmental insights
• AI-enabled sustainability through process optimization

Thursday 17 November • Digital-driven change
Digital technologies as an enabler of transformational innovation

• Applying digital tools to advance innovation research
• Reinventing digital transformation for customer experience
• The future of energy-efficient AI systems
• Countering the circularity crisis with digital identities

Discover new insights to shape the future during the InnoDays on 15, 16 and 17 November. Check out the event page for more information about the sessions and how to sign up for one or more days.

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The post Verhaert organizes the InnoDays, 12 webinars on shaping the future with AB InBev, Henkel & VITO appeared first on Verhaert Masters in Innovation.

At Verhaert we are helping our customers to innovate and develop their product portfolio. We have designed and developed more than 1000 products since 1969. Bringing a product to market is not a walk in the park and involves many aspects. One of these aspects is arranging the supply chains delivering the right components at the right time to be able to assemble the electronic boards in your product.

Due to global material and component shortage, specific electronic components can be very hard to come by these days. This situation introduces an extra risk in the product development cycle that must be handled.

The effect of component shortage

Like every other business, we at Verhaert also got affected by the events that happened around us and the rest of the world. Not being able to source desired and necessary components for development can lead to market introduction delays, possibly missing a window of opportunity. In production however, this may very well lead to a complete production stop, with potential customers moving towards your competitors. Multiple examples exist of companies that have products on the market for years, where the production has halted from one day to another, because they cannot source $ 0.3 components. Also the launch of new products is accompanied with a struggle to ramp up the production. Everyone ordering a new (electric) car, or e.g. a PlayStation 5, will know the problem.

It is generally known that the cost of change rises exponentially with the made development progress. It is not worthwhile tackle product risks such as feasibility late in the development process. If you know sooner that a concept can’t work, you will have lost less money on this concept. This means that the size of the changes normally reduces with the progress that you make. This is illustrated in the figure below.

Figure 1: The further the product is in the development, the more difficult it is to change fundamental parts

Now what is the effect of component shortage on this product development process? The component shortage is an unexpected occurrence, striking beyond your control, that forces you to perform such an undesirable design change. This leads you to take a step back in the development cycle, resulting in a higher cost and longer timing, and can even lead to a full stop in production. As component shortage may occur at any moment within the product design phase – and even when the product is on the market – and in any part of your product, this is to be treated as a project risk with a reasonable occurrence rate and a high severity level.

How can we deal with this project risk?

In the process of bringing to and keeping a product on the market, we deal with project risks, and this is no exception to this. How can this (partially) be mitigated? During the previous years, we encountered some component shortage difficulties, and devised some methods to deal with these. The application of each of these possibilities depends on the development phase the product is in and on the envisaged production size. In the remainder of this perspective, these risk mitigation possibilities will be explained, and some practical examples are given for clarification.

1. Risk analysis

The first step when dealing with risks is to make a risk analysis. During the phases where technologies, parts and components are selected, a component shortage risk analysis needs to be made. During this risk analysis, we indicate where there can be a possible problems in lead time and unavailability. This seems to be a lot of work, but this is actually an extension on the exercise to find if there are multiple suppliers for the same component.

How do we tackle this in practice? We perform a risk analysis to find multiple suppliers and add the regular lead time to the equation. For components where we see little alternatives, and with large lead times, it may be better to change this circuit. During the initial development phases it is the ‘easiest’ to change the implementation. The further in the development process, the more difficult this becomes.

It often happens that some parts seem ideal for the specific needs of a product. This also was the case in one of our projects. The lead time was more than one year however. This was the reason why alternatives were found and adjustments were made in the production prototype phase. This resulted in a more robust circuit from component shortage point-of-view.

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Understanding stakeholders

For newly appointed innovation managers, setting up initiatives across the organization can be challenging for various reasons. To avoid opening Pandora’s box, you need to set expectations straight. What is often coined pejoratively as ‘innovation theater’ might actually be an essential first step to rattling the cage in the organization. Not every company is ready for advanced innovation accounting and ROI optimization yet.

Innovation champions require a platform, clarity and support

Whenever you poke potential innovation champions to participate in ideation campaigns or idea development programs, it is paramount to understand that they are likely to put in the extra hours. In return, they expect to gain an interesting learning experience of creativity and entrepreneurship and a platform for visibility in the company. So, whatever initiative you are launching, be clear about what will be in it for them. Even if there is no fixed process for further idea development yet. Failing to provide clarity will create frustration that generates the fastest way towards resignations by disappointed innovators.

Leadership requires manageable processes and mid-term vision

Securing endured support and budget from the leadership comes with a price. The program will be monitored in a way the management is used to, probably both in a data-driven and gut-feeling way. Align firmly about what you want to achieve, as ROI or ‘innovations to the market’ will rarely be feasible metrics. In lower maturity levels, it would rather be about how many colleagues were involved, participant satisfaction scores etc.

Operational management requires tangible growth opportunities

Middle management can be great enablers or blockers for your innovation program. They can endorse their workforce to participate or complain about a lack of tangible output for their business unit with upper management. So once again, be concise about what they can expect in terms of output (in years 1, 2 and 3). Hear them out on what is keeping them up at night and how your innovation program can alleviate that. Consider also things lik team collaboration, personal development and employer branding as added value.

The post Nudge your company towards innovation greatness appeared first on Verhaert Masters in Innovation.

The post Nudge your company towards innovation greatness appeared first on Verhaert Masters in Innovation.

Successfully launching new products in new markets with new uses by new companies is extremely risky. What can corporates learn from start-ups? In this webinar, Quintijn Innikel, Owner at BEACON, explains how can you adopt their methods.

Watch the recording

View the presentation

 

The post Lean start-up, a method to increase your success rate of innovation appeared first on Verhaert Masters in Innovation.

The post Lean start-up, a method to increase your success rate of innovation appeared first on Verhaert Masters in Innovation.

Companies are always looking for ways to make their innovation process more efficient. Using standard designs is one of those methods that can optimize the development process. By reusing key components and applications as well for systems using several components, it reduces development times and lowers risks. This leads to more focus on the criticalities, and in the end a better product and happy customer. This webinar was presented by Dirck Seynaeve, Project coordinator IoT at Verhaert.

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The post Technology building blocks as benefit for agility in development appeared first on Verhaert Masters in Innovation.

Covid pandemic brought along many new societal problems. To solve them, you have to adapt the way you innovate. Together with imec we developed a novel platform for disease detection within 9 months. In this session, you can learn how the Verhaert Group organized this ambitious project using the 80% rule and a high-risk/high-gain strategy to do the “almost impossible”.

This webinar was presented by Yorick Koumans, Project Manager at BEACON, and Bert Verbruggen, Program Manager at imec. The Q&A was held by Tom Stefels, Partner at BEACON.

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The post Agility in innovation to maximize speed appeared first on Verhaert Masters in Innovation.

Imec announces collaboration with MiDiagnostics for commercialization

Imec and the Flemish government have announced the collaboration between imec and its spin-off MiDiagnostics to further commercialize imec’s breath sampling and ultra-fast PCR technology. Together with the Verhaert group they realized a functional prototype through an intense high-risk/high-gain process.

This ground-breaking innovation creates an almost holy grail of testing for the Covid-19 pandemic. The device is able to collect sample material from people through breathing rather than the widely-used nasal pharyngal sampling. On top of that, ultrafast PCR can be performed directly, allowing for extremely fast time-to-results. This provides a far more comfortable sample collection, as well as more efficient processing.

Collaboration imec & Verhaert

At the end of 2020, Verhaert and imec entered a strategic collaboration to co-develop a breakthrough solution based on imec technology platforms. In this context Verhaert also invested in the imec.istart fund to provide seed capital to new technology start-ups.

In January 2021, Verhaert and imec partnered up for this breakthrough rapid Covid PCR test development. In no time, they built a breath sampling consumable containing imec’s innovative chip solution and a high-end PCR processing instrument. These developments will be used as an assay and technology development platform to assess aspects beyond clinical performance. This is a significant step towards a real-life solution and allowing for future expansion into domains other than Sars-Cov-like cancers.

This collaboration required constant interaction between very different disciplines, for example biochemistry and chip development on imec’s part, and product development skills such as optical & thermal design, software development, mechatronics, electronics and mechanics from Verhaert.

To accomplish this strict time frame, a distinctive and agile project management approach was needed for fast decision-making and pursuing a parallel-path approach.

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Working in parallel

To achieve the required speed, we needed to create a flexible team and approach to do as much work in parallel as possible and allowing us to scale the teams with additional resources. These were released gradually during the first 2,5 months. Initially the team started with 3 people, gradually scaled to first 25 and finally 40 people. This project couldn’t have been realized without the competences and available resources in the Verhaert group involving:

• Consultants and engineers from Verhaert for system engineering, physics and thermal design, electronics and mechanical design
• LambdaX for optical instrument design
• Moebius for delivering additional engineering resources
• BEACON for the project management team

By dividing the team into subteams, each of them works on one specialized functionality or subsystem of the product. The goal is to develop the different product functionalities in parallel, despite the mutual high dependencies. We work with 6 subteams of 4 to 6 members, most of which are multi-disciplinary and require special attention to interface requirements, documentation, communication and alignment.

Information flow

To avoid delays, the subteams work simultaneously on the development in their subsystem without waiting for input from other subteams. At the end of the project, a complete set of demonstrator units must be realized in which all subsystems can be finally assembled, tested and can prove their integral performances together.

Therefore, each subteam has a linking pin. They meet for status updates and exchange relevant information. Because of the project’s speed and many parallel developments, there’s a great risk that the necessary information isn’t always shared in a timely manner. “Having a technical background helped to deeply understand the ongoing work. It’s important that we understand what information is crucial and what needs to be exchanged with whom and at what time. As project managers, we constantly absorb what is happening in the teams and also check that the information is shared by the linking pins. This flow of information is essential. In doing so, we’re always looking for the balance between execution and consultation, so that there isn’t only enough time for exchanging information, but also for doing the substantive work.” says Yorick Koumans, Project Manager at Beacon.

80 percent rule

The second thing that contributes to speed is decision-making. Decisions in the project consistently are made on 80 percent of the information. Normally we would proceed to 95 or 98 percent certainty, but it’s precisely that last 20 percent that takes a lot of time. If it looks very likely that something will work, we opt for that solution. Even if we’re not entirely sure. Taking risks need to go together with informing the client about the drawbacks, while balancing it with the time savings. As a result, the risk is taken very consciously together. By actively planning for alternatives it allows to return to the second best option in line when the first choice turns out to be wrong. Should this happen, we make a decision together with the client: do we go for an alternative and slow down the process or do we adjust the scope? Suppose the time to result is slightly longer than the original goal, then we make the following consideration: can we be satisfied with what we have now? Or are we going to solve it, even if that means we finish later?

Risk-focused

Mapping risks on components and features allows us to zoom in on the potential failure modes, the effect on other subsystems or parts, and on the failure of delivering its service. This focus helps to keep the complete team well-informed about the potential causes and mechanism of failure to try to mitigate by inherent design aspects. Looking for a recommended action to reduce the risks helps in steering the complete team towards those design choices that limit the risk taken while keeping the timeline in focus. A well-done FMECA has a timetable with a target completion date for each risk. Only when risks are as low as reasonably possible, the remaining risk will be accepted when there are no more potential benefits within the timeline.

As innovation complexity increases; its delivery time decreases. Our MyInnovationFactory Blueprint helps you to win the agility in innovation battle. IR&D organizations need to be agile and open to cope with disruption and time-to-market.

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