Past President of LES Scandinavia Kari Sipilä Director, D.Sc.(Tech.)h.c. FUTURE INNOVATIONS Past President of LES Scandinavia Former Director of the Foundation for Finnish Inventions Espoo, Finland THE ECONOMIC BENEFITS OF INNOVATIONS’ DEVELOPMENT AND CASE STUDIES Damascus 15-17.5.2007 © Kari Sipilä www.futureinnovations.fi kari.sipila@futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi CONTENTS Innovation development: Input and output – economic benefits Practical questions of IP and business - and replies Development work: from ideas into products on the market Innovation cases and results © Kari Sipilä www.futureinnovations.fi

THE SIGNIFICANCE OF INVENTIONS Entrepreneurship Competitiveness Internationalization Employment IDEAS INVENTIONS INNOVATIONS © Kari Sipilä www.futureinnovations.fi

INPUT TO INNOVATION DEVELOPMENT R&D expenditure ( public and private ) R&D personnel ( public and private ) R&D funding in the state budget and in the industry Research and technology programmes Researcher training Centres of excellence in research International research cooperation Large cooperation between public and private organizations ( business and industry ) Source www.research.fi © Kari Sipilä www.futureinnovations.fi

OUTPUT - ECONOMIC BENEFITS OF INNOVATION DEVELOPMENT Competitiveness Patents, innovations and new products and services New companies Employment High technology production and foreign trade Scientific publications and doctoral degrees Science and technology evaluations and foresight Source www.research.fi © Kari Sipilä www.futureinnovations.fi

QUESTIONS OF IP AND BUSINESS IN START UP AND SMALL COMPANIES We have some ideas and patents, but how can we make business of them? Can we afford more inventions, patents and other IP, R&D-activities, because of their costs? And how do we finance them? What kind of financiers exist in our country? What is IP management? What is included and is it something for us? Who should take care of patent matters in our company or outside? How do we get more information or money? © Kari Sipilä www.futureinnovations.fi

QUESTIONS OF IP AND BUSINESS IN SME COMPANIES 1(2) Why to apply for a patent and how? How do we get the most business and profit of it? What is Intellectual Property, its management and related tasks? How should we organize, finance and manage our R&D and invention activities? Who should take care of Intellectual Property – we or patent attorney or other consultant (who, where to find, costs, reliability, etc.)? © Kari Sipilä www.futureinnovations.fi

QUESTIONS OF IP AND BUSINESS IN SME COMPANIES 2(2) Who should follow competitors and their IP – and how? Should we sell or buy IP or license in or out, how to find partners or other interested parties? Whom and how and where should we train our staff for IP? How is IP linked to strategies and what kind of business planning, visions, etc. should we have? How should we make IP and innovation decisions? © Kari Sipilä www.futureinnovations.fi

REPLIES TO QUESTIONS: ADVISORY AND FINANCING SERVICES ARE ESSENTIAL Inventors, universities and innovative companies need innovation advisory services Usually innovation services include Advisory and financing services for the invention development work in innovation centers, which may be separate or part of universities or regional government offices Financing of research and development, patenting and commercialization costs or part of the costs © Kari Sipilä www.futureinnovations.fi

SERVICES OF AN INNOVATION CENTER ADVISORY ACTIVITIES ASSISTANCE IN THE INNOVATION POLICY AND RULES OWNERSHIP CLARIFICATION OF INVENTIONS EVALUATION OF INVENTIONS ADVICE IN PATENTING AND OTHER USE OF IPR PRODUCT DEVELOPMENT ASSISTANCE FINANCING MARKETING AND COMMERCIALIZATION ( NEW COMPANIES, SPIN-OFF, LICENSING, ETC ) DIFFERENT AGREEMENTS © Kari Sipilä www.futureinnovations.fi

POSSIBLE ACTIVITIES OF AN INNOVATION CENTER Advising Evaluation Promotion Financing Establishment of new Enterprises Communications Legal Services IPR Marketing Educational Activities Product Development Prototype Workshop Venture Capital Incubator Activities International co-operation Product Management © Kari Sipilä www.futureinnovations.fi

FROM IDEAS TO INNOVATIONS - DEVELOPMENT WORK © Kari Sipilä www.futureinnovations.fi

FIELDS OF INVENTIONS AND INNOVATIONS TECHNOLOGICAL STRATEGIC BUSINESS SOCIAL COMBINATIONS © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi

PRACTICAL FACTORS AFFECTING TO THE BIRTH OF INNOVATIONS Creativity and innovations need room, time and cooperation Innovative work should be enjoyable and awarding Encourage and allow different types of innovativeness Let all flowers grow and give them water, do not rinse too early Knowledge and success attract others – the magnet phenomen It is worthwile to respect different experiences, ages, cultures, backgrounds etc. Knowledge and skills grow, when different views and experiences influence Innovative persons cannot always innovate © Kari Sipilä www.futureinnovations.fi

FROM WHERE DO THE INNOVATIONS COME? Ideas, inventions and potential innovations may be based on market possibilities or needs lack of products, methods, solutions new technical or business solutions research and development work basic and applied science and research intuition, good luck, by accident, by serendipity applications to some other field where invented combinations of above © Kari Sipilä www.futureinnovations.fi

CHARACTERISTICS OF A GOOD INVENTION The product is market driven; it is in demand and there is market pull The product is inventive, novel and patentable The product is significant to the business and to employment The product is functional, capable of being produced and economical The product can be launched quickly There is organizational commitment behind the development project and the product Investors are interested in the venture © Kari Sipilä www.futureinnovations.fi

FROM IDEAS INTO PRODUCTS ON THE MARKET EVALUATION, PLANNING PATENTING PRODUCT DEVELOPMENT COMMERZIALI-SATION General counselling on inventions and innovations Invention-specific counselling Innovation projects Market pull Novelty and inventiveness Technical features Business opportunities Ownership IPR strategy and policy Domestic and international patent application Legal aid Technical Productive Commercial Prototype workshop Marketing communications Market reserch The Invention Market Licensing The production of the inventor entrepreneur © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi EVALUATION CRITERIA Proximity to the market who is the customer and is he willing to pay for a product developed from the invention Inventiveness, novelty, patentability in addition to the evaluator’s own knowledge, an Internet search is usually conducted for comparative reasons for instance ( http://ep.espacenet.com or www.delphion.com ) novelty research by traditional means carried out by the Patent Office The technical solution, technological level, potential for industrial manufacture often initially an expert assessment with calculations and comparisons, and then, at a later development stage, clarifications, calculations and comparisons related to a prototype and its testing Business potential, commercialization and management what is the business potential of the new product and its estimated competitiveness will future commercialization be based on the production in an existing or starting company, or on licensing, or on trade the business strategy and particularly the company and its management are evaluated several times during the invention development process © Kari Sipilä www.futureinnovations.fi

INNOVATIONS REQUIRE EXPERT KNOW-HOW IN MANY AREAS MANAGEMENT INTELLECTUAL PROPERTY RIGHTS INNOVATION PROCESS PRODUCTION DOMESTIC AND INTERNATIONAL MARKETING COOPERATION SKILLS © Kari Sipilä www.futureinnovations.fi

SOME SUCCESFUL INNOVATION CASES FROM UNIVERSITY RESEARCH © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi Mr. Linus Thorvalds developed the Linux system in the University of Helsinki in the early 1990s. He published Linux by using the GPL, General Public License, and transferred it to Internet free for everybody. Linux has become very popular in the whole world. © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi

ONLINE GAME HABBO HOTEL, FINLAND Virtual game world attracts young people Sulake Habbo Hotel is an online game world aimed at young people where multiple users can play simultaneously. In Habbo Hotel, users create virtual characters who experience adventures in the hotel along with other characters. www.sulake.fi © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi SOME SUCCESFUL INNOVATION CASES FROM INDUSTRY AND FROM INDUSTRY - UNIVERSITY COLLABORATION © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi BENECOL CHOLESTEROL LOWERING PRODUCTS Benecol offers you a new way to reduce your cholesterol with delightfully good-tasting foods. The name Benecol brings together Bene, meaning "good" and col, for "cholesterol.” www.raisiogroup.com © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi NEW DENTAL TREATMENT with Fibre-reinforced Composite Materials www.sticktech.com , Prof. Pekka Vallittu, University of Turku, Finland © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi NOKIA The Finnish Information Technology company. World leader in mobile phones. © Kari Sipilä www.futureinnovations.fi

ONE PRODUCT MAY INCLUDE LARGE IPR © Kari Sipilä www.futureinnovations.fi

THE ELDERLY PERSONS AND DIFFERENT ICT SERVICES © Tekes, Anna Niemelä © Tekes, Anna Niemelä © Kari Sipilä www.futureinnovations.fi

WRIST ALARM ( VIVAGO ) FOR ELDERLY PEOPLE WWW.ISTSEC.FI © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi AN INTERNET BUS FOR ICT TRAINING LOCALLY Netti-Nysse, Tampere, Finland (www.tampere.fi/kirjasto/nettinysse) © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi PAPER MACHINE INNOVATIONS The Metso Paper-supplied PM 1 OptiConcept fine paper machine at UPM's Changshu, China mill has again set a new world speed record for fine paper production. On 25-26.4.2006 the 10.4-m-wide (wire) machine was run at 1,654 m/min (5,427 ft/min) for more than 24 hours. (Source Metso Paper Ltd) © Kari Sipilä www.futureinnovations.fi

INNOVATIVE EQUIPMENT FOR DENTISTS ( INVENTOR KARI ULVIO) © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi CASE WATER MIST FIRE PROTECTION SYSTEMS MARIOFF HIFOG CORPORATION, HELSINKI / VANTAA, FINLAND © Kari Sipilä www.futureinnovations.fi

WATER MIST FIRE PROTECTION SYSTEMS Marioff HiFog Corporation 1 Marioff is the world's leading supplier of water mist fire protection systems. Marioff designs, manufactures and supplies high pressure water mist fire protection systems under the brand HI-FOG®. Marioff has also one of Finland's leading fine mechanical machining workshops. Founded in 1985, turnover 80 mill.euros, staff 320 persons www.marioff.com Sammutusjärjestelmä – Marioff HiFog. Erinomaisen keksijä – yrittäjän hieno idea on johtanut mittavaan yritystoimintaan, jonka ympärille lähes koko yrityksen liiketoiminta on keskittynyt. Tekes mukana alkuvaiheessa. © Kari Sipilä www.futureinnovations.fi DM 58114 05-2003 Copyright © Tekes

Marioff HiFog Corporation 2 HI-FOG is an innovative fire protection technology utilising high pressure to produce a fine water mist. HI-FOG combines the extinguishing characteristics of water with the penetrative qualities of gases without any safety hazards for personnel or the environment. © Kari Sipilä www.futureinnovations.fi

Marioff HiFog Corporation 3 © Kari Sipilä www.futureinnovations.fi

Marioff HiFog Corporation 4 M/S Freedom of the Seas M/S Freedom of the Seas, the first of two Ultra Voyager class vessels, is now under construction at the Aker Finnyards Turku Shipyard for Royal Caribbean International. When it enters service in April 2006, this 158,000 GRT vessel will be the world’s largest cruise vessel. The 339-metre-long vessel will carry 3,600 passengers on 15 passenger decks. The Freedom of the Seas will be fitted with about 13,000 sprinklers in the accommodation, public and service areas, as well as 400 spray heads in the machinery spaces. The machinery space arrangement follows the principles of all RCCL vessels since the Grandeur of the Seas. All machinery spaces are protected by an enhanced high pressure water mist system, providing a much higher level of protection than would be required by a regulatory local application system. Source:First Choice 24, March 14 2005 © Kari Sipilä www.futureinnovations.fi

Marioff HiFog Corporation 5 Marioff Corporation Oy is listed in top ten patents-list in Finland. HI-FOG is a registered trademark of Marioff Corporation Oy. Marioff Corporation has now some 100 patent families containing over 700 granted patents and almost 600 patent applications worldwide. Strong R&D department and extensive patent portfolio strengthen Marioff´s position as the world´s leading supplier of water mist fire protection systems. Marioff´s main owner Mr. Göran Sundholm is the only one in Finland who has a total of 68 patents to his credit. Major part of these patents is related to HI-FOG technology. Source: Marioff © Kari Sipilä www.futureinnovations.fi

Marioff HiFog Corporation 6 MARIOFF WON INTERNET COURT CASE Marioff has just won an important internet court case through the "fast-track" arbitration procedure of WIPO, the World Intellectual Property Organization. A competitor had been diverting customers to their own website from the domain name www.hifog.com (instead of www.hi-fog.com), arguing that "HI-FOG" or "HIFOG" is a commonly used term for any high pressure water mist systems. The arbitrator, chosen by WIPO, rejected this argument, deciding that the competitor had registered and used the name in 'bad faith', and ordered Network Solutions, the "com" registration company, to hand over the domain name to Marioff. So now you will get the same high quality information on the internet from the "first choice" water mist company - whether you key in "hi-fog" or "hifog"! Source: Article from First Choice © Kari Sipilä www.futureinnovations.fi

Marioff HiFog Corporation 7 CONCLUSIONS OF THE SUCCESS OF MARIOFF SUCCESS IS BASED ON GOOD INVENTIONS AND EFFECTIVE USE OF PATENTS AND TRADEMARKS MARIOFF HAS GROWN IN 20 YEARS FROM A START-UP COMPANY TO A LARGE INTERNATIONAL SME-COMPANY WITH SUCCESS PRODUCTS TO GLOBAL MARKETS TURNOVER 80 MILLION EUROS STAFF 320 PERSONS © Kari Sipilä www.futureinnovations.fi

© Kari Sipilä www.futureinnovations.fi INNOFINLAND AWARDS TO INNOVATIVE ENTREPRENEURS BY THE PRESIDENT OF THE REPUBLIC One of Innofinland 2001 awards was given to Exel Oyj, represented by Mr. Aki Karihtala by the President of the Republic, Mrs. Tarja Halonen, who was assisted by Mr. Martti Enäjärvi and Dr. Kari Sipilä. © Kari Sipilä www.futureinnovations.fi

Kari Sipila, Helsinki/Espoo, Finland THANK YOU! Kari Sipila, Helsinki/Espoo, Finland kari.sipila@futureinnovations.fi www.futureinnovations.fi www.les-scandinavia.org © Kari Sipilä www.futureinnovations.fi