CTO Survey 2013

CTO Survey 2013

23 Jan 2013

Terhi Marttila, Jussi Kajala,

Laura Kauhanen, Pekka Koponen

Contents

CTO Survey 2013 Introduction

CTO Outlook on 2013

CTO Views on Innovation across Value Chains

CTO Survey 2012

Introduction

CTO Survey covers Finnish CTOs’ views on the

current innovation environment and its future

outlook

Spinverse annually conducts the CTO Survey, targeted to Finnish Chief Technology Officers (CTOs). The survey deals with themes that arise in the semi-annual CTO Forum events.

The CTO Survey 2013 was done in partnership with Sitra, Confederation of Finnish Industries (EK) and Technology Academy Finland (TAF)

The survey received 120 responses from various industries: online responses were complemented by interviewing representatives from large companies.

Almost half (43 %) of the responses were from big corporations.

The results of the survey are compared to the previous years.

Nearly half of the TOP 100 R&D investors in

Finland answered the survey, added by other

significant Finnish companies

• Outokumpu

• Tikkurila

• Ahlstrom

• Sartorius Biohit Liquid Handling

• Logica

• Gasum

• STX Finland

• Beneq

• Okmetic

• NSN

• Ponsse

• Patria

• Santen

• Wärtsilä

• Metso

• Orion

• Kone

• Bayer Schering Pharma

• UPM

• Kemira

• Neste Oil

• Tieto

• Fortum

• Konecranes

• EADS Secure Networks

• Vaisala

Examples

Over 95 % of Finnish R&D investments are done by the top 100 investors. We cover this population well.

The main part of the respondents are

from technology-intensive industries

The top three industries are similar to the surveys of 2012 and especially 2011.

The next two have bigger proportions now than in 2012, and there were no responses

from construction industry in 2012.

33

22

15

13

11

7

6

4

4

1

0 5 10 15 20 25 30 35

Electronics and ICT

Metal and Mechanical Engineering

Energy and Environment

Life Sciences and Healthcare

Chemical Industry

Forest, Pulp and Paper

Construction

Mining and Metallurgy

Food and Nutrition

Media and Marketing

9

2

14

9

5

10

6

50

11

0 10 20 30 40 50 60

Infrastructure

Back-office services

R&D services

Operational services

Sourcing and processing of raw materials

Intermediary products and composites

Assembly of sub-systems

Manufacturing of end products

Marketing, sales, distribution

Nearly half of the respondents place their

companies to their value chain mainly as end

product manufacturers

The responses from the electronics and ICT industry cover

almost the whole value chain. On the other hand, metal and

mechanical engineering mainly belong to the group of end

product manufacturers.

4

4

1

1

1

7

1

1

1

2

1

1

7

1

1

1

1

1

1

1

3

1

4

1

1

2

1

1

1

1

8

19

5

5

3

4

4

1

1

1

2

5

1

1

1

0 5 10 15 20 25 30 35

Electronics and ICT




Chemical Industry


Construction


Food and Nutrition

Media and Marketing

Infrastructure

Back-office services

R&D services

Operational services

Sourcing and processing of raw materials

Intermediary products and composites

Assembly of sub-systems

Manufacturing of end products

Marketing, sales, distribution

R&D budgets vary between companies.

In general, SMEs use a bigger percentage of

their revenues to R&D

Almost a half (48%) of SMEs but only 21 % of big companies use more than 10% of

their revenues to R&D.

1

9

17

6

9

21

3

20

14

5

6

5

0 5 10 15 20 25 30 35

N/A

< 2 %

2-5 %

6-9 %

10-15 %

> 15 %

SMEs

Big companies

% of revenues used to R&D

CTO Outlook on 2013

Almost half of the CTOs plan increases to the

R&D budget for 2013 – however, the CTOs are

less optimistic than in the previous years

Only about 13% had decreases in 2012 and 9% had them in sight for 2013.

51%

56%

46%

39% 40%

0%

10%

20%

30%

40%

50%

60%

2011 prediction 2011 actual 2012 prediction 2012 actual 2013 prediction

CTOs who increase R&D investments

Diminishing resources have been a challenge

during the years past. The CTO becomes

responsible for leading operative R&D:

methods and processes.

Especially metal, life sciences and food sectors

increased their R&D investments for 2012,

whereas the forest industry decreased those.

30%

55% 47%

62%

36%

0%

17% 25%

50%

0%

24%

9%

0% 8% 9%

29%

0%

25%

0% 0% 0%

10%

20%

30%

40%

50%

60%

70%

Electronicsand ICT (n =

33)

Metal andMechanicalEngineering

(n = 22)

Energy andEnvironment

(n = 15)

LifeSciences

andHealthcare

(n = 13)

ChemicalIndustry (n

= 11)

Forest, Pulpand Paper

(n = 7)

Construction(n = 6)

Mining andMetallurgy

(n = 4)

Food andNutrition (n

= 4)

Media andMarketing (n

= 1)

R&D Budget in 2012

Increase

Decrease

47%

38% 40% 42% 50%

29%

17% 25%

75%

0%

13% 14%

0%

17%

0%

14%

0% 0% 0% 0% 0%

10%

20%

30%

40%

50%

60%

70%

80%


33)


(n = 22)


(n = 15)

LifeSciences

andHealthcare

(n = 13)

ChemicalIndustry (n

= 11)


(n = 7)

Construction(n = 6)


(n = 4)


= 4)


= 1)

R&D Budget in 2013

Increase

Decrease

Even though a third of the companies increases

recruiting in 2013, this number has clearly

declined from the previous years

However, only about 10 % foresee decreases for both 2012 and 2013.

73%

65%

54%

29% 28%

0%

10%

20%

30%

40%

50%

60%

70%

80%

2011 prediction 2011 actual 2012 prediction 2012 actual 2013 prediction

CTOs who increase R&D recruiting

Many big corporations have decreased the

number of R&D employees. The business

units are tied up with day-to-day work;

a balance should be retained, it is difficult

at the moment.

The biggest drops in recruiting from 2012 to 2013 happen

within the Metal and Mechanical engineering, as well as

Chemical industries.

30% 35%

40%

31%

44%

14%

0%

25% 25%

0%

21%

10%

0%

8% 11%

14%

0%

25%

0% 0% 0%5%

10%15%20%25%30%35%40%45%50%


33)


(n = 22)


(n = 15)

LifeSciences

andHealthcare

(n = 13)

ChemicalIndustry (n

= 11)


(n = 7)

Construction(n = 6)


(n = 4)


= 4)


= 1)

R&D Employees in 2012

Increase

Decrease

44%

10%

40% 42%

13% 14% 20%

50%

25%

0%

13% 10%

0%

17% 13% 14%

0% 0% 0% 0% 0%

10%

20%

30%

40%

50%

60%


33)


(n = 22)


(n = 15)

LifeSciences

andHealthcare

(n = 13)

ChemicalIndustry (n

= 11)


(n = 7)

Construction(n = 6)


(n = 4)


= 4)


= 1)

R&D Employees in 2013

Increase

Decrease

In 2013, recruiting clearly increases in the Electronics and ICT, Construction, and

Mining and Metallurgy industries.

Over a half of the companies introduce an

increasing number of products or services to the

markets each year

Only 2% decreased the numbers of new products and patents in 2012.

For the year 2013, 2% see decreases in the number of new products and no

one in the number of patents.

54% 53%

33% 28%

0%

10%

20%

30%

40%

50%

60%

New products -2012

New products -2013

Filed patents -2012

Filed patents -2013

An increasing number of companies is planning

to benefit from external technology sources

28%

21%

9%

5%

11%

9%

32%

28%

14%

11%

16%

16%

0% 5% 10% 15% 20% 25% 30% 35%

Licensing technologies from an externalparty

Licensing technologies to an externalparty

Buying IP/patents from an external party

Selling IP/patents to an external party

Acquiring a company because of itstechnology portfolio

Creating spin-offs

2012

2013

In 2011 and 2012, 23 % of CTOs planned to license out a technology.

Moreover, only 7 % actually did that in 2011, compared to 21 % in 2012.

R&D budgets vary between companies.

In general, SMEs use a bigger percentage of

their revenues to R&D

Almost a half (48%) of SMEs but only 21 % of big companies use more than

10% of their revenues to R&D.

1

9

17

6

9

21

3

20

14

5

6

5

0 5 10 15 20 25 30 35

N/A

< 2 %

2-5 %

6-9 %

10-15 %

> 15 %

SMEs

Big companies

% of revenues used to R&D

CTO Views on Innovation

across Value Chains

Finnish CTOs understand the importance

of customers and suppliers in R&D

51 50 40

13 4 0

32 30

38

24

22

14

11 8

9

6

8

14

2 7 9

22 45

50

4 5 5

36

22 22

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

80 %

90 %

100 %

CollaborativeR&D with

universities orresearch

institutes withinour mainindustry

CollaborativeR&D withcustomers

CollaborativeR&D withsuppliers

CollaborativeR&D with other

externalpartners than

the ones listedabove

Crowdsourcing:Utilizing e.g.

end-users in co-creation

Open innovationplatforms: e.g.

Demola, DesignFactory,

Innovation Mill

No opinion

Never

Have tried, once ortwice

Occasionally

Continuously

The occurrence of R&D collaboration of the CTOs’ companies with...

The main benefit of R&D collaboration are product or service

ideas for electronics and energy, flexible knowledge for metal

and life sciences

59% 56%

31% 44% 47% 56%

29% 34%

19% 16%

41% 38% 34% 16%

45% 19%

0%10%20%30%40%50%60%70%80%90%

Electronics and ICT

60% 55% 45% 60% 55%

80% 65%

40%

10% 10% 25% 15% 15%

10% 15%

20%

0%10%20%30%40%50%60%70%80%90%

100%


Not important

Important

80%

30%

70% 70%

30%

70%

30%

70%

20%

10%

0% 20%

20%

10%

20%

10%

0%

20%

40%

60%

80%

100%

120%


46% 54% 38%

54% 54%

85%

46%

77%

31% 38%

31%

31% 23%

8%

15%

0%

0%10%20%30%40%50%60%70%80%90%

100%


Not important

Important

Networks are important as a main benefit of R&D

collaboration for chemical, construction and mining

sectors. Forest values customer satisfaction and new

markets.

75% 50%

25%

71%

25% 38% 50% 75%

13% 38%

25%

29%

25%

63% 25%

25%

0%

20%

40%

60%

80%

100%

120%

Chemical Industry

43% 57%

86% 86%

29% 43%

14% 43%

14% 14%

0% 14%

14% 14%

43% 14%

0%

20%

40%

60%

80%

100%

120%


Not important

Important

50% 25%

50% 50% 75%

100% 75%

100%

50%

50% 0% 25%

25% 0%

0%

0%

0%

20%

40%

60%

80%

100%

120%

Construction

33% 33% 33%

67% 67% 67% 67%

100% 33%

67% 67%

33% 33%

0% 0%

0%

0%

20%

40%

60%

80%

100%

120%


Not important

Important

Collaborative R&D across value chains is

considered to be easy – is it really?

26%

42%

34%

19% 21%

13%

38%

50%

29%

23% 27%

13%

0%

10%

20%

30%

40%

50%

60%

Collaborative R&D withsuppliers

Collaborative R&D withcustomers

Collaborative R&D withuniversities or research

institutes within our mainindustry

Open innovationplatforms: e.g. Demola,

Design Factory,Innovation Mill

Crowdsourcing: Utilizinge.g. end-users in co-

creation

Collaborative R&D withother external partners

than the ones listedabove

SMEs

Big

2% 2%

8%

11%

15%

2%

10%

6% 6%

2%

4%

0% 0%

2%

4%

6%

8%

10%

12%

14%

16%SMEs

Big

Would like to do more

Find it difficult

The CTOs would like to increase their R&D

collaboration especially with Finnish SMEs

32%

23%

21%

30%

26%

17%

44%

23%

25%

27%

27%

27%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Finnish SMEs

SMEs abroad

Large Finnish corporations

Large corporations abroad

Universities and Research Institutes in Finland

Universities and Research Institutes abroad

SMEs

Big

Ardent, innovative entrepreneurs have

a lot stronger drive than the ones working

in big corporations.

Foreign SMEs and large companies are seen as

interesting, but how to find good R&D partners

among them?

32%

60%

25%

32%

21%

75%

40%

31%

54%

19%

48%

42%

75%

52%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Start-ups Finnish SMEs SMEs abroad Large Finnishcorporations

Largecorporations

abroad

Universitiesand Research

Institutes inFinland

Universitiesand Research

Institutesabroad

SMEs

Big

The amount of CTOs who think that it is easy to find good R&D partners among...

CTOs’ views on networking and

collaborative R&D

Networking is important for the

development work; however, it needs

to be remembered that own skills

are needed in order to absorb new

knowledge.

By developing service business,

a technology supplier can

participate in process and

technology optimisation.

R&D could be developed by improved

networking. CTOs have a central role

in this.

When developing your product portfolio

upstream in the value chain, you need to

remember not to go to your customer’s

area of business.

In order to ensure expertise and an

availability of knowledgeable employees,

It is important to support the research

done at universities. That can often also

be utilised in processes and product

development.

SHOKs are clearly more important for big

companies than for SMEs. EU funding is

only important for a third of the CTOs.

• In 2010 and 2011 figures, the “not utilized” opinion was not used

• 65% of the CTOs who stated SHOKs to be important were from big corporations

77% 77% 75%

31% 40%

26% 28%

33% 36% 34%

4% 4% 1%

30% 5%

8%

24%

9% 4% 9%

14%

42%

40% 37%

19% 20%

10%

39%

55%

25% 24%

48% 60%

21%

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

80 %

90 %

100 %

Tekes2010

Tekes2011

Tekes2012

SHOKs2010

SHOKs2011

SHOKs2012

ELY2012

EU2010

EU2011

EU2012

Not important

Not utilized

No opinion

Important

In 2012, SHOK funding was found the most

important by companies within the Forest, pulp

and paper industry, as well as Metal and

mechanical engineering

24% 32%

20%

8% 0%

57%

17%

12%

9% 33%

15%

45%

0%

33%

42% 27%

20%

54%

36%

43%

33%

21%

32% 27% 23%

18%

0%

17%

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

80 %

90 %

100 %

Electronicsand ICT (33)

Metal andmechanicalengineering

(22)

Energy andenvironment

(15)

Life Sciences,Healthcare,Pharma (13)

ChemicalIndustry (11)

Forest, pulpand paper (7)

Construction(6)

Not important

Not utilized

No opinion

Important

The importance of SHOK funding remains the

same in 2013

15% 14% 7% 8% 9%

0%

17%

52% 50%

47% 38%

27%

57%

33%

33%

27% 47% 54%

64% 29%

50%

0% 9%

0% 0% 0%

14%

0%

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

80 %

90 %

100 %

Electronicsand ICT (33)

Metal andmechanicalengineering

(22)

Energy andenvironment

(15)

Life Sciences,Healthcare,Pharma (13)

ChemicalIndustry (11)

Forest, pulpand paper (7)

Construction(6)

Decrease

No opinion

Stay similar

Increase

A quarter of the respondents were not familiar

with the most common EU funding opportunities

58%

25%

8%

23%

8%

2%

21%

65%

23%

35%

13%

21%

6%

27%

0% 10% 20% 30% 40% 50% 60% 70%

Framework Programme 7 (FP7)

EUREKA, Eurostars

Horizon 2020

Structural Funds (EAKR, ESR)

Joint Undertakings (e.g. ENIAC, ARTEMIS,Clean Sky)

Competitiveness and Innovation FrameworkProgramme (CIP)

None of the ones mentioned

CTOs who find these EU funding opportunities familiar

SMEs

Big

Mining and metal industries need more piloting

opportunities, SMEs and more value added

processing to be done in Finland

• The mines that have been active in Finland for a long time have

active collaboration in technology piloting with their technology

suppliers.

• Technology companies within the mining industry would like to

collaborate more with Finnish SMEs and wish to have new

entrepreneurs within the industry

• The mines that have opened in Finland lately bring new opportunities

for enlarging the collaboration to new metals and production

processes

• Domestic value-added to Finnish ore should be increased

Good technology companies in the metal industry

value chains are quickly acquired by someone.

A problem of small entrepreneurs is credibility.

However, giving opportunities for piloting has been

our policy. [The company] sees new SMEs

beneficial and needed within the industry.

Where will Finnish mining technology be developed

in the future? [...] Core competences should be retained

in Finland.

Conclusions

Even though Finnish CTOs see their R&D investments and recruiting to increase, they are less optimistic than in the previous years: less CTOs see increases coming up.

Most CTOs have R&D collaboration with their customers, suppliers and universities. Big corporations would like to increase R&D collaboration especially with Finnish SMEs. However, only a third of the SME CTOs think that it is easy to find good R&D partners among big corporations.

Building international networks would need additional emphasis to also enable a better gain from international funding opportunities: 25% of Finnish CTOs are not familiar with the most common EU funding opportunities and only a third of them thinks that EU is an important source of public funding.

The interviews revealed that Finnish mining and metal industries need more piloting opportunities, SMEs and more value added processing to be done in Finland.

CTO Survey 2013

Business

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