University challenge

As head of technology R&D at the industrial engineering giant ABB, Markus Bayegan sees his role as networking with academic and industrial partners to create ‘a climate of innovation’.

Dr. Markus Bayegan has Cambridge on his mind. The historic colleges and riverside walks of that fair city are, however, of less immediate interest to Bayegan than its potential benefits to the worlds of power and automation.

These are the twin businesses of ABB, the Swiss-based global industrial engineering giant of which Bayegan is chief technology officer, and so ultimate master of a $600m (£325m) annual R&D budget.

ABB is courting the University of Cambridge for access to the technologies that could give it a future competitive advantage. For its part, the university is delighted by the interest and has invited the amiable, dapper Norwegian to speak at its R&D management conference.

ABB, a regular R&D collaborator with Cambridge, recently strengthened the relationship by joining the university’s Corporate Liaison scheme. This will allow ABB to scour Cambridge’s research activities for projects of mutual interest.

That companies such as ABB want to work with Cambridge is, according to Bayegan, good news for more than just the two parties involved. The UK as a whole, he claimed, needs institutions to which the world’s biggest companies flock for their technologies. ‘From a geo-political view it is evident that these universities will in future play a key role in the competitiveness of their nations,’ said Bayegan.

Europe, he suggested, has traditionally taken a rather self-indulgent attitude to these matters. ‘In Europe, with some exceptions, we have had the opinion that these institutions should be left on their own to get on with their science, that combining it with industry was not a good thing,’ said Bayegan. ‘Thankfully that is changing.’ Cambridge and Imperial College – another ABB partner – are able to compete in the heavyweight division mostly composed of US powerhouses such as MIT and Stanford, said Bayegan.

‘When it comes to opening up the doors of the university for co-operation with industry, and transferring science and technology so they can be utilised, we have to accept that the Americans have come very far compared to the rest of the world.’

Bayegan believes that Europe is now in a race not just to make up ground on the US but to stay ahead of the increasingly confident developing nations of Asia, which have no compunction about giving the forces of global business whatever help they need. ABB already has significant research operations in India and China.

‘When it comes to these new economies the push is very strong. They want the funding from industry, and are very pragmatic about building things up quickly to create as much impact as possible,’ said Bayegan. ‘They know they cannot afford to have any dogmas. There is a hunger there to use science and technology to create industry and jobs.’

Bayegan claimed that this does not mean universities becoming an extension of the R&D labs of their business paymasters. When it is put to him that, in the opinion of some, too close a relationship could undermine the position of pure research, leaving room only for the stringently applied, he is insistent that the two can-co-exist.

‘It is right that the goals and boundary conditions for industrial research are different from pure research, but they are never quite independent from each other.’

According to Bayegan, a new technology naturally passes through distinct phases during its development. The first is pure research, the second is an ‘entrepreneurial’ phase in which it becomes evident that the technology could have applications. The third is where companies such as ABB come in. ‘This is the phase when we can take the technology and apply it to our products in industry. We are two different worlds, but we can be complementary to each other. We can create a strength for both our institutions.’

Bayegan also freely admitted that the process is driven by mutual need. Multinationals such as ABB will outsource more of their R&D and increasingly work with partners, in universities and elsewhere. ‘The world of industrial research is changing so quickly that no individual company can do it alone. We can no longer do everything within the walls of our own labs, and it makes no sense to try.’

Just as universities will compete to attract the support of business, companies themselves will have to convince the academics that they, not their rivals, are the right people to work with.

‘If ABB and competitors x and y go to the same universities, where is the difference between us? The answer lies in our knowledge of our customers, which is not something we share with universities or anyone else. Then there is the whole area of markets, sales and service. These are elements that can be used to differentiate between companies that are shopping for technologies in the same university.’

Any new academic partner of ABB will be working with a very different company from the one they would have found five years ago. A combination of under-performing businesses, debts, pension liabilities and asbestos-related legal action at one stage left the group teetering on the brink of insolvency. A wave of drastic measures followed, including the wholesale disposal of entire swathes of ABB’s operations, huge job cuts and the resignation of its chief executive. The slimmed-down ABB is still a big operation by any standards, with 115,000 employees and annual sales of $19bn (£10bn). But it is now firmly focused on two areas: power (transmission and distribution but no longer generation) and automation technologies.

‘We have gone through a difficult period commercially and financially,’ admitted Bayegan, who added that despite the upheavals of the past few years the company has not taken its eye off the R&D ball. ‘If you compare it to when we were a $35bn (£19bn) company we are obviously spending less, but as a percentage we have kept it steady. We are selling technology, and we have to keep a level of investment to secure our future.’

In an echo of his advice to the universities to look outwards, Bayegan said ABB itself had been forced to change not just its structure, but its culture. ‘ABB was traditionally very focused on continental Europe, and that was where much of our research was based. We have consciously changed that, first by moving research to the UK and US and then into Asia. There are good people all over the world, and we need to tap into that tremendous pool of brain power wherever it is,’ said Bayegan.

‘It also makes absolute sense from the point of view of being close and responsive to new markets, and it generally brings a new climate of innovation. When people from the same culture work together all the time they get into this one-way mode of thinking.’

ABB is not immediately associated with the leading edge of technology research. At first glance, the group looks like a traditional industrial heavyweight.

Nothing could be further from the truth, according to Bayegan, who said technology had transformed even its most bread-and-butter products. ‘Take today’s circuit breaker and put it beside one from 20 or 50 years ago. They are all called circuit breakers, but cannot be compared in terms of the materials used, the reliability, the intelligence they contain.’

As head of R&D it is Bayegan’s job to assess which areas of technology will make an impact on ABB’s business in the years ahead. Software and microelectronics will continue to be key areas, he said, while wireless technology will play a huge part in the future industrial landscape. ‘If you look at a traditional industrial installation it is like spaghetti, millions of wires everywhere. Wireless networks open up a completely new world for us, because you can put in wireless sensors that communicate using cheap radio technology,’ said Bayegan.

There is, however, one field of research that crops up repeatedly in discussion with Bayegan, and which he and ABB have clearly identified as a priority. This is materials technology, an area Bayegan admitted had sometimes been a Cinderella activity for ABB and other engineering multinationals.

No longer. ‘There was a period when we looked at materials as a boring type of technology. We thought there is really nothing to be done, surely we know all about materials,’ said Bayegan. ‘Now we are seeing a comeback of this technology and I think it will have a tremendous impact on almost all of our products.’

Bayegan revealed that within the next few months ABB will dramatically broaden the scope of its materials-related R&D activity.

Building on several years of smaller-scale work in the nanotechnology field, the company will create a ‘virtual laboratory’ encompassing partner universities, suppliers and ABB’s own research teams and business units.

‘We will no longer just be looking at nanotechnologies but the entire range of materials,’ said Bayegan. ‘Metals, composites and polymers are all used in ABB’s products. We want to know what opportunities there are for using micro or nano-materials in coatings, for new magnetic materials or in surface treatment. We need to know the implications of some of these new technology trends for our traditional products.’

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