The UK has been a global leader in innovation for centuries. As Ben Peace reports, the problem is that the country has been less than brilliant at converting that extraordinary talent into profitable business.
In both of the past two years, the UK has been ranked number two in the global innovation index, according to the Department for Business, Innovation and Skills. But since the Second World War, our track record in making the most of it commercially has been relatively poor.
That is why it is encouraging to see the development of a project that seeks to capitalise on some great British innovation.
The project in question has been investigating value creation and retention around a specific emerging technology – lithium ion batteries for automotive hybrid and electric vehicles.
Part-funded by Innovate UK, Project ABACUS (the acronym for innovAtive Business models and design Approaches for extending the in-serviCe battery life of fUture low carbon vehicleS) is run by a consortium that includes Jaguar Land Rover; WMG; University of Warwick; Potenza Technology, and G&P Batteries.
Between them the various partners possess a broad range of expertise, from testing and material recovery to intellectual property and life cycle assessment.
They have demonstrated that while there are various technical challenges, consideration of a broad range of factors beyond the technology itself can hugely improve understanding of the route to commercial success, and identify new ways of creating value.
Beyond the idea
The issues ABACUS has been exploring include technology evaluation, business model creation and ownership, by establishing the answers to questions such as:
- How does the value of the product change over time? How might this be tested?
- Who owns the product or its materials at different stages of the life cycle?
- What does the supply network look like? How might all stakeholders be remunerated appropriately?
- What are the environmental impacts at various stages?
- Does the IP strategy appropriately take account of the full lifecycle?
The market for electric and hybrid vehicles is growing rapidly as the technology improves and prices drop. But one issue limiting further growth is uncertainty around the value of the battery packs as the vehicles age.
The project has therefore investigated a way of testing battery performance 90% faster than before. It has also developed a business model by which the battery might be owned by someone other than the consumer, therefore removing one of the dominant consumer concerns when considering the purchase of an electric vehicle.
Another means of retaining value is to consider recovering materials at the end of the unit’s life. Some of the materials in batteries in particular, such as cobalt, are valuable and subject to future supply risks. Yet the project has found that current designs do not allow for this.
Legislation requires that batteries are recycled at the end of life, and this can come at a cost. But if they were designed for disassembly, some parts may be suitable for re-use, and recycling costs could be reduced.
A related story has emerged from the project’s research that I found particularly compelling: one company was manufacturing a battery pack using adhesives to join elements of the pack together – presumably due to a combination of cost reduction and IP protection.
When a fault was discovered post-production, the company tried to recall just the batch from which the faulty unit came. However, because the serial numbers were not accessible (due to the units being glued) they were forced to recall 100% of their products.
The cost involved drove the company into bankruptcy. In contrast, businesses like Spiers New Technologies in the US and Axion in the UK are proving that there is good business in repair and reprocessing of batteries.
Spiers is already processing 500 battery packs a month. This works even better in collaboration, a good example of which is Axion working with Jaguar Land Rover on the AMPLIFII project.
Here at the Knowledge Transfer Network (KTN), we help ensure that the results and learning from projects like ABACUS get disseminated appropriately and create further value. To that end, we will be publishing an abridged version of the project report once completed.
If you are looking for the right partners and funding that can turn your innovqtion into a commercial success, please get in touch with the manufacturing team at KTN. Visit ktn-uk.org
We also make connections more directly. For instance, we effected an introduction between the ABACUS team and Oxford-based Oxis Energy, which is developing another new wave in battery technology – Lithium Sulphur – which exhibits exceptional energy density on a weight basis and is developing interest in the aerospace and defence sectors.
KTN also uses insights from such projects to influence new government funding, as you can see in Innovate UK’s recently launched materials and manufacturing competition (in which up to £15m is up for grabs) a prominent mention of remanufacturing and design for use and end-of-life.
ABACUS demonstrates how modern, effective innovation is more than just technology. It requires the development of a sophisticated understanding of the customer, of value creation and retention, and risk, across complex supply chains and full product life cycles.
It is a contact sport – it is rare that one organisation has the full range of skills and expertise, and the right market reach, to tackle all of these factors. KTN was founded to make these connections, as a result of which we have been able to set up many projects like ABACUS.