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Rex Features |
"The cross-fertilization potential between life sciences and materials sciences is high," says van Leen. "Biotechnology, traditionally associated with life sciences, will increasingly play a role in developing new, greener and cleaner bio-materials, while at the same time, materials will increasingly be used in medical applications in the field of life sciences."
On September 22 this year, DSM plans to introduce a five-year innovation profit margin target designed to increase revenues to 300m/year from new products, new applications of existing products, plus sales of patent-protected products, compared with the 200m/year in revenues targeted between 2005 and 2010.
The company is still trying to figure out if the targets are achievable, and management is still evaluating whether the profit margin target should be made public.
"The innovation pipeline businesses would be given more demanding profit margin targets than existing businesses," says van Leen. "Our recent analysis shows that a lot of running businesses can't explain what their return on investment will be from innovation spend. More risky investments must be justified every three months, so this will be a challenge for our existing businesses."
In 2005, DSM created under its Innovation Center four Emerging Business Areas (EBAs) out of 10 potential candidates that are based on the strengths and synergies of its life sciences and material sciences portfolio. The EBAs include biomedical materials, white biotechnology, specialty packaging and personal nutrition.
SELECTIVE PROCESS
According to van Leen, the EBAs were selected from the marriage of social trends, such as issues in energy, water, population growth, health and wellness; and of technology trends, such as biotechnology, nanotechnology, and development of high-performance and functional materials.
"After four and a half years, two of the EBAs - biomedical materials and white biotechnology - have been successful. We will continue to fund those and grow them further," says van Leen.
"For specialty packaging and personal nutrition, we are considering growing them in partnerships. We have created a whole lot of value and interesting innovation in these two areas, but we believe we are not the best company, at least on our own, to make them a success," he adds.
"Cross-fertilization potential [of the sectors] is high"Rob van Leen, chief innovation officer, DSM |
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Putting the two units in partnerships or joint ventures will create one or two new EBAs for the next five years. Biofuels and solar are being considered, says van Leen.
"It is likely that one of the new business units will be associated with climate change," he says. "However, when it comes to either biofuels or solar cells, we will be more of a technology player rather than producer."
In biofuels, DSM will be able to leverage its strong capabilities in fermentation processing and enzyme technology. Van Leen cites as an example DSM's investment last January in Sweden-based Bioprocess Control, which provides advanced control technologies in biogas processing.
Biogas is produced by anaerobic fermentation of biodegradable materials, such as manure, sewage sludge and energy crops.
In the solar field, DSM is working to improve its KhepriCoat solar antireflective coating system, which van Leen said could contribute to improving the efficiency of solar modules. Another product is its nanotechnology-based antireflective picture glass claryl, which DSM says also has a potential use in solar cells.
