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Manufacturing Policy Portal [beta]

Hosted by the Centre for Science, Technology & Innovation Policy (CSTI)

Studying at Cambridge

 

Actors & Institutions

Actors and Institutions


Central Government Policy Organisation Actor

The arm of the federal German Government whose purview includes the promotion of advanced manufacturing in Germany is the Federal Ministry of Education and Research (Bundesministerium für Bildung und Forschung – BMBF).  The BMBF is organised into eight Directorates-General, each of which is responsible for different tasks.  Several of these – e.g., Directorate-General 1 (Strategies and Policy Issues), Directorate-General 3 (Vocational Training and Lifelong Learning), Directorate-General 5 (Key Technologies – Research for Innovation) – touch upon different aspects of advanced manufacturing policy.  Directorates-General also work closely with the Länder.

 

Fraunhofer Society

The Fraunhofer-Gesellschaft, an independent nongovernmental entity, is the largest organisation for applied research in Europe, comprising 67 government-backed institutes and research units, and with a €2 billion annual research budget.  Its customers and contractual partners are generally industry, the service sector, and public administration.  Institutes are required to balance their own budgets, which requires them to generate contract research.  Over 70% of the Fraunhofer Society’s contract research revenue comes from publicly funded research projects and contracts with industry, with the remainder contributed by the German federal and Länder governments in the form of base funding.  The Fraunhofer Society has an international focus as well, having set up research centres and representative offices to act as a bridge to regions deemed to be of “greatest importance to present and future scientific progress and economic development”. 

Management of the various institutes is largely performed by academics with industry experience, typically engineering professors.  Ph.D. students account for 30% of the Fraunhofer Society's 23,000 employees.   The average institute employs between 300 and 400 people, though some are much larger.  The Fraunhofer’s structure is quite distributed.  Each institute, which is linked with a German university, selects its own research fields and projects.

The society has over 250 business focus areas and core competencies.  There is an emphasis on applied research with practical industrial value in their research, mostly in areas including healthcare, security, communication, mobility, energy and the environment.  Fraunhofer Institutes tend also to focus on short term applied research projects – 6,000 to 8,000 annually and typically lasting shorter than two years – with immediate business applications.  The society generates a lot of knowledge in its own laboratories, and employees are encouraged to start their own companies, selling the technologies developed in the institutes (the founders pay a license fee to use patented discoveries for commercial use). Fraunhofer has also established seven institutes in the United States and research subsidiaries in Chile, Austria, Portugal, and Italy.  A primary rationale for establishing these foreign-based institutes appears to be in order to learn about technology development in other parts of the world.

Management of the various institutes is largely performed by academics with industry experience, typically engineering professors.  Ph.D. students account for 30% of the Fraunhofer Society's 23,000 employees.   The average institute employs between 300 and 400 people, though some are much larger.  The Fraunhofer’s structure is quite distributed.  Each institute, which is linked with a German university, selects its own research fields and projects.  With several research institutes focusing on innovation in technology and manufacturing, the Fraunhofer Society, with the ecosystem it has created as its funding has steadily grown over the years, provides critical support to the Mittelstand, enabling SMEs to continually upgrade their processes and products, a key factor in their sustained competitive advantage.

Fraunhofer has also established seven institutes in the United States and research subsidiaries in Chile, Austria, Portugal, and Italy.  A primary rationale for establishing these foreign-based institutes appears to be in order to learn about technology development in other parts of the wor

Fraunhofer Structure and Governance

Management of the various institutes is largely performed by academics with industry experience, typically engineering professors.  Ph.D. students account for 30% of the Fraunhofer Society's 23,000 employees.   The average institute employs between 300 and 400 people, though some are much larger.  The Fraunhofer’s structure is quite distributed.  Each institute, which is linked with a German university, selects its own research fields and projects.

Characteristics of Fraunhofer Society:

  • Each institute is paired with a university with similar research interests. The institutes are well equipped, and most operate multiple pilot manufacturing lines and demonstration facilities.
  • Fraunhofer's model is a classic government-industry partnership, and funding accrues via a complex set of relationships and arrangements. The federal and state governments, private contract research, and publicly funded contract research each provide roughly one-third of its funding.  However, a substantial amount of "industry" research can be funded through government grants and incentives. 
  • Funding is very stable, in large part because of a cross party consensus on the importance of applied research to German firms. 
  • Vocational education in Germany, combining academic studies with factory apprenticeships, produces a well-trained and technologically adept work force.  Fraunhofer emulates this system, employing part-time post-docs and master’s and Ph.D. candidates, who acquire practical experience while simultaneously pursuing their studies.
  • Fraunhofer holds a significant IP portfolio.

It is argued that the weakness of Fraunhofer's strategy is its focus on established industries, which means it is not typically a pioneer of new technologies.  However, its overall success has demonstrated that a high-cost, high-wage country can compete effectively in global markets.

 

Other Key Actors and Initiatives in German Manufacturing Policy System

 

Länder

The German states (Länder) play a significant role in Germany’s multi-layered policy landscape.  National institutions significantly interact with the Länder as well as the federal government, and the Länder jointly fund many of the initiatives that originate in Berlin.

 

German Federation of Industrial Research Associations (AiF)

The German Federation of Industrial Research Associations (AiF), founded in 1954, is a non-profit association organised by industry that promotes R&D in all industrial sectors in order to support the competitive strength of small and medium-sized enterprises (SMEs).  TheAiF is anetwork of 100 industrial research associations from all sectors (industry and service sector) with 50,000 affiliated companies.  In 2012,the AiF received 485 million euros of public funding for research projects by SMEs, and it iscurrently a partner to the Federal Ministry for Economic Affairs and Energy (BMWi).

 

Deutsche Forschungsgemeinschaft (DFG) 

The DFG is the largest independent research funding organisation in Germany, serving all branches of science and the humanities.  Its membership consists of German research universities, non-university research institutions, scientific associations and the Academies of Science and the Humanities.  In 2013, the DFG funded almost 30,000 new and ongoing projects “with a funding volume of €2.6 billion for the reporting period”.  The budget is provided primarily by the German government and the states (~ 2:1 ratio), and also includes EU funds and private donations.  The states and Federal Government are represented in all Grants Committees, although “the voting system and procedural regulations guarantee science-driven decisions”. Funding is distributed between individual grants,collaborative research centres,excellence initiatives, infrastructure funding, etc.

The structure of the DFG features three departments, the second of which is concerned with Scientific Affairs.  Contained within that department is a division called Engineering Sciences, a number of whose responsibilities include aspects of advanced manufacturing.  The DFG’s funding atlasis illuminating in how it demonstrates where funding is allocated, and where those investments are made.  There are several fundingprofilesubject maps based on DFG awards, including one for Engineering Sciences.  Production technology, which is the research field within Engineering Sciences that receives the largest amount of funding, dominates DFG-funded research at the universities of Hannover, Dortmund, Erlangen-Nürnberg and Aachen.

 

Steinbeis Foundation (but in the context of its MAS-like services)

The Steinbeis Foundation, established in 1971 by the state of Baden-Württemburg, is an institute specialising in technology transfer of academic research.  Headquartered in Stuttgart, it comprises approximately 1,000 “transfer enterprises”, which, depending on the focus of work, employ 6,000 experts in “either legally dependent Steinbeis Transfer Centers, Steinbeis Research and Innovation Centers, Steinbeis Consulting Centers, Steinbeis Transfer Institutes or companies of an independent legal nature”.  Many of these various centres and institutes are based in German universities.  Steinbeis Enterprises achieved a total turnover of 145 million euros in 2013.  Many of the services Steinbeis provides touch on various aspects of manufacturing.