 What would I like to do? I would like to talk about a national German national innovation strategy and Then use a very specific example, which we in Germany Framed industry 4.0 and I will put that into a European context and Into the context of European Research and innovation policies. So this offers you at least three ports of entry one is Innovation strategies from a national perspective The second is the specific example of advanced and modern manufacturing and the third is the European level so Let's start with with the first in Germany. We have worked for quite some time on Expanding our national research and innovation system. We are spending a whole lot of money in 2005 German R&D spending was 2.5 2.4 percent of the gross domestic product in 2014 these are the latest figures Numbers moved up to 2.9 percent. So we are close to the 3 percent Objective and we are in a group of European countries that spent quite some amount of money together with Finland, Sweden, Denmark, Austria We seem to be the front runners on the European level on a worldwide scale There is a small number of countries that spend more money on Research and innovation Israel as you all know Korea Japan so we try to be among the group of innovation leaders and if you look at the European Innovation Union scoreboard Germany belongs to the group of front runners Are we as good as the rankings indicate if you look at other rankings on International level that take a much broader perspective on framework conditions It seems that we could do better than the numbers indicate. So we are among the top five to top 15 Innovation-friendly countries on the globe. Let's take it that way What did we do in order to? Be part of this group in 2006 we started with a national innovation strategy which we framed the high tech Strategy the strategy involves all stakeholders It tries to be an initiative at the national level which brings different Business sectors as well as the various government departments under one roof We updated the strategy now. We are in a third phase. Where did we start the first one was driven very much driven by a Perspective on key enabling technologies. We identified about 15 key enabling technologies and Try to see what a potential they had for value creation In its second phase we did not change policies totally But we changed perspective from a technology push to a demand pull perspective So we looked at what is the societal demand? What are the areas that require? innovation and so fields came up just like climate and energy health and nutrition mobility communication of civil security and if you look around the globe you'll find those Phrases and those keywords all over My most favorite example is back in the 1990s. I attended a meeting of the Max Planck Society and They brought together Academic leaders from all over the world talking about their strategies for the future and the outcome was they all focus on Bionano info and optical technologies that we did in the first phase of the high tech strategy in the second phase We all just like many other countries looked at the grand challenges. What do we do right now? We merge the perspective. So we look at key enabling technologies We look at societal drivers. We look at global challenges Which we can address and which we should address and we look not only at innovation from a technological perspective, but also from a societal perspectives we try to Come to grips with what we call social innovation as well Well, as I said in the very beginning if I may make four points to sum that up Innovation policies require a great deal of money and policies always compete with other policy areas in Germany in the past ten years even in times of budget consolidation We set priorities At research and innovation and it seemed to pay off It seemed to be one of the factors that helped Germany to come out of the financial and economic crisis after 2008 fairly fast and A second aspect is that we combined and reoriented our innovation strategy And addressed grand societal challenges One of the challenges of course is the digital economy and I will talk about that in a minute from now a Third angle and the third aspect of the further development of the national Innovation strategy is that we try to be more systemic and try to be more inclusive so in terms of planning research agendas in terms of Executing research agenda. We try to tie in various groups and actors of society so Downstairs, I said the federal Ministry of Education and research differs from quite a number of other European research ministries In that we are not only a governmental actors with regard to rules regulation Legislation execution of legislation. We are at the same time a funding agency We spend about two point point five billion euro every year on direct funding for collaborative research of academic institutions and businesses and when we set out our research and funding agendas we try to have discussion and focus groups prior to Finally formulating this agenda and we try to bring in the perspective of non-governmental organizations and other actors of society in order to come up with a joint and common understanding of the objectives of science and Research so participation and transparency is a third aspect which is important for us and then of course we try to improve communication and cooperation of the stakeholders in industry and in the business world in science and within the government One of the key examples of this strategy is what we call industry 4.0 in other countries. It's called the Internet of Things. It's called advanced manufacturing It's called modern or digital manufacturing and each term Has a slightly different perspective, but in general they address they all address a similar challenge if I may try to provide you with a definition the term industry 4.0 from a German perspective Describes a modern mode of production that brings together cyber physical or embedded systems and network-based communication Driven by internet-based communication processes production equipment Communicates autonomously and tech technological components of industry 4.0 processes are sensor and actuator devices hardware components communication technology data processing devices and Software and in addition there is the human factor and I will talk about the human factor as well And if we take all this together we talk about smart factories indeed Why do we phrase it industry 4.0 in Germany? It's a historical perspective We look at the first industrial revolution with the steam engine We then look at mass production in the Ford Motor Company as a second phase of industrial development The third phase would be the entrance of computer technology into production processes and the fourth step Industry 4.0 is the introduction of network-based technologies into the production world about seven years ago as part of our National Innovation Strategic approach and we have an advisory board for this Which we call the high-tech forum a group of Production pioneers academics engineers business representatives got together and said we have to address this new challenge of network based production and they started to come up to design a research agenda which built upon prior research projects on on embedded systems cyber physical systems and They extended this to a network Technologies and so they came up with a research agenda which we funded and about four years later we thought that The baby had grown and the child was able to walk on its own and so we gave it away and there was a group of business associations bringing together all Actors in the manufacturing Industry and They started to create their own what they call platform discussion group strategic circle to further promote industry 4.0 And over time they developed what they call a common reference Architecture for the further development of industry 4.0, but it turned out if I may be frank it turned out that The association could not really combine the various company interests because this is a competitive field and we talk about competitive advantages by Improving and modernizing modes of production and so they to some extent met on Not probably the lowest common denominator, but definitely they did not aim very very high because it was so competitive And so about three years ago at the beginning of the current legislative period in Germany We decided that we take a fresh look at this group and at this process of self-organization Organization within industry and even companies were happy that we as a government take a took a fresh approach to bring together The various ministries within the German government together with company Representatives rather than business association representatives. So we brought in company representatives amongst others Siemens But also small and medium-sized companies to have a fair representation of different Enterprises different branches different sectors and different economic approaches to the topic and we brought them together with experts from the academic field from engineering but also from Vocational education and training amongst others and we brought the trade unions in and as I said the research organization so what we have now is called the industry 4.0 platform a network of experts to further promote this Development and we established individual working groups that focus on amongst others research and innovation They focus on another working group focuses on software architecture to have a common and joint architectural software architectural model that To some extent and as far as possible provides a uniform standard for the industry We look at standardization on the national and international level. We look at data security We look at legal ex aspects and we look at human resources and training legal aspects are Extremely challenging to whom belong the data if you create data during the production process And you share data on a joint platform Is it the company that produces and creates the data during the production process? Is it the software company that provides the platform for the exchange of data? Is it the user of the data and if one of the intermediators? Goes bankrupt what happens to the data which are stored someplace and no longer are within the company So very complicated and challenging topics which are addressed by the various working groups But to talk about industry 4.0 is one thing to see it happen is another and so we established a window An internet-based window. There is an interactive map on the internet which provides 200 showcases of industry 4.0 applications all over Germany What are the challenges one of the challenges is of course? Research and innovation we have to continue to provide research funding We spend about almost more than 300 million euro in the past euros in the past to for research projects And we are currently funding and we moved away from fundamental and Research we've moved away from research on Individual cyber physical systems now to as far as possible and within European regulations to research projects that try to apply the knowledge now on the company level And we try to reach out to small and medium-sized enterprises Because in Germany if you look at the development There is a small group of companies which are the front runners which apply the latest technologies And then there is a very large group of small and medium-sized and mid-cap companies in Germany Which are quite hesitant because they like the expertise And they don't know what to make out of the development and if you have to invest into Production equipment, which you use for 10 20 or 30 years. It's a major investment and companies Hesitate to make the investment right now. So together with our colleagues in the Ministry of the economy We established information hubs all over Germany to inform and to reach out to small and medium-sized Enterprises and we provide test beds Places to try out modern technologies both for those who develop industry 4.0 equipment So to the machine producers and at the same time Companies that try to take advantage of it and try to Emulate and model their production processes based on these new technologies. So providing test environments seems to be one way in order to motivate company to move ahead and I mentioned the human factor We also established research Programs together with employers and the unions on the future of the workplace Because industry 4.0 the digitization of production processes Comes along with new requirements for those who work on the production lines and new demands for on the one hand digital knowledge software application software development and flexibility because if you have a Network-based production process one of the advantages is that production equipment Adjusts to the different parts that come into the production process and you can start to Individualize mass production, but that means that those who work in the factories have to be more flexible and have to adjust to this flexible production process So we look at qualification. We look at training of people This was my industry 4.0 example as one of the showpieces of what a national innovation strategy can do Identify a topic address it from a research site then hand it over to a collaboration of public funders and business Appliers those who apply the knowledge In the business world and then try to further promote an issue and bring it forward by providing incentives as I said Building up test environments new research projects on the social development that come with a new technology We monitor this and we do have an expert group which we call the expert group on research and innovation And they published their annual report just recently and they criticized us why so because they said a focus on Modern modes of industrial production is pretty much in line with the present state of the German economy You we came out of the economic crisis amongst others also because we had a strong industrial base But the question and the challenge they gave us is is this the future? Is it right to focus on the? digitization and the network And the application of network technologies in the production field only and what are the new fields? Which we probably do not see application of digital technologies in medical in the medical world so health and digitization Or in a more abstract and general way New services coming out of digital technologies. Do we in Germany? Invest in companies that provide digital platforms for new services So are we too much path dependent by looking at the digitization of Manufacturing and what else shall we do? It's an open question. We haven't found a real answer We've set up within our expert group. We have set up a group not as a result of this criticism as a matter of fact already a year ago on Life science medical services and digitization and we have set up a working group which focuses on autonomous systems ranging from robotics in production as well as service robotics to Autonomous driving and autonomous mobility so we try to address new fields in order to Be in line with further development. I'm afraid however other countries pretty much do the same. So The unique selling point that still has to be identified My last point the European perspective If we look at Research and innovation This is a field on the European agenda Which is taken for granted and you don't make headlines with research and innovation and at the same time We all pay lip service to Europe has to become more competitive We have to compete with the United States and the Americas on the one hand when we have to compete with China and Asia on the other and we can only do this if we work together and Europe is united and strong. That is the lip service. We all pay What is the reality? Research and innovation policies have not really become the number one issue on the European agenda Finance wise. Yes, we have done not bad Horizon 2020 is the largest transnational research program ever on the globe 75 billion euro committed to this. However, if money is needed during the Current financial framework period and money has to be found someplace very often It's horizon 2020 where you can take it away for other purposes. So It seems to be at least ambivalent So what can we do and what is the current state? As I said horizon 2020 is well funded but the individual performance in science and innovation Is probably not in line with the objectives which we have phrased on the European level. The 3% GDP Goal as I said in the very beginning has only been reached by a small number of countries and We still try to find ways to make better use of the knowledge which we have in Europe for value creation in Europe Horizon 2020 has a well-balanced architecture now with blue skies research on the one hand and market application on the other and We do have a wealth of instruments to promote science and research When we set up and designed horizon 2020 there was a huge Outcry make it simpler make it better and simpler and simplification was the issue Now being almost halfway through horizon 2020 It seems to me that we have lost some of the impetus We try to make it a little bit simpler at the very beginning and from then on we differentiated and further developed and We have created again Toolkit which only the very experts can really understand and make use of So this is not really conducive for those who try to get Appropriate funding the challenges are out there. Of course aging societies in Europe Neurodegenerative diseases as one of the big health challenges health and nutrition The digitalization of societies Commissioner Moedas has answered with a strategy which he called the three O's Open science open innovation and open to the world Yes, we have to be open to the world, but what do the other two open actually mean? Open seems to be a keyword Which is now being used and applied in quite a number of countries at the beginning of this week I spoke to the Chinese Research Minister Wang Gang and he spoke about or reported from the 13th National People's Congress and he said we have come up with a new innovation strategy and There are a number of adjectives to describe them to describe the strategy one is green one is open and Then there was coordination there was innovation and there was sharing so these are the buzzwords so open seems to be a buzzword for the digital world and Prior to coming here. We sat downstairs together in a small group of people and we talked about intellectual property rights and how do we find the right balance of Research within academic institutions that can be applied to business applications and IPR of course is the legal tool to Provide an appropriate frame framework for the transition and use of ideas a different development are indeed open innovation Campuses and one of the most shining examples. I've seen in end-hofen in the Netherlands. We are Philips the company Philips stopped operation on its own R&D campus and they actually pulled out the Philips company sign They gave it away. They opened the gates in a literal sense to new companies and Academic institutions and they created an open innovation campus Does an open innovation campus work without IPR rules? No The difference is that you talk about IPR rules in the very beginning and you apply the same rules to all actors on campus But then you at the same time agree on sharing Some part of the knowledge which you develop by jointly using the research Equipment which is available and then you define the ways on how to Proprietary in a proprietary sense take advantage of the knowledge even further so Open can be one of the answers another answer certainly has to be Resume the road of simplification make the instruments better understandable to others and pave the road from blue skies research to Applied knowledge in a structured way a new development is a new instrument Which is called important project of common European interest. We do see that in a number of Business sectors amongst their microelectronics and one of the major International chip producers is here in Ireland In this field we no longer need regulations to make sure that we have competition within Europe We hardly have any companies left so if we talk about competition we talk about global competition and this global competition is disturbed by a National funding policies in countries like Taiwan Korea and even the United States So in order to provide a regulatory framework that helps companies Within Europe to compete on an international level in order to have this this instrument of important project of common European interest was developed and We curiously take a look at this in order to see whether it can help the European microelectronics industry to survive in this global competition if we look at European governance We do see that the European Commission at least in the field of research and innovation plays an even stronger role Which is not clearly defined if the Commission Does not reach its objectives by discussing it with the member states They make a shortcut and talk to the research organizations directly. This is called stakeholder dialogue To some extent we from a national perspective perceive this as circumvention of member state perspectives So in addition to simplifying the instruments with in addition to Providing the right regulatory framework to compete globally We see that the Commission should define its role clearly With regard to the member states we need a clear definition of labor and we need a clear definition of what added European value means and at what level Commission activities are necessary and to what extent the member states can live up to the ambition They formulate themselves That means however at the same time that the member states have to come up with a clear vision of what research and innovation means and This in a modern world means that we have to look beyond research policies and have to take into account Education and training on the one hand, but on the other hand also Industry and labor policies and we do have to do this on a national level We in Germany try to do it by bringing actors together under the umbrella of the high-tech strategy in Germany But we also have to do this on the European level as well So what does this mean if we run up for the follow-up program of horizon? 2020 we should take all this into account and we as member states have to be more ambitious in shaping a and ambitious agenda of The research and competitiveness Council we have to look at intersectoral discussions and at inter departmental discussions because The bottom line is We cannot do without Europe of course as Hans-Dietrich Kencher the former foreign minister in Germany who died just recently As he said Europe is our future We have no other and let me add research science and innovation are the key to European future So we have to work on these fields as well So thank you very much for your attention and I look forward to discussions