3. National Electronics Manufacturing Initiative (NEMI)NEMI is a process for helping industry and government make the most of limited national resources in electronics manufacturing. It is a way of doing strategic planning and partnering, rather than a specific set of programs or projects. The NEMI process is aimed at making the existing Federal investment in electronics R&D -- estimated at over $1 billion -- and the much larger private investments more effective, whether for meeting national security needs or for contributing to economic growth.
The NEMI process was begun in response to a high level of industry interest in forming a partnership with the Federal Government to further U.S. goals in electronics. NEMI seeks to meet the industry goal of enhanced global competitiveness and government goals of providing for the national defense, assuring U.S. leadership in critical technologies, increasing the efficiency and effectiveness of Federal R&D, and maintaining high-quality jobs in the United States.
Several new developments make NEMI a timely effort. The National Information Infrastructure will create markets that never existed before for electronic devices in everything from health care, education, and entertainment to warfighting. A second development is the digital revolution, which is creating a convergence in the design and manufacture of innovative electronic products for consumer and commercial, industrial, and military uses. U.S. companies lead the world in digital technologies. We have an opportunity to exploit that lead in new markets created by the NII -- some of which will replace markets where U.S. producers are currently weak. The single electronics industrial base of the future will enable U.S. producers to manufacture more efficiently for the global electronics market, while providing the world's best electronics technologies to our armed forces at affordable cost. To take advantage of these developments, we need to focus more closely than we have in the past on the manufacturing process.
In meetings sponsored by NEMI, government and industry have developed a set of technology road maps that cover the component, assembly, packaging, and infrastructure technologies relevant to the design, manufacture, and test of electronic information hardware, focusing on hardware that can connect to information networks, including the NII. Building on these road maps, NEMI is continuing to work with the industry to identify potential areas of government-industry cooperation where new infrastructure, strong supply chains, and fundamental technologies for electronics manufacturing need to be developed. The entire electronics supply chain is receiving attention in this assessment of R&D needs.
Evaluation. For a broad program such as NEMI, it is difficult to set overall timetables and deliverables. However, evaluation is still necessary, and the approach described in the section above on Schedules, Deliverables, and Evaluation will be applied.
Detailed budget information was not collected for NEMI or for the Manufacturing Infrastructure and Materials Technology Initiatives described below.
4. Manufacturing Infrastructure InitiativeThe goal is to support research, development, and other activities that broadly support the entire manufacturing sector. Through a government-industry partnership, the initiative intends to help manufacturing industries to create the next generation of manufacturing systems and enterprises.
The elements of the initiative are as follows:
The Manufacturing Infrastructure Initiative responds to requests from a broad array of companies and industry associations. Its approach is to focus on high-risk, high-payoff technologies with broad application; to address problems of enough size and scope to have a substantial effect; to develop measurable goals; to build on the strengths of particular government agencies in assigning responsibilities; and to involve in program planning and execution appropriate partners from industry, academia, state and local governments, and work force organizations.
Evaluation. Some manufacturing infrastructure projects are focused enough to permit setting goals, deliverables, and milestones. The NSF-ARPA cooperative program for agile manufacturing is one of these; demonstration projects in the program do have defined goals and deliverables. The Manufacturing Extension Partnership at NIST will be evaluated systematically to determine, for example, the services most valued by manufacturers, the types of firms that make the greatest use of the services, and the Partnership's impact at various levels ranging from individual services and centers to the MEP as a whole. It may be less feasible to set a defined schedule for progress in many of the generic technologies included in the advanced manufacturing infrastructure, such as sensors and controls, or the common databases and interface standards needed for electronic information exchange in manufacturing. However, in the context of focused initiatives, such as PNGV, it should be possible to also set milestones for progress in these underlying technologies.
5. Materials Technology InitiativeThe goal is to develop materials R&D programs that are closely linked with users. Materials science R&D is covered in the NSTC Committee on Fundamental Science. In CCIT, the emphasis is on industrial application and competitive performance. Market success depends on many factors, but common to most cutting edge manufacturing industries is the need for materials and process technologies designed for specific applications. The Materials Technology Subcommittee of the CCIT is focusing on materials R&D planning, implementation, and coordination, in six applications sectors: PNGV, Construction and Building, NEMI, Environmental Technologies, Manufacturing Infrastructure, and Aeronautics (under the Committee on Transportation).
Current activities of the Materials Initiative are in the following areas:
Evaluation. Progress toward and completion of technical goals will be measured for specific technical projects. For broader programs, near term measures will be the formation of close working relationships with representatives of selected sectors, and participation by industry in materials R&D projects. In the longer term, measures such as business creation, numbers and kinds of jobs created, and effects on the national and local economics will be applied, insofar as they can be identified. Sector specific activities will be evaluated in the context of the corresponding focused initiative (e.g., PNGV).
6. Environmental Technologies InitiativeThe broad goal of this joint initiative is to work with industry, academia, state and local governments, and non-government organizations in enabling a shift from incrementalism to technological transformation; from managing waste to sustaining and restoring ecosystems; and from reacting to environmental and public health threats to anticipating and preventing them. This strategy has been developed by the Joint Subcommittee for Environmental Technologies (JSET), under the auspices of both the CCIT and the Committee on Environment and Natural Resources (CENR).
Several challenges of particular importance to the CCIT are:
A forward-looking approach in these areas can help companies become more competitive by lowering their energy and resource needs while reducing or eliminating their waste cleanup and disposal costs. The rapidly growing market for clean technologies and the shift from consumption of resources to investment in new plants and equipment will spur economic growth and can potentially provide the U.S. companies with competitive advantage in the global marketplace.
Further details on the Environmental Technologies Initiative can be found in the CENR Strategic Implementation Plan.
D. Cross-Cutting ProgramsMost of the funds that support CCIT initiatives are from existing agency programs that, under CCIT leadership, are adjusted and realigned to carry out collective goals of the agencies comprising the Committee's membership. CCIT provides a way for government agencies to plan, coordinate, and implement high-priority activities in the area of civilian industrial technology, thus ensuring that tax dollars are being invested wisely. In many of these programs, industry helps to set the research agenda and shares the costs. In addition, the Administration has given high priority to cross-cutting programs that support development of pre-commercial technologies relevant to several important industrial sectors, including those that are the focus of CCIT initiatives. The Advanced Technology Program, which is targeted at economic growth; the Technology Reinvestment Project, targeted at making advanced commercial technologies available to the military; and other dual-use programs are described below.
1. Advanced Technology Program (ATP)
The National Institute for Standards and Technology's ATP works with industry to develop high risk but highly promising technologies that, if successful, would enable novel or greatly improved products and services for the world market. ATP is aimed at technologies that are not likely to be developed by private investment alone in time to compete in rapidly changing world markets. The government portion of the investment (all ATP projects are cost-shared with industry) shares the risk, and allows the realization of economic gains that otherwise might well be lost.
While government provides the catalyst, industry conceives, partially funds, and executes ATP projects. ATP research directions are chosen based on suggestions from industry and developed in consultation with industry. Specific R&D projects are selected from proposals submitted by industry. All awards are made through a competitive merit-based selection process, with evaluation of technical merit by government and academic experts, and business reviews by government experts and private sector experts who have no conflict of interest.
On average, ATP award recipients pay more than half the total costs of the R&D. This helps ensure that companies have a vested interest in the success of the project and timely commercialization. Moreover, industry is the source of proposals for technology focus areas -- multiyear efforts of about $20 million to $50 million per year, targeted at specific, well-defined technology and business goals. ATP also sponsors at least one general competition a year, inviting industry proposals in any technology area.
NIST inaugurated its program of technology focus areas in April 1994, and announced awards in these areas in October and November. The first five focus areas selected were: Information Infrastructure for Health Care, Tools for DNA Diagnostics, Component-Based Software, Computer-Integrated Manufacturing for Electronics, and Manufacturing of Composite Structures. A second set of technology focus areas was announced in early December. They are: Catalysis and Biocatalysis of Chemicals (including "greener" processes); Motor Vehicle Manufacturing Technology; Digital Data Storage; Digital Video in Information Networks; Vapor Compression Refrigeration Technology; and Materials Processing for Heavy Manufacturing.
Evaluation. From the start, ATP has strongly embraced program evaluation and considers it critical to the operation and long-run success of a results-oriented, efficiently run program. NIST's evaluation plan for ATP has provided a model for other industry-led cost-shared technology programs, including the Technology Reinvestment Project. It includes the general criteria outlined above, in the section entitled "Schedules, Deliverables, and Evaluation." More specific indicators of success, already used to rate early impacts on participating companies from ATP's startup years, include:
Budget. All of ATP's government funding is provided by the Department of Commerce. Funding in FY 1993 was $68 million. In FY 1994, the program was expanded to full-scale, with funding of $200 million, in FY 1995 it is funded at $431 million, and the FY 1996 President's request totals $491 million. Because of careful scale-up planning in its early years, NIST has been able to expand the program quite rapidly. Note, however, that ATP's current funding is still moderate in terms of the federal R&D spending overall. In FY 1996, it accounts for less than six-tenths of one percent of the total federal R&D budget.
2. Dual-Use Technology PartnershipsSince World War II, U.S. military superiority has been based on technological advantage. Technology will be even more important in the uncertain and unstable security environment we now face. But to maintain this advantage for our fighting forces, we must adopt a new defense technology policy. Two forces make the change unavoidable.
First, during the past several decades, the defense industrial base has become more and more isolated from the commercial base, due to layers upon layers of special requirements for defense procurement and to overreliance on military specifications. At the same time, the cost of supporting a segregated defense industrial base has grown rapidly. With DOD's procurement budget down by half since the height of the Cold War, the Nation can no longer afford to maintain two separate industrial bases.
Second, in a number of important technologies, the defense industry no longer leads the commercial sector. In fact, the new technologies that are most critical to national security -- software, computers, semiconductors, telecommunications -- are all being driven by fast-growing commercial demand, not by military demand.
A dual-use technology strategy will allow DOD to exploit the rapid rate of innovation and market-driven efficiencies of commercial industry to meet defense needs. By drawing on commercial technology and capabilities wherever possible, the military can do its job more effectively and at lower cost. In addition, the dual-use strategy allows DOD's continuing investments in leading-edge technology to contribute more to our Nation's commercial performance and economic growth.
One element of the dual-use approach is government investment in cooperation with industry to develop technologies with both military and civilian applications. The Department of Defense and Defense Programs in the Department of Energy are both strongly engaged in such partnership programs. Outstanding dual-use R&D programs include the Technology Reinvestment Project, a multi-agency effort funded by DoD, and a major portion of the Cooperative Research and Development Agreements (CRADAs) between industry and federal government laboratories (those funded by DoE Defense Programs).
The Technology Reinvestment Project, chaired by ARPA, is the largest and most visible of the DoD dual-use initiatives. It provides a mechanism for exploiting the potential of advanced commercial technologies to meet defense needs. ARPA has partitioned the TRP program into three distinct areas - technology development; deployment of technology to small and medium-sized businesses; and manufacturing education and training.
For example, a TRP-funded consortium is blazing the trail in multi-chip module (MCM) technology, which allows electronic systems to work faster and more reliably using less power. The military applications of MCMs range from precision guidance of advanced weapons to realtime signal processing for intelligence activities. At the same time, commercial use of MCMs contributes to and improves a vast array of high-technology products, including global positioning systems, realtime engine controllers for automobiles, solid state recorders, and digital signal processors for speech and images in telecommunications. Commercial demand will eventually make MCMs more affordable to the military, so that DoD benefits by accelerating technology development while still ensuring that it meets defense needs.
Highlights of the TRP program include:
Evaluation. For its contribution to the civilian industrial sector, TRP has modeled its evaluation plan largely on ATP's plan. For its major focus on military applications, TRP is developing a different, highly detailed evaluation plan. The ultimate test of the success of a dual-use technology program such as TRP will be the ability of the military to keep its technological edge, drawing from affordable, state-of-the- art technologies from the commercial sector, and the commercial success of these same technologies.
Budget. The budget for TRP and related programs was $550 million in FY 1993, $474 million in FY 1994, and $550 million in FY 1995.
3. Partnerships With Federal LaboratoriesFor over a decade, a series of laws and executive orders, receiving strong bipartisan support, have encouraged technology transfer from federal laboratories to industry. Several mechanisms have evolved to accomplish this goal, including licensing, personnel exchanges, access to user facilities, and compensated work for others. Cooperative Research and Development Agreements (CRADAs) were created as a special mechanism for technology transfer in 1986, for government-operated labs, and in 1989, for government-owned, contractor-operated labs. Other cooperative mechanisms are also employed, particularly at NASA, which has a number of options for working with industry to develop technologies that are mutually beneficial, both for the agency's space and aeronautics mission, and for commercial success in the private sector.
As with the Advanced Technology Program and the Technology Reinvestment Project, CRADAs and other cooperative agreements are cost-shared with the private partners and projects are proposed by industry. Unlike the ATP and TRP programs, however, the Federal labs contribute expertise and technology but do not provide funds to the non-Federal party. Rights to intellectual property are negotiated between the laboratory and the participant, and certain sensitive information important to industrial partners is protected from public dissemination for up to five years.
Since the CRADA mechanism was introduced, it has rapidly become the primary mode of industry-driven cooperative technology development with federal labs. Eleven agencies had a combined total of over 4,000 CRADAs, valued at $1.4 billion, at the end of 1994.
The number of CRADAs approved has risen steeply since 1993, reflecting efforts to simplify and improve the process by which these agreements are made. In addition to developing model, modular CRADAs with preapproved terms and conditions (easing the burden on researchers and ensuring a certain level of consistency and fairness in the agreements), the Administration's efforts include:
Evaluation. The evaluation system for CRADAs includes measures of:
As with ATP and TRP, measures of success include the general criteria for industry-led, cost-shared programs outlined above, in the section entitled "Schedules, Deliverables, and Evaluation."
E. ConclusionWhile primary responsibility for technology R&D lies with industry, the Federal government has invested in technology partnerships with the private sector for a long time: granting rights-of-way to private railroads, transporting U.S. mail on the fledgling airlines, developing standard weights and measures, investing in university agricultural research and extension, and "spinning off" technologies to the aerospace, computer, communications, and pharmaceutical industries as a result of defense, energy, space, and health related government "missions."
The end of the Cold War, the globalization of the world economy, and the explosion of new information and manufacturing technologies creates both challenge and opportunity for American industry, necessitating a "new R&D mission." That mission will be achieved by organizing a small percentage of Federal R&D resources specifically aimed at enhancing the competitiveness of American industry.
The Committee on Civilian Industrial Technology is coordinating the efforts of eleven Federal agencies to provide a range of government partnerships with industry, from the Advanced Technology Program at Commerce to expanded Cooperative Research and Development Agreements at Energy to focused industry programs for automotive, electronics manufacturing, and building and construction technologies.
The CCIT principles guide each of these efforts. Each was established based on industry interest, merit, and public need. Each is industry-driven and cost-shared. Each invests in research and development that individual companies could not perform themselves. Each will be measured for performance on a regular basis and discontinued by a set stopping point. Each will leverage limited Federal taxpayer investments for maximum economic impact.
The ultimate goal of these strategic efforts, and the ultimate measure of performance, is a productive, growing economy that creates high wage jobs and a rising standard of living for all Americans.
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