"Today many industries look up to our expertise"
Today many industries look up to the expertise at Indian Institute of Chemical Technology, Hyderabad (IICT). We can cater to industry needs on lab scale to designs on commercial scale. IICT is number one in sponsored research among CSIR labs. I feel industry has responded well in exploiting our expertise and we are meeting their requirements. Dr. G. Sampath Kumar, Head of Business Management Division of IICT, Hyderabad, shares the Institution's experience with industry.
Here are the excerpts from the interview.
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What
are the general requirements of the Indian companies, which have sought IICT's
R&D, help. What are the different considerations IICT takes into account
before accepting the assignment? How has been the experience so far, in terms of
specification of the requirements, client satisfaction, etc?
R
& D requirements of the companies vary with their size.
R & D services for large scale industry include technology
development, consultancy and technical services.
SMEs generally fallback on public sector R & D organizations.
SMEs expect end-to-end solution. They
also source off-the shelf technologies.
Large
industrial organizations generally would have their own R & D set up. They
approach us to reduce risks and make use of their expertise. For public organizations we have given designs for commercial
plant, backed up with performance guarantees.
Government
organizations like Defense establishments, ISRO have approached us for
‘substitute’ products. We have
successfully fulfilled such requirements.
In
consultancy services that we render, tacit knowledge is passed on to the clients
for their product development or capacity improvement.
In such cases implementation is clients’ responsibility. We cater to Indian clients in consultancy mode.
Technical services mostly belong to analytical services. We analyze and interpret results for the clients. This is in the nature of quality assurance. Our work here would be like random checking as opposed to routine checking the industries do internally.
We take up contract R & D – in project mode or in FTE - Full Time Employment - mode. Here we are paid a specific amount and a fulltime scientist and two assistants would be on the job and all expenses and overheads are taken into account.. In contract mode projects deliverables are defined in clear terms.
We
can see from your brochure many overseas companies have sought IICT's help in
R&D. could you tell about the nature and range of research the institute has
carried out for them. And, what do these companies find attractive with the
institute, is it the cost effectiveness or expertise etc.
Overseas
clients monitor our capabilities and approach us with background understanding
of our strengths. What we do is
cost effective for them. We are
preferred because as an R & D lab we could be
on the project full time, as opposed to a professor in a university in
the U.S. IICT in its activities
could be all-inclusive in the tests, as we would have the equipment and
expertise required for the purpose. Also
in cases where quantity required is small, they would approach us for making the
best of the cost benefit.
Overseas
projects are normally taken in FTE – Full Time Employment—mode.
One FTE would range from $60,000 to $1,00,000, which includes one
scientist and two assistants. In
this mode the project runs for a fixed period like six months, one year etc.
Project review is made in video conference mode with technical people
present on both sides. We have companies from France, Hong Kong, Japan, Switzerland,
the U. S. outsourcing projects to us.
Tricky
thing about the R&D is the timeframe. Sometimes we may not be able to get
the results as expected or develop processes. What have been the experiences so
far? Was there any instance when the contract had to be renegotiated due to such
reasons?
When
we are in the project mode we can work out the time required to finish tasks,
subject to factors such as availability of chemicals, manpower etc.
We could have difficulty with chemicals because we need small quantity of
chemicals and that to industry quality chemicals.
This quality chemicals are not necessarily available in small quantities.
Availability of equipment is also a consideration in contract
negotiation. Our experience so far
with overseas clients are very good. In
FTE mode there is no chance of project crossing the time limit.
If it is in the nature of advice or technical analysis we do not charge
extra if the project over shoots.
We
do the costing and projections before signing the contract.
There are instances where the contract was terminated mid-way by the
sponsors for various reasons. In
such cases we would not have any liability.
We may not get the complete money, but we will not have to return any
either. The payments are usually activity linked.
How
does the IICT balance in-house research and sponsored research interests? Are
people involved for these activities separately identified or all the scientists
are liable to take up the activities as required?
Engaging
in sponsored research is a policy decision made by CSIR in 1996.
CSIR labs are expected to earn 1/3 of their budget through contact R
& D. Many of the CSIR labs had a culture of taking up contract
research. Each department in IICT,
for instance, is asked to give its targets for externally earned revenues.
Departmental
and individual performance is measured on the basis of revenue earnings, paper
and patents. Scientists are given
options on what they choose. IICT
has been successful in generating revenue beyond its call.
We
grew from Rs.5 crore in 1996 to 33.5 crores
in 2007, which is almost 50% of our CSIR budget.
Normally the lab projects the annual targets for externally funded
projects and the same is allocated among different departments in the lab. The targets have increased by 20% annually over the years.
There are incentives for those who take up these projects which could be
up to 15% of the net savings.
Costing
R&D is a tricky job. How does IICT go about pricing the services? In terms
of budgets, which are the larger sponsored projects IICT has handled. And,
roughly what kind of margins are there in the activity?
We
adopt two principles in costing. On certain projects/services we cost as per
CSIR norms. It would be usually
cost + x. We are flexible with x
amount. On these matters the
Director of the lab takes final decision.
On
consultancy/or selling off-the-shelf technologies we charge ‘what the market
can bear’. We also have projects
in FTE mode, as I explained earlier.
We
have projects with budget line of Rs.10-30 crores.
Normally, these projects have time span of 2-3 year.
We have worked on selected overseas projects with $200,000 as fees.
How
have the scientists' taken the new challenge?
The
big projects are generally inter-departmental in nature.
These projects would have nearly 20 scientists working on them.
Scientists have taken this as a challenge.
Also, external projects are part of our organizational philosophy from
the very beginning. Industrial research is a part of our mandate.
And, scientists are given a choice on their activity tours and they make
their own targets, to that extent they balance their activities.
IICT
has many patents how have these patents contributed to the annual income?
In
pre WTO period IICT took advantage of the then prevailing patent law in the
country. In the 80s we started
developing processes and patented the same.
We have transferred almost 60 molecules to drug industry 50-60 adhesives,
and almost all of them are process patented.
In
post-WTO period, generally we would be IP partners with the sponsoring company
and in case of transfer of technology by the company to an outside agency.
We share the revenue as agreed upon.
Wherever we are owners of the patent we are putting more efforts to
commercialize the same. The labs have to bear portion of the amount for patenting.
The rest is borne by the
CSIR. Our annual expenditure on
patents is around Rs.2 crores. We have over 250 patents in force currently.
What
is the current ratio of grant-in-aid to sponsored R&D funding for the
institution? Are there any specific goals to be met? What are plans regarding
the income from sponsored research.
In
1996 we started with grant-in-aid and non-grant-in-aid—with 50:50 ratio.
Today grant-in-aid is around 70 percent.
In 30 percent non-grant-in-aid revenue, two-third is from overseas and
the rest from Indian sources.
IICT
has a technology-clearing house. What are its scope and activities?
Technologies
developed in the process of sponsored projects are with us and we transfer the
same through our clearinghouse. These
are transferred in one of the three ways, against payment.
What
is the experience with the industry so far? Have they been forthcoming with new
requirements? How does the future look like?