Monday, January 23, 2012

Innovation and the Indian Airline Industry

Why does the Indian airline industry struggle for profitabiity? And, what role does innovation play in airlines becoming profitable? My recent article in Outlook Business addressed these issues....

Monday, January 9, 2012

Commercialising Chemical Process Technology

On December 28, I participated in a special session of the Institute of Chemical Engineers’ Annual Conference, Chemcon 2011, held at the MS Ramaiah Institute of Technology in Bangalore. (As usual!) I spoke about the challenges faced by India in enhancing innovation output based on my book From Jugaad to Systematic Innovation: The Challenge for India.

But, for me, the most illuminating talk of the afternoon was on commercialization of technology by Dr. Rakshvir Jasra, currently Senior VP (R&D), Reliance Industries. Dr Jasra has been involved in the development of 25 process technologies and holds 21 US patents, in a career that has spanned roles at IPCL, CSIR (CSMCRI) and RIL.

Dr. Jasra presented case studies from his tenures at IPCL and CSMCRI, and drew conclusions for successful commercialization from these case studies.

While at IPCL, he was part of a team that worked on a molecular sieve for ultra-drying of cracked gas. Their first effort resulted in a prototype that was installed in the Nagothane plant of IPCL (covered by Indian Patent No. 178403 dated March 5, 1998). But the sieve did not perform – it disintegrated into powder. Jasra was the juniormost member of the team – he was sent to the plant to find out what was wrong. He identified the problem - the binder to zeolite conversion was not complete. The reason: the heat treatment rate was not sufficient to develop the tetrahedral silicon which would give the sieve strength. The team returned to the lab and worked on changing the process to solve this problem. The next trial was a success – they developed a superior molecular sieve covered by Indian Patent No. 190949 of 2003 and US patent 20050119110A1 June 2, 2005. At that time, this sieve was better than sieves made elsewhere.

Dr. Jasra explained some of the characteristics of this project that enabled its success: (1) Development was a “pull” from the adsorbent business; (2) R&D and manufacturing plant were parts of the same organization – this facilitated the innovation process; (3) R&D had gained some credibility through regular technical support to manufacturing. This allowed them to try out new sieves in the plant; (4) the top management was supportive – this positive internal ecosystem helped; (5) Commercial trials involved only moderate risks (easier); (6) rather than trying to find excused for the failure of the initial sieve, the IPCL R&D team admitted failure and tried to find out what went wrong - learning from a failed trial is important – this made them re-look at the mechanism of binder to zeolite conversion.

The second process innovation Dr. Jasra spoke about was a De-olefin process for food grade Hexane from Udex Raffinate. This involved IPCL, IOC and Engineers India Ltd. The IOC refinery was the world’s first plant producing Food Grade Hexanes from Udex Raffinate by clay catalytic process. There was a rich C6 stream but a high 5% percentage of olefins. IPCL R&D, EIL (for process development and engineering) and IOC worked together to develop an eco-friendly process for olefin removal from hydrocarbons (Indian patent No. 179409 of 1999). But there was some delay in adoption by Indian Oil.

Dr. Jasra described his lessons from this project: (1) the then IOC R&D director was the champion; (2)This was like a relay race – the speed, expertise of each team had to synchronise and converge towards a goal; (3) the delay in adoption indicates that commercialisation of an obviously beneficial process may also need efforts and strategy to be accepted (a different set of people is needed to make a good business case).

While at CSMCRI, Dr Jasra worked on a commercial process for Styrene Epoxide production. There were drawbacks in the existing process for styrene epoxide, a useful chemical for perfumery. CSMCRI developed a benign process inspired by a publication in JACS resulting in US patent 7,235,676 of 2007. The process was licensed to two medium-sized companies. Dr Jasra found that these companies preferred a one-time licensing model to a model where they had to pay continuous royalties.

Another project was for Recovery of Pd (a precious metal) from Pd-phthalocyanine complex adsorbed in silica for a pharmaceutical company. This process resulted in savings of Rs. 50 lakhs per year and is covered by US Patent No. 7, 108, 839 of 2006 and EP 1576200 of 2006.

He finally spoke about a project undertaken again while at CSMCRI to study the Chemistry of producing ANC and CAN from rock phosphate [2 patents]. This project was for a leading fertilizer company and was based on precipitating calcium carbonate from an inorganic waste from a nitrophosphate plant. It was not commercialized though it was technically successful, possibly because the project champion at the customer’s end passed away. The customer did a useful job of project monitoring that helped rapid execution of the project.

Dr. Jasra’s Overall Conclusions for the factors facilitating technology commercialization:

  • A proper internal ecosystem is essential 
  • R&D / innovation team has to build rapport, credibility with the customer / business
  • Alignment with the business/customer is essential
  • Commercial trials are likely to be done only if the risks are moderate
  • Never defend failures
  • A champion is needed for technology development
  • Development and commercialization of a technology is like a relay race where speed, expertise of each team has to synchronise and converge.
  • As far as commercialization is concerned, other reasons may over-rule technical ones
  • Vendors can be important partners in the process
  • It is possible to replace an existing process only if gains are huge (depends on the context!)
  • Aggressive strategy approach is needed to get buy-in
  • Realisation of royalty is difficult