www.pwc.com
What are today’s megatrends in industrial
transformation and how
to spot them
Vienna, 19 April 2012
Laurent Probst
Erica Monfardini
Laurent Frideres
Case study: Maritime and renewable energies (1/3)
The emergence of a new technology
1990s
In a climate of increasing awareness of the global
need for research and development in renewable
energy, research begins on marine turbines to
generate renewable energy from tidal streams
2005
OpenHydro is formed after negotiation of world
rights to the Open-Centre technology
• Design and manufacture of turbines for
deployment in tidal farms throughout the
world's oceans
• Sale of turbines with turnkey installation and
maintenance services providing developers
with an end to end solution
2006
Testing of the Open-Centre Turbine begins at the
European Marine Energy Centre (EMEC) in
Orkney, Scotland
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
2
Case study: Maritime and renewable energies (2/3)
DCNS and the Port of Cherbourg
1700s
1900s
DCNS is a naval defence company based in
France and one of Europe’s leading shipbuilders,
a company involved in both traditional and new
activities
1990s
The Port of Cherbourg, highly dependent on the
naval defence industry and the construction of
nuclear submarines, enters a crisis after the end
of the Cold War
1996
1700 jobs are lost at the shipyard of Cherbourg
2000s The reconversion of the port and the shipyard
presents an ongoing challenge
Attempts are made to identify new opportunities
for the port and to diversify the local economy
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
3
Case study: Maritime and renewable energies (3/3)
Development of a new industrial segment
2007
DCNS acquires Sirehna, a specialist engineering
company focused on the creation of key technologies
for the naval, offshore and energy sectors
2011
DCNS buys an 11% stake in OpenHydro
2012
DCNS and OpenHydro win the Cleantech 2012 Award
for the best investment in an innovative start-up by a
major corporate group
2012
A pilot project with four turbines is underway off
Paimpol-Bréhat in Brittany
2014
Planned start of operations of a new manufacturing
plant for tidal turbines at Cherbourg
2018
Production of 100 turbines annually expected at the
new facility in Cherbourg creating 2-300 new jobs
What are today’s mega-trends in industrial transformation and how to spot them
PwC
Acquisition
Test case
New
manufacturing
process
19 April 2012
4
New emerging industries
Characteristics
• Usually formed on the basis of a new product, service or idea
and come into being when consumer needs change, new technologies
replace older ones, or when new socio-economic conditions emerge
• Most often driven by key enabling technologies (KETs), new
business models such as innovative service concepts, and by societal
challenges that industry must address as a matter of survival
• Tend to be research and knowledge intensive industries, as
their emergence and development usually results from applied
creativity and disruptive innovation
• Typically nurture entrepreneurship and an innovative spirit
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
5
New emerging industries
Value chains are being reconfigured
• New emerging industries use some or part of the value chains
of traditional industries
• They consist of either entirely new activity sectors or of
restructured sectors that transform, evolve or merge into new
industries
• Service innovation is a key factor in these transformations
• Traditional sectors undergo a reconfiguration into new emerging
industries with transformations usually occurring at the
design and engineering phases
• New emerging industries have some key technologies-based
services in common, which include ICT, business services and
engineering
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
6
New emerging industries
Value chains are being reconfigured
Production
Traditional
industry
R&D
Engineering
Production
Distribution
Market
Adapted
Production
Market
Emerging
industry
R&D
Engineering
What are today’s mega-trends in industrial transformation and how to spot them
PwC
Production
Distribution
Market
19 April 2012
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Industrial transformations
New paradigms requiring new policies
Markets
New demands
Industry
Traditional
industries
Key Emerging Industries
R&D
Internationalisation
and globalisation
of R&D
Consumerism
Explosion of global
R&D capacity
Social change
Environmental
change
Emergence of the
knowledge –based
economy
New Models
Reorganisation
Key Emerging Industries
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
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2 signals to identify Emerging Industries : Equity
Investment and M&A
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
9
Identifying and classifying emerging industries
Our methodology
Focus on financial deals: mergers and acquisitions and equity investments
mergers &
acquisitions
Traditional
industry
Traditional
industry
mergers &
acquisitions
Emerging
industry
New
industry &
technology
mergers &
acquisitions
Emerging
industry
Traditional
industry
equity
investments
What are today’s mega-trends in industrial transformation and how to spot them
PwC
Finance
19 April 2012
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Identifying and classifying emerging industries
From sectors to key emerging industries
Candidate emerging
industries
Sectoral classification
Key emerging industries
Agriculture
Manufacturing
Information &
communication
Analysis
of crosssectoral
linkages
based on
M&A and
equity
data
Candidate
emerging industry
Financial
activities
What are today’s mega-trends in industrial transformation and how to spot them
PwC
Selection
of the most
active,
significant
and
relevant
emerging
industries
Key emerging
industry
Database on M&A and equity investments
including over 10,000 deals
19 April 2012
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New emerging industries
List of industries identified and numbers of deals
Number of M&A deals
Number of equity deals
Business and Management Services
1,526
3,633
Construction
2,472
5,694
Creative Industries
2,308
5,283
Eco Industries
1,452
4,517
Experience Industries
1,710
3,351
Finance
1,613
4,363
Food
1,165
2,030
ICT & Mobile Services
2,542
6,722
Maritime
1,196
2,821
Mobility
2,249
4,744
768
2,727
2,221
6,587
New Materials
Personalised Medicine
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
12
New industry configurations
Identified based on financial transactions between firms
Transport
Construction
Recovery &
Recycling
Energy
Maritime
Civil
Engineering
Manufacturing
Eco
industries
New
Materials
Publishing
Business
Services
R&D in
Biotechnology
ICT & Mobile
Services
Creative
industries
Media
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
13
Turnover (EUR million)
Key emerging industries (KEI)
Employment, turnover and value added
Value added (EUR million)
Mobility
5,000
4,500
500
1,000
1,500
Construction
4,000
3,500
Food
3,000
ICT & Mobile Services
Eco industries
2,500
Experience
Industries*
Maritime
2,000
New
Materials
1,500
1,000
Creative industries
Personalised
Medicine*
Management & Business
services
Finance*
Source: Eurostat (2009)
* The figures significantly underestimate the
sizes of these industries due to partial data availability
500
5
10
15
20
25
30
35
Employment (millions)
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
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Spatial distribution of activities
Maritime
Employment (2010)
Number of employees (2010) in
the maritime key emerging industry
< 2,500
15,000...20,000
2,500...5,000
20,000...30,000
5,000...7,500
30,000...40,000
7,500...10,000
40,000...50,000
10,000...15,000
> 50,000
Figures aggregated at the NUTS 2 level
from firm-level employment data
Data source: Amadeus - A database of
comparable financial information for
public and private companies across
Europe containing comprehensive
information on 19 million companies
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
15
Spatial distribution of activities
Maritime
Change in employment
2006-2010
Change in employment (2006-10) in
the maritime key emerging industry
< - 5,000
1,000...2,500
-5,000...-2,500
2,500...5,000
-2,500...-1,000
5,000...10,000
-1,000...0
10,000...15,000
0...1,000
> 15,000
Figures aggregated at the NUTS 2 level
from firm-level employment data
Data source: Amadeus - A database of
comparable financial information for
public and private companies across
Europe containing comprehensive
information on 19 million companies
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
16
Spatial distribution of activities
New materials
Turnover (2010)
Turnover in million EUR (2010) in the
new materials key emerging industry
< 250
2,500...5,000
250...500
5,000...7,500
500...750
7,500...10,000
750...1,000
10,000...20,000
1,000...2,500
> 20,000
Figures aggregated at the NUTS 2 level
from firm-level turnover data
Data source: Amadeus - A database of
comparable financial information for
public and private companies across
Europe containing comprehensive
information on 19 million companies
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
17
Spatial distribution of activities
New materials
Change in turnover
2006-2010
Change in turnover (2006-10) in
million EUR in the new materials key
emerging industry
< - 2,000
0...250
-2,000...-1,000
250...500
-1,000...-500
500...1,000
-500...-250
1,000...2,000
-250...0
> 2,000
Figures aggregated at the NUTS 2 level
from firm-level turnover data
Data source: Amadeus - A database of
comparable financial information for
public and private companies across
Europe containing comprehensive
information on 19 million companies
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
18
Final remarks
Relevance and significance
• Service innovation is key for the growth of these emerging
industries
• Acquisitions from and between existing industries provide early
signals of a new emerging industry
• Emerging industries represent a sizeable part of the economy
and impact significantly on regional competitiveness and longterm industrial development
• Policy and regulatory frameworks need to be frequently
reviewed and adapted to encourage and accelerate the growth of
emerging industries
Key Emerging Industries
What are today’s mega-trends in industrial transformation and how to spot them
PwC
19 April 2012
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Thank you for your attention!
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© 2012 PricewaterhouseCoopers S.à r.l.. All rights reserved. In this document, “PwC” refers to PricewaterhouseCoopers S.à r.l. Luxembourg which is a
member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity.
Contact details
Laurent Probst
[email protected]
Partner PwC
Erica Monfardini
[email protected]
Director PwC
Laurent Frideres
[email protected]
© 2012 PricewaterhouseCoopers S.à r.l.. All rights reserved.
In this document, “PwC” refers to PricewaterhouseCoopers S.à r.l. Luxembourg which is a member firm of PricewaterhouseCoopers International
Limited, each member firm of which is a separate legal entity.