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Growing your Lemonade Stand: Exporting Drives Sales and Innovation
9.19.2014

Remember how much fun it was opening your own lemonade stand?

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You would go to the supermarket with your parents to buy the ingredients, rush home to the kitchen with your siblings to mix everything up, create your own lemonade stand sign, and then head out to the end of your driveway / sidewalk to offer neighbors a cup of watered-down lemonade for 25 cents. While 25 cents per cup wasn’t the greatest profit margin, you still felt the most successful entrepreneur in the world!

I’m not taking a trip down memory lane for nostalgia purposes. The childhood lemonade stand can actually teach us a lot about manufacturing in today’s global economy, particularly when it comes to exporting and growing your business.

Lemonade for the Street vs. the Neighborhood

Let’s say you live in a neighborhood of 100 houses. However, you live at the end of a private side street where there are only five houses… and cars very rarely come your way. If you just sell lemonade to those five houses, you may cover your costs and make a small profit on your stand. However, it would be hard to grow your business. In order to build a successful lemonade stand, you would have to expand to other streets throughout the neighborhood and get in front of more customers, right?

Now let’s think about today’s business world. Ninety-five percent of the world’s customers live outside the United States. This isn’t an exaggeration – if you aren’t exporting, you are currently only hitting 5 percent of the world’s potential customers. You’re the lemonade stand at the end of a cul-de-sac.

Misconceptions about Exporting

In today’s competitive global market, the status quo is no longer an option. It’s not about sustaining business – it’s all about growth. However, many U.S. manufacturers don’t embrace exporting as a viable business plan to increase sales. According to an International Trade Administration fact sheet, “less than 1 percent of America’s 30 million companies export – a percentage that is significantly lower than other developed countries.”

Why aren’t more manufacturers exporting? Misconceptions lead companies to believe that exporting isn’t right for them.

Many manufacturers think that the market is “big enough here” in the U.S. to maintain business. While our domestic market is in fact huge, we’re also one of the most competitive nations in the world. The Internet and emerging technologies have only accelerated the competition. our target customers can research their competitors and pricing information at the touch of their computers or phones. There is only so much growth potential here in the U.S., especially as only 5 percent of the world’s market resides here

Others avoid exporting because they believe it will be too difficult. Foreign markets have different rules, regulations, currencies, etc. The risk may be too high. This isn’t an entirely unreasonable concern; there are certainly obstacles and logistics to overcome. However, there are many resources available to help companies strategically navigate these challenges It may take a bit of time to gather exporting know how, but the process is not as difficult as many businesses presume.

Finally, companies think that because they’re a small business, they don’t have the ability to export. Exporting is only for large manufacturers, right? The truth is – 97 percent of exporters are actually small or mid-sized businesses according to the National Association of Manufacturers. More than two-third of exporters are estimated to having fewer than 20 employees according to Export.gov. What companies lack in size, they make up with strategy.

The Benefits and Innovation of Exporting

The clearest benefit of embracing exporting is more sales. By entering previously untapped markets, a manufacturer can increase revenue and growth. A study by the Institute for International Economics found that, “U.S. companies that export not only grow faster, but are nearly 8.5 percent less likely to go out of business than non-exporting companies.”

There are other benefits. For instance, when companies enter different markets, they’re exposed to new cultures and buyer personas. These experiences enable an organization to develop a broader understanding of different types of consumers. This knowledge can influence how manufacturers sell domestically to their own target audiences.

Innovation is important for any manufacturer in today’s economy. Innovation is a common “buzzword,” but being innovative means solving a problem in a unique way or trying something new to improve your business. If your company wanted to try a new internal process, technology, product enhancement or even an entirely new product line, you could use the foreign market as a test. This leads to innovations you can offer to your domestic customers. 

Get Hands-On Help withExporTech™

So now you are interested in exporting and probably have a lot of questions such as, “How do I start?” “How do I select the right countries and business partners?” and “How do I overcome the logistics and make sure I get paid?”ExporTech™will help you answer these questions and more!

The ExporTech™program helps U.S. manufacturers systemically and strategically enter foreign markets. The program is geared towards C-level executives and key decision makers and is backed by the NIST Manufacturing Extension Partnership, U.S. Export Assistance Centers, FedEx and numerous legal and logistic experts.

In ExporTech™, exporting experts actively engage with participants and provide hands-on coaching to help U.S. manufacturers develop their strategic exporting plans. Participants attend three workshops over the course of three months and all classes and lessons are based on proven exporting methodologies, research and success stories.

Manufacturers leave the program with a specific exporting plan to drive sales; it is also the only national program where organizations develop a written exporting plan that is reviewed by experts. This accelerated program is also designed so that companies can start exporting right away.

Nearly 575 companies have participated in 105 ExporTech™ programs across the country. Since 2007, the total program resulted in $400 million in increased or retained sales for participants and the average participant realized:

  • $770,000 in new export sales
  • New sales from exporting within six months of completing the program
  • $50,000 in cost and investment savings

More than 30 small manufacturers relay their ExporTech™ success stories on the MEP website.

Resources for Exporting

For more information about ExporTech™, see a list of state MEP centers providing the program.

The U.S. Commercial Service also offers a “Gold Key Matching Service” which helps companies find potential overseas customers, distributors and business partners. Trade counseling is also available. And there are also various international trade fairs in the near future where companies can start introducing their products to foreign customers.

Put your “lemonade stand” in front of more thirsty customers. Exporting can help a good company grow its business and secure its future.

This piece first appeared in Manufacturing Innovation Blog.

Kari Reidy is Acting Manager, Communications at Manufacturing Extension Partnership, National Institute of Standards and Technology.

 

 

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When Shale Gas Met Software
9.17.2014

Getting shale gas out of the ground is one thing. But taking it to customers is quite another.

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American pipeline operators are investing as much as $40 billion every year to maintain, modernize and expand their networks. The shale gas boom is putting operators under pressure to move more gas to marketfaster and more safely, and many U.S. pipelines have been in service for at least two decades.

“We need an agile and comprehensive pipeline solution that could be delivered quickly and allows for a more real-time view of pipeline integrity across our interstate natural gas pipelines,” says Shawn Patterson, president of operations and project delivery at Columbia Pipeline Group.

Columbia runs a 15,000-mile gas pipeline network linking the Gulf Coast to the mid-Atlantic region and the Northeast. It will soon start using GE software and big data to monitor its network in almost real time, and streamline its operations and planning.

The technology, called Intelligent Pipeline Solution, combines GE software and hardware with Accenture’s data integration expertise. It runs on Predix, GE’s industrial software platform, and links pipelines to the Industrial Internet for the first time.

The Intelligent Pipeline Solution is the first commercial product GE and Accenture have offered up since they formed their software and big data partnership in 2013. The companies expect the system to be operational in the first half on 2015.

The world’s pipelines stretch for some 2 million miles, enough to wrap themselves 80 times around the equator. GE estimates every 150,000 miles of pipeline generates an amount of data equal the entire printed collection of the Library of Congress, or 10 terabytes.

Brian Palmer, chief executive of GE’s Measurement & Control unit, says that the new system will help customers like Columbia make the right decisions at the right time to keep their assets safe. It will help them send repair machinery and crews where they are needed most, and speed up response time to problems.

The system is designed to harvest data from sensors installed along the pipes and equipment, sync it with external data sources and deliver to customers detailed analytics and risk assessment from key points of the network. “The goal is to help pipeline operators make proactive, rather than reactive decisions,” Palmer says.

The piece first appeared in GE Reports.

 

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Global Health Innovation at Work: A New Approach to Cancer Screening
9.16.2014

Innovation is the buzzword of the decade. Touted by government officials, corporate and civic leaders and entrepreneurs, the word has become a stand-in for anything cutting edge or trend setting.

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But for those of us working in the field of global health, innovation is the driving force behind transformational change that can propel the most promising solutions to the world’s relentless health challenges.

Innovation in global health is more than scientific breakthroughs and engineering feats, and shiny new technology — it means offering health providers in impoverished and remote communities the opportunity to save lives with safe, effective and affordable healthcare interventions.

That’s the essence of the innovation behind the “single visit approach” (SVA), a strategy for cervical cancer prevention pioneered by Jhpiego, a global health affiliate of Johns Hopkins University.

For most women in the developing world, screening for cervical cancer is rare, resulting in over 270,000 women needlessly dying every year from what is a preventable and treatable disease. The SVA is a low-cost method that uses simple vinegar to screen and offers same-day cryotherapy treatment, all at a fraction of the cost of the traditional PAP smear and saving the time and expense of making another trip to the clinic.

SVA is saving lives in 22 countries around the world where Jhpiego has supported cervical cancer prevention programs. In Tanzania, Julietha Makyala, a 37-year-old mother of three children, decided to take advantage of a free cervical cancer screening. She and 13 other women screened that day at a health facility in Njombe tested positive for precancerous lesions and were able to receive treatment quickly and safely during the same visit.

That kind of impact is exciting and energizing, but what about the millions of women who aren’t as lucky as Makyala? The success of the cervical cancer “screen and treat” programs in preventing women like Makyala and others from dying unnecessarily from cervical cancer depends on something quite simple: cryotherapy equipment that works, is affordable and empowers the healthcare workers in the outer corners of health systems worldwide to treat the women whom they screen and among whom they identify pre-cancerous lesions.

Yet in many countries, cryotherapy equipment that is cost-effective, robust and efficient for the single visit approach remains a bottleneck. It was this reality that prompted a team from Jhpiego and Johns Hopkins University Center for Bioengineering Innovation and Design to develop CryoPop — a new, inexpensive cryotherapy device that is portable and cost-effective.

Let’s take a moment to walk in the shoes of a nurse in rural Tanzania, Antonia Masinga. Like most healthcare workers in developing countries, Masinga’s job is demanding; and like the rest of us, she takes pride and ownership in the ability to do her job well and deliver life-saving healthcare to her community.

Her health clinic would like to start its own SVA cervical cancer program in her district, but the one piece of cryotherapy equipment they have cost a lot, so they could only buy one or two. One of them is now broken, and the cost and complexity to get it fixed has rendered it a dust collector in the corner of her clinic.

Now, when women come in to get screened, if Masinga detects a pre-cancerous lesion, she often has to refer the women elsewhere to get treated. As they walk out the door, Masinga worries that the woman will go home and her lesion will progress without getting treated, a missed opportunity and a tragic reality.

CryoPop is designed for people like Masinga, but costs a fraction of existing cryotherapy devices. It is also more robust and uses CO2 more efficiently — a gas that’s available wherever anyone drinks Coca-Cola. That means we will be able to see and treat more women at a lower cost to the health system.

In advanced product development stage, the CryoPop team has spent extensive time with users and clinical experts from all over the world. In addition to empowering healthcare workers like Masinga and making successful cervical cancer prevention and treatment programs a reality for women and families regardless of where they live, it turns out that CryoPop could also be an attractive alternative for clinical providers in developed or emerging markets in Asia, Europe, and Latin America. CryoPop has the potential to close the gap in cervical cancer prevention and treatment.

Developing technology for global health is not easy, with —even the simplest technologies facing a challenging course to move from idea to impact. CryoPop is simple, but transformational — empowering frontline health workers who are committed to providing quality, life-saving care to the women who need it most. And with the help of partners like the GE Foundation, we are closer to bringing this change about.

It is up to us to find the intersection of innovation, global health need, and engineering and scientific breakthroughs to deliver on the promise of global health technology.

Brinnon Garrett Mandel is the Director of the Innovations Program at Jhpiego, an affiliate of Johns Hopkins University, managing a portfolio of global health technology innovations and a team of bright engineers and public health clinicians, researchers, and practitioners. With a background in both public health and business, Mandel has worked in various roles at Jhpiego and in the private sector, with an interest in the intersection of global health, technology and business.

 

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Does Your Brain Need a Few Reps at the Gym?
9.15.2014

Some muscles are easier to flex. Athletes can hit the weight room to run a faster 40-yard dash, but what about engineers looking to improve their memory and problem-solving skills?

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Welcome to the brave new world of brain training, where companies such as Brainturk, Lumosity and Mindsparke offer specialized games and mental activities to “exercise” and enhance cognitive capacity and mental health. While the concept may sound more rooted in science fiction than reality, it’s based on real breakthroughs in neuroscience, namely the concept of neuroplasticity.

One Word: Plastic

The physiology of gray matter is still one of the most mysterious phenomena in natural science. It was long believed that brain cells develop in utero and remain essentially the same through adulthood — that our brains don’t change much over our lifetime. That’s no longer believed to be true.

“During most of the 20th century, the consensus among neuroscientists was that brain structure is relatively immutable after a critical period during early childhood,” says Kiran Kumar, founder of Brainturk. “This belief has been challenged by findings revealing that many aspects of the brain remain plastic even into adulthood.”

Kumar cited other research showing that supports the theory that “working memory can be increased in adults.”

In the face of a growing body of evidence suggesting that life experiences affect brain cell growth and development — the idea behind neuroplasticity — services such as Brainturk and Mindsparke ask the obvious question: If our brains can change, can we change them for the better?”

Stay tuned

Neuroplasticity is accepted science, but brain training is still a nascent industry that has sparked its share of debate. Though studies have shown that users get better at brain-training games over time, researchers are still looking at how that correlates to abilities in the real world — including job skills.

So far, anecdotal evidence is positive, but definitive proof never hurts when you’re trying to market the efficacy of a product. “There is a tendency for companies to say a certain measure represents X ability, but there may be insufficient, if any, research to support the assertion,” Dr. Sherry L. Willis, a University of Washington research professor told the New York Times.

A 2008 study by scientists from the University of Michigan and Bern found that 30 minutes a day of using training method boosted the working memory and fluid intelligence of participants by at least 40 percent more than a control group after just 19 days.

“This kind of jump in our thinking power can do wonders for our job performance,” says Martin Walker, an Oxford-trained scientist who founded MindSparke, which employs a similar training method in its program.

Walker, who calls the brain “the most valuable asset” in our careers, says brain training is a way to invest in your future.

Brainturk and Lumosity are currently working with researchers to study cognitive training. Brainturk is doing a clinical trial with a pharmaceutical company, while Luminosity is conducting research with institutions that include Harvard and Columbia.

Kumar acknowledges that Brainturk is exploring uncharted waters, but he sees a promising future for cognitive training as a means for personal — and professional — growth.

“The brain fitness industry is quite new and as per a market survey, it is set to grow in the upcoming years,” Kumar says. “We at Brainturk hope to provide tools to individuals as well as corporates to improve their overall mental health and gain peak performance at a very low cost using the latest technologies.”

Given the intense competition among businesses to attract the best and the brightest, is it only a matter of time before they start investing in their talent’s brain power?

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Running on Waste Heat
9.12.2014

Gang Chen’s thermoelectric devices turn waste heat into electricity for vehicles and other machines.

It’s estimated that more than half of U.S. energy — from vehicles and heavy equipment, for instance — is wasted as heat. Mostly, this waste heat simply escapes into the air. But that’s beginning to change, thanks to thermoelectric innovators such as MIT’s Gang Chen.

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Thermoelectric materials convert temperature differences into electric voltage. About a decade ago, Chen, the Carl Richard Soderberg Professor of Power Engineering and head of MIT’s Department of Mechanical Engineering, used nanotechnology to restructure and dramatically boost the efficiency of one such material, paving the way for more cost-effective thermoelectric devices.

Using this method, GMZ Energy, a company co-founded by Chen and collaborator Zhifeng Ren of the University of Houston, has now created a thermoelectric generator (TEG) — a one-square-inch, quarter-inch-thick module — that turns waste heat emitted by vehicles into electricity to lend those vehicles added power.

“Everybody recognizes the great potential of waste heat, but the challenge has always been that not many think seriously about systems that can turn that heat into power,” Chen says. “It’s not just waste heat, it’s wasted potential to do useful work.”

In a TEG, electricity is generated when heat enters the top of the module, and then moves through the semiconductor material — packed into the TEG — to the cooler side. The resulting motion of electrons in the semiconductor under this temperature difference creates a voltage that’s extracted as electricity.

However, in many TEGs, atomic vibrations in the material can also leak heat from the hot to the cold side. GMZ’s method essentially slows the heat leakage, leading to a 30 to 60 percent increase in performance across many thermoelectric materials.

The company’s TEG can withstand temperatures of roughly 600 degrees Celsius on its hot side (top surface), while maintaining a temperature of 100 C on its cold side (bottom surface). With this gradient of 500 C, a module that’s 4 centimeters squared can produce 7.2 watts of power. Installed near a car’s exhaust pipe, for instance, this converted electricity could power the car’s electrical components, essentially reducing the load on the vehicle’s alternator, reducing fuel costs and overall emissions.

In June, GMZ successfully generated 200 watts from a larger TEG as part of $1.5 million program supported by the U.S. Department of Energy (DOE). The goal is to eventually integrate multiple 200-watt TEGs into the Bradley Fighting Vehicle, a U.S. military tank, to produce 1,000 watts, helping save on fuel consumed on the battlefield, which can cost $40 per gallon.

GMZ is also working under another $9 million DOE grant as part of a program to improve fuel economy in passenger vehicles by 25 percent. GMZ has plans to soon apply its TEGs to cars, with aims of improving efficiency by 5 percent.

Decades in the making

The concept of thermoelectrics dates back to 1821. Initially called the Seebeck effect, after its discoverer Thomas Seebeck, it derives from heating one end of a conductive material — a semiconductor, for example — to cause electrons to move to the cooler end, producing an electric current. Applying a current to the material, in turn, carries heat from the hot to the cool end.

Thermoelectric technologies picked up steam in the 1950s, as companies and research labs started funding projects to bring the technology to real-world applications. Although these efforts led to niche applications in refrigeration and sensors, large-scale applications did not materialize, because thermoelectric materials are notoriously inefficient: While these materials conduct electricity well, they also conduct heat well, so they’d equalize temperature quickly, leading to a low efficiency.

The field remained stagnant for decades. Then, in the 1990s, researchers — including Institute Professor Emeritus Mildred Dresselhaus at MIT — began using nanotechnology to restructure thermoelectric materials for greater efficiency.

Chen arrived at MIT in 2001 after researching thin films and nanowire-based thermoelectrics for four years at the University of California at Los Angeles, including a long-distance collaboration with Dresselhaus. At MIT, he continued his collaboration with Dresselhaus and brought in Ren, a materials expert, to develop new materials.

Then, in 2008, Chen, Ren, and Dresselhaus met another milestone: They realized a 40 percent increase in the efficiency of bismuth antimony telluride — materials used in thermoelectric coolers — using an inexpensive process.

As described in a Science paper that year, Chen and his team crushed the material into a nanoscopic dust and reconstituted it in bulk form — with grains and irregularities that dramatically slowed the passage of phonons through the material. (Phonons, a quantum mode of vibration, are primary means of heat conduction.) This reined in the heat leakage, while allowing for the free flow of electrons.

Using a cost-effective and safe alloy in bulk form meant the material could be applied to a variety of applications. And Chen saw that the method — “now widely used around the world,” he says — was ripe for commercialization. “With thermoelectrics, you’re always doing research for potential application,” he says.

“Once the material was good, it was time to move.”

The world “needs a device”

To branch out into a startup, Chen found inspiration from MIT’s entrepreneurial ecosystem. “You sort of feel it,” he says. “You hear and see what other people are doing and you get inspired.” (Now, he says, he’s become part of that ecosystem, “guiding students who want to start a company.”)

After their discovery, Chen and Ren launched GMZ out of a garage in Waltham, Mass., with the broad goal of developing and commercializing their materials.

“But we were a little naive,” Chen says. “It turns out that because the thermoelectric market is small, there’s no big buyer. We realized the materials world wasn’t just about materials. It needs a device.”

Three years later, they had tangible products to pitch to investors: a device that could draw electricity from solar hot-water collectors and an early version of the current TEG module. They managed to raise $7 million in their first funding round and $18 million a few months later.

But challenges persisted. Because there was no similar product on the market, they went through years of trial and error; deciding on materials, for example, is challenging, because in thermoelectric applications there are many types of materials to use and a variety of heat sources. “The [efficiency] of a material depends on temperature you’re facing,” Chen explains. “So you have to look at what’s the heat source temperature, and what material matches that temperature range.”

For their commercial TEG modules, which the company started producing around 2011, GMZ settled on half-Heusler materials, an alloy with a strong crystal structure that allows great stability at high temperatures. But the company has future plans for other materials: bismuth telluride, lead telluride, the mineral skutterudites, and silicon germanium.

Apart from giving the company a boost, the development of TEGs was a means of helping the whole market evolve, Chen says: “Thermoelectrics isn’t something you can see. It’s not as recognized as a battery or photovoltaic cell. The whole field needs successful products on the market to sustain, inspire, and stimulate innovation. That’s really a mission for people working on this.”

Ultimately, Chen sees GMZ as a big step toward his goal of helping create a more energy-efficient world. “Most of my research at MIT is about energy,” he says. “The motivation for me is really taking this basic research into the real world. I take great pride in that.”

Reprinted with permission of MIT News.

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