Fostering innovation in the water sector
The water sector is slow to adopt new solutions, and for good reason. Providing safe water to the public is a utility’s primary concern, and introducing new approaches increases risk and liability. These end users are not in the business of gambling with public health or, as Trevor Hill, CEO of Global Water Resources and FATHOM, put it at a recent panel discussion, managing a technology company’s risk.
Recently, Trevor and other experts were part of a panel at World Water-Tech North America, a conference that brought more than 200 global leaders to the MaRS Centre in Toronto to discuss industry challenges. During the discussion, the experienced entrepreneur suggested that companies must understand the “psychology of the buyer.” They must understand those reasonable fears and demonstrate their solutions using diligence, care and performance.
The long road to commercialization
For companies offering new technologies, it’s a long road to commercialization. Even established multinational companies have challenges introducing new products.
“Customers are just as resistant to buying new things from Dow as from a startup,” said panellist Snehal Desai, global business director of Dow Water and Process Solutions. “This includes new versions of products they already use and love.”
Competing priorities, such as a need to be more efficient with infrastructure funds and to optimize existing water systems, however, mean that there is indeed a demand for new solutions. For large companies, the traditional approach has been acquisition. But more often, panellists revealed, the question has become: “Do I really need to own it?”
At least two large companies are exploring how they can get more value from engaging in the growth of new companies by enabling increased capacity and shorter innovation cycles. Here’s a quick look at them.
Testing and demonstration
This one-of-a-kind facility supports customers in the region and gives Dow access to a wide variety of water sources, including wastewater and seawater, to support product development and performance testing in real-world conditions. Initial research efforts are directed in areas such as improving the quality of desalinated water, minimizing costs and reducing energy consumption per cubic metre, extending the useful life of membranes, and increasing efficiency of materials.
“It’s a controlled environment in which to test our new technologies,” said Snehal, who explained that access to the facility cut the time to test and prove Dow’s two most recent technologies in half. Companies outside of the Dow family are also able to use these facilities, he added.
When it comes to new technologies, Veolia is looking for long-term development projects rather than acquisitions, said Peter Gallant, vice-president of business development and regulatory affairs at Endetec Global Sensor Platform / Veolia Water Technologies. “We want our interests aligned. We’re looking for strategic partnerships.”
The Veolia Innovation Accelerator (VIA) does not invest in companies. Instead, its goal is to promote the entrepreneurial ecosystem by offering access to more markets, pilot sites and Veolia’s strong research-and-development capabilities. Since the program launched in 2010, VIA has worked with more than 400 innovators and their technologies.
VIA has both proactive and reactive models, explained Peter. The proactive model includes open innovation challenges, like the recent Veolia Environment Moisture Measurement Challenge. With the reactive model, companies can apply to VIA for a serious assessment of their business.
Panellists agreed that, whatever the commercialization method, innovation always requires a compelling customer value proposition. Without one, technologies are doomed to fail.
“Innovation must fill gaps,” said Chris Morrison, assistant vice-president of technology partnerships at Ecolab. “It all comes down how it affects the CAPEX/OPEX.”
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Kerry FreekKerry Freek is the manager of marketing and communications for the Water Technology Acceleration Project. WaterTAP was the key partner of World Water-Tech North America 2014.