Challenges for Innovation:
An Industry Perspective
Dr. Dan Lachica, SEIPI President
Inclusive Innovation Conference 2017
May 31 – June 01 | The Peninsula Manila, Makati City
THE PHILIPPINE ELECTRONICS INDUSTRY
Where It Is and Where It Should be
PRESENTATION OUTLINE:
The Philippine Electronics Industry
- Where It Is and Where It Should Be
- PATHS
- Top 10 Technology Tends
Innovation Activities
Challenges for Innovation
Summary
THE PHILIPPINE ELECTRONICS INDUSTRY:WHERE IT IS
end of 2016
Electronics51%
Non-Electronics
49%
Source: PSA
The Philippine electronics industry
remains to be the top export industry in
the country.
However for the past 3 decades, the industry has been
stagnant in its operations focusing only on assembly, test
and packaging for the past 3 decades.
Components/Devices (Semiconductors)
70%
Electronic Data Processing
19%Office Equipment
1%
Consumer Electronics
2%Telecommunicatio
n3%
Communication/Radar2%
Control and Instrumentation
2%
Medical/Industrial Instrumentation
0%
Automotive Electronics
1%
SECTORAL COVERAGE
INDUSTRY PERFORMANCEInvestments and Employment
INVESTMENTS Total foreign direct investments
approved in 2016 amounted to PhP49.349 billion.
EMPLOYMENT Total employment in 2016 was 3.2 million.
PHASE
1
PHASE
2
Project Duration: October 2016 – September 2017
Commenced last October 1, 2016
Funded by DTI-BOI and monitored by DOST-PCIEERD
To be executed by UA&P and IDC
Objective is to determine specific products and technologies that the Philippines should focus on, and the enablers for success
Project Duration: April 2015 – December 2015
Funded by USAID-STRIDE and outsourced to Mapúa Institute of Technology
Determined domestic product and technology trends through interviews and FGD among Philippine electronics industry leaders
Performed desk research of global technology and industry trends in semiconductor and electronics devices and technology
PRODUCT AND TECHNOLOGY HOLISTIC STRATEGY (P.A.T.H.S.) for the Semiconductor and Electronics Industries of the Philippines
THE PHILIPPINE ELECTRONICS INDUSTRY:WHERE IT SHOULD BE
PRODUCT AND TECHNOLOGY MATRIX
Sem
icond
ucto
r and
Other
Com
ponen
ts
Electr
onic
Data
Proce
ssing
(EDP)
Office
Equip
men
t
Telec
omm
unica
tions
Com
mun
icatio
ns
and R
adar
Cont
rol a
nd
Instr
umen
t
Med
ical a
nd
Indu
strial
Autom
otive
Ele
ctron
ics
Cons
umer
Ele
ctron
ics
Solar
/Pho
tovo
ltaic
Internet of Things
(IoT)
- Printers (3D
Printers),
- WiFi Signal
Analyzer
- Switch
- Cell Station,
Base Station,
Routers,
Modems, Hot
Spots, Fiber
- M2M Connectivity,
Switch
- Smartphones
- Notifications
System,
- Environment
Monitoring
- Smart Grids
- Point of Care
Diagnostics, Wearable
Biosensors, Intelligent
Buildings, Smart
Cements
- Intelligent Dash
Boards
- Antenna,
Entertainment System
- Smart Devices (watch,
glasses, phones),
Tablets, Cameras
- ATMs, wireless
chargers, superspeed
USB,
- Activity tracker
Energy Harvester,
Wireless Power
Transfer,
Solar Panels
RoboticsPC Mother
Boards
Sensors and
Receivers
Motors, Electronics
Point of Sale, Biometric
readers, ECG, EEG
Dosimeter, Defribilator,
Industrial Fitting, DNA
Analyzers, Hearing
Diagnostic
Instrumental, Dental
Chair & Equipment,
Ventilators, Space and
Avionics
Parking Camera, Body
Electronics and Lighting,
Hybrid Electronics
Vehicle (HEV), HVAC,
Drone, Factory
Automation/Control
Smart LED Lights TBD
Driverless CarsElectronic
Security LockMotors
Sensors (Speed, Inertial,
Humidity, Rotor position),
Body & Chassis Electronics,
Car Seat Assembly,
Automotive Steering Wheel
Assembly, Vision systems, e-
vehicles
Artficial
Intelligence (AI)DSP
Advance Driver
Assistance System
(ADAS),
Virtual Reality
(VR)
Augmented
Reality (AR)Smartphones GPS Navigation
- Various wearables
(Smart clothing,
ID Tags, Smart
Patches),
- Smartphones,
Tablets
Big Data Analytics
Servers,
Computers,
Storage,
Laptop
Storage
(Hard Drive
Disk )
Cell Station,
Base Station,
Routers,
Modems,
Hot Spots, Fiber
Servers Infotainment
Smart watch. Activity
tracker, Tablets,
Cameras
Communication
Network
(Uninterrupted)
Power Supply
(Uninterrupted) Power
Supply, Antenna for
mobile communication
system base station;
Telecomm
Infrastructure
Transceivers; Enterprise
Switching
Security Entrance
SystemElectronics for Military/DefenseDrone
Electronic Door lock,
Security solution for
hand held
merchandise
Green
Technology
Environment
MonitoringElectronic Vehicle
Energy
Harvester,
Wireless Power
Transfer,
Solar Panels
TOP 10 STRATEGIC TECHNOLOGY TRENDS IN 2017
1. AI and Advanced Machine Learning
1. Intelligent Apps
1. Intelligent Things
1. Virtual and Augmented Reality
1. Digital Twin
1. Blockchain
1. Conversational Systems
1. Mesh App and Service Architecture
1. Digital Technology Platforms
1. Adaptive Security Architecture
Source: Gartner
BENEFITS AND EXPECTED RESULTS OF PATHS
GOVERNMENT
Provide guidance to the government in providing the industry what it truly needs
collectively and not just address the need of one or two big companies.
Aid the country’s investment promotion agencies in identifying what specific niche the
Philippines has to promote to entice electronics investments in the country.
Guide government as to what infrastructure and policies should be prioritized.
ACADEME
Keep the academe at the front seat of PATHS while it is being crafted already. This gives
the academe a glimpse on how to prepare their students to be candidates for
employment in electronics manufacturing firms.
STEM (Science, Technology, Engineering and Math) courses will be enhanced and better fir
the needs of the electronics industry.
Encourage students to continue studying at graduate schools for MS and PhDs in
engineering.
OTHER STAKEHOLDERS
PATHS can prepare the local supplies with the competencies and capabilities they would
soon need in order to serve the players in the industry and internationally.
EXISTING PLAYERS
With PATHS, the firms here in the country will now have better reasons to justify to
their respective corporate headquarters the transfer of higher value activities in the
Philippines and or expansion of capacities as PATHS aims to show that the Philippine
electronics industry is now going beyond assembly, test and packaging.
In pursuing higher value activities and growth sectors, the PH semiconductor and electronics industry will be able
to reverse the sluggish performance of the industry. With the electronics sector still the biggest contributor to the
country’s GDP, more jobs could be available to the Filipinos once the industry gets back on track. PATHS can
trigger influx of new kinds of investments in the country.
INNOVATION ACTIVITIESANALOG DEVICES
Designed and released 24 new products to the
market designed by Filipino engineers in the
field of precision and power.
The company’s test and development
engineers have developed over 50 test
solutions on breakthrough products in the
area of healthcare, analog front end, RF and
mix signal devices.
ADGT has its own garage initiatives, where
engineers can pitch their ideas and get
funding within the company. One of the
accepted projects is a development of a
wearable breast cancer detection that will
revolutionize early and affordable diagnosis.
The company has a continuing effort in
industry-academe linkage. The plan is to set-
up an RF lab at UP which should boost the
Filipino engineers’ skills in pursuing IoT
projects. This is an addition to the company’s
2 labs that are built in UP for IC design and at
Mapua for Test Development
INNOVATION ACTIVITIES
CONTINENTAL PLANT (CALAMBA)
For 14 years, Continental Plant Calamba produces an array of automotive electronic safety
products including anti-lock braking speed and inertial sensors, radar, lidar, and optical advanced
driving sensors. These products are shipped to most major car-makers and need continuous
design and process improvement to maintain competitiveness in world markets.
Idea-management has long been an important part of continuous improvement. Hundreds of
ideas are proposed, evaluated, and implemented each year, and rewards are earned by the
innovators.
Beginning in 2016, an in-house R&D center was opened to design new braking sensors and
develop innovative product solutions.
Beginning in 2017, a central process engineering center was opened to develop innovative
processes for use anywhere in the Continental network.
Plans are in place to expand these new departments over the next five years.
INNOVATION ACTIVITIES
TESDA
Plan to develop regional innovation training centers
One MNC is investing close to USD100 million on capital equipment
due to strong demand.
CHALLENGES FOR INNOVATION
1. Better BS and MS programs2. Students and faculty immersion3. Relationship with schools
ROBUST SUPPLY CHAIN
EARLY TECHNOLOGY ADOPTION
HUMAN CAPITAL
1. Increase in local value content2. Automotive and industrial segments3. VC investment to bring technology to the Philippines4. Expand more product lines instead of processes
1. New product launches Automotive and industrial segments (e.g. what can the Philippines do for driverless cars)
2. Design OEM and ODM products
PRIVATE-PUBLIC PARTNERSHIPS
1. Incentives for technology start-up companies2. Funding for and development of local SMEs3. Attract investors to bring technology to the Philippines
GOVERNMENT SUPPORT
DTI/BOI/PEZA/EDC : Investments, Incentives, Roadmap, Intercessor
DOST: ADMATEL, PIIC, ERDC, Technology
TESDA: TWSP
NEEDS R&D Grants
Incentives
Talent
IP Protection
Ease of Doing Business
Peace and Order
Infrastructure*2017 Survey from some SEIPI members
PREPARING FOR THE FUTURENowadays, technology is constantly changing and rapidly developing.
We need to keep up with the innovations of our industry in order to be
relevant in the future.
INNOVATIONS
We need to adapt with the changes and the demands, not only
of today, but also of the future.
It is important to keep adding value on your products to
sustain and/or increase business productivity and growth
An innovation ecosystem is said to be thriving and healthy when the resources invested in the
knowledge economy (either through private, government, or direct business investment) are
subsequently replenished by innovation induced profit increases in the commercial economy. At that
point, the two economies (knowledge and commercial) exist in balanced equilibrium and the
innovation ecosystem is deemed to be healthy. – National Science Foundation, VA
Innovation is a fundamental source of significant wealth generation within an economy
THANK YOU and GOD BLESS.