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Power the Future Report: The power of knowledge engineering in action

2015 February 04, 08:41 CEST

To power the future, companies must make technology innovation an integral part of their business success, explains Dr. Alejandro Sanz, Head of Group Technology Intelligence at SKF

Sustaining industrial leadership after more than a century of operation is a welcome challenge to SKF. Embedding knowledge engineering in services and products requires a continuous renewal of your own competences, as well as challenging yourself to go beyond the point where others stop. The question is, how do you generate, deliver and capture value based on the opportunities offered by new developments in technology?

Our business objective is to bring new knowledge and innovative value propositions to generate critical improvements in reliability and productivity for all our customers. To develop new advanced systems, solutions and service, the innovation cycle has to be continuous and loop endlessly. This can be a difficult task to achieve, but as we hope to show using our experiences at SKF, it can be integrated within existing processes to create real and sustainable business benefits.

The outside-in approach 

Several factors should determine the innovation policy and management that a company implements. These include assessments on the economic effectiveness of technology investments, internal attitudes to innovation, legislation frameworks and the timing and future role of technology in industrial performance.  Inevitably, these analyses are to a certain extent based on estimates of future behaviour, which gives rise to uncertainty and an associated level of risk.

At SKF, we developed the Strategic Innovation Analysis (SIA), which anticipates new market or service trends as well the expectations of the market to ensure that the company is consistently delivering value. We have recognised that strategic decisions on innovation cannot be undertaken without an intimate understanding of the relationship between the company’s internal set-up (in regards to innovation, markets, managerial attitudes, technological and human resources, capital structure, etc.) and the opportunity space created in (or imposed by) the market. [1].

The company must anticipate, assimilate and integrate market trends and expectations. The external context of forces that a company has to understand includes market needs, legal & economic frameworks, competitive benchmarking, technological opportunities, and new business opportunities.

Taking the classic outside-in approach, SKF developed professional technology intelligence and intellectual asset business units to continuously monitor technology trends, the positioning of customers, competitors and markets as well as systematically screening for new partners or targets for mergers and acquisitions.

Entrepreneurs and startups are responsible for some of the most innovative and disruptive technologies and value propositions. It was once said by Nonaka [2] that, “Creativity is about divergent thinking and innovation is about convergent thinking”. Following this line of thought, it can be argued that for large established businesses, having direct involvement with entrepreneurs and startups provides fresh and unorthodox approaches to technology and business. This concept is one that SKF has embraced and we have found that during discussions between our experienced business leaders and younger, smaller startups we are able to combine the best of both worlds to disrupt the market.

This type of venture involves taking non-traditional approaches to business strategy with the purpose of creating significant value to market and customers. With SKF’s approach, an average of 70 startups per month are evaluated, assessed and benchmarked. Our management team receives specific updates not only on the key focus areas of interest but also in a blue-sky view. This identifies new and radical business concepts that, when combined with our own brand-promise, could lead to very different types of new offerings.

This kind of outside-in approach starts with the long term opportunity in mind by creating a new competitive space. The outside-in approach requires a holistic view of emerging trends and needs to lead towards a systematic delivery of a portfolio of concrete business growth opportunities. [2]

The inside-out approach 

By comparison, the inside-out approach to innovation involves several levels of analysis, creativity and co-operation. However, the common theme that is at the heart of this approach is to think globally, but act locally.

A company’s style of innovation management stems from its employees’ attitudes to innovation. A deep rooted acceptance and encouragement of innovation is vital for such a culture to flourish within an organisation. At SKF for example, our focus has always been on problem-solving and invention since day one. This is evidenced in our development of the self-aligning bearing to solve the problem of bending shafts – which in turn invigorated the overall market for bearing technology. For us, knowledge engineering isn’t just a motto but is market recognition of a continuous series of improvements that we have made ever since our founder Sven Winguist designed his first commercial invention. [3]

Over the years, continued sustainable investments in research and development have been critical to the growth of SKF as a company and brand. The establishment of our Engineering and Research Center (ERC) in Nieuwegein, the Netherlands, was extremely important not just for us, but for the engineering world at large, as it has inspired the development of disruptive technology such as hub bearing units and the creation of the bearing life theory that has been adopted industry and worldwide. For us, the spirit that initiated our first innovation – one of using invention and knowledge to solve a specific problem - is still at the very heart of our business. 

Another important aspect of internal analysis is a screening and scrutiny of internal potential in terms of technology and resources. It’s important to allow a degree of flexibility in the process, to clear a path internally for any possibilities that might arise. Using SKF as an example, innovation is considered one of the strategic pillars for the future growth of our entire business. Each of our business areas has been assigned a challenge: to create completely new and game changing offers to demonstrate future value-based leadership. To reach the growth targets that our business strategy demands, there is a need to identify and integrate internal resources while providing visible support from management to the initiatives. 

As part of this inside-out approach, we launched several activities with the aim to overcome the fact that in large organisations, talented people can be located anywhere and everywhere, however they are often not connected with each other and usually lack the right network to support this. Our methodology is based on a creative process where employees, no matter where they are located globally, can submit and develop creative ideas into solid business proposals. They can do so either by using an online internal communications tool or participating at specific workshops. To give some structure to the creative process across SKF, specific strategic parameters or goals are dictated by our various business units.

All ideas that are submitted are vetted following the Real-Worth-Win methodology created by the Harvard Business School [4]. A shortlist is presented to a final evaluation board, made up of business unit directors as well as employees from product development and manufacturing. They then use the same methodology to further whittle down the selection. Any idea that is selected by the evaluation board gets the green light for forming a dedicated development team and further maturation at a dedicated boot camp. The owner of the idea is put in charge of forming an inter-functional team to attend this camp. To avoid discouragement, it’s also important that feedback is provided for any ideas that aren’t developed further.

The boot camp comprises of two weeks of intensive activity and includes participation of any relevant figures at a management level. The first task of this team is to develop a vision of the market. This includes an opportunity/fit analysis followed by the identification of key strategic choices. The second phase of the boot camp focusses on timing and business qualification, as well as preparation of a pitch to management at a divisional level. This initiative has proven successful in bringing valuable ideas from different countries and integrating international and complementary teams in projects with real value and impact.

A final part of our ‘think globally, act locally’ philosophy has been to physically expand the global footprint of SKF. We set up organisations that specifically concentrate on innovation and emerging disciplines and practices of engineering. These organisations include Group Technology Development (GTD), Advanced Development Centers (ADC) and Global Laboratories (GL). Our Global Technical Centers (GTC) give us a solid technology presence in key geographies and their activities include research and development, lab-pilots, prototypes, full-scale demos, platform integration and local specialisation.

The recipe and rules for successful innovation 

In our experience, having a process that is rigorous yet flexible and interactive is key to encouraging creativity and innovation.

Figure 2 gives a view on how the different elements of innovation fit together like gears in a machine. During the development of mid-long term technology projects, it is important not to lose contact with market expectations and evolutions, particularly as new opportunities may often be uncovered during the length of such a project.

The future positioning of the company is put into execution by coordinating two types of innovation management: Strategic Innovation Management (SIM) and Continuous Innovation Management (CIM).

CIM integrates knowledge solutions from within SKF into tools, systems and service; SIM uses portfolio sources (R&D, alliances, joint ventures, partnerships) to ensure a constant renewal of the value proposition of the solution being developed. The two approaches integrate competences and knowledge from different domains to develop successful solutions. We measure our results against market and customer expectations.

One key thing that we have learned is that leaders in innovation defy convention to explore new areas. Innovation and creativity efforts must be persistent and disciplined to bring the benefits of ideas to markets in a consistent way. However, real success comes from taking into account the constraints and goals of others and integrating them with your own with one single purpose in mind: to power the future.


The highest level of value can be provided when SKF co-creates value by working directly with customers in the most demanding projects. We have found that our depth of industry knowledge compliments the new and emerging fields of engineering and related services, often to produce some of the most outstanding results. The following examples demonstrate how SKF has been able to expand the horizon of what is possible by collaborating with its customers.

Reliability in any condition and place 

Operation and maintenance constitutes a significant proportion of the cost of running a wind turbine - up to 40 per cent of the acquisition price over the lifetime of a machine. Individual repairs are also potentially very costly. For this reason, turbine manufacturers and maintenance service providers are keen to adopt any technology that helps to reduce maintenance and downtime.

Black oxidation treatment has been proven to improve the reliability of bearings in a wind turbine [5]. This surface treatment process delivers improvements to performance at reasonable cost and was identified as the optimal solution to improve operational reliability. Black oxide provides protection against tribochemical attack, reduces the permeation of hydrogen and increases the resistance against moisture damage, such as standstill corrosion. In addition, it has been proven that black oxdised bearing steel surfaces extend the range of safe operating conditions compared with uncoated bearing steel surfaces.

Turbines operate in aggressive environments, so sealing is another key element to improving their reliability. Rubber excluder seals can wear out quickly as they are unable to handle the rough counterface surfaces and limited lubrication conditions common to turbine main shafts. If they fail, they leave main shaft bearings more exposed to contaminants that can cause equipment failures, unplanned downtime, and higher kW costs per hour. In many cases, replacing rubber excluder seals up-tower is very difficult or next to impossible.

The HRC1 axial excluder seal is designed to overcome these challenges. This seal is made of a special H-ECOPUR, an SKF-developed polyurethane material with excellent abrasion resistance and tear strength. The result is an axial excluder seal that delivers significantly extended service life and contaminant protection for increased wind turbine reliability and reduced maintenance costs.

Working closely with a prominent wind turbine manufacturer, SKF subjected the HRC1 axial excluder seal to an extended field trial. Following installation on 40 separate 2.5MW turbines, the seal operated continuously under real conditions. This field trial helped confirm that the axial excluder seal provides drastically extended service life compare to conventional rubber excluder seals.

Keeping the rail industry on track 

Since the turn of the century the increasing demands faced by China’s transportation companies have provided great opportunities and interesting challenges.  China’s Very High Speed Train, which at 380km/hour is the fastest train in the world, is one such challenge. The producers of the train asked SKF to explore the possibility of extending the service interval of the bearing from 800,000 km to 1.3M km. In response, SKF created the new CRU 130X240 bearing solution, which achieved a stable temperature over the full test mileage of 1.3M km and at speeds of up to 420 km/h.

For the next generation of passenger trains, with speeds of 160-250 km/h, SKF has developed a new tapered roller bearing unit (TBU).  The new unit increases bearing service life by up to 40 percent compared with existing solutions. In addition, lab tests indicate a 30 per cent friction moment decrease, while patented heat treatment SKF Xbite improves overall robustness and performance of the bearing. This next generation bearing unit helps OEMs and end users to increase safety and maximise profit.

Developed directly due to customer demand and collaboration, SKF’s Compact Tapered Bearing Unit CTBU) has an axle load rated to 45 metric tons, which means that operators can increase profitability by hauling more product with the same length/configuration train. This CTBU from SKF is the only heavy haul bearing rated to 45 ton operational axle load on the market.  This represents a transportation capacity increase from existing 35.5 ton axle suitable for existing or new wagon fleets.

There is nothing conventional in traditional energy production 

Although often referred to as traditional forms of energy, there is nothing conventional when it comes to safely extracting and conveying oil and gas from the harshest of environments. The first subsea production units will be commissioned on the Asgard gas field in 2015 thanks to the development of Active Magnetic Bearing (AMB) technology, which was only possible due to the close collaboration between SKF and leading energy companies.

Although it seems that fracking is an emerging form of energy production, SKF has been responding to demands for high pressure fracking valves for many years. For each customer and valve design, SKF developed unique low torque ball and roller screw bearings leading to high reliability valve sub-systems. Several thousands of these solutions have been implemented since and have proven to provide remarkable performance. This engineering know how and enduring technologies are now being used for the development of higher pressure applications, up to 15,000-20,000 PSI.

Within the highly demanding exploration and drilling environments, critical applications that require traditional encoding are a major source of productivity losses due to exposure to the toughest conditions. To solve this problem, SKF used its experience of robust sensing integration to develop a solution that is ideal for the application. In addition, the same technological competence and robustness has been applied to the specification, installation, operation and analysis of thruster monitoring systems, which have been approved for use for longer periods between maintenance by international certification bodies.

 [1] KIRSTETTER E., EAGAR R.,KOLK M. and ROOS D.  The Creativity Era - a new paradigm for business. Prism, 2, 2013, p. 12-29.
 [2] PALMER D. and KAPLAN S. A Framework for strategic innovation. White paper. Innovation Point LLC ( P.1-26
 [3] FRITZ M and KARLSSON B. SKF a global story 1907-2007.
 [4] DAY S. G. Is it real ? Can We Win? Is it Worth doing? Managing risk and reward in an innovation portfolio. HBR, December 2007, p. 110-120.
 [5] STADLER K., HAN B., BRIZMER V., PASARIBU. Advantages in using black oxidized bearings in wind applications. SKF Evolution. To be published.

Aktiebolaget SKF

SKF is a leading global supplier of bearings, seals, mechatronics, lubrication systems, and services which include technical support, maintenance and reliability services, engineering consulting and training. SKF is represented in more than 130 countries and has around 15,000 distributor locations worldwide. Annual sales in 2013 were SEK 63,597 million and the number of employees was 48,401.

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