INSTITUTIONAL SOURCES TRANSFORMING CRISES INTO A SPRINGBOARD FOR INNOVATIONS CHEW YEN CHENG MICHELE (MSc, NUS; BSc (Hons), UCL) A THESIS SUBMITTED FOR THE DEGREE OF DOCTOR OF PHILOSOPHY DIVISION OF ENGINEERING & TECHNOLOGY MANAGEMENT FACULTY OF ENGINEERING NATIONAL UNIVERSITY OF SINGAPORE 2011 INSTITUTIONAL SOURCES TRANSFORMING CRISES INTO A SPRINGBOARD FOR INNOVATIONS Acknowledgements I am very grateful to the patient guidance of Prof ChihiroWatanabe. His invaluable experience and expertise in a broad range of topics has made this possible because not many supervisors have the mix of policy and academic experience, especially in the area of technology policy, patents and technology management. And not many were willing to undertake supervision of a topic such as water as many are not familiar with the technology. I would also like to thank Prof Hang Chang Chieh for his foresight of accepting such a PhD topic to be undertaken within the department. I would also like to thank the officers from PUB who had provided me with data and agreed to my many hours of interview. Table of Contents SUMMARY I LIST OF TABLES . II LIST OF FIGURES III CHAPTER I INTRODUCTION 1.1 INTRODUCTION 1.2 BACKGROUND . 1.2.1 Water – A Global Issue . 1.2.2 Singapore’s NEWater Journey 1.3 THEORETICAL BACKGROUND 1.4 LITERATURE REVIEW 1.5 RESEARCH QUESTION . 12 CHAPTER II 14 FOUR-PHASED DEVELOPMENT . 14 2.1 INTRODUCTION 15 2.2 DATA CONSTRUCTION . 15 2.2.1 NEWater Dependency . 16 2.2.2 Trend in Learning 18 2.2.3 Elasticity of NEWater Substitution . 20 2.2.4 Accumulation of Knowledge Stock . 23 2.3 RESULTS . 27 2.3.1 Stock & Functionality . 27 2.3.2 Four Phases of NEWater Development Trajectory . 40 2.3.3 Institutional Approaches 53 2.4 DISCUSSION 65 CHAPTER III 71 CONCLUSION 71 3.1 SUMMARY OF FINDINGS 72 3.2 LIMITATION 73 3.3 FUTURE WORK 74 REFERENCES 76 APPENDIX 87 SUMMARY This PhD research attempts an in-depth analysis on Singapore’s strategy in transforming its vulnerability in water into a springboard for new innovations. Using NEWater as the innovative solution to achieving the nation’s vision of being self-sufficient in water, the transformation process of achieving growth and sustainability is mapped out. The initial stage of growth was dependent on imported capabilities (comprising technologies and human capabilities). As local firms collaborated with overseas partners in projects, learning occurred. The learning was absorbed and assimilated, leading to the development of indigenous capabilities (technologies and human capabilities). These indigenous capabilities developed were later exported by local companies via projects secured in overseas markets. This internationalization activity triggered further innovation among the leaders (innovators) and the followers (imitators). The dynamic relationship between the innovation and institutional factors is the essence of the co-evolutionary acclimatization stage, the final stage of the growth framework. i LIST OF TABLES Table 1.1 NEWater factories in Singapore Table 2.1 Trend in NEWater Dependency in Singapore (2003-2011) – 103 m3/d, % . 16 Table 2.2 Estimated trajectory for NEWater dependency in Singapore (2003-2011) . 17 Table 2.3 Diffusion parameters in knowledge stock of Singapore’s NEWater development trajectories (2003-2009) 32 Table 2.4 Quarterly trends in knowledge stock of the two waves of Singapore’s NEWater development (2003-2009) . 33 Table 2.5 Learning-based knowledge coefficient and Technology-based knowledge coefficient 37 Table 2.6 Country of origin for suppliers of products and services for Singapore’s NEWater factories . 41 Table 2.7 Leading Japanese suppliers# of advanced membranes to Singapore NEWater factories . 42 Table 2.8 Export destination of Kristal™ membranes manufactured by Hyflux Limited 45 Table 2.9 Designed capacities of water plants constructed by Hyflux Limited 45 Table 2.10 Nature of international projects contracted by Keppel Integrated Engineering 47 Table 2.11 Export of indigenous capabilities by Sembcorp Industries# 49 Table 2.12 Corporate R&D centers established by global water players in Singapore . 56 Table 2.13 Public sector R&D centers established in Singapore 56 Table 2.14 Water projects awarded under DBOO model 64 Table 2.15 Dependency on technology-driven water in Singapore . 67 ii LIST OF FIGURES Figure 1.1. Closing the water loop. . Figure 2.1. Trend in NEWater dependency in Singapore (2003-2011): actual and estimated (%). . 17 Figure 2.2. Level and timing of inflection in a diffusion trajectory in the Bass Model. . 26 Figure 2.3. Trend in learning coefficient (2003-2009). . 28 Figure 2.4. Trend in NEWater and Conventional Water ratio (2003-2009). . 29 Figure 2.5. Trend in the correlation between prices and volume of NEWater and Conventional Water (2003-2009). 30 Figure 2.6. Trend in knowledge stock of two waves in Singapore’s NEWater development (20032009) 34 Figure 2.7. Trends in the ratios of two waves in knowledge stock of Singapore’s NEWater development (2003-2009). 35 Figure 2.8. Correlation between the ratio of the two waves in knowledge stock in Singapore’s NEWater development (2003-2009). 35 Figure 2.9. Scheme of knowledge stock in Singapore’s NEWater development (2003-2009). 36 Figure 2.10. Trends in the technology-based knowledge coefficient and learning-based knowledge coefficient of Singapore’s NEWater development (2003-2009). . 37 Figure 2.11. Inflection points of the two waves of knowledge stock of Singapore’s NEWater (2003Q1- 2015Q4). . 39 Figure 2.12. Four-phased NEWater transformation process. 40 Figure 2.13. Value chain in the water business. 57 Figure 2.14. A vibrant water ecosystem in Singapore involving more than 70 companies. . 58 Figure 2.15. The Design-Build-Own-Operate model. . 61 Figure 2.16. The Design-Bid-Build model. . 62 Figure 2.17. The Design and Build model . 63 Figure 2.18. Strong partnership established in the DTSS Changi Water Reclamation Plant. . 64 Figure 2.19. Strong partnership established in the Marina Barrage Project. . 65 Figure 2.20. Innovator-Imitator relationship. 67 Figure 2.21. Sustaining global economic competitiveness via new functionality development. 68 iii ABBREVIATIONS D&B Design & Build DBB Design-Bid-Build DBOO Design-Build-Own-Operate DTSS Deep Tunnel Sewerage System EWI Environment & Water Industry Development Council EWRP Environment & Water Research Programme IES International Enterprise Singapore IPU Indirect Potable Use MEWR Ministry of Environment & Water Resources NF NEWater Factory NRF National Research Foundation NTU Nanyang Technological University NUS National University of Singapore PPP Public-Private Partnership PUB Public Utilities Board RIEC Research, Innovation and Enterprise Council SIWW Singapore International Water Week WHO World Health Organization iv CHAPTER I INTRODUCTION CHAPTER I INTRODUCTION 1.1 Introduction The research idea is to propose a model for transforming a national vulnerability into an economic growth pillar. To achieve this objective, national vulnerabilities that had been transformed into an economic competitive strength were shortlisted. Japan’s labour shortage vulnerability in the 1960s, which lead to the development of the nation’s automation industry, in particular, the robotics industry, is one example. Another example is the energy crisis in Japan that occurred during the 1970s. The vulnerability of insufficient energy supply as a consequence of dependence on imported crude oil spurred innovations in systems efficiency for greater efficient use of energy by energy-intensive industries (mainly the manufacturing industry). These vulnerabilities have been studied and mathematical models have been proposed. The mathematical models suggest the evolution of economies from the Industrialization Era to the Knowledge-based Era. Thus, the proposed models take into account new theoretical concepts that have evolved along the way and have improved predictive capabilities as scenario planning is an important aspect for businesses and nations. The emphasis of the research is focused on which variables to measure and how the statistical significance and predictability of the variables. Literature neither document the transformation process nor does it document the application of various mathematical models in the analysis of a real-life transformation. This research focuses on a vulnerability that affects nations globally. That is the vulnerability of water as water is probably the only natural resource to have an impact of all aspects of human civilization. To name a few, these include agriculture, industrial development, health and culture. industry to the Singapore economy, future work focusing on the service industry will bring to light the necessary policies for the service industry to contribute to the nation’s economic competitiveness. On the technology-driven front, this framework can be applied to study Singapore’s efforts in building indigenous capabilities in the biomedical sciences. Having invested heavily in the biomedical sciences, the result from this future work will assist policy makers in shaping the future Science & Technology policy for Singapore. The findings will also justify the government’s investment in the industry and the value-add of the industry to the nation’s economic competitiveness. As the water-energy nexus will impact decisions of businesses and policy makers, future work is suggested for investigating the synergy between NEWater and desalination. Qualitative and quantitative data is insufficient for a comprehensive investigation to be conducted at the point of writing this thesis but preliminary analysis does reveal that the synergy is created from the fusion of the indigenous strengths from desalination and the learning from NEWater. 75 REFERENCES 76 REFERENCES Araral, E., 2010. Improving Effectiveness and Efficiency in the Water Sector: Institutions, Infrastructure and Indicators. Water Policy, 12, Supplement 1, 1-7. Arrow, K.J., 1962. The Economic Implication of Learning by Doing. Review of Economic Studies, 29, 155-173. Arrow, K.J., Chenery, H.B., Minhas, B.S. & Solow, R.M., 1961. Capital-labor Substitution and Economic Efficiency. Review of Economics and Statistics, 43(3), 225-250. Bass, F.M., 1969. A New Product Growth Model for Consumer Durables. Management Science, 15(5), 215-227. Bel, G., Fageda, X., & Warner, M.E., 2010. Is Private Production of Public Services Cheaper Than Public Productivity? A Meta-regression Analysis of Solid Waste and Water Services. Journal of Policy Analysis and Management, 29(3), 553-577. Callon, M., Laredo, P., & Rabeharisoa, V., 1992. The Management and Evaluation of Technological Programs and the Dynamics of Techno-economic Networks: The Case of the AFME. Research Policy, 21, 215-236. 77 Chen, D.C., Maksimovic, C., & Voulvoulis, N., 2011. Institutional Capacity and Policy Options for Integrated Urban Water Management: A Singapore Case Study. Water Policy, 13, 53-68. Chen, C., & Watanabe, C., & Griffy-Brown, C., 2007. The Co-evolution Process of Technological Innovation – An Empirical Study of Mobile Phone Vendors and Telecommunication Service Operators in Japan. Technology in Society, 29, 1-22. Choung, J-Y., Hwang, J-H., & Choi, J-H., 2000. Transition of Latecomer Firms from Technology Users to Technology Generators: Korean Semiconductor Firms. World Development, 28(5), 969982. Clark, K.B., 1985. The Interaction of Design Hierarchies and Market Concepts in Technological Evolution. Research Policy, 4, 235-251. Coombs, R., Green, K., Richards, A., & Walsh, V., 2001. Technology and The Market: Demand, Users and Innovation. Cheltenham, UK, Edward Elgar. Dechezlepretre, A., Glachant, M., & Meniere, Y., 2008. The Clean Development Mechanism and the International Diffusion of Technologies: An Empirical Study. Energy Policy, 36, 1273-1283. Du, G.P., Hall, S., Janes, L., MacKay, H., & Negus, K., 1997. Doing Cultural Studies: The Story of the Sony Walkman. London: Sage Publications. Fan, P. & Watanabe, C., 2006. Promoting Industrial Development Through Technology Policy: Lessons from Japan and China. Technology in Society, 28, 303-320. 78 Fukuda, K., & Watanabe, C., 2008. Japanese and US Perspectives on the National Innovation Ecosystem. Technology in Society, 30, 49-63. Furtado, A.T., & Freitas, A.G. de., 2000. The Catch-up Strategy of Petrobras Through Cooperative R&D. Journal of Technology Transfer, 25, 23-36. Gallagher, K.P., & Shafarddin, M., 2010. Policies for Industrial Learning in China and Mexico. Technology in Society, 32, 81-99. Geels, F., 2005. Co-evolution of Technology and Society: The Transition in Water Supply and Personal Hygiene in the Netherlands (1850-1930) – A Case Study in Multi-level Perspective. Technology in Society, 27, 363-397. Ho, K.W., & Hoon, T.H., 2009. Growth Accounting for a Technology Follower in a World of Ideas: The Case of Singapore. Journal of Asian Economics, 20, 156-173. Hobday, M., 1995. East Asian Latecomer Firms: Learning the Technology of Electronics. World Development, 23(7), 1171-1193. Huang, A.Y-J., & Liu, R-H., 2008. Learning for Supply as a Motive to be the Early Adopter of a New Energy Technology: A Study on the Adoption of Stationary Fuel Cells. Energy Policy, 36, 2143-2153. 79 Kline, S.J., & Rosenberg, N., 1986. An Overview of Innovation. In: Landau, R. Rosenberg N., (eds). The Positive Sum Strategy: Harnessing Technology for Economic Growth. Washington, DC: National Academy Press, 275-305. Kobos, P.H., Erickson, J.D., & Drennen, T.E., 2006. Technological Learning and Renewable Energy Costs: Implications for US Renewable Energy Policy. Energy Policy, 1645-1658. Kondo, R., Watanabe, C., & Moriyama, K., 2007. A Resonant Development Trajectory for IT Development: Lessons from Japan’s i-mode. International Journal of Advances in Management Research, 4(2), 7-27. Kristinsson, K. & Rao, R., 2008. Interactive Learning or Technology Transfer as a Way of Catchup? Analysing the Wind Energy Industry in Denmark and India. Industry and Innovation, 15(3), 197-320. Layton, E., 1971. Mirror-image Twins: The Communities of Science and Technology in 19th Century America. Technology and Culture, 12(4), 562-580. Layton, E., 1976. American Ideologies of Science and Engineering. Technology and Culture, 17(4), 688-701. Lee, K., & Lim, C., 2001. Technological Regimes, Catching-up and Leapfrogging: Findings from the Korean Industries. Research Policy, 30(3), 459-483. 80 Lee, S.H., 2010. Development of Public Private Partnership (PPP) Projects in the Chinese Water Sector. Water Resource Management, 24, 1925-1945. Leonard-Narton, D., 1988. Implementation as Mutual Adaptation of Technology and Organization. Research Policy, 17, 251-267. Leydesdorff, L., 2000. The Triple Helix: An Evolutionary Model of Innovations. Research Policy, 29, 243-255. Leydesdorff, L., & Etzkowitz, H., 1998. The Triple Helix as a Model for Innovation Studies. Science and Public Policy, 25(3), 195-203. Lin, G.T.R., Shen, Y-C, & Chou, J., 2010. National Innovation Policy and Performance: Comparing the Small Island Countries of Taiwan and Ireland. Technology in Society, 32, 161-172. Lobina, E., & Hall, D., 2007. Experience with Private Sector Participation in Grenoble, France, and Lessons on Strengthening Public Water Operations. Utilities Policy, 15, 93-109. Long. J.S.R., 2002. On the Threshold of Self-sufficiency: Toward the Desecuritization of the Water Issue in Singapore-Malaysia Relations, in: C. G. Kwa (Ed.) Beyond Vulnerability? Water in Singapore-Malaysia Relations, p. 109, Institute of Defence and Strategic Studies, Singapore. Lundvall, B.A., 1988. Innovation As An Interactive Process: From User-producer Interaction to the National System of Innovation. In Dosi, G., Freeman, C., Nelson, R., Silverberg, G., Soete, L., (eds.) Technical Change and Economic Theory. London, Pinter, 349-369. 81 Lundvall, B.A., & Johnson, B., 1994. The Learning Economy. Journal of Industry Studies, 1(2), 23-42. Mahajan, V., Muller, E., & Srivastara, R.K., 1990. Determination of Adopter Categories by Using Innovation Diffusion Models. Journal of Marketing Research, 27(1), 37-50. Mazzoleni, R., & Nelson, R.R., 2007. Public Research Institutions and Economic Catch-up. Research Policy, 36(10), 1512-1528. Moore, G.A., 1991. Crossing the Chasm: Marketing and Selling Technology Products to Mainstream Customers, Harper Business Essentials, New York, Harper Collins. Nelson, R.R., 1994. The Co-evolution of Technology, Industrial Structure, and Supporting Institutions. Industrial and Corporation Change, 3(1), 47-63. Nelson, R.R., 2004. Economic Development from the Perspective of Evolutionary Economic Theory. Essay available online http://dcsh.xoc.uam.mx/eii/globelicswp/wpg0702.pdf. Nelson, R.R., 2008. What Enables Rapid Economic Progress: What are the Needed Institutions? Research Policy, 37, 1-11. Oudshoorn, N., & Pinch, T., 2003. How Users Matter: The Co-construction of Users and Technology. Cambridge, Massachusetts, MIT Press. 82 Public Utilities Board, 2009. Milieu, Public Utilities Board. Public Utilities Board, 2010. Singapore: A Global Hydrohub, Public Utilities Board, presentation for the Singapore International Water Week 2010, Pre-event Media Briefing, 16 June. Rogers, E. M., 1983. Diffusion of Innovations (3rd edn), The Free Press, New York. Rosenkopf, L., & Tushman, M., 1994. The Co-evolution of Technology and Organization. In: Baum, J.A., Singh, J.V., (eds). Evolutionary Dynamics of Organizations. New York, Oxford: Oxford University Press, 403-424. Sharp, M., 1991. Technology – A Special Case for Catch-Up. Technology in Society, 13, 189-205. Shell, K., 1967. “A Model of Inventive Activity and Capital Accumulation,” in: Shell, K., ed., Essays on the Theory of Optimal Economic Growth, MIT Press, Cambridge. Shell, K., 1973. “Inventive Activity, Industrial Organization and Economic Activity,” in Mirrlees, J. and Stern, N., eds., Models of Economic Growth, Macmillian & Co., London, U.K. Solow, R.M., 1956. A Contribution to the Theory of Economic Growth. The Quarterly Journal of Economics, 70(1), 65-94. Stankiewicz, R., 1992. Technology as an Autonomous Socio-cognitive System. In: Grupp, H., (ed). Dynamics of Science-based Innovation. Berlin: Springer, 19-44. 83 Tan, Y.S., Lee, T.J., & Tan, K., 2009. Clean, Green and Blue, Singapore, Institute of Southeast Asian Studies. Van de Ven, A.H., & Garud, R., 1994. The Co-evolution of Technical and Institutional Events in the Development of an innovation. In: Baum, J.A., Singh, J.V., (eds). Evolutionary Dynamics of Organizations. New York, Oxford: Oxford University Press, 425-443. Van, D.J., 1998. Imagenation: Popular Images of Genetics. New York: New York University Press. Verhulst, P.F., 1845. Recherches Mathematiques sur la loi d’Accroissement de la Population. Nouveaux Mémoires de l’Académie Royale des Sci. et Belles-Lettres de Bruxelles, 18, 3-38. Watanabe, C., Asgari, B. & Nagamatsu, A., 2003. Virtuous Cycle between R&D, Functionality Development and Assimilation Capacity for Competitive Strategy in Japan’s High-technology Industry. Technovation, 23(11), 879-900. Watanabe, C., Hur, J.Y. & Matsumoto, K., 2005. Technological Diversification and Firms’ Techno-economic Structure: An Assessment of Canon’s Sustainable Growth Tracjectory. Technological Forecasting and Social Change, 72(1), 11-27. Watanabe, C. Hur, J.Y. & Lei, S.Y., 2006. Converging Trend of Innovation Efforts in Hightechnology Firms under Paradigm Shift: A Case of Japan’s Electrical Machinery. OMEGA, 34(2), 178-188. 84 Watanabe, C., & Zhao, W., 2006. Co-evolutionary Dynamism of Innovation and Institution, in Yoda, N., Pariser, R. & Chon M.C. (eds)., Chemical Business and Economics, The Chemical Society of Japan, Tokyo, 106-121. Watanabe, C., Lei, S., & Ouchi, N., 2009a. Fusing Indigenous Technology Development and Market Learning for Higher Functionality Development: An Empirical Analysis of the Growth Trajectory of Canon Printers. Technovation, 29(2), 265-283. Watanabe, C., Moriyama, K., & Shin, J.H., 2009b. Functionality Development Dynamism in a Diffusion Trajectory: A Case of Japan’s Mobile Phones Development. Technological Forecasting & Social Change, 76:6, 737-753. Watanabe, C., Shin, J.H., Hekkinen, J., Zhao, W., & Griffy-Brown, C., 2011. New Functionality Development Through Follower Substitution for a Leader in Open Innovation. Technological Forecasting & Social Change, 78(1), 116-131. Yang, Joon-Mo., Kim, Tae-Wan, & Han, Hyun-Ok., 2006. Understanding the Economic Development of Korea from A Co-evolutionary Perspective. Journal of Asian Economics, 17, 601-621. Yao, X., Watanabe, C., & Ying, L., 2009. Institutional Structure of Sustainable Development in BRICs: Focusing on ICT utilization. Technology in Society, 31, 9-28. 85 Zhao, W., & Watanabe, C., 2008. A Comparison of Institutional Systems Affecting Software Advancement in China and India: The Role of outsourcing from Japan and the United States. Technology in Society, 30, 429-436. 86 APPENDIX 87 APPENDIX Appendix A-1 Conventional Water and NEWater and their prices in Singapore (2003-2009) 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 t 2003 2004 2005 2006 2007 2008 2009 Pcn 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 1.40 Pnn 1.30 1.30 1.30 1.30 1.30 1.30 1.30 1.30 1.15 1.15 1.15 1.15 1.15 1.15 1.15 1.15 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 4473 4251 4099 4300 4520 4220 4242 4041 4160 4100 4252 4316 4623 4306 4236 4139 4904 4595 4392 4427 4545 4433 4261 4398 4209 4279 4327 4372 4435 4208 4049 4237 4441 4132 4137 3922 4014 3930 4045 4070 4316 3975 3862 3722 4344 4006 3766 3731 3763 3607 3408 3460 3260 3267 3260 3254 38 43 50 63 79 88 105 119 146 170 207 246 307 331 374 417 560 589 626 696 782 826 853 938 949 1012 1067 1118 38 81 130 193 272 360 465 585 730 900 1107 1353 1660 1991 2365 2783 3342 3931 4558 5254 6036 6862 7715 8652 9601 10613 11681 12799 CPIO MPMG 99.9 98.4 1.40 99.4 99.2 1.41 100.0 101.2 1.40 100.4 101.3 1.39 100.9 108.1 1.39 101.0 108.6 1.39 101.9 109.7 1.37 101.5 109.6 1.38 101.3 110.0 1.38 100.8 111.3 1.39 102.5 111.0 1.37 102.8 111.3 1.36 102.4 112.1 1.37 102.2 114.4 1.37 102.9 115.1 1.36 103.7 116.4 1.35 103.2 128.2 1.36 103.6 129.3 1.35 105.8 127.0 1.32 108.2 126.8 1.29 110.1 131.0 1.27 111.4 135.1 1.26 112.9 137.4 1.24 113.0 130.1 1.24 112.5 121.4 1.24 111.8 117.6 1.25 112.8 118.8 1.24 112.8 116.8 1.24 1.32 1.31 1.28 1.28 1.20 1.20 1.19 1.19 1.05 1.03 1.04 1.03 1.03 1.01 1.00 0.99 0.78 0.77 0.79 0.79 0.76 0.74 0.73 0.77 0.82 0.85 0.84 0.86 : Actual (nominal) price of Conventional water (S$/ ) : Actual (nominal) prices of NEWater (S$/ ) 1, : Quarterly trend of Used Water (10 /month) 1, : Quarterly trend of Conventional Water (10 /month) 1, 1, : Quarterly trend of NEWater (10 /month) CPIO: CPI for overall economy (average 2003 = 100) MPMG: Manufacturing Product Price Index for Manufacturing Goods (average 2003 = 100) ⁄CPIO 100 : 2003 fixed (real) price of Conventional Water ⁄MPMG 100 : 2003 fixed (real) price of NEWater PUB website and publications MEWR website and publications Singapore Department of Statistics, Yearbook of Statistics 88 Appendix A-2 Functionality Development Inducement by Imitator Substitution for Innovator Bass model is depicted as follows: (A-1) Functionality development (FD) can be depicted as follows: A-2) Equation (A-2) suggests that FD tends to decline over time. The management strategy of firms involves efforts to prolong a high level of FD. The ability to prolong these efforts, known as the ‘prolonging ability’, is reflected in the Bass model as the relationship between imitator innovator and . The mathematical reasoning is as follows: Given that and , FD can be expressed as follows: (A-3) Differentiation of FD with respect to , (A-4) Since Since and , (A-5) 1, y can be approximated as follows: 89 (A-6) Therefore, equation [A-4] can be developed as follows: . (A-7) 15 Since inequality [A-7] demonstrates that FD increases as the ration of increases, can be identified as the ‘prolonging ability’. Consequently, the ‘prolonging ability’ and its contribution to FD can be observed. 15 Since increase in demonstrates a shift from to , demonstrates negative value. 90 [...]... sufficient water supply was a great challenge Today, Singapore is able to successfully manage the nation’s water supply and demand requirements By operationalizing Singapore’s transformation, policy makers who intent to embark on such transformations can use the model as a reference and adapt it according to the status institutional conditions and economic development status of their nation 1.2.2 Singapore’s... Mexican economy, the first stage of liberalization The final phase was the ‘New regulatory framework and NAFTA’ phase Trade and financial reform and public deficit control were implemented, and export increased Further to this, the authors detailed the transformation in the terms of production capacity, competitiveness and sectoral linkages and that of technological capabilities By mapping the transformation... capability and the direction (depth and scope) of capability accumulation are necessary for a successful transformation for the companies studied Furtado and Freitas (2000) conducted an indepth study on the learning process that enabled a successful transformation in Petrobras, a Brazilian state-owned oil and gas company The study is interesting as the oil and gas industry is often considered a ‘sunset’... catchments and imported water are examples of conventional sources NEWater and desalinated water are the sources from unconventional means Since the contribution of NEWater makes up the majority of this unconventional means at the time of this research, there is no justification to separately calculate the elasticity of substitution for NEWater and desalinated water Water obtained from conventional sources. .. institutional innovations enabling the transformation Following Chapter I, which provides the motivation and theoretical background, Chapter II identifies the phases necessary for the transformation and the institutional factors that facilitated the transition between the phases, supported by empirical data A summary of the findings and the conclusion is presented in Chapter III This PhD research makes significant... known as Planned Indirect Potable Use or Planned IPU) Figure 1.1 illustrates how the IPU strategy is part of PUB’s strategy to close the water loop Today, Singapore’s water supply is made of the Four National Taps – imported water, local catchment, NEWater and desalinated water Singapore boasts of a diversified and sustainable supply of water through large-scale urban storm water harvesting, water recycling... the model is static, this implies that learning and human capital is also 8 static in time and at a certain level In reality, R&D is constantly evolving and the ability to learn and the human capital built is also constantly changing This PhD research studies an innovation that is technology-driven and knowledge-intensive taking place in a knowledge-based economy The capacity to commercialize the outputs... important role in the transformation process A comparison of the innovation policies for Taiwan and Ireland revealed different approaches undertaken by the government to facilitate the transformation process (Lin et al., 2010) The Taiwanese government was found to adopt a more active top-down approach that involved substantial government research funding and resources to develop target industries while... recycling and desalination to augment imported water; complimented by integrated urban water management and urban planning (Tan et al., 2009) In this PhD research, the terms ‘water reclamation’, ‘water recycling’ and ‘water reuse’ are used synonymously In Singapore, the product of the process is branded as ‘NEWater’ NEWater is a technology-driven innovative solution as a means of increasing the nation’s water... to the water to restore the pH balance of the water NEWater passed more than 65,000 scientific tests and surpassed the requirements for portable use by the World Health Organization (WHO) RAIN Stormwater Management Desalination Direct NonPotable Use Collection of Rainfall in Drains & Reservoirs Treatment of Wastewater SEA Treatment of Raw to Potable Water Reclamation of Used Water Direct NonPotable Use . SUMMARY This PhD research attempts an in-depth analysis on Singapore’s strategy in transforming its vulnerability in water into a springboard for new innovations. Using NEWater as the innovative. the application of various mathematical models in the analysis of a real-life transformation. This research focuses on a vulnerability that affects nations globally. That is the vulnerability. water loop. Today, Singapore’s water supply is made of the Four National Taps – imported water, local catchment, NEWater and desalinated water. Singapore boasts of a diversified and sustainable