Boost in earnings from businesses

The positive economic development in Germany is reflected in the respectable result for 2011", explaines Professor Hans-Joerg Bullinger, President of the Fraunhofer-Gesellschaft, presenting the figures for the previous year. „Financial resources rose from 1.66 billion euros to 1.85 billion euros. That's equivalent to a growth of twelve percent."

The research organization's financial resources are made up of the budgets for contract and defense research plus the expansion investments. „Contract research – the key area of research and development services – grew eight percent to 1.515 billion euros. In terms of defense research, the current budget of 98 million euros was five percent up on 2010. The expansion investments rose substantially to 236 million euros," said Chief Financial Officer Prof. (Univ. Stellenbosch) Dr. Alfred Gossner, explaining the 2011 result.

For contract research, project income rose to 1.1 billion euros – this is the income from orders with businesses, publicly funded projects and licenses. „Business income has developed especially well," emphasizes Gossner. „It is up 15 percent and reached a historic high of 531 million euros." Business income has increased dramatically twice in succession. Having risen by 15 percent, orders from industry in 2011 stood at 406 million euros. Fraunhofer took in 125 million euros from licenses. Income from public projects with the government and the states amounted to 405 million euros. And Fraunhofer earned 71 million euros from EU projects.

In addition to income from industrial orders and public projects, the financing model employed by the Fraunhofer-Gesellschaft has a third pillar, institutional funding. Institutional funding is provided by the German federal government and the states on a ratio of 90:10. Fraunhofer uses these funds for initial research, expanding the technology portfolio and for internal programs. This institutional funding grew by five percent in fiscal year 2011.

Three inventions per working day

In the fiscal year 2011, Fraunhofer researchers registered 673 new inventions. That's roughly three inventions every single working day. There are patents pending for 494 of these developments. The number of active industrial property rights and applications for such rights rose to over 6131.

During the financial year 2011, Fraunhofer invested 236 million euros in the research infrastructure of its institutes (Major infrastructure capital expenditure). That's a record level. „This high level of investment is mainly down to support from the European Regional Development Fund and the Recovery Plan 2," Gossner explains. The expansion has been largely supported by the government and the states, with 51 million euros in co-financing coming from EFRE funding. Some 59 million euros from Recovery Program 2 were also used. Last year, Fraunhofer accelerated the expansion of the application center „Polymer Nanotechnologies" of the Fraunhofer Institute for Applied Polymer Research IAP, as well as two large-scale construction projects of the Fraunhofer Center for Silicon Photovoltaics CSP.

Pooled into defense research is the expertise from seven institutes engaged in the field of defense and security research. In the previous year, the budget for defense research grew by five percent to 98 million euros. Some 56 million euros were provided by the Federal Ministry of Defense.

Last year, Fraunhofer hired 1300 new employees. This pushed the headcount to over 20,000. „To be able to realize the growing number of research projects and process the rising order volume, we will continue to need new, qualified employees," emphasized Dr. Alexander Kurz, Head of Human Resources at Fraunhofer-Gesellschaft,.

To recruit highly educated employees, Fraunhofer employs an extensive talent management procedure. One example is the „Attract" program. It systematically approaches external scientists with innovative ideas from internationally renowned facilities or from industrial organizations. As group leaders with links to a Fraunhofer Institute, they have an opportunity to advance their activities in the direction of applied research.

Yet Fraunhofer also selectively promotes managers from within – with the "Vintage Class," for example. This program is designed to identify successor candidates for the upper levels of institute management.

Fraunhofer is a popular employer, as revealed by last year's employee survey. Some 86 percent of employees are proud to work for Fraunhofer. In Germany overall, only 60 percent on average say that about their employer.

During fiscal 2011, Fraunhofer had 200 million euros in sales (excluding license income) with its international partners. This represents growth of 14 percent compared to 2010. Income from cooperation with European businesses and from EU-funded collaborative research rose by a full 17 percent to almost 145 million euros. Through orders with European partners, Fraunhofer generated more than 74 million euros, for an increase of 27 percent.

To date, Fraunhofer has been engaged mainly in Europe, the US and Asia. Now, the research organization wants to expand its international activities to the new growth region of South America. In September 2011, it opened the first Fraunhofer center in South America, the Fraunhofer Center for Systems Biotechnology CSB in Santiago de Chile.

A continually changing research landscape and ever-shorter innovation cycles require a research organization to have a flexible strategic planning process that is geared toward likely scenarios. That's why last year, Fraunhofer started the 2025 Strategy Process, which is based on a scenario analysis.

In identifying new and innovative future fields, the Fraunhofer-Gesellschaft is taking into account short- and medium-term technological and social developments, as well as emerging long-term trends. Clearly urbanization and the associated growing importance of cities as a central living space are such global trend. Under the motto „City of tomorrow," Fraunhofer and other researchers are working toward the vision of a city that is not only sustainable and livable but also offers future viability.