GE opens oil and gas R&D center in Oklahoma

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Two test wells drilled deep underground and a well simulation towering five stories above, highlight the advanced research capabilities of GE’s Oil and Gas Technology Center.

GE have opened their oil and gas technology center in Oklahoma City, which is expected to become the central hub for the company’s scientists and engineers to collaborate with the oil and gas industry on digital and hardware solutions and advancements. The center consists of five stories and 125,000 sq ft of lab and office space, suitable for 230 employees.

The facility is designed to advance technology throughout the oil and natural gas industry, and is the company’s 10th worldwide research center, however, the first to specialize in one area.

GE’s CEO, Lorenzo Simonelli, says the research focus at the center will span across all areas of oil and gas such as; production solutions and well construction systems, oilfield facilities and systems, and reservoir performers. Simonelli believes a strong commitment to R&D will help the oil and gas customers find new efficiencies to work through tough market conditions and lead to transformational opportunities for the industry to thrive long term.

“This is a unique center from a global perspective and the plan is to be at the forefront and take the industry forward through applied technology,” Simonelli said. “Unconventional oil and gas drilling is taking place in other parts of the world. There is an opportunity to bring them in here to study and learn with others in the industry. This is going to provide the ability for commercialization of new technology and a new approach at a faster pace.”

The new technology center will accelerate innovation, the center will enable the full power of digital solutions and technology from across GE’s industrial businesses to advance the oil and gas industry.

While the oil and natural gas industry has used improved technology over the past decade to unlock vast amounts of oil and natural gas, the industry remains inefficient, said Mike Ming, general manager of the research facility. The new technology outcomes from this center will solve this issue by utilizing reserves in cost-effective and environmentally friendly ways and subsequently attracting companies from across the nation and around the world.

An innovative creation which has already been developed at the technology center is ‘Raven’ the prototype drone, engineered to detect emissions precisely and cost-effectively. ‘Raven’ has already been successfully piloted and was able to detect emissions from oilfield equipment at well sites in Arkansas. ‘Raven’ is one of many exciting developments to be produced from Oklahoma’s new research center.

To find out whether your company could qualify for the Federal Research Credit, Contact a Swanson Reed specialist.

Albuquerque builds $35 Million high-tech R&D hub!

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Construction of the first building in Albuquerque’s high-tech research and development hub has officially begun in Central and Broadway Downtown.

The $35 million, 160,000-square-foot facility will house the University of New Mexico’s tech-transfer office and Innovation Academy, along with start-ups and partners involved in collective efforts to build a bustling, high-tech business zone in the heart of Albuquerque. The building will also provide housing for students studying in the entrepreneurial education programs and launching businesses.

Citizens of Albuquerque are very excited about the construction progression of the city’s R&D hub and are eager to be the first to take a tour when it is due for completion in August 2017, they believe the facility will forever change Albuquerque’s downtown skyline and will revitalize the whole area.

The R&D hub will facilitate education for entrepreneurs, provide lab facilities for state research universities and will reserve 2,000 square feet for the Air Force Research Laboratory to open a tech-transfer office.

It is already predicted that the University of New Mexico will intake 500 students into their own academy section of the R&D facility. This Academy will allow students to receive direct experience and real-world skills in entrepreneurship. The academy will consist of meeting areas, classrooms, individual working spaces and a state-of-the-art visualization room.

Academy Director, Robert DelCampo, describes the R&D hub as a one-stop shop, as students will live upstairs in trendy apartments, work on new technology and business ideas downstairs, and then walk to the Supporting Technology Transfer Center next door to get help taking their developments to the market.

While building such an innovation facility may be a huge investment, New Mexico state board strongly supports encouraging the future of its current and upcoming generations. Innovation is the future, without innovation, fresh ideas cannot be developed, resulting in the demise of projects and organizations.

The people of Albuquerque identified the need to significantly invest in the future of its entrepreneurs, business owners and organizations, by building this R&D facility, and are highly optimistic about the positive future outcomes resulting from it.

If you are an entrepreneur, business owner or are simply wanting to know more about R&D and how you may be eligible for the R&D Tax credit, contact a Swanson Reed specialist today.

 

 

Is R&D A Valuable Measurement of Innovation?

Preparation Pointers from Swanson Reed

The Relationship Between R&D and Innovation

It is well known that when performed effectively research and development (R&D) can increase the value of a company. However, Forbes writes that this is commonly misconstrued as it has been claimed that research and development spending directly translates to a measure of innovation. While R&D and innovation do correlate, they are not a perfect formula.

Tendayi said, “having a great R&D process and achieving market success with technologies we invent are two different things.” He goes on to suggest that R&D spending may be an effective measure of best practice within a particular industry.

In gauging the correlation between R&D and innovation rankings, the 2016 report of the Top 10 Innovative Companies provides the perfect example. Five of the ten ranking innovative businesses were also ranked in the top twenty for R&D spending in 2016, while the remaining five spent between $4.5 to $0.7 billion US dollars. Effectively, this demonstrates the necessity for research and development within innovation, as all 10 of the raking companies invest largely in R&D, however, it also demonstrates that spending was not the solo contributor to innovative success.

What is the Perfect Formula?

A successful company is capable of marrying innovation with market understanding. As Forbes explains, effective innovation solves for both technical and market risk factors. This is often left behind in lab based companies where business models are overlooked.

According to Forbes entrepreneurial expert, the formula for success continues to fund research and development programs that meet industry standards while implementing a strong invention to market management process making the improvements and inventions accessible on the market.

If  you would like to discuss the R&D Tax Incentive further, please do not hesitate to contact one of Swanson Reed’s offices today.

Trump’s Proposed Tax Reforms

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After a dramatic election season the proposed tax reforms of US President Elect, Donald Trump, are currently a topic of great interest for businesses. While pre-election reform plans may not necessarily become legislation, Trump will be supported by Republican chambers of commerce, making passing legislation more likely in absence of strong opposition.

How Might This Affect R&D?

In an attempt to decrease corruption due to the influence of special interests, Trump plans to eliminate special interest outlays and most business tax credits such as the domestic production activities deduction and the work opportunity credit which currently supports veterans among other groups. These points are controversial as many of the expenditures he proposes to eliminate relate more to public policy concerns than they do to special interests.

However, one positive position maintained through Trumps reforms is the continuation of the Research and Development (R&D) tax credit. This influences greater innovation and improvement of existing systems or processes within industry. As Trump promotes the repatriation of labor and production, an increase in R&D support could be a possibility. Some predict that Trump may use the incentive as a maner of influencing larger percentages of manufacturing, not just research, within the U.S.

If  you would like to discuss the R&D Tax Incentive further, please do not hesitate to contact one of Swanson Reed’s offices today.

How R&D Spending Correlates to Innovation

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From 2015 to 2016 North America increased R&D spending by 8% rising close to $300 Billion as Europe, Japan and the Rest of the World fell by 9%, 8% and 3% respectively and China rose by 19%. Many of  2016’s Most Innovative Companies invested over $8 billion in R&D (research and development) this year as calculated by Strategy & Business.

Apple and Alphabet, formerly known as Google, have maintained first and second in innovation since 2010 increasing R&D spending from $1.3 and $2.8 billion in 2010 to $8.1 and $12.3 billion in 2016.

 

2016 Top 10 Innovative Companies – Strategy & Business

Company Geography 2016 Innovation Rank 2016 R&D Spending Rank 2016 R&D Spend ($Bn)
Apple United States 1 11 8.1
Alphabet United States 2 4 12.3
3M United States 3 – 1.8
Tesla Motors United States 4 – 0.7
Amazon United States 5 3 12.5
Samsung South Korea 6 2 12.7
Facebook United States 7 – 4.8
Microsoft United States 8 6 12
General Electric United States 9 – 4.2
IBM United States 10 – 5.2

* Unfilled Spending Rank signifies company ranked lower than 20th

* R&D spend data is based on most recent full year figures reported prior to July 1st – Strategy&

 

As displayed by the recorded spending not all Top 10 Innovative Companies of 2016 were ranked in the Top 20 for R&D Spending in 2016, however, each company did perform R&D.

Innovation is supported within the cultures of these leading companies in part by the support of the United States. The research and development tax incentive seeks to foster innovation and growth making R&D possible for SMEs as well as large corporations.

Read about eligibility to find out if you qualify for the R&D Tax Incentive.

If  you would like to discuss the R&D Tax Incentive further, please do not hesitate to contact one of Swanson Reed’s offices today.

Issues Facing Multinationals After Apple’s Tax Headlines

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Apple in Ireland

This week Apple has taken a blow from the European Commission as the EU demands Apple pay their withstanding taxes to Ireland to the tune of about 14.5 billion US dollars. While Apple would be the one with a large bill, the focus lies heavily on the Irish government for what the EU defines as selective treatment or creating a special benefit for an individual or company. However, Ireland refuses to claim the taxes. Why?

By accepting the $14.5 billion Ireland will put at risk its reputation for being a cheap and stable market in which to perform business. As of 2014, Ireland had $350 billion or 311 billion euros of foreign direct investment which was 165% of GDP. Despite what is sure to be a costly fight with the European Commission, Ireland can not afford to lose these large investors. This, in effect, will damage Ireland’s relationship with the many multinationals functioning there such as Facebook and Google who have their European headquarters in the country.

Apple & the Big Brother

Apple CEO, Tim Cook, has issued a clear letter addressing Europe’s Apple community stating that the opinion issued by the European Commission has no factual basis as Apple pays the taxes it owes. The company continued to say that as nearly all of Apple’s R&D (research and development) is performed in California the vast majority of their profits are taxed within the US. This year Apple is lined up to spend about $10 billion on R&D increasing their research spending by about 30% from 2015. The letter concluded by drawing attention to proactive rather than retroactive lawmaking and by committing to further investment in Ireland and the European market.

Why has the US government supported Apple in this fight? For some time there has been conversation regarding the repatriation of profits being made abroad. While bringing the era of parking money offshore to an end would be beneficial for the US, allowing Apple to pay the sum would potentially add to the federal deficit. Additionally, Washington has stated its concern regarding the European Commission encroaching on US Government Jurisdiction. However it seems that not only the US is getting involved.

Bigger Fish to Fry

This is only the beginning of much more to come – governments worldwide have been struggling with how to tax the intangible multinationals and now the conversation has been opened. The question is; will these multinationals be forced to pay for their previous agreements or will rulings move from the current period forward?

If you would like to discuss the R&D Tax Incentive further, please do not hesitate to contact one of Swanson Reed’s offices today.

R&D Recreating Business

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Competitive Differentiation

We are all beyond aware of the rapidity of innovation today. In less than twenty years we have seen the technological dreams of Sci-Fi favorites come to life. Just this July we watched as the launch of Pokemon GO transformed the business sphere overnight, creating new methods of engaging consumers. As we accelerate our technological capabilities the challenge we face is to balance that technological innovation within human spheres such as workplaces, learning environments and business.

In a review of R&D transformation in relation to digitalization, SAP Vice President – Thomas Ohnemus, wrote that, “only five percent of companies say they’ve mastered digital transformation to the point of competitive differentiation.” In this quickly evolving market, competitive differentiation can be achieved through rapid response to the demand for innovation. This is where R&D must constantly be one step ahead of the game.

Shifting Business Structure 

While this race of market prediction is typically seen in the electronic industry, Ohnemus draws attention to the frequency in which companies are shifting from offering products to offering services. In this way companies must rethink the way they perform business; selling a service often requires continued customer relations, troubleshooting and preventative care to keep the service running smoothly.   

Innovating to Create Innovation

As the industry itself transforms, so must the workplace and the expectations surrounding furthered education within companies. Google has been one of the greatest workplace innovators – as the source of much of the world’s information Google employees are encouraged to take full advantage of the resource. Furthering education on topics of interest as well as using the company’s wide range of technological innovations to improve company culture and communication. This can be extended from personal interests to company training as education methods become faster and more accessible harnessing the strengths of millennials.


A famous example of this is Google’s 20 percent projects. Google allowed creativity to blossom and subsequently produce major projects such as Gmail and Google News by allotting for 20 percent of working hours to be dedicated to furthering personal projects and interests. While the 20 percent project time is rumored to have lost momentum it is true that, “any company can benefit from learning how to better attract and manage innovators, foster engagement and ultimately lead to success.” Thomas Ohnemus suggests that nowhere are these innovative techniques more important than in R&D.


If you would like to discuss the R&D Tax Incentive further, please do not hesitate to contact one of Swanson Reed’s offices today.