Alison Miner
US DOE/Carlsbad Area Office
(505) 234-7321

Bill Keeley
Westinghouse Waste Isolation Division
(505) 234-7594

In January 1995, a team composed of personnel from the US Department of Energy (DOE) Carlsbad Area Office (CAO) and the Westinghouse Waste Isolation Division (WID) set out to improve the Waste Isolation Pilot Plant (WIPP) technology transfer program. Minimally funded and lacking the legal and contractual mechanisms to enter Cooperative Research and Development Agreements (CRADAs) and license agreements, the WIPP program was virtually at a standstill. The team chose to challenge all program assumptions and processes. To the surprise of all, the team concluded that the answer was not to pump more money and labor into the program, but to fundamentally reinvent the program, doing more with fewer resources.

In benchmarking other federal technical transfer programs, the team noted that nearly every program:

• Focused exclusively on transferring hard technology rather than soft technology
• Sought to execute CRADAs and license agreements, involving exclusive intellectual property rights and royalty fees
• Used traditional marketing methods
• Provided the federal government with only a minimal return on investment (ROI)

The team developed the following guiding principles for the new WIPP technology transfer program:

• Focus on transferring soft technology, such as training systems
• Seek non-CRADA transfers involving non-exclusive rights and the waiver of fees
• Use push marketing on the Internet to announce technology transfer opportunities
• Provide the DOE with maximum return on technology transfer investment

By challenging every aspect of a traditional technology transfer program, the CAO/WID team developed a program that has enjoyed a resounding success. By the end of fiscal year 1997, the CAO/WID team has completed more than 4,000 transfers, created/retained an estimated 500 jobs, and has had an estimated economic impact of $21.4 million in the private sector.

For a nominal investment, WIPP is:

• Creating new income and jobs in the private sector
• Helping stakeholders receive maximum return on federally-funded R&D efforts
• Helping small businesses expand their services and product lines
• Helping large businesses compete in the global marketplace
• Providing educational institutions with tools necessary to improve learning
• Helping government agencies and not-for-profit organizations improve the quality of their operations
• Demonstrating the quality of its products, people and facility to a diverse national audience
• Pioneering a technology transfer approach that complements rather than competes with CRADAs

WIPP looks forward to sharing the process with other organizations.

Historically, the transfer of technology developed at U.S. federal government facilities to the private sector for commercialization has proven to be an expensive and time-consuming process, yielding limited return on investment. In 1994, the Waste Isolation Pilot Plant (WIPP) technology transfer program was at a virtual standstill. Located 26 miles southeast of Carlsbad, New Mexico, the WIPP site includes disposal rooms excavated in an ancient, stable salt formation 2,150 feet (almost half a mile) underground. Transuranic waste consists primarily of clothing, tools, rags, and other disposable items contaminated with trace amounts of radioactive elements, mostly plutonium. Managed and operated by the U.S. Department of Energy (DOE) Carlsbad Area Office (CAO) and the Westinghouse Waste Isolation (WID), WIPP was an unlikely candidate for success in the technology transfer field for the following reasons:

• The technology transfer program was minimally funded ($100K per year)
• The facility lacked the legal and contractual mechanisms to enter into Cooperative Research and Development Agreements (CRADAs) and licensing agreements. CRADAs and licensing agreements are the primary tools used by federal facilities to conduct technology transfer
• Unlike the national labs (such as Sandia National Laboratories) and some of the larger DOE facilities (such as Hanford [WA] Reservation), the WIPP does not research and develop high-tech hardware. Traditionally, high tech hardware has been the focus of federal governmental technology transfer programs
• The WIPP facility is in a remote, sparsely-industrialized location, making it difficult to market technology using traditional methods, such as working directly with local manufacturers

In January 1995, a reengineering team composed of CAO and WID economic development and technology transfer personnel set out to make the dormant WIPP technology transfer program work. Working on the project part-time, the team challenged the traditional technology transfer paradigm, completing the task in February 1995. In benchmarking other federal technology transfer programs, the CAO/WID reengineering team noted that most federal technology transfer programs performed the following:

• Focused exclusively on transferring hard technology to private sector businesses
• Sought to execute CRADAs and licensing agreements involving exclusive rights, and requiring private sector businesses to invest in technology commercialization and/or pay royalty fees
• Used traditional marketing methods, such as manned displays at conferences and trade shows, journal advertisements, and one-on-one meetings with businesses and entrepreneurs
• Concentrated on achieving a few, major transfers
• Spent significant amounts of money
• Provided the federal government with only a minimal return on investment (ROI)

During the analysis, it became quite clear to the team that the traditional technology transfer model would not work at WIPP: the program lacked human, financial, and technological resources, and the likelihood of obtaining additional resources was remote. To the surprise of CAO and WID personnel, the team concluded that for the WIPP program to be successful, it needed to be conducted in a manner almost totally opposite of the traditional program paradigm (see Table I).

While monitoring safety and management discussion lists and forums on the Internet, the reengineering team had noted that demand in the marketplace was much higher for soft technology than for hard technology. Specifically, discussion list subscribers were looking for communications surveys, training modules, human resource development evaluation tools, and safety manuals. While lacking many in-house-developed hard technologies, WIPP had an abundance of high quality, in-house-developed soft technologies. These materials include:

• Safety manuals, procedures, and training courses
• 31-module self-paced management and supervisor training program
• 10-module self-paced and classroom successful professional development program
• Management, general employee, and leadership development needs analysis tools

Literally dozens of audit groups, ranging from the Defense Nuclear Facilities Safety Board to the DOE Voluntary Protection Program (VPP) evaluation team have audited some or all of these materials. The materials have helped WIPP earn a number of awards, including the following:

• First DOE facility to earn VPP Star Status
• Winner of vice-president Gore’s National Performance Hammer Award
• First nuclear facility to earn ISO 14001 certification
• Best-in-class in industrial safety
• Winner of 1997 Quality New Mexico Pinon Award

Thus, the team was confident that it had high-value soft technology that would be in demand in the private sector.

While benchmarking, the reengineering team noted that many federal technology transfer programs were bogged down in the legal and financial complexities of CRADAs, licensing agreements, exclusive intellectual property rights, and royalty fees. The reengineering team believed that these complexities sometimes made technology transfer an expensive, unattractive process not only for recipients, but also for the government. In fiscal years 1996 and 1997, the DOE spent $436 million on 3,490 CRADAs. CRADAs and licensing agreements can involve exclusive intellectual property rights and limitations (e.g. field of use or term), or non-exclusive intellectual property rights and royalty fees. Ironically, guidance from the DOE and other federal departments urge technology transfer personnel to seek opportunities involving the granting of non-exclusive intellectual property rights. But the idea of paying royalty fees to receive non-exclusive intellectual property rights has proven unpalatable to many US entrepreneurs. Furthermore, many entrepreneurs are discouraged by the length of time necessary to execute a CRADA or license agreement, typically three to four months.

To overcome these obstacles, the CAO/WID reengineering team developed a short, generic, written agreement allowing the transfer of non-exclusive intellectual property rights at no cost to the recipient. With the assistance of CAO and WID legal staff, the team drew up a three-page form that serves as the application and agreement for technology. Key clauses of the agreement are the following:

• The agreement is used only to transfer soft technology and associated non-exclusive intellectual property rights to U.S. organizations (businesses; educational institutions; local, state, and other federal government agencies; and not-for-profit organizations)
• CAO and WID waive the right to collect royalty fees
• The recipient indemnifies CAO and WID for all damages, costs, and expenses arising from utilization of technologies
• The subsequent use of the technology is virtually without condition—recipients can use the technologies internally and/or modify them for commercial use

Through the new technology transfer agreement mechanism, the reengineering team hoped to cut red tape, reduce costs and process cycle time, and make the technology transfer process more attractive to potential participants.

Historically, a significant portion of the federal technology transfer budget has been devoted to marketing. Traditional marketing efforts include advertisements in trade journals, booths at trade conferences, direct mailing of brochures, and one-on-one meetings with local businessmen and entrepreneurs. This is not a cheap process: to buy space and man a booth at a three-day trade conference can easily cost $8,000. With an annual technology transfer travel budget of approximately $10,000, WIPP was not in a position to use the trade conference approach. The team rejected the direct mailing approach because a trial direct mailing effort produced no results. Finally, employing an approach of one-on-one marketing to local manufacturers and businesses simply was not possible: WIPP’s host communities (Carlsbad and Hobbs) and region (southeastern New Mexico) have few manufacturers and venture capitalists. The closest manufacturing center of any size is the City of El Paso, TX, nearly 200 miles from the WIPP facility.

The reengineering team determined that the Internet provided the WIPP technology transfer program with the only realistic opportunity to market soft technology to a large audience. Use of the Internet for marketing technology transfer was not a new idea–a number of labs and facilities, such as Sandia National Laboratories, were already advertising technology transfer opportunities on their World Wide Web (WWW) sites. But these sites used pull marketing. The team determined that WWW pull marketing was simply not an effective means of communication: there are too many sites competing for the attention of a relatively small number of potential customers.

The team elected to employ push marketing on the Internet, taking technology transfer opportunity messages directly to potential customers via special interest group discussion lists. The components of a discussion list are simple. The typical list is dedicated to a single, broad topic such as management. Universities operate most lists, with professors serving as moderators. To subscribe to a list, an individual sends an e-mail message to the list’s computer server (listserv). Once an individual has subscribed, the individual can send messages to the moderator. If the moderator considers the topic of the message appropriate for the list, the moderator electronically distributes the message to all list subscribers. Subscription to lists range from a few hundred subscribers to thousands.

The Internet supports literally hundreds of discussion lists covering hundreds of different topics. The team combed documents such as the World Wide Web Yellow Pages for relevant discussion lists. The team’s initial marketing list included the following discussion lists:

• Safety list, operated by University of Vermont
• Training and Development list, operated by Penn State University
• Human Resources list, operated by Cornell University
• Quality list, operated by Princeton University

The team planned to subscribe to these lists and announce the availability of soft technology at no cost by posting messages to the lists.

During fiscal years 1996 and 1997, the 49 labs and facilities that make up the DOE complex executed 3,490 CRADAs at a DOE cost of $436 million. This translates into 36 CRADAs per facility annually at a DOE cost of $125,000 per CRADA. The reengineering team concluded that a shotgun marketing approach had greater potential than this rifle approach. Simply put, the team believed that WIPP would realize the greatest return on investment by putting its soft technology in the hands of a large number of people, fully recognizing that a significant portion of the recipients would probably never use the material.

To the surprise of all, the team did not request more resources for the technology transfer program, but opted to do much more with only half of the resources. By using the Internet approach to market soft market technology, the team reasoned that it could cut the technology transfer budget in half, taking it from $100,000 to $50,000. The team calculated that two people (a manager and a secretary) working part-time on the project (less than one full-time equivalent), could successfully operated the new Internet-based technology transfer program.

The traditional yardstick used by the U.S. federal government to measure the success of technology transfer programs is the number of CRADAs executed during a given fiscal year. The CAO/WID team believed that while important, this number could be deceiving. Therefore, the team identified the following as the performance measures for the reengineered technology transfer program:

• Spinoff commercial sales in the private sector achieved by recipient businesses
• Cost savings and cost avoidance realized internally by recipient organizations
• Number of jobs created in recipient organizations
• Number of jobs retained in recipient organizations

The team also elected to determine the indirect economic impact of the program by using performance indicator statistics and standard government multipliers.

With the analysis and design phases of the reengineering product concluded, the reengineering team addressed a typical weakness of technology transfer programs—the lack of a detailed operating plan. The execution of CRADAs and license agreements are very procedurally (and legally) driven. However, during its technology transfer program benchmarking, the team did not find a single program that defined and integrated goals and objectives, product selection, marketing, agreement execution, and program evaluation in a single program operations plan. From the team’s experience, the lack of an operations plan was a recipe for confusion and inefficiency. Therefore, the team developed a detailed operations plan, Conduct of Technology Transfer. The plan contains the following:

• Introduction

• Awareness of Technology Transfer

• Approval Cycle

• Transfer of Technology
• Evaluation of Technology Transfer

The CAO and WID legal, economic development, and technology transfer staffs reviewed and eventually approved Conduct of Technology Transfer. The team distributed the document to all personnel to ensure, as one team member put it, "that everyone was reading from the same page."

Even with the extensive analysis performed by the reengineering team, there were no guarantees that WIPP’s new technology transfer program would be successful. Technology transfer personnel moved quickly to test the system. In February 1995, CAO and WID sent an e-mail message to Cornell’s Human Resources discussion list announcing the availability of an organizational communications survey at no cost. Those interested in obtaining a review copy of the survey were directed to leave a voice mail message on a line dedicated for technology transfer. Within 24 hours, CAO/WID received over 30 inquiries from around the world. The CAO/WID technology transfer personnel were ecstatic, but the response presented new challenges. Some of the requests came from foreign educational institutions and organizations. In the interest of promoting international research and education, CAO/WID decided to provide requesting organizations in U.S.-friendly countries with reference only copies of WIPP-developed soft technology. This policy continues today.

After receiving a voice mail request for a document, CAO/WID mailed the requester a hard copy of the document and a technology transfer application. If interested, the requester mailed the application to WIPP, and then CAO/WID would approve the transfer and mail hard and computer disk copies of the document to the requester. Cycle time was approximately one month—better than the three-to-four month cycles of traditional technology transfer programs, but still not as efficient as the reengineering team envisioned. CAO/WID expanded marketing efforts to the discussion lists targeted during the reengineering effort.

Over the course of the next two years CAO/WID made the following changes to improve the program’s effectiveness:

• Wrote more descriptive technology transfer opportunity notices, and included the technology transfer application as an attachment. This eliminated an entire loop of the transfer cycle (requester requesting review copy—CAO sending review copy and application)
• Accepted electronic (e-mailed) applications for technology transfer—most participants opted for this approach rather than calling, mailing or faxing in a request
• Began sending recipients computer disks only, eliminating the labor necessary to make hard copies

Through these process improvements, CAO/WID cut the entire technology transfer cycle time down to two weeks. By February 1997, however, WIPP was receiving 50-60 applications for technology transfer every week: clearly, the process needed to be improved again. Accordingly, in May 1997, CAO/WID launched a completely electronic technology transfer process:

1. CAO/WID posts an e-mail technology transfer opportunity notice with an application attached to discussion lists
2. An interested list subscriber fills out the application electronically and e-mails it to CAO/WID
3. CAO/WID review and approve the application on-line
4. CAO/WID send the requester an e-mail containing the technology transfer agreement, and the soft technology as an attachment

CAO/WID can now fulfill many technology transfer requests in a matter of minutes: average cycle time is now one working day from receipt of the technology transfer application.

The technology transfer group has encountered few problems in marketing and transferring soft technology via the Internet. E-mail and discussion lists have proven to be reliable marketing and transfer mechanisms. The group estimates that it has delivered 20 e-mail technology transfer notices to a total of 20,000 subscribers from 30 discussion lists, for a total of 400,000 direct marketing contacts. Despite this huge volume, CAO/WID has received only four complaints. Two complaints concerned spamming (in both instances the individuals had failed to note that the soft technology was available at no charge), one involved a trademark concern (since resolved), and one involved concerns about competition (also resolved). Clearly, the individuals and organizations that make up the Internet community are interested in WIPP soft technology.

The evaluation phase of the project actually began on the day that the technology transfer group e-mailed the first technology transfer notice to the first discussion list. Using any measure, the Internet-based soft technology program has been a resounding success.

The program has fared well when using the traditional performance measure for technology transfers: the number of transfers completed. Due to continuous process improvements, significantly increase the transfer rate (see Table II).

Table II. Transfers and Program Expenditures by Fiscal Period

As Table II illustrates, the major jumps in numbers occurred when CAO/WID began accepting e-mailed applications (FY 96-1) and when the program moved to completely electronic marketing and transfer. Note that these improvements occurred without an increase in labor or funding.

There are no programs to benchmark these numbers against—the WIPP Internet-based soft technology program is the first of its kind. It is interesting to note, however, that CAO/WID completed 4,142 soft technology transfers during FY 96-97, while the rest of the DOE complex (49 sites) completed 3,490 CRADAs. CAO/WID spent $42 per transfer, while the rest of the DOE complex spent $125,000 per CRADA.

The CAO/WID program has transferred soft technology to 2,800 businesses, educational institutions, government agencies, and not-for-profit organizations in all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, and the Federated States of Micronesia. Transfer rates closely correlate with state populations. As of September 1997, small-to-medium sized businesses lead the way in requests.

The 1,300 small-to-medium sized businesses fall into two broad categories: consultants who use and sell the materials commercially and medium-sized businesses that use the materials internally to improve organizational performance. Typical small-to-medium sized businesses are the following:

• Cavalier Development Company (VA), a small, woman-owned firm using the WIPP manager training program commercially in the DC area
• Emergent Dynamics (CA), a small consulting firm using a WIPP-developed management development needs analysis tool commercially in California
• Rohrer’s Quarry (PA), a small business, used the WIPP safety manual to develop an internal safety manual

One of DOE’s key economic development objectives is to assist and provide opportunities to small, women owned businesses. Since 1995, the CAO/WID program has completed more than 300 transfers to women-owned small businesses.

The 800 educational institutions receiving transfers include universities, senior and junior colleges, and secondary and primary schools. Educational recipients report using the materials in the classroom and to train internal staff. Educational institution recipients include:

• National Universities–Harvard, Yale, MIT, Princeton, Cornell, Rice, Cal-Berkeley, Illinois, Columbia, Michigan, UCLA
• Regional Universities–New Mexico State, Southern Illinois, Boise State (ID), South Carolina, Florida Atlantic
• Four-year Colleges--Vassar (NY), Alleghany (MD), Carson-Newman (TN), Briarcliffe (NY)
• Junior Colleges--College of DuPage (IL), Western Iowa Technical Community College, Honolulu Community College (HI)
• Secondary Schools--La Salle High School (FL), Oconomowoc High School (WI), Nathan Hale High School (WA)
• Primary Schools--Kent Gardens Elementary School (VA), E. J. Arthur Elementary School (NY)

The more than 300 government agencies receiving transfers include local, state, and federal organizations:

• Local Government Agencies—City of Phoenix, City of San Diego
• State Government Agencies –Texas Legislative Council, California Department of Transportation, Commonwealth of Pennsylvania’s Governor’s Office
• Federal Government Agencies—U.S. Air Force, NASA, Smithsonian, FAA, Amtrak, IRS

The more than 200 large corporations consist primarily of Fortune 500 companies. These companies use the materials internally to train, benchmark, and analyze their organizations. Large corporation recipients include:

• High Tech—Intel, Motorola, Dell Computer, Gateway 2000, 3M
• Major Manufacturers—General Motors, Procter &Gamble, Inland Steel
• Energy—Exxon, Texas Utilities, Florida Power & Light

Finally, the more than 100 not-for-profit organizations run the gamut from small organizations such as the Carlsbad [NM] Hispanic Chamber of Commerce to large ones such as Goodwill Industries and the National School Boards Association.

As previously indicated the primary yardstick for measuring the effectiveness of the program is not the number of transfers completed, but the impact of the transferred materials. During 1996 and 1997, CAO/WID surveyed samples (n = ~700) of the technology transfer recipient pool to determine the economic impact of the program in the private sector. The surveys indicate the following:

• 25% of recipients were using the materials
• 27% had not had a chance to use the materials but anticipated using them in the future

The team was pleased with these results. The shotgun marketing approach had yielded far higher usage numbers than anticipated. The CAO/WID technology transfer team had hoped for 10-15% usage.

Based on 1997 survey data, CAO/WID estimated that by August 1997 recipients had achieved the following:

• $15.8 million impact from commercial sales
• $5.6 million impact cost avoidance or savings
• 215 new jobs created (directly and indirectly)
• 275 jobs retained (directly and indirectly)
• 490 total jobs created and retained (directly and indirectly)

Thus, for a total investment of $175,000 in the technology transfer process, WIPP has achieved an estimated $21.4 million economic impact, and created or retained an estimated 490 jobs. WIPP knows of no other federal technology transfer program achieving this ROI.

The new technology transfer program has helped CAO/WID foster a positive public attitude toward the quality of WIPP soft technology, the WIPP facility, the DOE and Westinghouse, and the federal government itself. Through surveys and unsolicited feedback, technology transfer recipients let CAO/WID know that this unique program is appreciated:

The evaluation mechanisms in place not only help CAO/WID to determine the economic and public relations impact of the technology program, but also help re-chart the future of the program. Recipient feedback, process audits, and record reviews have convinced CAO/WID that the automation of the technology process can advance even further. Accordingly, in 1997, CAO/WID established a File Transfer Protocol (FTP) site (www.t2ed.com) on the WWW, allowing organizations approved for technology transfer to directly download soft technology in their desired format at their convenience. The FTP site is reducing technology transfer request processing labor, improving the reliability of electronic transfer, and allowing CAO/WID to transfer larger-sized soft technology electronically.

Strategically, the technology transfer group envisions a seamless electronic process in which potential recipients:

• Receive a notice of soft technology availability electronically
• If interested in the soft technology, click on the WIPP FTP site address embedded in the notice
• At the FTP site, review a sample of the soft technology for organizational applicability
• If interested in obtaining the soft technology, complete an on-line application
• Receive a message containing the approved application and a password for obtaining the soft technology
• Download the soft technology at the FTP site
• Annually receive electronic surveys to determine the impact of the soft technology and the effectiveness of the technology transfer program

Employing this approach, the technology transfer group believes that it will be able to double the annual output (to more than 5500 transfers) while maintaining the same costs ($50,000).

Is the WIPP technology transfer model designed to compete or replace the traditional technology transfer process? The answer is no. There will always be a place for formal hard technology CRADAs, involving exclusive intellectual property rights and royalty fees. The CAO/WID team views its Internet-based soft technology model as complementary to, rather than competitive with, traditional technology transfer. The team believes that other government facilities and organizations could easily adapt the model. Having established a good program track record, the technology transfer group is now poised to share the process with other government agencies, both nationally and internationally. One DOE facility (West Valley, NY) has already expressed interest in establishing a similar program.

By challenging every aspect of the traditional process, the CAO/WID team has developed a highly effective technology transfer program that has enjoyed a resounding success.

For a nominal investment, WIPP is performing the following:

• Creating new income and jobs in the private sector
• Helping stakeholders receive maximum return on federally-funded R&D efforts
• Helping small businesses expand their services and product lines
• Helping large businesses compete in the global marketplace
• Providing educational institutions with tools necessary to improve learning
• Helping government agencies and not-for-profit organizations improve the quality of their operations
• Demonstrating the quality of its products, people and facility to a diverse national audience
• Pioneering a technology transfer approach that compliments rather than competes with CRADAs  

WIPP looks forward to sharing the process with other organizations.

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