LTQ_Quarterly_01_2015_EN_Version LTQ

QUARTERLY
BY LEONTEQ
1
15
THE
HE
EM
MAGAZINE
AGAZINE F
FOR
OR IINVESTMENTS,
NVESTMENTS, TR
TRENDS AND TECHNOLOGIES
INTERVIEW WITH
ELON MUSK
THE VISIONARY WANTS
TO GO TO MARS
BUSINESS
TRAVEL
48 HOURS
IN SINGAPORE
MADE TO
MEASURE
THE CULT OF
SANTONI SHOES
INDUSTRY
WORKPLACE 4.0 –
NETWORKING
AMONG MACHINES
FOCUS ON
INFRASTRUCTURE
2 EDITORIAL
Dear clients,
Welcome to the first issue of the Leonteq Quarterly in 2015! You may have
noticed that it is now longer. Five years after its initial launch, we’ve decided to
expand the publication. The Quarterly now covers a wider variety of topics in
the style of contemporary magazines. Thus, you’ll find useful tips on interesting
cities where Leonteq has its own offices, as well as exclusive stories and profiles of
successful entrepreneurs. For this issue we met with Elon Musk, co-founder and
CEO of the pioneering California-based electrical vehicle maker Tesla Motors, for
an exciting interview. The commercial success of battery-powered vehicles depends heavily on the universal availability of charging
stations.
The Quarterly now covers
a wider variety of topics in
the style of contemporary
magazines.
This brings us to our special section on infrastructure.
Throughout the world there is an enormous need for
investment in the backbone of the global economy.
Experts estimate that USD 57 trillion in funding will
be required up to 2030. As many countries are constrained by tight budgets, they
are forced to rely on partnership with private investors. Exciting and promising
opportunities are opening up to investors not only in this regard, but also with
regard to infrastructure companies listed on the stock exchanges.
Our choice of topic reveals that despite the expansion of the magazine, we have
not lost sight of our core objective: we want to provide our readers with ideas
for asset allocation. In this spirit, I hope that you not only enjoy reading the new
issue, but that you’ll also find plenty of useful information in it.
Jan Schoch
CEO
Leonteq Securities AG
CONTENTS
3
Contents
AT A GLANCE What’s
really behind the Internet
of Things. Page 4
LOCATION Singapore:
exciting metropolis and
successful onancial centre.
NEWS What’s going on
at Leonteq this quarter.
Page 6
PROFILE Man with a mis-
sion: Elon Musk, American
visionary. Page 8
SPORTS A sport of contrasts, biathlon fascinates
both fans and athletes.
Page 14
SPECIAL REPORT:
INFRASTRUCTURE
INTERVIEW
He knows what he wants:
Tesla and SpaceX founder
Elon Musk.
8
38
CASH FLOW Building with
public funds. Page 20
INVESTMENT Billions are
powing into infrastructure
projects around the globe.
18
Page 22
RESOURCE MANAGEMENT
Water: a valuable resource
to be safeguarded. Page 26
WORKSTATION 4.0
The manufacturing
industry is facing a
revolution. Page 30
34
MADE TO MEASURE
MADE TO MEASURE
Santoni creates handmade
bespoke shoes.
Santoni, tradition and
bespoke craftsmanship
guarantee success. Page 34
LOCATION Singapore is
more than just an attractive
onancial centre. Page 38
GIMMICKS It’s the little
INFRASTRUCTURE The world is remodelling and investing
billions of dollars in the largest construction sites.
things that make the
difference. Page 42
Publishing information
Published by
Leonteq Securities AG
Brandschenkestrasse 90, P.O. Box 1686
8027 Zurich, Switzerland
Publication: 3 times per year
Print run: 2000 EN / 3000 DE
Concept + realisation
Axel Springer Schweiz AG, Corporate Media
Editor-in-chief
Manuel Dürr
[email protected]
Translation
Amelia Sassano
Marketing Director
Sandra Frank Dudler
[email protected]
Authors
Wolfgang Hagl
Christian Ingerl
Wilma Fasola
Oliver Gerhard
Ulrich Pramann
Matthias Niklowitz
Photo credits
Cover: Simone Perolari / LUZ photo Agency;
Content:Todd Cole/Trunk Archive; Portrait:
Todd Cole/ Trunk Archive (p. 9), Eric Odgen /
Trunk Archive (p. 11); Biathlon: Gian Giovanoli /
KMU Fotografie (p. 17); Infrastructure: Nordic
(p. 23), Maurus Huwyler (p. 23), Dustin
Bleizeffer and WyoFile.com (p. 28): Singapore:
Andrew Tan (p. 38), Illustration: Felice Bruno
(p. 40). All other photos are from iStock,
Alamy and ZVG.
Subscriptions
Leonteq Securities AG
[email protected]
Phone +41 58 800 1091
Fax +41 58 800 1010
Print
Staffel Medien AG, Zurich
www.staffelmedien.ch
Reproduction, in whole or in part, of articles
and images is permitted only with the prior
written approval of Leonteq Securities
AG. No liability is assumed for unsolicited
deliveries.
Legal notice
This publication is for informational purposes
only and is not research; it does not constitute
a recommendation to buy or sell financial
products, an offer or an invitation to provide
an offer. The information therein is provided
without any guaranty or warranty with regard
to accuracy, completeness or reliability. It is
explicitly recommended that investors obtain
comprehensive and personal advice from a
financial expert before investing in any financial
products. This publication is no substitute for
such consultation.
© Leonteq Securities AG 2015.
All rights reserved.
In keeping with the principle of sustainability, this publication was printed carbon-neutral on certified paper, thus contributing to sustainable forestry
worldwide. Only green energy was used in the production of this publication, and a hybrid vehicle was used to deliver it.
4 AT A GLANCE
The “Internet of Things” is coming
The “Internet of Things” is the next
revolution in the computer age.
4.1%
Ultra-fast mobile communication
networks, minuscule computer chips
and new data analysis methods
Transportation
form the technological basis of this
Driverless vehicles, GPS location,
performance monitoring
development, in which computers
communicate with each other of their
own accord. The question is not if,
but when the “Internet of Things”
takes off: early devices such as the
Fitbit Ultra (a “wearable”), the Nest
Diamond (networked thermostats
for residential premises) or Google
7.7%
Glass (optical head-mounted display/
wearable computer) are already
available. Driverless cars will be ready
Security
for serial production in several states
Biometric and facial recognition
locks, remote sensors
in the US by 2016.
Number of devices/user
8.3%
Retail
FROM MAINFRAMES TO
UBIQUITOUS COMPUTERS
Inventory reporting, shopping
via smartphone, anonymised
monitoring of consumer choices
1
10
million
60
million
million
1960
1980
1990
One million non-networked
mainframes were enough
Unconnected mini-computers
conquer the office
Text e-mail is the first Internet
application at universities
QUARTERLY 1 / 15
40.2%
POTENTIAL SCENARIOS...
Business/
Manufacturing
Real-time monitoring of
material inventories and
supply chains, robotic
manufacturing systems
30.3%
Shopping
Work
In the retail sector, the large-scale use
of RFID chips could reduce storage and
shipping losses by 2 per cent. At least that
much is possible if cash registers in the
stores are replaced by barriers that detect
the prices of the individual products as soon
as the shopping trolley is pushed through.
Payments will be debited from your bank
account in contactless form in the future.
There is a huge potential for automation
particularly in industry. The optimisation
of work processes, improved monitoring of
production facilities and increased energy
efficiency alone would enable industry to
reduce costs by 2 to 4 per cent annually,
even if only half of the potential optimisation were achieved.
Travel und Transportation
Health Care
Several automobile manufacturers have
announced that their first self-driving cars
will be available within two years. The car
makers were allowed to do large-scale
testing in several states in the US as well
as a few countries in Europe. The pioneers
are Google and Tesla in the United States.
Driverless vehicles will probably become
common in industry (mines, closed factory
premises, large warehouses) before they do
so on public roads.
If wearables monitor the health of the people wearing them in real time, costs in the
health care sector could be reduced by 1 to
2 per cent, and by even more if the use of
medication and participation in (amateur)
sports were also monitored and optimised
by wearables. Still more could be achieved
if the ‘Internet of Things’ made dangerous
jobs for humans superfluous with the use
of machines.
Health Care
Monitoring of vital signs,
electronic recording of
health data, pharmaceutical
safeguards
Insurance
The black boxes in cars are just the
beginning. Wearables indicate how things
could progress. The ‘Internet of Things’
enables insurance companies to collect
massive volumes of data on the more
or less risky lifestyles of the people they
insure and to align their pricing models for
accident insurance, health insurance and
life insurance contracts accordingly.
3
500
20
billion
billion
billion
2000
2010
2020
The Internet is accessed by
one billion desktop PC users
Smartphones are the devices most
commonly used worldwide to access
The ‘Internet of Things’ consists
of billions of tiny computers that
are built in everywhere
6 NEWS
LOCAL
(R)EVOLUTION DAY 2015
Hear it from the experts
The objective of Leonteq’s (R)Evolution
Day is to further intensify the dialogue between the academic world and investors. In
2015 the annual event will once again bring
together exciting speakers and topics. The
motto: “Welcoming change –What changes will shape our business in 2015?” The
panel of experts will meet at Hotel Dolder
Grand in Zürich, and will be moderated by
Ellen Frauenknecht. The keynote speaker
will be Guy Kawasaki. He was a consultant
at Motorola and ‘chief evangelist’ at Apple
before he became the head strategist at
Canva and an executive fellow of the Haas
School of Business at University of California, Berkeley. He will reveal the strategic
steps required to develop new products and
services and how to motivate employees to
create things customers love.
QUARTERLY 1 / 15
After the opening speech by Dr. Peter
Forstmoser, president of the executive
board of Leonteq AG, will explain to Nick
Sohnemann how the financial technology
has shaken the very foundations of the
entire sector, as new financial technology
actors are currently crowding the established players in the banking sector out
of the market. Michael Hartweg, a founding partner of Leonteq and the head of
Strategic Innovation & Business Intelligence, will provide insight into our smart
data initiative and explain how we have
redefined the investment business for our
customers. Klaus Schweinsberg, professor
of economics and founder of the Centrum
für Strategie und Höhere Führung (Centre
for Strategy and Higher Management), will
then examine the relationships between
Europe and Switzerland in a provocative
analysis.
In the afternoon, Urs Birchler, professor
of banking at the Institute for Banking
and Finance of the University of Zürich
and president of SUERF – The European
Money and Finance Forum, will explore
the question of why the Swiss financial
centre’s room for manoeuvring is continuously shrinking in a presentation entitled
“Honey, I shrunk the playing field – what
happened to Swiss banking?”. Following the presentation, Guy Kawasaki will
explain his philosophy, which will inspire
us to recognise and seize opportunities to
create new products and change the world.
The event will be concluded by Jan Schoch,
CEO of Leonteq AG.
7
GLOBAL
CHINA
29 branches
1 representative office
REPUBLIC
OF KOREA
JAPAN
1 branch
1 branch
HONG KONG
INDIA
50 branches
12 branches
TAIWAN
43 branches
MYANMAR
PHILIPPINES
12 branches
MACAU
1 representative office
1 representative office
1 branch
VIETNAM
SINGAPORE
1 branch
89 branches
THAILAND
INDONESIA
1 representative office
39 branches
MALAYSIA
1 branch
1 representative office
DBS: Over 250 branches
in 17 markets
FINANZ ’15 4/5 FEBRUARY 2015
EXPANSION
‘Investments
of the Future’
Partnership with DBS
For the first time the Funds Fair and the
Structured Products Forum in Zürich will be
merged to create the new FINANZ ’15 at the
Kongresshaus. The new financial fair
gains an additional dimension as a
Visit us
platform for the exchange of knowat our
ledge, trends and experience in the
stand V10
area of investment, and visitors can
learn about an even wider range of
financial products as well. We look forward
to welcoming numerous interested guests at
our stand. Schedule your personal appointment with one of our financial experts
for one-to-one meetings on Wednesday,
February 4th, 2015 at www.finanzmesse.ch/
display/de/1+to+1+Meetings.
In February 2014 we had announced the
signing of a declaration of intent with a
larger institute in Asia. On November 4th
we confirmed the start of a new partnership
with DBS, the largest financial services
group in Southeast Asia by balance sheet
total. The partners have already begun issuing products jointly. The complete implementation of the collaboration is expected
to take at least 12 to 18 months.
DBS is one of the largest financial services
groups in Asia with over 250 branches in 17
markets, a balance sheet total of 417 billion
Singaporean dollars (approximately 310
billion Swiss francs) and a Tier 1 ratio
of 13.5 per cent as per June 30th, 2014.
DBS is domiciled and listed on the stock
exchange in Singapore, where they are
market leader with over 4 million clients.
The company is expanding in the three
most significant growth markets in Asia,
namely Greater China, Southeast Asia and
South Asia. The strong capital base of
the bank and its credit ratings “AA-” and
“Aa1”, which are among the highest in the
Asian-Pacific region, earned DBS the coveted title of “Safest Bank in Asia” awarded
by Global Finance for 6 consecutive years
(from 2009 to 2014). DBS employs 20,000
staff members. For more information, visit
www.dbs.com. Singapore is one of the few
countries worldwide with an “AAA” rating
(Standard & Poor’s, September 2014).
Source: DBS Annual Report 2013
1 representative office
8 PORTRAIT
HIGHLY CHARGED
MUSK
Many see him as the new Steve Jobs. Some even compare
him to Henry Ford and Thomas Edison. For others, he is just
a megalomaniac. But one thing is clear – right now, Elon Musk
is one of the most fascinating entrepreneurs in the world.
As the
largest shareholder, eBay’s
acquisition
of PayPal
netted Musk
USD 165
million
T
he 43-year-old is certainly not
lacking self-confidence. He wants
to solve humanity’s really important
problems. To end our dependence
on fossil fuels, he has accelerated
the growth of electric car manufacturer Tesla. With
SpaceX, he wants to reduce the cost of space travel
dramatically and one day colonise Mars. Musk, father of five children and twice divorced, has a career
with plenty of ups and downs behind him. Born in
South Africa, he immigrated to Canada at the age of
17, and studied economics and physics. He left his
doctorate at prestigious Stanford University after two
days because the internet economy was developing
around him. He sold his first company, the internet
platform Zip2, to computer manufacturer Compaq
in 1999. He later assisted in developing the PayPal
online payment service. When PayPal was acquired
by eBay for USD 1.5 billion in 2002, as the largest
shareholder, Musk netted a smooth USD 165 million.
With the money, he took over start-up company
Tesla and founded SpaceX. However, the first three
launches ended in disaster and SpaceX was facing
bankruptcy. Tesla also ran out of money in the
9
VISIONARY
AND IDEALIST
In spite of
setbacks, Elon
Musk continues
on. He wants to
change things –
and does so with
perseverance and
consistency.
He is a man who
divides opinions.
I’m afraid
of artiácial
intelligence.
10 PORTRAIT
LIFE IN SPACE
With his company
SpaceX, Elon Musk
goes beyond earthly
limits.
financial crisis. In an attempt to save both companies, Musk invested his entire personal fortune. It
paid off. Nearly 50,000 of his multi-award-winning
Tesla Model S sedans have sold to date, and he
expects to sell half a million of the successor Model
3 by 2020. And SpaceX has billion-dollar contracts
from NASA. Meanwhile, Musk’s net worth is estimated at nine billion dollars.
Elon Musk, you run the electric car manufacturer Tesla and the space travel company SpaceX,
and you are chairman of the Solar City manufacturer of solar power systems. How do you divide
up your working week?
On Mondays I work on SpaceX, on Tuesdays and
Wednesdays I’m usually at Tesla in Palo Alto, and on
Thursdays and Fridays I’m at the Tesla Design Center
in Los Angeles. At the weekends, I try to be there for
my children. But I also travel a lot.
I wouldn't recommend
anyone to be the CEO of two
companies at the same time.
With all your projects, do you have a limit where
it all becomes too much?
Right now, I’m just at the point where it’s too much.
I wouldn’t recommend anyone to be the CEO of two
companies at the same time and chairman of a third.
It’s not a recipe for a happy life, believe me!
How long do you want to keep doing it?
At least until our mass-market electric vehicle is in
production. We expect that to be in 2017. I’ve always
been clear about that. Then I’ll decide what to do
next. I’ll always be part of Tesla. The only question is
whether I’ll always lead the day-to-day business.
Are there any challenges that even you would
ond too big?
I would say that bureaucracy can be quite difficult.
Or the traffic in Los Angeles. But seriously – I believe
you can overcome almost any challenge. You just
have to decide which one to work on. In my case, it’s
sustainable energy and space exploration. These are
11
SpaceX has billion-dollar
contracts from NASA.
12 PORTRAIT
the really important problems for humanity. If we
don’t solve the problem of renewable energy by the
end of the century, the global economy will collapse.
And there will come a day when the Earth is no
longer enough for us. We will need somewhere new
to live. That’s why I want to colonise Mars one day
with SpaceX.
What does the crash of Richard Branson’s
SpaceShipTwo mean for your plans?
It’s a tragedy, but it doesn’t have any consequences
for us. We’re taking a very different approach to
Richard Branson.
Facts from
the life of
Elon Musk
700 satellites
The number of Wi-Fi
satellites Musk wants
to shoot into space
to provide internet
access around the
world. Estimated cost:
around USD 1 billion.
USD 500
A company is like a team:
the stronger your players,
the more the players pursue the
right tactics together, the better
the result.
The sum Musk
received for the code
for the computer
game Blastar, which
he developed when he
was 12.
GBP 616,000
You also envisioned the idea for Hyperloops – a
train that would speed from San Francisco to
Los Angeles in half an hour. That does not ot into
your scheme. It does not solve a major problem
for humanity.
Do I want to solve the problem myself? No, I don’t.
I’ve just designed and published the concept so that
others can implement it. It wouldn’t be that hard. I
hope someone takes it on. The Hyperloop is the best
method to transport large numbers of people between cities that are less than 1,000 kilometres apart.
I don’t understand why people still build normal
trains. They’re so slow. It’s crazy.
What will we see orst, the Hyperloop or people
on Mars?
Probably the Hyperloop.
The price of the Lotus
Esprit S1 from the
James Bond film ’The
Spy Who Loved Me‘
that Musk purchased
at auction in 2013.
His goal: to use Tesla
technology to convert
it into a real amphibious vehicle.
63 years
The age of his
mother Maye when
she appeared naked
on the cover of New
York magazine in
2011. She was imitating the pregnant Demi
Moore.
13
3 citizenships
Musk was born in
South Africa, became
a Canadian citizen
before his military
service and later
gained US citizenship.
12 seats
There are a dozen
seats in Musk’s
private jet, a Dassault
900, with a purchase
price of approximately
USD 35–39 million.
Iron Man 2
Elon Musk took a
minor role in the
sequel to the successful blockbuster. He
played himself.
2013
The year in which
Tesla topped the
Google hit list as the
most searched-for
international car
company.
RUNNING
SMOOTHLY
Although Tesla
had difficulty
getting off the
ground, its electric
car business is
now booming.
USD 17 million
The cost of the
estate in Bel Air (Los
Angeles) which is
still home to his five
sons from his first
marriage.
Do you have a leadership philosophy?
You need to do everything you can to achieve your
goal. And you can only reach it if you have great people working with you. A company is like a team – the
stronger your players, the more the players pursue
the right tactics together, the better the result. It’s the
leader’s job to make sure that happens.
What criteria do you look for in players for your
team?
I look for evidence of exceptional abilities. This
doesn’t mean that the person needs to have got good
grades or gone to the right school. It means he or she
has done extraordinary things in the past. That’s a
good indicator for the future.
Is it a gift to be able to inspire other people with
your own vision? Or can anyone be Elon Musk?
I believe that everyone has their own talents. But
people often limit themselves – they’re capable of
much more than they realise. There’s a whole lot
of software running in your head. Who wrote the
software? In most cases, it wasn’t you. So perhaps the
software should not even run the way that it does.
Maybe you should rewrite it! Then you wouldn’t be
so limited.
In your professional life, you risk everything. Do
you do the same in your private life?
I don’t like risk per se. I don’t go bungee jumping
or skydiving. Before having a family and running
two companies at the same time, I had a fighter jet,
a Soviet L39. I did stunts with it, which was a lot of
fun. But I was always worried – what if the mechanic
didn’t tighten a screw properly and the wing falls off ?
That’s why I stopped flying and sold the jet when the
children were born.
What is currently your greatest fear?
At the moment I’m afraid of artificial intelligence.
That’s the biggest threat to our existence. Digital
super-intelligence can get out of control.
With all the projects you are involved in, what do
you want to be remembered for in the end?
I don’t care whether I’m remembered or not.
14 SPORTS
HOT PURSUIT
Biathlon hones the
focus and endurance
of its athletes.
BIATHLON
FULL SPEE
HIGH FOCU
Speed
S
peed a
and
nd ccomplete
omplete ccalm.
alm. T
The
he rapidly
rapidly alternating
alternaating
contrasts fascinate fans and athletes alike. A look at a
sport that’s recently been gaining popularity.
D
US
15
A
lot, if not everything, depends on the
next few seconds. An accurate shot is
the key. The target is 50 metres away,
and only 4.5 centimetres in diameter
when the athletes are shooting in the
prone position. (When shooting in the standing position, the target is 11 centimetres in diameter). Even
when you’re fresh and relaxed, it’s damned difficult
to hit the bull’s-eye. A biathlete once gave an apt
description of what it feels like when he arrives at the
shooting range during the race: It’s as if you’d just
stormed up a steep flight of stairs and were trying
desperately to thread a needle as fast as you could.
Your heart is racing after the steep climbs and swift
descents. The athletes burn so much energy during
the race that their pulse soars to an almost inhuman rate of 215 — absolutely useless for shooting.
Thus, the biathletes have to use a special breathing
technique to lower their pulse quickly to roughly 160
beats per minute. Less than that would be disastrous,
leaving the athletes gasping for air with trembling
legs. Among German-speaking biathletes, this
feared state that leaves them unable to do anything
is known as the “sewing machine”. And each missed
target results in skiing a penalty loop, costing the
athlete approximately 25 seconds. In the individual
competitions, the penalty is an entire minute.
Precision and dynamics
Biathlon is the sport that unites two contrasting
activities. During the skiing laps, the athletes push
themselves to their physical limits, but upon reaching the shooting range they must calm down and
BIATHLON: THE FACTS
Biathlon is a combination of cross-country skiing and
shooting with a small bore rifle. The athletes generally
start a few minutes apart and race against the clock,
using the skate-skiing technique to propel themselves
forward. The skiiing rounds are broken up either by
two or four rounds of shooting, half in a prone position
and the other half standing. In the individual competitions, skiers are given a penalty of one minute for
each missed shot, which is added to the skiing time. In
the sprint, pursuit, mass start and relay, the athletes
must ski penalty loops of approximately 150 metres.
The men’s biathlon became an Olympic sport in 1960,
and the women’s biathlon in 1992. The series of races
that comprises the Biathlon World Cup has taken place
since 1978 (men) and 1987 (women). The high point of
this season is the world championship in Kontiolahti,
Finland from March 3rd–5th, 2015.
16 SPORTS
THE WEAPON
The small bore
rifle (.22) must
weigh at least
3.5 kg, the
magazine may
not hold more
than 5 cartridges
and the highest
permissible
muzzle velocity
is 360 m/s.
Today, 97 per cent
of the athletes
use ANSCHÜTZ
equipment.
achieve a state of utmost concentration instantly.
It’s a balancing act, but it’s precisely this tension
between extreme endurance and precision that
makes the sport so appealing to both athletes and
spectators. The athletes are under enormous mental
pressure. Their hearts are pumping wildly, their
thighs burning and their nerves are raw when they
enter the shooting rounds. Then they’re put to the
test of keeping calm, trusting in their own abilities,
having a bit of good luck, and hoping that a sudden
gust of wind doesn’t ruin everything. They shoot
either standing up or lying in a prone position. The
standard textbook recommends aiming, inhaling, exhaling two-thirds of the inhalation, and
pressing the trigger, and then following through
briefly. One shot per breath. But that’s ancient
history. In the meantime, many fire twice before
they inhale. There are fast shooters like the
Austrian Simon Eder, who fires the five shots
in less than eight seconds.
A new popularity
No other winter sport has experienced a
boom comparable to that of biathlon in
recent years. Each January, 18,000 spectators undertake a four-day pilgrimage to
the town of Ruhpolding (population
7,000) in Upper Bavaria. And since
2002, 50,000 fans annually arrive at
the Schalke Arena in Gelsenkirchen
to watch their favorite sport, while
millions of fans are glued to their
televisions as well. Shortly before
the millennium, the programme
planners recognised biathlon’s
potential, and have been working behind the scenes to shape
the sport. Thus, new disciplines
such as the sprint, pursuit, mass
start, mixed relays and night racing
were created especially for TV. This
success is also partially due to the
fact that there are no complicated
rules for biathlon. All that counts
is the stopwatch and the targets
that are hit and flip over — or
not. Spectators follow the athletic
dramas at the shooting ranges
minute by minute. What began
90 years ago as an Olympic
The name Gasparin stands
for success in Switzerland
Selina was the silver medallist at the Olympic Games in
Sochi in 2014.
demonstration competition known as military patrol
now has a broad fan base, despite the fringe status of
biathlon in the 1970s. It had a terrible image. Moreover, women, who were allowed to participate in the
world championships for the first time in 1984, were
ridiculed as gun-toting dames.
Swiss world champions
The breakthrough came with appealing athletes like
Uschi Disl and Magdalena Forsberg, later Kati Wilhelm and most recently Magdalena Neuner. The Germans, Norwegians and Russians dominated the sport
for years. However, biathlon has long since become
a major winter sport in other countries, including
France, Sweden, Austria and Italy, Ukrain, the Czech
Republic and now Switzerland as well. The popularity of biathlon in Switzerland is due primarily to the
17
PULSATING The athletes have
to get their heart rate under
control to shoot properly.
1. LEONTEQ BIATHLON CUP
Leonteq has been active in biathlon at the
regional level for several years now. With
our new function as the headline partner,
we are supporting the up-and-coming
sport at the national level beginning
with the winter season 2014/15 and are
actively fostering the next generation of
biathletes.
The starting signal for the cup was
December 6th/7th, 2014 in Realp.
The cup comprises a total of eleven
races, and the finale will take place
on March 28th/29th in Lantsch. The
athletes will compete in the following
categories: Kids, Elites, Challengers and
the Open Biathlon. www.swiss-ski.ch
success of Selina Gasparin. In December 2013 she
won her first two World Cup races and three months
later became a silver medallist at the Olympic Games
in Sochi. Together with the Swiss relay team she
caused a sensation: in addition to Irene Cadurisch,
her two sisters Elsa and Aita were on board. There
had never been such a biathlon family before. Selina’s
success is a prime example of what’s important in
biathlon. Athletic talent is important, of course.
But tenacity and a strong will to succeed are equally
significant factors. Selina, who grew up in the small
village of S-chanf in Upper Engadin, started out as
an alpine skier, but then switched to cross-country
skiing, which made it easier for her to push her little
sister Elisa in her pram. Years later, it was again her
little sister who convinced her to switch once more.
Elisa sparked Selina’s enthusiasm for biathlon and
together the pair converted their youngest sister Aita
as well. The two older sisters gave Aita an unusual
present for her confirmation — a gun.
In the beginning, the sisters had to ask their neighbor whether he would allow them to set up mechanical targets in his field. Later, their parents, together
with other parents, financed the first training center
in Switzerland (Engadin Nordic). Four years later,
there were four permanently installed shooting ranges in which the mechanical targets were equipped
with cable pulls so that they could be reset from
“black” to “white” from a distance. Selina’s job at the
customs agency left her plenty of time for extensive training. She also secured a place at university
in Norway, studying sports and exercise science
together in a special cohort with numerous other
top athletes. During all this, she also sought support
from a psychologist, as today’s exceedingly accurate
markswoman used to be afraid of shooting. Thanks
to that support and the backing of her husband Ilia
Chernousov, a top Russian cross-country skier, she
became one of the world’s top biathletes. In 2015 she
will be taking a break from biathlon, as the couple
are expecting their first child.
Further information:
Many well-known ski resorts offer taster courses
in biathlon.
Horw (CH): www.skiclub-horw.ch
Lenzerheide (CH): www.biathlon-arena-lenzerheide.ch
Oberhof (DE): www.weltcup-oberhof.de
Ruhpolding (DE): www.biathloncamp.de
Antholz (IT): www.biathlon-antholz.it
Ridnaun (IT): www.biathlon-ridnaun.it
Hochfilzen (A): www.biathlon-hochfilzen.at
Ramsau am Dachstein (A): www.skischule-ramsau.at
18 INFRASTRUCTURE
BUILDING SITE
FUTURE
19
WHY THE LARGE INFRASTRUCTURE
PROJECTS AROUND THE GLOBE OFFER
INVESTORS ENORMOUS OPPORTUNITIES.
20 INFRASTRUCTURE
Cash flow that’s stable over the long term
Lucrative collaboration between the public sector
and private industry. More and more countries are
using public-private partnerships to gain access to capital.
T
he urgently necessary development
and expansion of the global infrastructure does indeed offer investors promising opportunities. The
companies in this industrial sector
frequently have extremely stable business models
and can afford to be generous to their shareholders.
It’s an enormous sum: According to the McKinsey
Global Institute (MGI), USD 57 trillion will be
required by 2030 to maintain the global infrastructure. Without investment on this scale, the forecasted
expansion of the global economy is at serious risk.
Many nations face an immense challenge in this
regard. After all, the financial situations of the crisis-ridden western industrialised
nations in particular are not
In 2013, the year of their
exactly rosy. In the member states
closure, 47 infrastructure
of the Organization for Economic
funds not listed on the
Cooperation and Development
stock exchanges collected (OECD), the gross national debt
USD 38 billion.
now amounts to more than 90
per cent of the gross domestic
product. “The need for private capital to finance
major investments in transport, energy, telecommunications and services is huge,” says Michael Cembalest, Chairman of Market and Investment Strategy at
J.P. Morgan Asset Management, in summarising the
situation.
Interesting investment case
In the analysis entitled “The road not taken”, the
American institution details the pitfalls as well as the
opportunities in infrastructure investment. The au-
thors believe that the public sector needs to find ways
to provide adequate remuneration for private investors. Should this effort succeed, involvement in the
infrastructure sector can certainly be attractive. “Investors can profit from investments with cash flows
that are stable over the long term that are closely tied
to economic growth, the rising demand for energy
and increasig urbanisation,” wrote J.P. Morgan Asset
Management. More and more countries are using
public-private partnerships (PPPs) to gain access to
capital. These are long-term collaborations between
the public sector and private industry. Public-private
partnerships are frequently used in road construction. When a company plans, finances, builds and
operates a certain route, the state returns the favour
by letting its partner keep the toll revenues.
Interest in private investment is growing. In 2013,
the year of their closure, 47 infrastructure funds not
listed on the stock exchanges collected USD 38 billion. Thus the inflows were not only nearly one third
higher than the figure for the previous year: according to a report published by the data service provider Preqin they were the highest since 2008. This
megatopic has long since reached the stock market as
well. The quotations list includes innumerable shares
from the infrastructure sector. The S&P Global
Infrastructure Index is recognized by investors and
analysts as a global benchmark for the segment. This
indicator includes 75 companies. To diversify the
exposure, the method targets the following sectors:
utility companies, transport and energy. Over a period of 5 years, the S&P Global Infrastructure Index,
launched in February 2007, achieved an annualised
21
total return of 10.8 per cent. More than two fifths
of the historic performance is due to the dividend
payments of the indexed companies.
Stable cash pows, generous dividends
This shows that infrastructure companies have the
potential for high and above all stable cash flows
thanks to their particular business models. This is
also true for the index heavyweight Transurban.
The Australian group develops and operates toll
roads and is active in the United States as well as in
Australia. The network of motorways, bridges and
tunnels distributed throughout Melbourne, Sydney,
Brisbane and Washington, D.C. covers nearly 1,200
kilometres. Revenues are streaming in: in fiscal year
2014 (as of June 30th), Transurban’s income from
the toll roads rose by 13.1 per cent. The company increased the dividend by a similar figure and
announced a further rise for the current fiscal period
in 2015. If the management keeps their promise,
the company could boast average annual dividend
growth of 10 per cent, starting from 2009. This strategy is obviously popular with investors, as the share
price has more than doubled over a 5-year period.
The current “revolution” in the American energy
sector is also reflected in the aforementioned themed
index, i.e. fracking. This well stimulation technique
involves injecting highly pressurised water mixed
with certain chemicals and sand into deep, dense
rock formations in order to produce oil and gas. At
the end of 2014, the shale boom resulted in American
oil production rising to more than 9 million barrels
per day for the first time since 1970. The beneficiaries of this development include midstream companies in particular, i.e. companies specialised in the
production, processing, transport and storage of oil,
gas and petroleum products. Williams is among the
10 biggest securities lilsted in the S&P Global Infrastructure Index. The American company describes
itself as one of the largest natural gas producers and
processors in North America. With Enbridge and
TransCanada, two further representatives of this
unique sector joined the ranks of the top 10 infrastructure companies as of October 31st, 2014.
S&P Global Infrastructure Index:
5-year total return performance
Source: Thomson Reuters, 17 November 2014. Historical data are not reliable
indicators of future developments.
5000
4500
4000
3500
3000
2500
2000
1500
1000
500
2009
28 Oct
2010
28 Oct
2011
28 Oct
2012
28 Oct
2013
28 Oct
2014
28 Oct
US oil production (in millions of barrels/day)
Source: US Energy Information Administration, 12 November 2014. Historical and
hypothetical data are not reliable indicators of future developments.
10
e = expected
8.6
9
6.5
8
7
6
5.5
9.4
7.4
5.6
5
4
3
2
1
0
2010
2011
2012
2013
2014e
2015e
22 INFRASTRUCTURE
A market with abundant potential
Needed around the globe: infrastructure expansion.
Countries have to optimise existing facilities such as
roads, railways, ports and utility systems.They are faced
with the challenges posed by new technologies such as
e-mobility and the Internet.
O
ctober 31st, 2014 was a special day
for AlpTransit Gotthard AG. At
exactly 12:00 noon, workers laid
the last tracks in the Gotthard Base
Tunnel. After 39 months of construction time and a total of 290 kilometres of track laid,
the “golden threshold” had been reached. The longest
railway tunnel in the world is now open for use along
its entire length of 57 kilometres. However, it will
still be a while before the first trains actually thunder
through the tubes at speeds of up to 250 km/h. The
operating company has scheduled the opening for
the end of 2016. The signals are to turn green in the
Ceneri Base Tunnel three years later. Seventy years
after the Basel-based engineer and transport planner
Carl Eduard Gruner sketched out his initial vision
of a passage through the Gotthard, the New Railway
Link through the Alps (NEAT) will be completed.
According to an estimate published by the Swiss Federal Office of Transport at the end of 2013, the total
costs of Switzerland’s largest current construction
project will reach CHF 18.5 billion.
A huge obstacle to growth
According to those responsible for the project, this
gigantic investment will pay for itself: In addition
to the more efficient transport of goods, they expect
shorter travel times for domestic and international
public transportation. AlpTransit Gotthard AG also
notes that the transport of goods may partially shift
to the rails and the contribution to protection of the
Alpine environment. Such construction projects
Definition: The subsectors of “infrastructure”
Source: Allianz Global Investors, September 2012
Economic infrastructure
Transport
- (Toll) roads
- Bridges and tunnels
- (Air)ports
- Railway
- Underground lines
- Logistics centres
Energy & Resource
Management Systems
- Oil and gas pipelines
- Gas/electricity supply
- Gas/electricity grids
- Water supply
- Water distribution
- Sewage/waste water
disposal
- Renewable energies
Telecommunications
- Cable networks
- Radio masts
- Satellite systems
Social infrastructure
- Schools
- Hospitals
- Prisons
- Courts
- Sports stadiums
- Trade shows
23
PROJECT
Istanbul Airport
COUNTRY
Turkey
PROJECT TYPE
SCHEDULED
COMPLETION
Airport with
up to 150 million
passengers per
year
End of 2018
(as per media
reports)
CHF
26.7
BILLION
Source: www.igairport.com
TOTAL COSTS
PROJECT
NEAT
(New Railway Link
through the Alps)
COUNTRY
PROJECT TYPE
SCHEDULED
COMPLETION
151.84 kilometres of railway
tunnels and
gallery system
End of 2016
TOTAL COSTS
CHF
18.5
BILLION
Sources: AlpTransit Gotthard AG, Bundesamt für Verkehr BAV
Switzerland
24 INFRASTRUCTURE
USD 57 trillion: Breakdown of the infrastructure investments
required between 2013–2030
Source: McKinsey Global Institute, McKinsey Infrastructure Practice, January 2013
21%
Electricity
29%
Streets
20%
8%
Water
Railways
17%
4%
Airports
1%
Ports
Telecommunications
play a key role not only in Switzerland, but worldwide. “Without the necessary infrastructure — from
transport systems to power grids and drinking water
systems — economies cannot reach their full growth
potential,” warned the McKinsey Global Institute
(MGI). A study published by the research institute
in 2013 describes the global backlog demand in the
infrastructure sector in detail.
The gap found by the researchers is huge. For the
period from 2013 to 2030, they estimate the need for
investment at USD 57 trillion. The analysts emphasise that this is only a rough estimate.
More than two thirds
However, this does not disguise the
fact that the countries need to accelerof the system covering
ate their efforts significantly. Accord67,000 kilometres
ing to MGI, the predicted investments
exceed the spending in the 18 years
before the forecast period by nearly
60 per cent. “The necessary USD 57 trillion exceeds
the estimated value of the currently existing infrastructure worldwide,” added the experts. Economic
performance plays a key role in such forecasts. “The
economic growth, in particular the increase in per
capita income, is considered the decisive factor for
the growth in infrastructure demand,” explained
the Organisation for Economic Cooperation and
Development (OECD). They provide an example of
the strong connection: During a 30-year phase that
ended in 2007, the global economy achieved average
growth of 3.3 per cent. During the same period the
global demand for electricity rose by 3.6 per cent per
year.
The developing countries crave electricity
The soaring world population plays its part as well.
A forecast by the United Nations assumes that the
number of people living on the planet will increase
by one billion to more than eight billion by 2025.
Twenty-five years after that the UN expects the population to be 9.6 billion. The institution emphasised
in its report that “The population growth will take
place primarily in the developing regions”. Moreover, many of these countries are quickly catching
up economically with the western industrialised
nations. Thus, particularly in the emerging markets,
the demand for new roads, railways, power grids
and social facilities is correspondingly high. Back to
the example of electricity: The OECD assumes that
the developing countries will more than triple their
electricity consumption between 2003 and 2030. To
meet the immense demand, experts believe that the
region must invest more than USD 5 trillion in the
generation, transmission and distribution of electricity. China accounts for just under 40 per cent of this
sum. By 2030 the People’s Republic could generate
more electricity than the United States.
Although consumption in the OECD countries is
expected to increase only by 1.4 per cent annually,
these nations are also facing enormous costs. The
organisation estimates the investment in electricity
between 2003 and 2030 at just under USD 4 billion.
The aging infrastructure in the western industrialised countries is a major problem. In recent years,
power outages have left millions of households in
the dark. Even though Switzerland has been spared
such spectacular blackouts up to now, it is also
confronted with this risk. Swissgrid makes no bones
about it. “The Swiss transmission network is hitting
its capacity limits,” wrote the operating company
on its website. More than two thirds of the system,
which covers 67,000 kilometres, is over 40 years old.
To meet future challenges such as rising demand
and the fluctuating infeed from renewable energy
sources, the Swiss Federal Council has initiated the
renovation and expansion of the electricity grids.
Ambitious goals for e-mobility
As part of this initiative, integration in the European
grid and testing of smart grid technology are to be
25
PROJECT
MombasaKigali Railway
REGION
East Africa
PROJECT TYPE
SCHEDULED
COMPLETION
Just under 3,000
kilometres
of railway tracks
2018
(as per media
reports)
CHF
13.1
BILLION
accelerated. The latter term designates an intelligent
power supply in which the components integrated
in a grid communicate with each other to utilise
existing capacities effectively while simultaneously securing the supply. Smart grid technology is a
prime example of the relatively new infrastructural
challenges. E-mobility is another one. In early 2014,
more than 400,000 electric vehicles were on the
road around the globe. Within twelve months that
figure had doubled. However, the drive technology
currently plays almost no role in the global automobile market. If the multinational policy forum
known as the Electric Vehicles Initiative (EVI) has its
way, twenty million e-vehicles will be on the road by
2020. In Switzerland, Swiss eMobility has committed to developing and expanding electromobility.
Shortly after its founding, the association launched
the development of a nationwide network of quickcharge stations, thus tackling a primary problem of
this technology, namely the range. In the meantime,
superchargers from Tesla have also been integrated
in the network. The American e-vehicle pioneer
wants to use such stations to enable its customers
to drive long distances with only a few stops. (Read
more about this company and its visions in the exclu-
sive interview with CEO Elon Musk on page 8.)
The clever manager initially gained renown as a
co-founder of the Internet-based payment service
Paypal. Thus, Musk knows what he’s talking about
when it comes to the infrastructure required by our
contemporary lifestyle. Shopping online and using
social media via PC, tablet or smartphone are par for
the course for more and more people these days.
The number of Internet users worldwide has
increased nearly eightfold since the millennium. According to the Internet World Stats portal, 2.8 billion
people were active in cyberspace at the end of 2013.
Over two thirds of Europeans have access to the
Internet, while the figure for North America is 85 per
cent. However, in Asia only three out of ten people
can surf the Web. In the mad race to catch up, the
countries will have to massively expand their broadband networks — a project that certainly won’t be
given as much time as the traversal of the Gotthard.
Source: KPMG
TOTAL COSTS
26 INFRASTRUCTURE
Down to the last drop
The global demand for water is soaring, but
resources are becoming scarce. New technologies
for water management and distribution as well as
sewage/waste water disposal are urgently necessary
and well worth the money.
O
n May 6th, 1968, when the environmental movement was in its infancy,
the European Council in Strasbourg
issued a drastic statement: “Water
is a precious and indispensable
resource for humans.” This was
followed by an appeal of hitherto unprecedented
urgency: “The supply of good drinking water is not
inexhaustible. Thus, it is a matter of increasing urgency to preserve these resources, use them sparingly
and to increase them wherever possible. Each and
every person has a duty to use water only sparingly
and with great care to ensure the well-being of our
society.”
Each and every person
has a duty to use water
only sparingly and with
great care to ensure the
well-being of our society.
No life without water
What was recorded in the European
Water Charter nearly 50 years ago
has not lost any of its significance
today. Without water, life can’t
exist. But while the world population is continuously increasing and
mankind’s demand for water is constantly rising,
whether in the form of drinking water or as a raw
material for industry and agriculture, many parts of
the world suffer from severe water shortages. There
really shouldn’t be such a bottleneck. Water covers
71 per cent of the earth’s surface and the global water
supply amounts to 1.4 billion cubic kilometres, which
corresponds to a cube with an edge length of 1120
kilometres. However, the largest part of the global
water supply consists of the salt water of the world’s
oceans. Only 48 million cubic kilometres (3.5 per
cent) of the planet’s water is fresh water. But in the
end, only approximately 0.3 per cent of the worldwide volume of water is actually usable for humans.
Improving water infrastructure
In view of such data, it stands to reason that the
OECD is calling for sustainable improvement in the
water infrastructure. The Organisation for Economic
Cooperation and Development stated the problem in
a nutshell in the study entitled “Meeting the Water
Reform Challenge”: “Effective management of water
resources poses huge challenges to countries around
the world. Billions of people have no access to a
reliable water supply and adequate sanitary facilities.” Thus, the institution believes that considerable
investment in the water infrastructure is required.
The OECD calculates that in its member states alone,
an annual volume of more than USD 600 billion will
be required until 2025. The organisation estimates
the annual capital requirement worldwide to be
more than USD 1 trillion. In no other infrastructure
segment studied by the OECD is the forecast spending so high.
27
PROJECT
Crossrail
London
COUNTRY
United Kingdom
PROJECT TYPE
SCHEDULED
COMPLETION
Over 100 kilometres of rapid
transit city rail
End of 2018
CHF
22.7
BILLION
PROJECT
Cameron LNG
COUNTRY
United States
PROJECT TYPE
SCHEDULED
COMPLETION
Gas liquefaction
and loading
for export
2019
Source: Cameron LNG
TOTAL COSTS
CHF
9.7
BILLION
Source: Crossrail Ltd.
TOTAL COSTS
28 INFRASTRUCTURE
PROJECT
Ningdong Energy
and Chemical
Industry Base
COUNTRY
Source: Shenhua Ningxia Coal Industry Group
United States
PROJECT TYPE
SCHEDULED COMPLETION
Energy and
chemical
industrial park
2020
TOTAL COSTS
CHF
32.5
BILLION
Efociency and technology are in demand
Dam construction, seawater desalination plants,
renovation of old water and sewage pipes, the development of water-saving technologies - the list of
current challenges could be continued indefinitely.
A market worth billions has grown up around this
issue. The following section provides brief outlines of
a few core areas. The production of drinking water
via the desalination of seawater is already making an
important contribution to the global water supply
and it will play an ever larger role in
It is possible to irrigate
the future. While 1 per cent of the
world’s population is supplied with
trees and crops with
desalinated seawater today, this figure
salt water using vapor
could increase to 25 per cent by 2025,
transfer technology.
according to a forecast of the consultancy Global Water Intelligence. The
conversion is accomplished in desalination plants,
whereby various technologies can be used. The bestknown methods are electrodialysis (electrochemical
production of pure water), reverse osmosis (production of pure water via filtration pressure) and
evaporation (thermal production of pure water). Currently, 7000 seawater desalination plants have been
installed and new projects are being launched on
an ongoing basis. Although the technology has made
great progress in recent years, desalination plants
consume a relatively large amount of energy. In the
Mid-Eastern oil-producing countries, this problem is
solved by combining the desalination plants with oil
and gas power stations. The experts at Global Water
Intelligence assume that the market volume for seawater desalination will rise from USD 8.9 billion in
2012 to USD 17 billion in 2017.
Global differences: Percentage of the population with
access to water systems and sanitary facilities
Source: OECD Study: Meeting the Water Reform Challenge, 2012
Access to water
Access to sanitation
98 98
100
83
All figures in %
93
83
79
75
58
49
50
25
0
World
Industrialised countries
Eurasian
Developing countries
29
Water for agriculture
Agriculture is by far the biggest user of water worldwide, accounting for 70 per cent of consumption.
Thus it is extremely important to reduce the demand
in this sector with more efficient technologies. Drip
irrigation plays a major role in this regard. In this
process, hoses in which water outlets are arranged at
regular intervals are laid, and a constant but low volume of water flows through them. The advantage of
the system is that evaporation and leakage losses are
significantly reduced. Another interesting technology is irrigation via vapor transfer. In this innovative
method, plastic pipes are used that let steam through,
but not water and the substances it contains. This
makes it possible to irrigate trees and crops with salt
water.
Intelligent supply networks
A large part of the water supply for the world’s
population is lost, unused. For example, in London
up to 50 per cent of the water produced leaks away,
because some of the distribution pipelines date from
the 19th century. A smart water network is needed.
The consultancy Global Water intelligence is of the
same opinion. According to them, companies offering
solutions to the problem of inefficient water pipelines
find themselves in a rapidly growing market. In their
forecast, the water experts assume that the market
volume in this segment will nearly double from USD
3.6 billion achieved in 2013 to USD 6.9 billion by
2018.
Waste water disposal
A non-existent or inadequate sewage/waste water
disposal system not only harms the environment but
is also the source of diseases that spread through contact with pathogenic organisms (microbes, bacteria,
viruses). The World Health Organisation (WHO)
estimates that 1.5 million cases of hepatitis A, 133
million parasitic infections, 120 million gastrointestinal infections and 50 million respiratory infections
annually are caused by poor sewage management.
Contamination occurs via leaks in sewage canals
or result from the drainage of untreated sewage
into the environment. To overcome this challenge,
various high-tech solutions have been developed in
the industrialised countries. Ecological sanitation is
one such concept, and is based on the recycling of
materials. Sewage is not considered waste material
but a recyclable material in this system. This has two
main advantages: the reduction of emissions into the
environment and the re-use of the water.
Water stands out: Expected average spending on
infrastructure per year (in USD trillions)
Source: OECD Study: Infrastructure to 2030, page 29, June 2006
2010 – 2020
2020 – 2030
WATER
STREET
245
772
+34%
+19%
292
1037
ELECTRICITY
TELECOMMUNICATIONS
87
+177%
646
RAILWAY
-74%
171
54
+7%
58
One example of state-of-the-art household sewage technology is the separation toilet. Household
sewage consists of three main components (gray,
yellow and brown water) with different characteristics. While the brown water contains the majority
of organic substances (substrate), the yellow water
contains nearly all soluble nutrients such as nitrogen,
phosphorus or potassium. The majority of the sewage consists of gray water (household sewage without
yellow and brown water), which carries only very low
volumes of nutrients. A separation toilet channels
the yellow water and brown water into different containers. While the yellow water is used in agriculture,
the brown water is turned into compost in containers. The ripe compost can then likewise be used for
agricultural purposes. The gray water is purified
and is then put back into household circulation. The
initiators of the European Water Charter would have
loved such innovative technologies.
241
30 FUTURE
WORKPLACE 4.0
ROBOTS AS
COLLEAGUES
Machines are networking and making their own decisions. The new internet of things, services, data and people
will shape the manufacturing world of the future. The fourth
industrial revolution has begun.
SMART ASSISTANTS
Businesses are already
making use of networked
information systems in
their customer service.
T
he advance of information and
communication technology in the
manufacturing industry will have
a dramatic impact on the entire
sector. Companies around the world
are in agreement on this fact, but few can identify
what changes they will need to make. The digital
transformation of the workplace represents a major
challenge for the industry – which not all businesses
will be able to meet. The result will be a reduction
in the number of market participants in the medium to long term. Explosive growth in production
technologies is redefining the entire value chain
in the manufacturing industry. While mechanisation, electrification and automation of production
brought major changes, the expectation now is for
truly disruptive innovation. Experts in the field
are referring to this shift as the fourth industrial
revolution. Cyber-physical systems and the internet
of things, data, services, and people will dominate
industrial production in the future. Everything will
be networked with everything else, building on the
base formed by information and communication
technology. But even in Germany, which has played
a pioneering role in this area and where the Federal
Government created the concept of ‘Industry 4.0’
back in 2011, many projects are still in their infancy.
In part, because the transition is not yet seen as economically viable. Small and medium-sized companies in particular would rather stick with what they
know, than invest in an area that, at least to date, has
lacked convincing practical examples. In response,
experts have called for demonstration centres, rather
than isolated showcases. This is the only real way
to explain the advantages of Workplace 4.0 to these
businesses. In parallel to these developments, new
A GLIMPSE OF TOMORROW'S WORLD
At the Institute for
Robotics and Intelligent Systems at ETH
Zurich, the future is
already reality.
32 FUTURE
PRIME MOVER
ABB now has more than
250,000 robots installed
worldwide. The Swiss technology group, specialised
in process automation, is
one of the major players in
Industry 4.0.
strategies must be created for industry qualifications
and training, to ensure workers are fully prepared for
the challenges of the future. Consulting firm Deloitte
has addressed the approaching revolution and the
impact on Swiss industry in its
recent study, ‘Workplace 4.0’.
With around 330,000 employees,
an export volume in 2013 of CHF
65 billion and representing 32.5
per cent of total exports, the engineering, electrical
and metal industry plays a key role in the country. To gain an initial overview, four major aspects
were examined, beginning with vertical integration
within factories. Intelligent production systems will
Artiácial Intelligence
and 3D printing play
the primary duet.
dominate the workshops of the future, independently optimising flow times, utilisation, development
quality, production, distribution and sales. As well as
bringing qualitative improvement to the production
process, it will also enable maintenance management
to be fully automated. The entire supply chain is
considered as a horizontal network, from the input
logistics to warehousing, production, marketing and
distribution, through to output logistics and subsequent services. Customers and business partners
are also taking an increasingly important role in this
network. The global trend towards customisation
is an important component in the new approach to
digital production. The entire product life cycle can
33
FANUC ROBOTICS EUROPE
The Japanese electronics and
engineering company presents a
production cell from the food sector.
This can pack items such as freshly
baked croissants (see image) or newly
prepared chocolates.
cost advantages can result from new designs, reducing the number of manufacturing steps, allowing
shorter delivery times and enabling local production
worldwide.” Dr Robert Sekula, Head of Manufacturing Technologies at ABB added: “It is not inconceivable that production with 3D printing could be ten
times faster than with conventional methods in the
future.”
MINI FACTORY CresaLine, the modular automation
platform from Obwalden company Credimex, can be
used to manufacture small components.
be tracked in detail, enabling integrated engineering with modified processes and reduced costs. But
the key driver in the fourth revolution — or rather
evolution — is the exponential growth in technology,
with artificial intelligence and 3D printing playing
the primary duet. The latter in particular is bringing radical changes to manufacturing. Products
that were previously created by carving a block or
removing layers are now 3D printed by adding successive layers and materials, saving time, money and
material. ‘Cost savings of 40 to 60 per cent along the
entire process chain seem possible with 3D printing’,
explained Raphael Urech, Hybrid Parts Manager for
the Thermal Power Sector at Alstom. “Significant
Workplace 4.0 obviously promises numerous advantages. However, comprehensive networking on
this scale comes with significant risks. In the study
by Deloitte, nine out of ten managers surveyed were
sure that they could make changes to improve their
competitiveness, especially in terms of global markets. The greatest potential was offered by engineering and the electrical and chemical industries. However, an almost equally large number were certain
that cyber risks such as hacker attacks and viruses
will increase, along with data theft and corporate espionage. To prevent these issues and be in a position
to implement Industry 4.0, the majority of companies will need to completely reorganise their IT
structure — not least because the networks will cross
enterprises and countries. All market participants
will need to work together to successfully implement
the changes. As many companies lack the required
financing and resources, they are selective in which
aspects they implement, with more and more businesses opting for research and development in 3D
printing. In many industries, prototypes and early
batches are now created using this new process. Purchasing and procurement are also taking advantage
of closer networking. However, it will certainly take a
few more years until Industry 4.0 becomes standard
in Switzerland and other countries. But companies
that behave as though nothing is changing will be left
by the wayside. So now is the time for businesses to
look for answers and create structures to ensure they
will be principal players in the future.
EVOLUTION
3D printing already plays
a major role in research
and development, creating prototypes and small
batches out of nothing.
34 MADE TO MEASURE
PREMIUM BRAND
Precision
craftsmanship
35
Tradition unites with innovation to create
luxury made by hand. The bespoke shoes of
the Italian manufacturer Santoni are amongst
the finest in the world. Customers pay up to
five-digit sums for a unique pair.
36 MADE TO MEASURE
IDENTIFYING FEATURE Each shoe is painted by hand in up to 15 steps; the orange sole is the trademark of the luxury manufacturer.
A
It takes
30 hours to
make a shoe
from start to
ánish.
ndrea Santoni handed the management of his shoe company to
his son at the end of 1990, leaving
the latter to decide whether he
wanted to continue producing
shoes exclusively by hand. Having
grown up between leather and lasts, Giuseppe never
even considered converting to mechanical production. “I’m not completely opposed to machines; they
should be used where it makes sense,” he explained.
“But our quality standards are based on absolute
precision and experience, and that requires intuitive
skill and expertise.” His success has confirmed his
decision, with revenues rising in the last fiscal year by
11.5 per cent to 64 million euros. Sales of the exquisite shoes from the small Italian community of Corridonia are booming, particularly in Asia, the Middle
East and the United States. In the meantime, 4 out
of 5 pairs are sold in these regions, and the company
is hoping for further growth via the expansion of its
e-commerce segment.
The reasons for the popularity of Santoni shoes in
America are hard to fathom. In fact, the enthusiasm
of the American buyers laid the foundation for the
success of the company. In 1975, Andrea Santoni
firmly believed that timeless design paired with top
quality would always prevail, especially in the United
States. Thus, together with his wife and two shoemakers, he produced his first collection of hand-sewn
shoes on the ground floor of his home. Then, without
being able to speak a word of English, he got on a
plane to market his products overseas. He knew that
he would distinguish himself from the other Italian
manufacturers only if he built up a loyal customer
base beyond the borders of his own market. His plan
worked. The elegant, finely crafted Italian products
were a hit in the United States. Sales rose quickly and
production was moved out of the family home into a
nearby factory. At the same time, Italians and other
Europeans began to fall in love with the exquisite
Santoni shoes as well — after all, if the upper class in
far-off America bought them, the products had to be
extraordinary.
It takes 30 hours to make a shoe from start to finish.
Watching the 400 employees at work, the first thing
you notice is their passion for their craft. They carry
out the same steps day after day, yet there is nothing
routine or automatic about their work. Practiced and
precise, each individual step in the process is meticulously executed in turn. Without drowning out the
natural background noise via headphones, they listen
to the cacophony of clattering, stapling and squeaking, which is audible even in the leather storage area.
Once a season the shelves of the storage area, which
is located in the cellar, is filled up with expensive raw
materials. The close collaboration with the suppliers
provides certainty regarding the origin and quality of
the leather. The buyers select the goods personally on
the producers’ premises and mark the material with
the Santoni stamp. The Italians always make sure
they are not cheated on their deliveries. The exotic
leathers such as crocodile, snakeskin or ostrich are
purchased exclusively from certified farms in Singapore, Louisiana and Africa.
All of the leather is cut to size by hand. Afterwards,
the individual pieces are sewn, and the classic shoes
37
Let’s be
honest – we
don’t make
shoes people
need. We
make shoes
that people
want.
Giuseppe Santoni
TRADITION Cobbler, stick to your last — at Santoni that
means everything down to the tiniest detail is done by hand.
THE BOSS Took over the management of the successful
family-run company in late 1990: Giuseppe Santoni.
are given the unique Santoni orange lining. Once
mounted on the lasts, the midsole is then attached,
followed by a layer of cord to ensure suppleness despite a hard leather sole, and finally the outer sole
is attached. After the corresponding drying period,
each shoe is given its individual colouring. The
women, who are mostly recruited from an art school
in Milan, apply the tints to the individual pieces,
finishing by dying the sole in the trademark Santoni orange. Andrea Santoni calls this process the
“patina”. Depending on the model, up to 15 layers of
colour are applied. Thus it gradually becomes clear
even to the completely uninitiated why the prices
for Santoni shoes range from three-digit figures to
the price of a small car. The production of the latter
category also involves a bespoke process in which
precisely customised lasts are made to measure for
well-to-do shoe owners.
passion for his work, for the product and the brand,”
he explained. “Let’s be honest — we don’t make shoes
people need. We make shoes that people want.” It
takes creative minds and the right collaboration to
communicate that far beyond the borders of Italy.
Thus, the traditional Italian firm sews wristbands for
the Swiss luxury watch brand IWC and maintains a
close partnership with Mercedes AMG as well. Analogous to the fireproof shoes designed for the drivers,
a sporty AMG range of shoes was introduced. “These
partnerships are important,” explained Giuseppe
Santoni, adding, “not least because we compete
with luxury brands operated as subsidiaries of huge
corporate groups. We, on the other hand, are still
an independent operation in which each step of the
work is done in-house.”
The foresight of Giuseppe Santoni laid the foundation for the continuous growth of the company
in recent years, particularly in the international
markets. He has not changed the basic philosophy
of the company, but today he talks more about what
makes the brand so special. He invested heavily in
rebranding the design and expanding the e-commerce segment as well as in marketing and public
relations work. He specifically seeks out foreign PR
agencies who understand his approach to excellence
in work. “Everyone at Santoni is consumed with a
Finally, Santoni reveals that he is, after all, a bit
eccentric. The company manufactures a striking
number of products in blue. Is that the latest trend?
“No,” he said, smiling. “I’m always clothed in blue,
from head to foot. It’s my favourite colour. I don’t
own a single pair of black shoes, or a single black
suit. That’s a bit of freedom I give myself.”
38 LOCATION
48 HOURS IN
SINGAPORE
Attractive onancial centre, fascinating travel destination. With
a population of 5.4 million, the metropolis has become an attractive
destination in many regards.
S
Leonteq Securities
(Singapore) Pte Ltd.
was founded in 2012.
The company acquired a
capital market license in
summer 2013 and entered
a strategic partnership with
the Asian financial services
provider DBS in late 2014,
with the goal of advancing the development and
distribution of structured
equity derivative products.
Twenty-six staff members
work on-site under the
direction of David Schmid.
ingapore is on its way to outstripping Switzerland as one of the most
successful offshore financial centres.
The populous metropolis is rapidly
gaining international importance, particularly in the field of private banking.
Singapore is investing heavily in service
quality, education and training. Moreover,
the market is strictly monitored by the
regulatory authorities, who are also actively
committed to promoting the location
and the industry. These efforts are visible
particularly in the development of the
infrastructure, to which the 700-km2 island
nation has committed high investments,
especially in recent years, and to tourist attractions in particular. Amongst the largest
projects are the Marina Bay Sands Resort
(with construction costs of roughly USD
6 billion) and the Resorts World Sentosa
(with construction costs of USD 5 billion).
The number of annual visitors has been
increasing for years, although most of them
schedule Singapore as an intermediate stop
on the way to other Asian holiday destinations. Tourists generally spend no more
than 24, 48 or at most 72 hours in the city.
Thus, the brief stay has to be well-planned
so that not a minute is wasted. In addition
to the familiar highlights such as the Infinity Pool on the roof of the 55-storey Marina
Bay Sands Resort or an evening in Chinatown, Singapore offers a surprising number
of smaller but classy attractions and an
excellent and diverse cuisine.
Early birds can start the day jogging in the
Botanic Garden, followed by the traditional
kaya toast as a reward for their exertions.
Café Ya Kun Kaya Toast in Far East Square
has the best versions of this tasty snack.
During the day and in the evening, the mix
of cultures found in Singapore offer a huge
range of options. “You can get everything
here — Chinese, Malay, Indian, Thai, Indonesian, Japanese and Korean cuisine,” explained David Schmid, Head Asia Leonteq
Securities. “Especially in the hawker
centres, the huge market halls, you’ll find a
fantastic selection at fair prices.” A popular
meeting place is Lau Pa Sat in the financial district. It’s generally overcrowded
at lunchtime, but in the evenings it’s an
ideal place where you can mingle with the
natives. The street in front of the market is
closed promptly at 7:00 p.m. to make way
for the food stands. Don’t bother with menus – the best thing to do is to browse among
the numerous display cases and let them
inspire you, according to the connoisseurs.
Beyond the culinary delights, you can
immerse yourself in the history of Singapore at the Heritage Museum. Not only the
exhibits, but contemporary witnesses as
well recount the development of the city.
A visit to the Night Safari at the zoo is also
highly recommended. There may be up to
4‚500 visitors at the weekend, but experiencing the animals in the jungle at night
will make you oblivious to them.
39
TOP OF THE WORLD
No other view is as popular
as the one from the pool on
the roof of the Marina Bay Sands
Resort.
40 LOCATION
Where to go in Singapore
BARS
DISCO
CONCERTS
EXHIBITIONS
OUTDOORS
The 1-Altitude Gallery & Bar
is not an insider tip but a must.
The roof of the One Raffles
Place Building , on the 63rd
floor, is the highest place
you’ll find to enjoy the sunset
and cocktails. Wednesday is
ladies’ night, with free entry for
women. The Orgo Bar offers a
similarly spectacular view. The
host and bartender Tomoyuki
Kitazoe serves extraordinary
cocktails and invites you to
have a seat on ‘ice cubes’.
‘Don’t take yourself too
seriously’ is the slogan of the
nightclub Bang Bang, which
offers a stylish interior and
popular DJs. The concept: relax
and dance the night away in the
glow of cutting-edge lighting
systems. The high-resolution
LED wall with its 45 gigantic
screens alone is worth a visit.
Those who prefer R&B and
hip-hop will find not only the
atmosphere they’re looking for
at The Butter Factory , but
the corresponding professionals at the turntables as well.
Relax and enjoy a Singapore
Sling and live music in jeans
and a T-shirt in a pub-style
atmosphere. Walla Walla in
the Dutch quarter is great for
a casual evening with friends.
On the other hand, if you’re up
for a big show, you’ll find it at
Esplanade – Theatres on
the Bay. The concert hall holds
1600 people, while the theatre
has 2000 seats. A shopping
arcade as well as numerous
restaurants and cafés are also
integrated in the building.
The building of the ArtScienceMuseum, resembling half of
an eggshell, is a highlight in
itself. Embedded in the Marina
Bay Sands Resort , it offers
guests changing exhibitions
that all focus on creative people. The National Museum
provides a stark contrast. Built
in 1849, the elegant neo-classical building shines with a new
yet still traditional radiance
since its re-opening in 2006.
To explore Singapore by foot,
try an Original Singapore
Walk. A native guide will take
you from Chinatown through
the red light district and on to
the newly built architectural
highlights. Various themed
walks are offered on different
days of the week. To escape
from the hustle and bustle of
urban life, take a day trip to the
island of Pulau Ubin north of
Singapore. You can also camp
there overnight if you wish.
41
DINING
RELAXATION
TIPS
TRANSPORTATION
SHOPPING
Chilli crab is a Singaporean
speciality. You’ll find an
especially spicy version of the
crab in tomato sauce at the
Jumbo Seafood Palace. If
you’re looking for a romantic
evening and would rather watch
the sunset over Singapore
than your budget, Jaan is the
right place for you. The young
chef Julien Royer pampers a
maximum of only 40 guests
per evening with his French
cuisine. After midnight, meet
for chicken roti prata at the
Newton Circus Foodcourt.
Those with a bit of time on
their hands should drop by
the Kenko Reflexology &
Fish Spa, where ‘Dr. Fish’ is
responsible for the pedicures.
And you’ll want to plan nearly
an entire day for the 10,000
m² ESPA spa in the Sentosa
Resort. If you prefer to relax in
the great outdoors, you’ll want
to visit the Botanic Garden,
which opens at 5 a.m. Admission to the 74 hectares is free;
the view can also be enjoyed
from a bridge overlooking the
garden.
Cleanliness is celebrated in
Singapore. Those who violate
the rules will be subjected to
severe penalties, including corporal punishment. Smoking
is forbidden in nearly all public
places. Those who litter the
streets will pay high fines, and
only those who have a medical
certificate are allowed to chew
gum. Business cards are
exchanged at the beginning of
business meetings. The person
giving you his card expects
you to read it carefully before
putting it in your wallet.
Those arriving with Singapore
Airlines should hang on to
their boarding passes; these
give the holders discounts and
rebates throughout the city for
everything from hotels to restaurants and tickets to various
attractions. You’ll find the entire
list on the airline’s website. The
fastest way of getting around
the city itself is a day pass for
the SIA hop-on bus network,
which covers the entire city.
The Singapore metro, known
as the MRT, is one of the most
modern in the world.
With its own metro station and
eight stories of shops, ION
Orchard Mall can rightly call
itself a Mecca for shopping.
You’ll want to bring plenty
of money with you. A visit to
the Tekka Wet Market is a
journey through the cuisines
of Singapore. You’ll find
numerous traditional and
fresh products at innumerable
stands. Browsing here will
make you hungrier by the
minute. Finally, check out the
latest technical gadgets at the
Funan DigitaLife Mall.
42 GIMMICKS
MUST
AB
DIE POST BUY!
OH MY G-ODD
The electric guitars by ODD Guitars are made
using 3D laser technology. Founder Olaf Diegel
uses Selective Laser Sintering (SLS) to manufacture custom-made guitars that are tailored
to customers‘ individual needs. Priced from
USD 3,000 www.odd.org.nz
Have a playful new year. With
these great gadgets!
STORYTELLING
The new Moleskine notebooks with
Livescribe Smartpen automatically
digitise notes via the companion
app. Price: approx. CHF 190.
www.moleskine.com
UNDERCOVER
COME ON!
Hard takeoff, soft landing: The Cloud by
Swiss brand On evolved from a partnership between six-time Ironman winner
Olivier Bernhard and designer Thilo
Alex Brunner. Price: CHF 190.
www.on-running.com
The Hydroview from Aquabotix is controlled via your smartphone or tablet and
delivers impressive images of the underwater world. Price: from CHF 5300.
www.aquabotix.com
DIY
AND... ACTION!
Build your own computer
game console. The Mignon
Game Kit has a 35-LED
display plus microcontroller
and is reminiscent of early
portable games. Price:
approx. CHF 80.
www.mignongamekit.com
With the water-repellent
GoPro Fetch dog harness,
you can discover the world
from your best friend‘s
point of view. The GoPro
camera can be mounted on
the dog’s back or chest.
For dogs from 7 to 54 kilos.
Price: from CHF 65.
www.gopro.com
INTERNAL
43
UPGRADE TO
LEONTEQ
Leonteq Securities (formerly EFG Financial
Products) was founded at the end of 2007 with
the original purpose of issuing and selling structured products. In the meantime, the platform
is now available to external partners within the
framework of our Partnerships strategy.
We have set ourselves the goal of playing a key role in
shaping the market for structured products with transparency and a differentiated range of services. As an
independent outsourcing partner for investment product services, we are unique in the industry and well
equipped for the further development of the market.
Leonteq Securities has one of the most experienced
teams of experts in the business focused on customer
service across all areas of the company and supported
by a state-of-the-art, integrated IT infrastructure.
With our modern, integrated platform, which is designed
for flexibility, innovation, customer service and transparency, we are a leader in the Swiss market. We operate internationally, with a focus on Europe and Asia.
INTERESTED?
We look forward to your comprehensive application.
[email protected]
SAVE THE DATE
4th & 5th February 2015
FINANZ ’15
10:00 a.m. – 6:00 p.m.
Zurich Kongresshaus
www.finanzmesse.ch
26th February 2015
ZHAW Graduates’ Day
9:30 a.m. – 4:00 p.m.
Winterthur, Eulachhallen
www.absolvententag.ch/cms/messetag/
4th March 2015
HSG Talents
12:00 noon – 6:00 p.m.
St. Gallen, Olma Messehalle
www.hsgtalents.ch/en/hsg-talents-conference/hsg-talentsconference/events/career-fair/ QUOTE
If everyone is moving
forward together,
then success takes
care of itself.
Henry Ford
Henry Ford (1863 — 1947)
was an American industrialist, the founder of the Ford Motor Company, and
sponsor of the development of the assembly line technique of mass production.