Traditional project funding has a catch for many projects - especially in the IT sector: completed in three to nine months with a large workforce, such projects are too short-term for the lengthy application process. However, the so-called research allowance has been available since the beginning of 2020. Innovative companies can claim a quarter of their R&D personnel costs against tax. The advantages of this new subsidy are that the requirements for development projects are low, as they involve applied, product or process-related developments that exceed the technological status quo in the company. As an example of a funded development, ISG has developed an open simulation platform based on a digital twin, in which even external simulation models can be integrated, as well as virtual controls and real hardware, so that a real-time simulation is created under full control. The application process is relatively unbureaucratic and, above all, the application can also be submitted retrospectively. This means that ISG has the prospect of around half a million euros in additional liquidity, which can be invested in further innovative projects.

The Stuttgart-based company ISG has been working together with the funding provider Partner für Innovation und Förderung (PFIF) for around ten years. In the early years, only one project was funded each year, but this has now increased to four, split equally between ISG's two specialist areas of simulation and CNC. They meet twice a year to exchange ideas, and there is an almost weekly telephone call between Stuttgart and Lahr. This is necessary because PFIF advises its customers with its background information on specific funding pots and emphasizes aspects of content so that they fit exactly with the tender - whether in mechanical engineering, electromedicine or the textile industry, whose projects all become more digital.

Research allowance: the chances of success are higher

As projects can only be funded either through traditional project funding from the state, federal government or EU or through the research allowance, an assessment by a specialist is extremely important. For example, a training program with the digital twin is funded by the BMBF as a grant project because it is a long-term, strategic project. In future, the twin will not only be used for faster commissioning, but also for virtual training before commissioning or for new employees. To this end, the Stuttgart-based company is working with the University of Bamberg to develop a didactic concept that allows error scenarios to be run through easily, just like in a flight simulator. No mechanical engineer would allow such delicate situations to occur on his real system - emergency stops, machine downtime or even deliberate errors.

Although project funding offers higher grant rates of up to 60 percent, the time and bureaucratic effort involved is higher and the chances of success are lower than with the research grant. In contrast, this is practically made for IT companies, because it is aimed more at short-term projects with a lower degree of innovation.

The author: Jens Gieseler is a freelance journalist