Efficient product development of cyber-physical systems, through advanced digitalization

In this call for proposals, we want to fund project, which contributes to efficient product development of industrial cyber-physical systems using advanced digitalisation. By cyber-physical systems we mean systems that integrate digital and physical components, i.e. systems that consist of both software and hardware. The projects will be driven by industrial needs and will lead to methods, tools and working methods that integrate AI throughout the development chain, from requirement setting to verification and regulatory compliance.

You can apply for up to SEK 8 million in funding for project that lasts between 12 and 24 months. Applicant shall be a consortium of at least two participants, including at least two industrial participants in the form of companies. In addition to companies, academia, institutes, public activities or government agencies can participate.

The call for proposals is part of the Advanced digitalisation programme, an industry-driven programme to promote Sweden's, and Swedish industry's, ability to create the digital solutions of the future. The projects financed will contribute to Sweden's joint ability to create and use digitisation opportunities.

Generative AI, AI agents and other AI-based development tools are changing the conditions for industrial product development. At the same time, the industry sees challenges in product development of more complex systems consisting of both advanced hardware and software, so-called cyber-physical systems. It is an area where Swedish industry has long built its international competitiveness.

Swedish industry needs tools, methods and structures such as support for efficient product development, regulatory compliance and efficient collaboration between humans and AI in the development process.

This applies to the entire development chain, including both hardware and software, and extends from idea to a product that can be manufactured. Product development also includes links to legal, administrative and market aspects.

Some examples of industrial needs:

• Increase development productivity with agent applications that support the entire development cycle, from eligibility requirements to validation, and launch, including various aspects of hardware dependencies.
• Discover errors and deviations earlier in the development process.
• Make the development process faster and deal with new bottlenecks when software development is no longer limiting.
• Short lead times and reduce costs through automation and support for parallel development.
• Manage “legacy”, i.e. retrieve information and knowledge from old systems, or effectively replace old systems. For example, knowledge of old code or integrations.
• Simplify regulatory compliance. It can be about tools and support for specifications, standards, documentation, analysis, structuring and product certification.
• Customize solutions for businesses with complex product development, such as challenges linked to real-time, safety-critical systems or complex hardware-related development.
• Increase the understanding of complex relationships and decision-making through human-in-the-loop-based working methods.

What will the call for proposals achieve?

The call for proposals will help develop new innovative tools and methods for product development that benefit Swedish industry on a broad front. It is important to emphasize that the call for proposals focuses on product development processes for cyber-physical systems, and does not address AI-based decision support in all industrial processes or all operational technologies (OT).

What are the projects expected to achieve?

• Solutions adapted for businesses with complex product development, such as challenges linked to real-time, safety-critical systems or complex hardware-related development.
• Effective and secure methods to retrieve information and knowledge from old systems or effectively replace old systems, for example through knowledge of old code and integrations.
• New methods and tools that address all aspects of product development, all the way from ax to limp. Projects should thus not only address software development, but also more slow neighbouring processes such as the legal, regulatory or administrative ones.
• Short lead times and reduced costs through automation and the possibility to develop several parts of a system in parallel.
• A realistic plan for industrialization no later than three years after the completion of project.

The Advanced digitalisation Programme

The call for proposals is part of the Advanced digitalisation programme, a effort from Vinnova in collaboration with industry, which mobilises actors from different parts of society towards joint objective.

Advanced digitalisation wants to strengthen Swedish research and make Sweden more attractive when it comes to research and innovation investments, and stimulate the development of advanced digital technologies. The programme will be implemented with a long-term perspective and contribute to innovative, enabling technologies and the development of key competence areas that meet the needs of industry.

Read more about the programme at Advanced digitalisation website.

The call for proposals is aimed at need owner in industry who, together with other actors in a consortium, can develop applicable solutions in the field. The other parties may be, for example, industrial companies, academia, research institutes or experts in product development.

Therefore, applicants must be a consortium with at least two participants, of which at least two are industrial participants in the form of companies.

In order to meet the call's expectation of dissemination of results and industrial impact, consortia that are cross-industry are particularly welcome.

Industry in the Advanced digitalisation programme refers to the entire production chain – from extraction of raw materials to finished products, as well as industrial service sectors and technology sectors needed for the production chain to function. This includes, for example, energy, logistics and transport, telecommunications, water/air/ventilation and recycling. The defence industry is also covered.

Every participant seeking funding shall have Swedish legal personality. In this respect, foreign organisation who has a branch or an establishment in Sweden is equated with a Swedish legal person. The costs of the project shall be attributable to the activities of the branch or establishment.

We fund collaborative projects that contribute to efficient' product development of industrial cyber-physical systems using advanced digitalisation.

Some examples of activities

• Develop new knowledge, new tools, methods, models, algorithms, decision support or digital solution concepts. Projects should seek new knowledge through planned research or critical analysis.
• Assess and validate that developed solutions contribute to efficient product development.
• Identify and analyze organizational prerequisites, barriers and enablers for future implementation of new methods, tools and solutions, such as change management, competence development and innovation management needs.
• Analyze prerequisites and knowledge needs for future implementation and utilisation of project results.
• Distribute results, experiences and knowledge to relevant target groups outside the project.

We do not fund

• Rutinal or recurring changes to existing methods, tools and working methods.
• Project that focus on industrial processes other than the product development process.
• Project that only applies to the development of software systems and not cyber-physical systems.

What costs can we finance?

Our funding is subject to rules about state aid. The rules govern the types of costs that we can finance. These are called eligible costs.

In this the call for proposals, these types of costs are eligible:

• Remuneration costs: Gross wages and salaries paid, employer's contributions and other non-wage labour costs.
• Equipment, land and buildings: Costs of instruments, equipment and rent for premises other than ordinary business premises.

• Consultancy and licence costs: costs of consultancy services, knowledge and patents purchased or used under licence from an external actor; These costs may not exceed 20% of an organisation's budget. In case of special needs, for example if the project requires specialist expertise, we can accept a higher percentage. You should then justify this in your proposal, and the justification is taken into account in our assessment.

• Other direct costs: Costs such as materials, supplies and travel necessary to carry out the project.

• Indirect costs (overheads): Costs linked to the project but not directly incurred, such as premises and cleaning. Indirect costs may not exceed 30% of wage costs. Universities, university colleges, research organisations and government agencies may have higher permitted levels, depending on activities.

For more detailed information on what costs we can finance, see Instructions to eligible costs

What eligibility requirements applies to costs we fund?

For your costs to be eligible, this applies, among other things:

• They must be actual, reasonable and necessary for the activities in the project.
• They must be recorded correctly and on a separate project code in the accounts. You may not cover project costs with other public funding or your own funds intended for other project.
• You may not include someone else's costs as your own.

For more detailed information on which eligibility requirements, restrictions and exceptions apply, see our general terms and conditions.

The rules about state aid determine how much of the costs we can finance. This is determined individually for each organisation. We therefore distinguish between how big the funding project can get, and how much a participating organisation can get.

How big funding can the project get?

The project can get up to eight million kronor in funding, and a maximum of 50% of the project's total eligible costs. The preliminary total budget of the call is SEK 40 million.

How big funding can a participating organisation get?

How big funding a participating organisation can get depends mainly on:

• the organisation's size and activities
• what activities the organisation will carry out in the project.

Descriptions in future sections about which support we can provide are simplified. For full details, see Grants and support levels for funding.

Support to companies for research and development

In this the call for proposals we give support to industrial research.

Industrial research can be described as seeking new knowledge through planned research or critical analysis. This is to develop or significantly improve products, processes or services.

Which companies qualify as small or medium-sized enterprises (SMEs)?  

• To assess the size of a company, we apply the EU SME definition. The definition is based on the number of employees, annual turnover and balance sheet total.   

• If the company is part of a group, data for the whole group should be included. If the undertaking owns or is owned by other undertakings between 25 % and 50 %, this information shall be taken into account.   

• For help in determining whether a company is an SME, please read How the EU defines small and medium-sized enterprises (SMEs). 

How much of the costs can we finance?

The organisation's size and type of activity determine how much of the costs we can finance. This is called the maximum aid intensity.

Maximum aid intensity for industrial research:

• Lity of enterprise 70 %
• Medium-sized enterprise 60 %
• Large enterprise 50 %

Situations in which we finance a higher proportion

If the project is covered by one of these bonus bases, we can finance a higher proportion of the costs.

• Actual cooperation: Some level of collaboration between small and large companies, between companies in two different European countries or between research organisations and companies.
• Dissemination of results: Extensive dissemination through, for example, conferences or open databases.

Maximum aid intensity for industrial research with bonus base:

• Lity of enterprises 80 %
• Medium-sized enterprises 75 %
• Large enterprises 65 %

Support to universities, university colleges and other public organisations

We also give support to organisations who does not conduct economic activities. This means that the organisation does not offer a service or product on a market. This usually includes universities, research institutes and other public organisations.

This aid is not covered by the State aid rules. We can therefore finance up to 100% of the costs of such an organisation. The aid is often referred to as ‘not state aid’.

How is it determined whether a organisation engages in economic activities?

A organisation offering any kind of service or product on a market is considered to engage in economic activities and cannot be granted this form of support.

It does not matter how the organisation is financed: whether it is public or private, or whether it is profit-making. Nor does it matter what legal form the activity takes. For example, whether it is a limited liability company, a partnership, an economic association, a non-profit association or a foundation.

If a organisation conducts economic activities is determined by their ordinary activities, not by the activities of the project.

Some organisations conducts both economic and non-economic activities, such as research institutes. Then it is important that you know in which of these activities you apply.

Are you unsure if a organisation in your project conducts economic activities, please contact call manager. However, The organisation is responsible for assessing whether it conducts economic activities.

For us to judge your proposal, it must meet some formal eligibility requirements. If the requirements are not met, we will reject proposal directly.

Eligibility requirements on participants

• All participating organisations shall be legal entities. Natural persons or sole proprietorships cannot participate. Foreign legal entities may also participate. However, foreign actors that may funding by us must have a branch or a place of business in Sweden, and the costs shall be incurred at the branch or place of business.
• The coordinating party shall be a Swedish legal entity and conduct activities in Sweden.
• At least two participants shall participate in the project. This includes the coordinating party. Different parts of a organisation are the same legal entity and count as a participant, for example two departments at a university.
• At least two of the project partners must be industrial participants in the form of companies.

Eligibility requirements on the project

• The project may apply for a maximum of SEK 8 million.

• The project must start no earlier than 2027-03-19 and no later than 2027-04-15
• The project must not have started before you have submitted your proposal.

Eligibility requirements on proposal

• Proposal must be written in Swedish or English.

• Proposal must follow the instructions under the heading "How to apply".
• Proposal should contain all requested attachments.

Applications that meet our eligibility requirements criteria will be forwarded to assessment. In the assessment, we look at how big potential your idea is, how realistic it is and who will implement the project.

We also look at how well your project integrates gender equality, both in how your project group is composed and how you implement the project. By integrating sex and gender perspectives, more inclusive and relevant solutions are developed. This strengthens both the innovation capacity and the project's results.

Gender equality as a tool for innovative social development

What do we assess?

When assessing applications, we look at three main criteria:

• Potential: We analyze what effects and what value we can expect from the project.

• Actors: We assess the participants' competence and ability to implement the project and achieve the desired results and effects.
• Feasibility: We assess how realistic and credible the project plan is, both for implementing the project and for achieving the desired results.

In the combined assessment of the project, potential is weighted with 40% and Actors and Feasibility with 30%.

Potential (40%)

• How much potential the project proposal has to achieve the call's objective and aim to contribute to efficient product development of cyber-physical systems.

• How innovative the project proposal is in relation to existing solutions and ongoing major initiatives in the area.
• How credible is the project proposal's analysis of the problem and the results that the proposed solution is expected to achieve.
• How likely it is that the project proposal is feasible, scalable and has impact and impact on Swedish industry.
• How well the project proposal contributes to increased gender equality by integrating perspectives on sex and gender.

Actors (30%)

• How well the composition, participation, competence and ability of the actor constellation contribute to project objectives and implementation.
• How well the consortium is anchored in Swedish industry.
• How well the project partners demonstrate the ability to disseminate, utilize, commercialize and further develop the results and knowledge generated in the project, both within their own the organisations and outside the consortium.
• How well the project manager and other key people are assessed to be able to lead and implement the project.
• How well the financial contribution, participation, power and influence are distributed equally between women and men in the project team.

Feasibility (30%)

• How well the project plan and budget are assessed to be able to realize a solution in accordance with the project proposal.
• How credible the project plan's risk analysis and action plan for these risks are.
• How well the project plan shows how the results will be utilized and disseminated in Swedish industry, both within the the organisations and outside the consortium.
• How well the gender distribution in the project team and perspectives on sex and gender have been integrated into the project plan.

• How well the need for consulting services and licenses is justified. This only applies if an organization's budget includes more than 20 percent consulting and license costs.

How do we assess?

Once we receive the applications, we review them. We screen out any applications that are incomplete or do not meet our eligibility requirements.

The applications that are correct and complete are distributed among different evaluator and assessed in competition with each other. The evaluators are appointed by us based on their expertise in the field. Each proposal is assessed by at least three evaluator.

Once the evaluators has reviewed the applications, we have an assessment meeting where the evaluators recommends which applications should be granted.

We may also call for an interview before making a decision.

How does it affect an organization's financial status?

Before deciding on funding, we also conduct a comprehensive assessment of the organizational and financial status of those who receive funding.

We use information we receive from credit reports, currently from Dun & Bradstreet.

In our assessment we check this:

• Organisations who are granted funding for salary costs must be registered as employers with the Swedish Tax Agency. If such registration does not exist when we make our decision, you must be able to show that a notification has been made. We do not approve retroactive registration.
• Organisations must not be insolvent, or undergoing liquidation or corporate restructuring. They must also not have any significant unpaid debts with the Swedish Enforcement Authority.
• The project manager should be employed by a participant, preferably the coordinating party.

• Limited liability companies must not have used up half or more of their share capital.

If requested, small and medium-sized enterprises (SMEs) must be able to demonstrate that they have the financial capacity to carry out the project according to their budget in proposal. Financial capacity refers to a registered turnover or available capital that corresponds to the company's entire budgeted own funding of the project.

If requested, small and medium-sized enterprises (SMEs) must verify their SME status with a model declaration according to this model declaration template.

When we have assessed all applications, we will send you a decision in which we either approve or reject your proposal. Since the applications are assessed in competition, you may be rejected even though you meet all eligibility requirements and criteria.

In the decision, we indicate how much of the costs we cover for each organisation.

You cannot appeal our decision, but you are welcome to apply to us again at another time.

What if you are granted funding?

If we grant you proposal, you must follow our general terms and conditions for funding. The terms and conditions include this:

• That you should sign a special document in which you agree to your participation and undertake to carry out the project.
• That you should report how it goes, your costs and achieved results to us during the project period.
• If you are several parties, you must have a written project agreement that regulates your mutual rights and obligations in the project. All parties must sign the agreement before submitting your first progress report. As it may take time to develop and negotiate an agreement, we recommend that you start with this as soon as possible.
• How to use the results and that scientific publication should take place with open access so that the results are made freely available to everyone.

See our general terms and conditions

You also need to follow the special conditions that applies to this the call for proposals:

• The project should, upon invitation from the programme manager, participate in relevant events within the Advanced digitalisation programme and thus contribute to the dissemination of knowledge within Swedish industry in accordance with the programme's aim.  
• In the case of information about the project and any publication of project results, it must be stated that the work was carried out with support from Vinnova (in English the name is reproduced with Sweden’s Innovation Agency) within the Advanced digitalisation programme. Publication means, for example, publication, regardless of medium, and oral presentations.

We may also decide to add supplementary special conditions for individual project. If so, they are set out in the decision.

Can you have to repay funding?

If you have received more money than you are entitled to or if you do not follow our term, you may be liable to repay.

When the call for proposals closes, your proposal will be registered. We will then send an e-mail confirmation to the person responsible for the user account as well as to the project manager and the company signatory. If you have not received a confirmation within 24 hours after the call for proposals closes, please contact us.

When the call for proposals closes, you cannot change anything in proposal. Then you can only supplement if we ask for it.

Who can read you proposal?

Your proposal will be read by employees at Vinnova and the evaluator who participate in this the call for proposals. Everyone works under a duty of confidentiality.

Applications submitted to us become public documents. This means that we have to disclose them if they are requested. However, we treat certain types of information as confidential if it is likely to cause economic damage to the individual if they are disclosed. It concerns information on business and operational conditions, inventions or research results.

General documents and confidentiality