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Corporate R&D March 15, 2007

Posted by gordonwatts in science.

The March 3rd edition of the Economist had a good article on the state of corporate R&D. You know — the people the brought us the transistor? This survey points out how the boom of technology has really changed how research is done. In the old days places like AT&T had Bell laboratories — places where research was done that didn’t focus on an immediate product. Sure — the research was more applied than what goes on in some university lab where there is absolutely no pressure to produce a product — but still the product horizon was pretty far off. No so much any longer, however. According to this survey research departments in companies (if they still have them) are much more focused on solving the problems of product teams — indeed, research groups are often paired with product teams which was rarely the case previously. It was a science advisor for Franklin Roosevelt that setup this system: universities would do only pure research and companies would do applied. This model with separation of scientists and engineers was duplicated in companies. Obviously, it worked quite well. But it has changed. The Economist’s argument for this change (now)?

The approach to R&D is changing because long-term research was a luxury only a monopoly could afford.

“The fusion of research and development is meant to solve the central shortcoming of [Roosevelt’s science advisor’s] plan: how to turn ideas into commercial innovations.

… the nature of IT has changed so much. … the science that went into computing was itself closer to basic research. By contrast, many of the big scientific questions in computing have been answered — at least well enough for companies to find that innovation emerges from new ways of arranging today’s technologies rather than inventing new ones.

What is the new model?

Companies tinker with today’s products rather than pay researchers to think big thoughts. More often than not, firms hungry for innovation look to mergers and acquisitions with their peers, partnerships with universities and takeovers of venture-capital-backed start-ups.

There is (at least one) one ironic passage in the article:

But making this vision work technically is hard. Academics, he says, cannot do this, since they continually struggle for funds. This forces them into projects of just one or two years — even shorter than industry horizons. “It’s insane,” says Mr. Drucker [a Microsoft media applications researcher]. He reckons it means corporate research can look farther ahead, do bigger things and risk more money for a big payout.

You can’t have it both ways, right? You can’t depend on universities for start ups and long term research and also talk about really short event horizons. Sadly, there is truth to this split. Perhaps they are right. All the important big questions that require years of work have been answered in computing (where have we heard that before!?), and it is fitting that companies, most motivated to put out a working product, are the right place for further research.

But this product driven model won’t work for the next big thing. If transistors powered this revolution — what will power the next? You’ll need something hidden away, insulated from the corporate winds, to do that research. Currently only the government has a “business model” that can fund that sort of research.

Now, if only they had enough cash to carry out that mission…


1. Uncle Al - March 20, 2007

Discovery does not occupy a PERT chart cell nor does it admit to parameterized DCF/ROI calculation. The future is invariably discovered by the undeserving. Obese professional management then takes over as its pimp, vigorously milking an underfed cow.

“There is a greater darkness than the one we fight. It is the darkness of the soul that has lost its way. The war we fight is not against powers and principalities, it is against chaos and despair. Greater than the death of flesh is the death of hope. The death of dreams. Against this peril we can never surrender. The future is all around us, waiting in moments of transition, to be born in moments of revelation. No one knows the shape of that future, or where it will take us. We know only that it is always paved in pain.” G’Kar,Babylon 5, Season 3

“There will be no thought, as we understand it now. Orthodoxy means not thinking—not needing to think. Orthodoxy is unconsciousness.” 1984, George Orwell

Results can be funded, research cannot. The first place to look for a bottleneck is at the top of the bottle. What kind of nation funds Head Start (slumbunny daycare) 20% above the National Science Foundation (all physical science support)? A self-interred nation. Invest in the future you desire, not in the future you abhor.

2. Adam Ierymenko - March 20, 2007

There is a third source for R&D, but it is even more underfunded than the other two: the “starving startup” and/or “pro-am” hobbyist/inventor. A lot of new programming languages and similar things have come out of such individuals in the last ten years or so, but very few people are willing to subject themselves to this kind of pain.

I speak as one who knows. 🙂

3. Kristin - March 21, 2007

I wonder, if one were to compare the budgets for former research departments with the increase in executive compensation at some of those places over the past two decades, whether one might find that the former went down as the latter went up?

No question that there have been changes in the global marketplace, too. But ya know, it was only two generations from the Sun King Louis XIV to the French Revolution. Sic transit gloria mundi.

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