The state of R&D

Goldense Group periocically surveys companies about their R&D practices and has done so since 1998. It recently completed the 2014 version on industry practices in the areas of product creation, development, commercialization, and metrics.

The consulting and market research firm Goldense Group, Inc. began researching industry practices in the areas of product creation, development, commercialization, and metrics in 1998. The firm recently completed its 2014 installment on research practices. The point of the exercise is to identify emerging practices likely to spread across industry. Here are a few of the key findings to come out of this year's effort:

Innovation is continuing to become more important. Activity in pre-product development functions of basic research, applied research, and advanced development rose significantly in the 2000s. These are normally considered risky activities and are usually cut back during challenging economic times, but surprisingly, that trend has been minimal during the past five years.

Processes for R&D are becoming more formalized, which is one indication that innovation is becoming a more permanent part of many companies.

IP is becoming more important. Only 27% of industry reports no change in the importance of IP since 2008. 55% reports it's more imortant and 17% reports thery're placing much more emphasis on IP. All in all, almost
three quarters of industry has boosted its emphasis on IP. 33% of companies track IP revenues. 28% track IP profits. 44% track the cost and 32%
track the capital cost. The tracking of costs exceeds the tracking of results.

Top five metrics for R&D:

R&D Spending of Sales, used by 79% of companies 
Total R&D Headcount, 67%
Current-Year % Sales Due To New Products Released In The Past “N” Years 62%
Patents Filed/Pending/Awarded/Rejected 61%
New Products Released 58%

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Lee Teschler

Leland serves as Editor-in-Chief of Machine Design. He has 34 years of Service and holds a B.S. Engineering from the University of Michigan, a B.S. Electrical Engineering from the University of...
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