4 ms·

Twice the R&D Budget Doesn't Get You Twice the Innovations

7 points by taylorbuley 15y ago

rch 15y ago
It would if you could use that budget to hire twice as many genuine innovators. But those folks can be difficult to find....
- bugsy 15y ago
  Not really, we are easy to find and all over the place. It's just that typical corporate environments are threatened by the highly talented, and those that aren't are unwilling to pay the market rate. Not a problem since others are and when that's not the case such as with Google's founders, they just create their own business and run it themselves.
  - rch 15y ago
    ...you've managed to mention most of the factors that make it difficult for the average business to identify and retain talent. The market is extraordinary competitive, given the wealth of options that capable people have these days. If innovators were everywhere, then I could just walk over to the campus adjacent my office and hire up a storm... but I can't. And I wouldn't have it any other way.
bane 15y ago
But having a healthy R&D can make a huge difference to the bottom line. An example I just recently came across while researching some retrogaming articles: http://en.wikipedia.org/wiki/Nintendo_development_teams http://en.wikipedia.org/wiki/Nintendo_development_teams Sega also had a number of very important and successful R&D teams (AM1, AM2, AM3, etc.) They're large investments no doubt, but both of these companies did, or are doing, very well because of the R&D efforts. On the opposite end of the spectrum, I once was contracted to work with a large defense system integrator who kept the R&D team I was assigned to on less than a shoe string budget. The result? Missed deadlines for months and months while the team awaited funding resulting in an incomplete system and no business at the end of it because there was nothing to show the eventual customer.
tyree732 15y ago
I think this goes without saying, but product announcements are not the only indication of successful R&D. A company can also do serious R&D and gain value from any patents acquired or products they didn't ship as a result. If anything, I think it indicates where R&D beyond a certain point goes. Companies needs R&D to advance their core products, but if you're doubling R&D spending past that you're probably researching "pie in the sky" ideas that are either far away from feasibility or not directly tied to any core products you currently ship.
bugsy 15y ago
Seems like a silly distraction claim since they only look at raw number of things and not their quality or return. Would you rather invest $10,000 10 years ago and get a PHP calendar app, or invest $20,000 and get Google search? Both are single products.
softbuilder 15y ago
The major assertion is that the trend predicted by a few variables will continue on. What if it's parabolic? What happens if you put in 10x the amount of investment? What if it's harmonic and there are sweet spots?

7 points by taylorbuley 15y ago

rch 15y ago

It would if you could use that budget to hire twice as many genuine innovators. But those folks can be difficult to find....

bugsy 15y ago
Not really, we are easy to find and all over the place. It's just that typical corporate environments are threatened by the highly talented, and those that aren't are unwilling to pay the market rate. Not a problem since others are and when that's not the case such as with Google's founders, they just create their own business and run it themselves.
- rch 15y ago
  ...you've managed to mention most of the factors that make it difficult for the average business to identify and retain talent. The market is extraordinary competitive, given the wealth of options that capable people have these days. If innovators were everywhere, then I could just walk over to the campus adjacent my office and hire up a storm... but I can't. And I wouldn't have it any other way.

bane 15y ago

But having a healthy R&D can make a huge difference to the bottom line. An example I just recently came across while researching some retrogaming articles: http://en.wikipedia.org/wiki/Nintendo_development_teams http://en.wikipedia.org/wiki/Nintendo_development_teams Sega also had a number of very important and successful R&D teams (AM1, AM2, AM3, etc.) They're large investments no doubt, but both of these companies did, or are doing, very well because of the R&D efforts. On the opposite end of the spectrum, I once was contracted to work with a large defense system integrator who kept the R&D team I was assigned to on less than a shoe string budget. The result? Missed deadlines for months and months while the team awaited funding resulting in an incomplete system and no business at the end of it because there was nothing to show the eventual customer.

tyree732 15y ago

I think this goes without saying, but product announcements are not the only indication of successful R&D. A company can also do serious R&D and gain value from any patents acquired or products they didn't ship as a result. If anything, I think it indicates where R&D beyond a certain point goes. Companies needs R&D to advance their core products, but if you're doubling R&D spending past that you're probably researching "pie in the sky" ideas that are either far away from feasibility or not directly tied to any core products you currently ship.

bugsy 15y ago

Seems like a silly distraction claim since they only look at raw number of things and not their quality or return. Would you rather invest $10,000 10 years ago and get a PHP calendar app, or invest $20,000 and get Google search? Both are single products.

softbuilder 15y ago

The major assertion is that the trend predicted by a few variables will continue on. What if it's parabolic? What happens if you put in 10x the amount of investment? What if it's harmonic and there are sweet spots?