Assessing the R&D capability of the Japanese pharmaceutical industry

According to some observers, Japan's pharmaceutical industry 'emerged as a global competitor' in the 1980s. According to others, the same firms 'face severe obstacles' in the 1990s and may 'run out of time in their internationalization efforts.' To help clarify the competitive position of the Japanese industry, this article uses an original framework and set of estimates to codify the R&D capability of the nine major Japanese pharmaceutical companies ('the nine majors') and compare it with the R&D capability of their Western counterparts. On this basis the article concludes that the majors are not yet global competitors, although several could be by the end of the decade. The estimates help to quantify what has been described as a large gap between the R&D position of the Japanese companies and the position of the top Western pharmaceutical firms.     

The externalisation of R&D activities and the growing market of product development services

Several authors in recent years have discussed the observed trend towards the externalisation of (part of) a firm's R&D activities. As a consequence, several companies have been created that provide innovators with technical and scientific services such as R&D contracts, laboratory testing services, technology consulting, industrial design, engineering.
The paper is based upon an empirical study which consists of (i) an extensive analysis, in which information has been collected (for about two hundred companies) on size, location and type of services offered; (ii) an intensive analysis, in which one case is studied in depth of a company providing product development services. Some conclusions have been drawn regarding the characteristics of the market of product development services and the management and organisation of companies operating in that market.     

R&D networks and innovation: decentralised product development in multinational enterprises

This paper documents the ways in which overseas R&D in MNEs now plays roles in what are innovative new approaches to innovation itself. Networks of laboratories are seen as supporting both the short-term and long-term competitive evolution of the MNE group's globally-effective product innovation.
In terms of the immediate commercial application of new products for global markets it is argued that product development labs work within creative overseas subsidiaries in MNEs. These aim to derive variants of the new product that fully meet the distinctive needs of each key regional market.
Another separate network of decentralised MNE labs carry out precompetitive (basic or applied) research, embodying particular areas of technological comparative advantage of their host countries. This network of labs therefore provides inputs into a centrally-articulated programme whose objective is to provide the basis of the longer-term technological evolution of the MNE, by upgrading the core knowledge from which future generations of innovative products can emerge.     

The impact of EC R&D programmes on corporate R&D practice in Europe: a knowledge-base approach

This paper examines the role of additionality in the impact of EC R&D pro-grammes on firms. It comes from a study of the Impact of the EC Framework Pro-gramme on European Industry, which was sponsored by the Support Programme for Evaluation Activities in Research (SPEAR) of the EC. The argument is that there is an interaction between ie use of additional R&D resources, the organization of the R&D process, and the exploitation of R&D results. The analysis of the R&D process takes place within a framework based on the concept of the knowledge-base of the firm. A number of case studies are discussed and conclusions are drawn as to the impact of the EC Framework Pro-gramme on European firms.     

Incomplete contracting in an R&D project: the Micronas case

Systematic empirical evidence on the consequences of incomplete contracts is meagre, because contracts are often classified as business secrets, and are accordingly difficult to obtain for research purposes. In this study we employ the extensive information from the life of a Finnish research joint venture, Micronas, during 1980–1992 to cast light on this issue. Of particular interest is the principal-agent relationship between the owners and the management of the research joint venture. Our investigation confirms the strong message of the incomplete contract theory. Hold-up problems are pervasive in R&D projects, and the allocation of power and ownership is important to the success of the projects.     

Age structure shifts in Research & Development (R&D): Some statistical evidence and an integrative approach to link behavioural aspects of individual and group age in collaborative R&D

Since empirical material concerning the age structure of industrial R&D organizations is scarce an attempt is made to present some statistical evidence in support of the wide-spread notion of a shift toward a higher median age in R&D laboratories during the past years. Then, on an individual level of analysis the results of an extensive review of existing empirical research on the covariation of individual age and scientific performance are summarized in brief. On a group level of analysis research relating age of collaborative R&D groups (i.e., average length of time group members had worked together in a particular group) to group performance is discussed. To integrate the contradictory findings of prior research two analytic concepts are introduced, namely the discrimination of different situations of collaboration and the identification of two basic functions of interactions in collaborative R&D. Based upon these concepts an integrative approach to account for time-related performance patterns on an individual and group level of analysis is laid out. Finally, possibilities of a diagnostic application of the suggested concepts are indicated.     

Developing a 'receptive' R&D environment for inward technology transfer: a case study of the chemical industry

The purpose of this paper is to show how certain internal organisational activities affect an organisation's ability to engage in the external acquisition of technology commonly referred to as inward technology transfer. The study focuses on a technology trawling exercise conducted by ICI and reveals difficulties in 'receptivity' on the part of the receiving businesses. A conceptual framework is developed which identifies four major components of the inward technology transfer process. These are: 'Awareness'-'Association'-'Assimilation'-' Application'. Using this conceptual device separate studies are conducted within two large multinational chemical companies in the North West of England. The findings reveal the importance of certain non-routine activities and indicate how successful organisations are able to manage the tension between the need for creative non-routine assimilation processes to generate a 'receptive' environment for future growth and efficient routine activities to remain competitive in the short-ierm.     

Toward the development of benchmarking tools for R&D project management

This paper presents an audit model for the process of R&D project management that can be used to check the robustness and repeatability of processes and provide a template for internal and external benchmarking. The intention is to offer a 'fine-grained' model focusing rather closely on the R&D activities within the broader innovation process, thus complementing the more widely based innovation audit models that already exist.
Based on field-work in six business units in ICI and five companies from other industries, the paper sets out three major variants of the R&D project management process. These variants reflect the fact that R&D projects take place in different circumstances and have different objectives.     

Managerial perceptions of technology licensing as an alternative to internal R&D in new product development: an empirical investigation

Increasingly, companies are using the licensing approach to acquire external technology as an alternative to internal new product development. However, the licensing literature presents lists of benefits and costs without identifying either their relative importance or the underlying dimensions. This article presents the results of a survey of Australian licensee firms designed to fill this gap in the literature. The results show that the major reason for licensing relates more to the immediate need to gain competitive advantage than the relative low cost advantage of technology licensing or having access to future technology. The major impediments to licensing are the entry and exit costs and the loss of decision-making autonomy resulting from licensor-imposed restrictions. Further, only two factors, perceived search costs and low cost market entry advantage of licensing appear to vary among the industries studied. Future research and managerial implications of the results are discussed.     

Research findings in strategic management with implications for R&D management

Abstract
The author has reviewed the literature, predominantly North American, on the relationships between corporate strategy and corporate performance.
The general context is the question of where and how a firm should diversify. The author considers three areas of decision: corporate strategy, (where to compete), business strategy, (how to compete), and corporate organization (receptiveness to diversification). It appears that the most advantageous corporate strategy is to diversify into a high-profit area but to maintain a substantial relatedness to existing businesses; the best business strategy is to have a market-related perspective, to use R&D to develop new products with a marked competitive advantage rather than new processes, to minimise investment but to enter the market on a sufficiently large scale. This last condition presupposes a high degree of top-management commitment to the venture. Furthermore, consideration has to be given to whether the organizational culture is such as to nurture rather than stifle the venture by insisting on administrative controls appropriate to the firm's traditional base.
The author points to three areas deserving of further investigation: How a firm in a mature industry can find a related area that is sufficiently attractive; how to fix on the correct scale of an entry taking into account the long lead times before the venture shows a net return; and how to ensure that the corporate culture will be able to accommodate novel interests and procedures.
All the above matters pose questions for the management of technology and the direction of R&D.     

R&D and technology purchase through licence agreements: complementary strategies and complementary assets

This paper reports on a major UK-wide investigation into the role of inward technology licensing and in-house R&D as alternative and complementary strategies in new product and process development.The role of licensing in the technology strategy of the firm can be viewed as the 'buy' in the context of 'make or buy' technology decisions. Such technology purchases may be made for a number of reasons including insufficient in-house resources or gaps in R&D provision stemming from small scale, risk, low investment in research or diversification away from existing research competencies. However, technology markets might have substantial information imperfections and transaction costs. The tasks of finding a technology provider, transferring the technology inwards and absorbing it into commercially successful new products and processes, can inhibit the use of licensing agreements for technology acquisition.
This research, using a sample of 128 manufacturing companies (including both licensees and non-licensees), examines some key propositions around the use of technology licensing. Data was collected on technology strategies, complementary assets, internal organisation and market structure. Analysis of the data suggests that strategies of 'buy and make' are complements rather than alternatives, and that extensive use of licensing requires substantial complementary assets to be in place. The nature of product-market positioning was found to be a significant driver of technology strategy, with firms that pursue product differentiation being the most likely to license. Whilst a priori it might be expected that internal organisation would influence technology strategy, this study was only able to provide weak support for this.     

Problems of R&D manpower in India

Abstract
Manpower Planning is important in R&D organizations. If one examines the budget of a research institute in any part of the world, one would find that 60–70% of the expenditure is incurred on staff salaries and benefits. Of course, manpower planning is beset with problems. This paper deals with: (i) lack of literature; (ii) scientific manpower statistics; (iii) recruitment; (iv) unemployment of S&T personnel; (v) brain drain; (vi) internal brain drain; and (vii) suggestions.     

International management of R&D: The Swedish Experience

This paper summarizes the results of in-depth case studies of international R&D management in four Swedish multinational corporations. The results suggest that foreign volumes and shares of R&D expenditures are rapidly increasing. Through a rapidly increasing number of foreign acquisitions, foreign R&D laboratories have been added. As part of international rationalization of production, foreign units have been given global product mandates with responsibility both for manufacturing and R&D. In maturing foreign subsidiaries, routine technical activities have often evolved into proper R&D. Tight labour market conditions for engineers in Sweden have made it increasingly necessary to exploit existing technical capacity, regardless of location.
Concurrently, companies face new pressures for international coordination and control of R&D. Coordination is required to reduce product differentiation, to facilitate technology transfer and to ensure the technical and market compatibility of products and components developed at different locations but sold as part of total systems. Drawing on the experience in the four investigated companies, the paper discusses how systems and procedures can be developed to meet the need for coordinated international R&D management.     

Towards networked R&D management: the R&D approach of Sonera Corporation as an example

In this paper the authors delineate the challenges of a dynamic environment to R&D management. The authors build on most recent ideas, such as the dynamic capability view of the firm, as strategic foundation for modern R&D management. Collaboration is emphasized as a meta-capability for innovation. These ideas are merged into a 'Networked R&D Management' approach that emphasizes internal and external collaboration networks as critical for companies operating in a dynamic business environment. The approach is illustrated with ICT industry as an example. The implementation of Networked R&D Management is reflected in the illustrative case discussion of R&D management of Sonera Corporation.