By silicon.com, 26 October 2004 17:25
How important is R&D investment?
There's plenty of evidence it's good for business - especially in the long term.
With the release of its 2004 R&D Scoreboard yesterday, for instance, the DTI provided analysis that suggests those companies that invested heavily in R&D over the past four years tended to have higher sales than those that were stingy with innovation budgets.
And it speaks well for R&D that the industry giants - Intel, Microsoft and IBM - are also the top spenders.
It's not a sure bet, though - it's easy enough to invest millions in research that never yields a penny.
The value of R&D is a hard thing to measure, too, and thus hard to make an airtight case for ROI. This - and the fact that great leaps forward rarely come in on time or on budget - is probably why many companies are reluctant to pay out for it.
How much a company needs to spend obviously has to do with the business they're in - hardware is going to take more than services, say.
It's not necessarily related to innovation - though more so to product development than to creating new processes or business models. And it's not necessary for everyone to do it themselves. Telcos, for instance, tend to rely on suppliers and partners to do the R&D in the wider telecoms space.
But this publication believes R&D is essential for IT to thrive - and to continue to contribute to business success and benefit society.
Companies may go under because they spend too much on development - and yet it may be worth it to the industry as the things they discover could live on.
It takes money to get the graphical interface, the mouse, the iPod - but it's money we've got to spend because without these sorts of breakthroughs, IT dies.
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