How is your R&D investment split between projects focused on Growth, Competitiveness, and Sustaining?
Do you track this as part of your R&D Portfolio analysis? If so, and you are comfortable sharing, we would be interested in the split for your business area or sector (or even company-wide if appropriate). If you know of a reference publication/survey on this topic, we would be interested in this as well.
FYI we define these categories as follows:
- Growth projects are directed at future growth of the business;
- Competitiveness projects are aimed at reducing costs, improving productivity/yield, operational effectiveness, etc. to make operations more competitive;
- Sustaining projects & activities are aimed at defending or sustaining the business today; examples include customer and/or plant support provided by R&D (typically "firefighting," reactive support), next generation "replacement" products, product fixes, HSE or Product Stewardship-related, etc.
As a reference, the split for our R&D organization is ca. 50/20/30 Growth/Competitiveness/Sustaining. Our target is to have ~60% in Growth, and for Sustaining to be less than Competitiveness. We have collected benchmark data on this in the past, but haven't updated it in the last several years. Thank you. - R&D Manager, Specialty Plastics producer
Markus Fromherz, Chief Innovation Officer, Healthcare, ACS, a Xerox Company
We define several portfolio measures for R&D projects. One is by maturity and horizon of the project. We call the categories Explore, Incubate, and Partner, going from early-stage projects without a clear business group in mind to pilot-ready or even product-ready projects that are executed in a collaboration between research and development groups. The split has varied over the years, but is roughly one third each.
Another portfolio measure is by technology and market newness, following the work of Ian C. MacMillan and Rita Gunther McGrath (Crafting R&D Project Portfolios). There we’re striving for a balance that has research concentrated on projects with medium to high technology newness (or uncertainty) and a small degree of market uncertainty, but the development organizations tend to concentrate on projects with low uncertainty in both areas. -