Scrutinizing Industrial R&D Data. (Perspectives)

Hira, Ron, Research-Technology Management

The September 2002 issue of the Institute of Electrical and Electronics Engineers' (IEEE) Spectrum Magazine contained a special report on R&D. It was generally upbeat about industrial R&D spending, noting that, "the world's Top 100 Spenders increased R&D expenditures by an average of 5.25 percent in 2001, despite massive turmoil in the telecommunications, computer, and semiconductor sectors" (1). The report indicates that all is well with the state of industrial R&D, but some do not believe the rosy descriptions reflect the current reality.

A former industrial R&D executive and I had a discussion about the current state of industrial R&D. He was skeptical about the Spectrum message because his peers provided anecdotal evidence of substantial layoffs and cuts in research divisions in 2002. He suspected that the true story was being underreported, in part because of the lack of timely data. Some of his colleagues insisted that he was getting a skewed perspective because his peers primarily come from the telecommunications industry, which has been hit hardest.

So, which perspective is more accurate? A variety of data sources track the magnitude and character of the R&D work to help answer the question.

R&D Data Sources

The National Science Foundation conducts an annual Survey of Industry Research and Development (www.nsf.gov/sbe/srs/indus/start.htm). A key advantage of the NSF data is the number of variables, in addition to R&D expenditures, it provides. The data are very useful for retrospective studies, but currently have two limitations: First, there is a significant lag time between the collection of the data and their presentation; e.g., the latest available data at the time of this writing were for calendar year 2000 (albeit there are indications that future NSF reports will lag only one year in reporting data). Second, the NSF data are aggregated by industry; disaggregated information at the company level would be more helpful to analysts.

Is there a good data …

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Publication information: Article title: Scrutinizing Industrial R&D Data. (Perspectives). Contributors: Hira, Ron - Author. Journal title: Research-Technology Management. Volume: 46. Issue: 1 Publication date: January-February 2003. Page number: 4+. © 2009 Industrial Research Institute Inc. COPYRIGHT 2003 Gale Group.

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