Ninety-two companies were surveyed by the Industrial Research Institute about their R&D investment plans for 2010 and their actual experience in 2009. Their responses suggest modest reductions in 2010, but growth in the segment of R&D focused on new business projects.
Continuing a trend since 2003, increased participation is also anticipated in acquisition of technology from external sources via alliances and joint ventures, contracts with Federal laboratories, and mergers and acquisitions. This trend is accompanied by planned reductions in internal basic research, and reduced hiring of new graduates for R&D positions.
Trends Analysis--Looking to 2010
This is the IRI's 26th R&D Trends Forecast. The survey is focused on expectations for industrial R&D investment in 2010 and based on responses from 83 IRI member companies and 9 non-IN companies that were also invited to participate. It was conducted in July and August of 2009. Because this is a voluntary survey and the IRI membership changes due to business events such as mergers, the mix of companies changes from year to year. Nevertheless, we believe there are a sufficient number of responses from the industrial R&D community for the data to be meaningful.
The results of this survey are discussed in six areas:
* Profile of participants.
* Summary results--responses to the basic survey questions, and comparison with past years' responses.
* Breakdown of responses in various industrial segments.
* Responses to questions about "your biggest R&D problem."
* Changes in R&D investment from 2008 to 2009.
* Initial 2009 R&D investment plans compared with actual experience.
Profile of Survey Participants
Figure 1 shows the distribution of the 92 survey participants, based on projected 2009 corporate revenue. Although some participants did not answer all the questions, typically there were 85 to 88 responses to each question.
The participants are medium to large corporations-many global--with a total of 187 R&D labs outside the U.S., in 37 countries. China has the most non-U.S, labs among the participants (24 labs), followed by Germany (19), the United Kingdom (18), and India (16).
The principal survey questions and the distribution of responses are presented in Table 1. "Not applicable" (N/A) responses have been omitted in our tabulation of the data. The Sea Change Index is helpful in examining the breadth of change. This Index presents positive changes minus negative changes in the responses, normalized by the total number of responses. This Index is stated as a percentage that can vary between +100% and--100%. With reference to Table 1, Questions 1-8, the first two response categories are deemed to be negative because they indicate zero or negative growth. The last two categories are considered positive because they reflect anticipated annual growth of 5% or more. Additional Questions 9a through 9h are also shown in this table.
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The annual Sea Change Index for these questions, from our 2000 through 2010 surveys, is presented in Table 2.
After increases in R&D expenditures in 2007 and 2008, and flat investment in 2009, the outlook for 2010 envisions a broad pullback in R&D investment (Question 1). The different components of Question 3 also project continuation of a decade-long trend in increased industrial R&D focused on new business projects, at the expense of R&D focused on supporting existing businesses and industrial R&D in directed basic research.
There is a clear and continuing shift since 2003 to align with universities or Federal labs where basic research is generally emphasized (Questions 9b, 9c and 9d) together with participation in alliances and joint R&D ventures (9e), and acquisition of technological capability through mergers and acquisitions (9t). …