MIT Sloan Management Review

Organizing R&D for the Future

March 19, 2013 | Marla M. Capozzi, Peet Van Biljon and Jim Williams

Executives from around the world agree that research and development is a global effort requiring collaboration. Yet many say their organizations must improve in this area — evolving from the centralized approach that’s prevalent today — to meet strategic goals. In other words, for today’s R&D organizations, there is a significant gap between knowing what to do and actually doing it. Vital as it is to their futures, the art of collaboration is one that many R&D organizations have yet to master.

This article both highlights this problem and highlights what R&D organizations can do differently. The prescription for what R&D organizations can do differently comes from a group of “high-performing innovators” — companies where respondents to a survey reported higher organic growth than competitors and attributed a large portion of that growth to new in-house products.

Not surprisingly, these high performers are far ahead of their peers in three key dimensions: collaboration, allocation of talent and capital, and the use of product platforms to drive speed to market. For example, 31% of respondents at high-performing companies said their organizations already make product-related decisions collaboratively, compared with 20% of all other respondents.

Continuous and targeted knowledge sharing is an essential element for collaboration and a prerequisite for innovation success. R&D leaders should ensure that sharing new insights, lessons and best practices is an expected part of daily work activities. These leaders should also clearly define which knowledge is most important to share.