National Academies Press: OpenBook
« Previous: 6 What Have We Learned from Hot Topics?
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 64
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 65
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 66
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 67
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 68
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 69
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 70
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 71
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 72
Suggested Citation:"7 Industrial Innovation with External R&D Programs." National Research Council. 2003. Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable. Washington, DC: The National Academies Press. doi: 10.17226/10676.
×
Page 73

Below is the uncorrected machine-read text of this chapter, intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text of each book. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

64 REDUCING THE TIME FROM BASIC RESEARCH TO INNOVATION IN THE CHEMICAL SCIENCES 7 Industrial Innovation with External R&D Programs Francis A. Via1 Fairfield Resources International It is a privilege to be part of this Chemical Sciences Roundtable program with the National Academy of Sciences. The goal of this presentation is to demonstrate that external research programs with collaborators at universities and national laboratories can accelerate the industrial research and development (R&D) process. The essential criteria to realize this goal will be considered and illustrated with several examples that led to accelerated commercialization and some that did not. Participating in this workshop has given me the opportunity to review Akzo Nobel’s U.S. experi- ment with innovation over the past 12 years and to reassess the metrics for external research programs. I would like to provide an overview of the strategic value of external research programs using specific examples from Akzo Nobel supplemented with additional case studies from Dow and DuPont. This presentation will attempt to demonstrate that these collaborative research programs have become a critical component for accelerating research progress, sparking innovation, fostering the renewal of research organizations, and contributing to technology leadership, especially during times of declining support for discovery research in industry. In the mid-1980s the Board of Directors of Akzo Nobel recognized that the nature of industrial research was changing and that the issues associated with market and technology leadership and captur- ing emerging technologies were receiving less attention and resources than the shorter-term subjects. To achieve the desired balance of research activities, Akzo established its third corporate research center in Dobbs Ferry, New York. This center was chartered to conduct focused discovery research in core and emerging technologies with a major emphasis on collaborative external research with U.S. universities and national laboratories. The many advantages of an outward vision manifested with external research initiatives are well recognized. One of the key issues is referred to as “backfilling,” which addresses the need for discovery research to provide a foundation for R&D that is no longer being conducted by 1Francis A. Via joined Fairfield Resources International as a senior consultant with more than 30 years of experience managing industrial R&D, intellectual property, and market development at Stauffer Chemical Company, Akzo Nobel, Inc., and GE. He directed Akzo Nobel’s Corporate Research-US to capture emerging technologies. Utilizing external cooperative research programs at universities and national laboratories served as the keystone for this corporate research. 64

INDUSTRIAL INNOVATION WITH EXTERNAL R&D PROGRAMS 65 industry with the same commitment and fervor as during the major growth years of the 1950s to the 1970s. Another advantage is the technical flexibility that is provided to evaluate emerging technologies while minimizing risk. The goal of this presentation is to demonstrate the role of external programs in accelerating R&D. Earlier presentations showed the business process of managing new product development by applying a stage-gate system. At Akzo Nobel we employed a typical six-stage system to guide activities from the early idea phase to the final step of commercial production. In reviewing the stage-gate innovation process, it may be unclear how an external program can accelerate innovation. In most cases, an external program is principally associated with the idea stage of discovery research (Stage 1). This activity represents not only the very early project action but also a rather small portion of the resources required for new product/process development. Many studies have demonstrated that the most critical component of accelerating research and increasing both the efficiency and the return on investment of research is the implementation of an effective decision-making process. The ability to select the “correct” R&D programs has proven to be one of the leading components of a successful R&D organization. This decision-making process in- volves input from all facets of a commercial organization, including science, economics, marketing, competitive analysis, intellectual property assessment, manufacturing, environment, regulations, cus- tomer needs, and public perceptions. The Akzo Nobel experiment has shown that a properly structured external research program can help evaluate and understand the science and thereby assist in the early stages of the decision-making process by providing more state-of-the-art options at minimal risk. The overwhelming majority of external programs at universities and national laboratories are asso- ciated with Stage 1, the idea phase, of a new product development program. Influencing the early idea phase can have an impact on the entire innovation process. Robert G. Cooper of McMaster University is a leading business methods researcher in new product development methods. He offers an online course in the training and application of a stage-gate system. A recent study of new product innovations and developments shows that the idea phase constitutes a rather minor proportion of the resources used over the entire project, less than 1 to 2 percent, and the market analysis was more complete for those programs that succeeded. How can an external university component help this process with such a modest early-stage role? Those familiar with the stage-gate process recognize that there is a strong overlap between each of the phases. As you proceed to the later stages, especially to piloting the process, there is a growing need to fully understand the science to guide and select continuing approaches. A new product development process was likely justified with a stringently controlled budget to facilitate achieving the targeted return on investment as well as the timing needed to secure a strong or dominant position in the marketplace. Thus, resources to develop the underpinning sciences are relegated to a “nice to have” position but are not seen as a critical step in this business process. More often than not, a working knowledge of the underlying sciences can accelerate new product development, particularly at the pilot and customer evaluation stages. This understanding of the chemistry can be obtained at low risk in the early stages and at modest cost with a university or national laboratory partner. Speed to market is essential to rapidly capture the high-risk investment for new product develop- ment and provide the projected returns. How can external research alliances allow us to more quickly reach this breakeven point? Two examples have been selected to demonstrate this process. The first involves a selective cata- lysts development program at Akzo Nobel under collaboration with Mark E. Davis of the California Institute of Technology (Caltech). Catalysts with greater selectivity were needed to improve the perfor- mance of a product line of phosphorus-based flame retardants and functional fluids. The Akzo Nobel

66 REDUCING THE TIME FROM BASIC RESEARCH TO INNOVATION IN THE CHEMICAL SCIENCES corporate research team had been working with Mark Davis for more than 4 years on new zeolite synthesis primarily for petroleum refining applications. When this particular challenge arose, the exter- nal program at Caltech was modified and rapidly developed leads based on an outstanding knowledge foundation of the technology and an effective teaming, especially effective communications with the industrial partner. Based on external leads, the internal developments at Akzo Nobel were accelerated and led to an independent approach. In less than a year the technology had advanced and was ready for plant trials. The second example also involves catalysts development. The goal of this project, headed by Leo E. Manzer and Walter Cicha at the DuPont Central Research Station, was charged with developing a new highly selective catalyst for the manufacture of phosgene while reducing the amount of the undesired by-product, carbon tetrachloride. As a result of basic studies by the DuPont catalysts research team, it was recognized that carbon tetrachloride formation arose from chlorination of the carbon catalyst that is used in the commercial process to promote the reaction of carbon monoxide and chlorine. Manzer’s team had to address a challenge involving two incompatible factors. He needed a carbon catalyst that would promote the efficient and selective chlorination of carbon monoxide but that would remain inert for chlorinating the carbon catalyst surface. Through many years of experience the DuPont team has built a knowledge base and scientific network that led to the Boreskov Institute of Catalysis in Novosibirsk, Russia. Alliances with international research facilities are a major trend in external pro- grams. The team at Novosibirsk had developed a unique series of specialty carbon materials and supports. The DuPont team evaluated variations of these specialty carbon materials, and within less than a year and a half the catalysts became operational at the DuPont Deepwater Plant. Building on core competencies facilitated the success of these two examples for accelerating re- search through external collaborative programs. Both programs exemplify the findings of a 2-year study conducted by the Industrial Research Institute during the mid-1990s. About 300 members constitute the Industrial Research Institute, from R&D-intensive corporations with chemical and petrochemical companies composing about 30 percent of the membership. During the early 1990s, many members wanted to share best practices for improving the performance of R&D. A 2-year study provided a package of guidelines for procedures, approaches, and recommendations termed the Technology Value Pyramid (see Figure 7.1). One of the study’s key recommendations was to identify core competencies and maintain supporting technology platforms. These platforms are composed of the full spectrum of R&D activities, including a working knowledge of internal technology, internal networks, market dynamics, external networks, and leading-edge emerging technology. Thus, an R&D program can be readily accelerated by tapping into your technology platform and internal network to select focused team members. Commonly, there is little or no physical movement; although a program manager will have authority and accountability for the entire team. With this foundation, a well-designed team can achieve a rapid start and accelerate development. An additional challenge for R&D management arises after completion of the new product or process development program. Scientists and engineers who have helped navigate the new development effort now emerge as veterans with a valued personal and professional growth experience. With relatively high probability, opportunities become available for these “seasoned” travelers to move to other areas within the corporation. This activity of significant mutual benefit creates a challenge for R&D management. It has become imperative to rebuild and maintain these technology platforms and networks. I would like to provide several examples of successful external university programs and define approaches to persistent issues such as intellectual property and management strategy. Each year the American Chemical Society (ACS) provides an award for leadership in chemical research and

INDUSTRIAL INNOVATION WITH EXTERNAL R&D PROGRAMS 67 TECHNOLOGY VALUE PYRAMID Outcomes: Value Creation Portfolio Assessment Strategy: Integration With Business Asset Value of Technology Foundations: Practice of R&D Processes to Support Innovation Chemicals FIGURE 7.1 The Industrial Research Institute’s Technology Value Pyramid shows the value of maintaining supporting technology platforms. Reprinted by permission of the Industrial Research Institute, Inc., from “Technology Value Program,” 1996, www.iriinc.org/tvp.html. management—The Earle B. Barnes Award. In 1995 Leo Manzer received the award, which serves as a clear indication that the DuPont team had built a technology platform in catalysis. In 1998 Joseph A. Miller of DuPont was recognized with the Barnes award not only for his management and commitment to corporate research but also for his external vision. Another example of a successful external research program is the collaboration between Joseph M. DeSimone of the University of North Carolina, Chapel Hill, and North Carolina State University, and DuPont. Dr. DeSimone developed a new solvent system based on carbon dioxide for manufacturing fluorocarbon polymers that avoids the use of chlorofluorocarbon solvents. It required only 4 years from the beginning of the collaborative effort to announced plans for construction of a semiworks plant. This acceleration was achieved after spending nearly 2 years negotiating the research and licensing agree- ment. A well-designed collaborative program with the right people and targets can overcome obstacles both technical and administrative. How can a university program accelerate a new product or process development project with such common delays for issues such as intellectual property? The successful approach is one of commitment. Both parties must believe the project will be conducted and make plans to initiate research accordingly, protecting all parties in the interim, until an agreement is in place. This year Kurt W. Swogger of Dow was acknowledged for his vision and leadership in directing the successful Insite Catalysts commercialization program that reportedly was accelerated by a factor of 3

68 REDUCING THE TIME FROM BASIC RESEARCH TO INNOVATION IN THE CHEMICAL SCIENCES BOX 7.1 Key Components for Accelerating Research and Development Through External Programs • Objectives and Timing • Professors and University Personnel • Responsible Industrial Scientists • Business and R&D Management Commitment • Publication of Results • Intellectual Property Ownership Established • Relevant and Educational Projects • Formal Reviews and Frequent Communications • Multiyear Agreement • Must Be Flexible relative to conventional programs. The Dow development team involved five external collaborations with universities for the development of this outstanding new line of olefin polymerization catalysts. Swogger received the Earle B. Barnes Award at the banquet dinner during the spring 2002 ACS meeting. Concentrating, for this discussion, on the role of external projects, it is noteworthy that the Dow award winner is also a champion of such programs. A year earlier Swogger gave the presentation at the spring 2001 ACS meeting on accelerating product development speed via cooperative research with universities. Using ideas from different success stories, a list of key components was assembled for this presentation to outline key criteria for successful external programs to accelerate R&D (see Box 7.1). I would like to review two of these points: (1) the responsible industrial scientists and (2) the business and R&D management commitment. For these external university programs supported by Akzo Nobel, a secondary but critical goal was to provide opportunities for increased responsibility and personal growth for staff research scientists and engineers. The company also wanted to acknowledge the role of the internal scientists and provide a renewing force for the organization. The position of technical liaison was created, with responsibilities for both the external and the initial internal research programs. To the university the technical liaison represented Akzo Nobel, and to us the technical liaison represented the university. The technical liaison’s goal was to utilize the strengths, capabilities, and differences in scientific insight of the university team. Our representatives would visit the university with some frequency in addition to the biennial reviews. For example, in a program at the University of Massachusetts on liquid crystalline polymers, the two technical liaisons would spend half a day with five participating professors and their students every 6 weeks. The most successful forum was the pizza lunch. For nearly all programs a business commitment was established before starting the external project. Global markets are moving targets, and we have had several external programs fail to maintain the interests of the business group while achieving technical success or making good progress. In some cases, during the R&D program either the market or the market assessment changed or the target business group was divested. Thus, without a potential business commitment or a path to commercialization, an exit strategy for the external program was exercised. In most cases funding for the program was continued at a level to cover commitments and especially to cover the students to graduation.

INDUSTRIAL INNOVATION WITH EXTERNAL R&D PROGRAMS 69 Metrics for external programs were established that are compatible with the evaluation of an internal corporate research program. A stage-gate system is applied. When an external program reached the level of a business unit funding (Stage 2, internal R&D project), this achievement was considered a success. Overall, about 20 percent of our external programs reached that stage. This number is also a reflection of the risk level and the technical progress of the external program. Other programs have different expected levels of success. The National Institute of Standards and Technology’s Advanced Technology Program seeks a higher level of success. On the other hand, a few years ago Texas Instruments funded a series of corporate research projects with the aim of addressing high-risk ideas. These were termed “Wild Hare” projects. When this initiative achieved a 20 percent success level, management questioned whether operations was taking sufficient risk, as a 20 percent success rate was rather high to be addressing programs at the intended risk level. There are several professional organizations that recognize achievements in external R&D pro- grams. The ACS and the Council for Chemical Research both recognize outstanding accomplishments in this field. I would like to examine two well-publicized success stories for accelerating R&D with an external effort. To develop new chlorofluorocarbon replacements, DuPont formed a team with more than 10 universities and national labs to investigate aspects of these replacement materials and to accelerate the program. External activities complimented internal functions and covered the full spec- trum of issues, including structure/property relationships, physical properties, atmospheric behavior, manufacturing methods, and even engineering unit processing studies. This program proved so success- ful that the U.S. Environmental Protection Agency requested DuPont to delay full replacement of chlorofluorocarbons so that the applications infrastructure could have additional time to adjust to the new replacement materials. The second example for a successful external project involves the Remediation Technologies De- velopment Forum, which includes members from governmental agencies, seven companies, and volun- teering universities. This consortium was established in 1992 by the Environmental Protection Agency to foster collaboration between the public and private sectors. The goals are directed at addressing the technical and regulatory issues for environmental bioaugmentation with a focus on the bioremediation of trichloroethylene. The tasks include developing technology, educating the regulators and the public, and securing approvals from the multiple regulatory agencies—federal, state, and local. The consortium was successfully directed by Dave Ellis of Dupont. The forum was designed to foster public-private partnerships to conduct both laboratory and applied field research to develop, test, and evaluate innova- tive remediation technologies. A number of test sites have been established, and bioremediation of trichloroethylene was successfully demonstrated. A recent review meeting consisted of several hundred participants, including representatives of federal, state, and local regulatory agencies. Thus, the multitasks of demonstrating technology, establishing credibility, and education were accomplished and accelerated with this external collaborative effort. As the impact of external R&D on accelerating and facilitating commercialization is assessed, it is essential to classify the nature of the development program. Figure 7.2 shows the characteristic market- technology diagram, where technology (current and new) is defined horizontally and the market (current and new) is shown vertically. Many of the award-winning external programs that were reviewed fall into the new technology for current markets quadrant. This quadrant, popularly referred to as Pasture’s quadrant (for the plot of not market versus technology but science versus technology), is the domain of moderate- to high-risk development programs. This area represents a moderate comfort zone for vision- ary management. How do external programs help the most aggressive quadrant—new technology for new markets? The assessment indicates that external collaborations have a particularly important role to

70 REDUCING THE TIME FROM BASIC RESEARCH TO INNOVATION IN THE CHEMICAL SCIENCES New Business ? Current OK Current New Technology FIGURE 7.2 External programs impact the current business (science)/new technology quadrant. play in these programs as they can bring to bear different technology issues and perspectives rapidly with reduced risk, timing, and cost. This next example was chosen because the product, a fast-setting cement, represents a new product for a new market. The term “new market” for this discussion is defined as viewed from the perspective of the potential producer. While highway repair products could be considered a current market for many suppliers, it was a new market for Stauffer Chemical. This project differs from others in that it involved an external collaboration to conduct a market assessment with a business school and not a technical collaboration. As shown, Akzo Nobel worked with a Rutgers business school team that conducted a market assessment study to include a business plan with pricing and a potential customer list. With six students this study was conducted in two semesters and included customer visits in the metropolitan area. The special feature of the product is that the magnesium phosphate cures in less than an hour and a highway can be reopened in less than one work shift, especially between high-traffic “rush hours.” This is of value for heavily traveled highways and bridges. Despite the technology and marketing plan, the program failed because reorganizations and divestitures moved the project champions to other businesses. Several planning meetings with the new parties looked encouraging but lacked the staying power for new product development. This example was chosen to emphasize that the commitment of a business team and the role of a champion are two factors necessary to achieve success. Any discussion on external collaborations with national labs and universities would be incomplete without considering the company’s responsibilities to the collaborators and the responsibilities for managing intellectual property. In the Akzo Nobel experience there were four projects for which interest

INDUSTRIAL INNOVATION WITH EXTERNAL R&D PROGRAMS 71 in the business units could not be sustained, and as a consequence, the intellectual property rights were returned to the university. Most of these examples involve new technology for new markets. For these cases involving Northwestern University, the University of Pittsburgh, Rensselaer Polytechnic Institute, and the University of Utah, each university was successful in licensing the technology to third parties. When conducting a successful external collaboration, a window on technology is gained and it is essential to have the commitment to move forward or the opportunity may be lost. Two other examples of collaboration involve national laboratories where the technology requires multidisciplinary approaches that exceed internal capabilities. Akzo Nobel’s expanding pharmaceutical division was interested in exploring new approaches for immunotherapy. A corporate brainstorming session provided the seeds of the project idea based on an emerging technology of radioimmunotherapy. Can the selectivity for cancer therapy be improved by building on the technology to guide an alpha particle to a cancer cell? An alpha emitter provides a steady, linear, high-energy particle. It has a short range and, if guided inside a target cell, can be selectively lethal. All that is needed is an alpha emitter located at the cancer site. The project entails three parts: an alpha emitter, a delivery method, and a way to test it. None of these were in place at Akzo Nobel, so an external collaboration was the preferred choice. The first action was to select and secure an alpha emitter. For that Oak Ridge National Laboratory was identified as a possible source. Two years later, after implementing agreements and safety procedures, we had secured samples of bismuth 213 with actinium 225 to serve as the alpha source for the program. To develop the radionucleotide delivery system (the cow), the Karlsruhe Atomic Energy Laboratory was contracted. This approach serves as an example of a global collaborative program. The second project challenge was to bring the alpha emitter to the cancer site. Perlmmune, a subsidiary of Akzo Nobel at the time, produced monoclonal antibodies that could selectively bind to cancer cells of acute myelogenous leukemia. The third challenge, to attach the radionucleotide to the monoclonal antibodies, required the experience and skills in actinide chemistry of Los Alamos National Laboratory. Access was gained via a “work for others” agreement to prepare selected chelating agents. In addition, a tetra acetic acid derivative, obtained in collaboration with Dow, was used for the subse- quent studies. David A. Scheinberg, of the Memorial Sloan-Kettering Cancer Center, working with colleagues at Columbia and Cornell Hospital, directed all the pharmacological facets of the program. Akzo Nobel maintained an equity position as several employees together with a venture capital group formed the spinoff, PharmActinium, Inc. Radioimmunotherapy is a strategy designed to increase the efficacy of native monoclonal antibodies, decrease the toxicity of therapy, and improve the long- term outcome of patients with leukemia. Preliminary trials have demonstrated an extraordinarily high selectivity/kill ratio. With this example, one can see that developing technology with external collaborations provides opportunities that otherwise may not be attainable in a timely and economically palatable fashion. As a final illustration in the area of new technology and new markets, the involvement of national laboratories is shown to achieve the technical progress and the knowledge integration for accelerating commercialization. As the fad of high-temperature superconductors rose and subsequently dissipated, teams from Argonne, Oak Ridge, and Los Alamos national laboratories together with the University of Wisconsin continued to pursue the science and technology of superconducting wire. As a result of this collaboration, the technology is currently being commercialized with American Superconductor, Inc. About 20 miles of cable are planned for completion by year’s end for a utility in the Albany, New York, area. External research partnerships, properly designed and integrated into internal activities, can accelerate the new product development process. The time from idea stage to commercialization, with the proper commitments, can be reduced substantially, in some cases by 50 to 66 percent. Akzo Nobel

72 REDUCING THE TIME FROM BASIC RESEARCH TO INNOVATION IN THE CHEMICAL SCIENCES has shown that this acceleration can be realized by applying flexibility to achieve a win-win situation for all partners and by implementing the guidelines for external collaborations. Developing an avenue to participate in the research infrastructure at U.S. universities and national laboratories is becoming essential for sustainability and technical leadership in an industrial R&D organization. The advantages of this outward vision are broad based and have been shown to provide a positive impact on industrial research. In conclusion, the principal foundation for accelerating R&D with external programs requires maintaining key technology platforms; processes for selecting both the programs and the external collaborators; internal and external networks including business teams and scientific leaders; identifying market-driven needs; securing a business commitment; and a renewing investment in the internal R&D team members. I am pleased to acknowledge the many outstanding participants and proponents of this 12-year experiment at Akzo Nobel. It was a privilege to have been a member of the Akzo Nobel team and to have enjoyed the camaraderie and intellectual challenges provided by these leading managers, scientists, and engineers, both internal and external, through over 100 collaborative partnerships at 30 universities and seven national laboratories. DISCUSSION J. Stewart Witzeman, Eastman Chemical: One of the problems I have observed with external re- search programs is that the manager is often fighting internally because the R&D community sees it as competitive and because it is often seen by senior management as one of the first things to cut in tough times. Do you have any best practices on how companies are able to maintain continuity in these sorts of programs? Francis Via: You have identified a critical issue for external programs that reflects on sustainability and relative value demonstration. Several of the examples given in this review involved programs at Dow and DuPont, which have both successfully addressed this persistent issue. One of the frequently pro- claimed advantages of external R&D programs is that there is flexibility with reduced risk. This nature makes them more vulnerable to fluctuations in research funding. This is but one of the many challenges of R&D management in the 21st century. The principal goals of the Industrial Research Institute study leading to the Technology Value Pyramid also address this issue by demonstrating the need to maintain technical leadership in core technology areas. External networks can be developed and maintained in times of financial restrictions with less funding and additional personal involvement. Andrew Kaldor, ExxonMobil: I have never seen so many examples of entrepreneurial linkages from external relationships. How much overhead, time, and effort are required to manage a successful project? Francis Via: A genuine commitment is required to conduct a valued external research program. Over- all, funding was allocated to the internal R&D team for review guidance and follow-up that was essentially equal to the external funding. The Akzo Nobel corporate group maintained a research team at Dobbs Ferry with full responsibility for conducting the internal research starting after external demonstration of the concept stage. Also this team has responsibility to serve as the technical liaison for at least half the external projects. For the other half of the projects, the business units contributed 10 percent time share the first year and a 50 percent share for the second year to cover their scientist who served as the technical liaison for select programs that had advanced beyond the concept stage. In

INDUSTRIAL INNOVATION WITH EXTERNAL R&D PROGRAMS 73 addition, several of us who were managing the programs were involved full time, screening, reviewing, and identifying projects and gaining input from or selling to the business community. I would like to comment on intellectual property as that issue was raised earlier. Akzo Nobel had more than 100 contracts with universities. In most of those the intellectual property was assigned to the university. We would write and file the application, covering all costs for patent execution on behalf of the university. In response, Akzo Nobel would obtain the first right of refusal for a royalty-bearing license with limits on royalties defined. The universities maintained the right to license to others in different fields of use.

Next: 8 Some New Ideas for Speeding Up the Development of Products from University Research »
Reducing the Time from Basic Research to Innovation in the Chemical Sciences: A Workshop Report to the Chemical Sciences Roundtable Get This Book
×
Buy Paperback | $47.00 Buy Ebook | $37.99
MyNAP members save 10% online.
Login or Register to save!
Download Free PDF

Innovation, the process by which fundamental research becomes a commercial product, is increasingly important in the chemical sciences and is changing the nature of research and development efforts in the United States. The workshop was held in response to requests to speed the R&D process and to rapidly evolve the patterns of interaction among industry, academe, and national laboratories. The report contains the authors' written version of the workshop presentations along with audience reaction.

  1. ×

    Welcome to OpenBook!

    You're looking at OpenBook, NAP.edu's online reading room since 1999. Based on feedback from you, our users, we've made some improvements that make it easier than ever to read thousands of publications on our website.

    Do you want to take a quick tour of the OpenBook's features?

    No Thanks Take a Tour »
  2. ×

    Show this book's table of contents, where you can jump to any chapter by name.

    « Back Next »
  3. ×

    ...or use these buttons to go back to the previous chapter or skip to the next one.

    « Back Next »
  4. ×

    Jump up to the previous page or down to the next one. Also, you can type in a page number and press Enter to go directly to that page in the book.

    « Back Next »
  5. ×

    To search the entire text of this book, type in your search term here and press Enter.

    « Back Next »
  6. ×

    Share a link to this book page on your preferred social network or via email.

    « Back Next »
  7. ×

    View our suggested citation for this chapter.

    « Back Next »
  8. ×

    Ready to take your reading offline? Click here to buy this book in print or download it as a free PDF, if available.

    « Back Next »
Stay Connected!