Growth Team Membership 2010 Priorities Survey R&D/Innovation and Product Development European Survey Results
 

Growth Team Membership 2010 Priorities Survey R&D/Innovation and Product Development European Survey Results

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Growth Team Membership 2010 Priorities Survey R&D/Innovation and Product Development European Survey Results.

Growth Team Membership 2010 Priorities Survey R&D/Innovation and Product Development European Survey Results.

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Growth Team Membership 2010 Priorities Survey R&D/Innovation and Product Development European Survey Results Growth Team Membership 2010 Priorities Survey R&D/Innovation and Product Development European Survey Results Presentation Transcript

  • Growth Team Membership™:2010 R&D/Innovation and Product Development Priorities European Survey Results May 2010 Contact us at GTMResearch@frost.com
  • What is Growth Team Membership™?Growth Team Membership™ (GTM) is an annual subscription program that offers research, events and services designed toincrease the effectiveness, productivity, and impact of executives in the functions that support the CEO’s growth strategy. Growth Team Membership™ Research. 2
  • Table of Contents PageSection 1: Survey Purpose and Respondents 4Section 2: External Factors Shaping R&D/Innovation and ProductDevelopment Strategy 5 Section 2.1: By Business Model 8Section 3: Key R&D/Innovation and Product Development Challenges 9 Section 3.1: By Business Model 13Section 4: R&D/Innovation and Product Development Effectivenessand Expenditures 14 Section 4.1: By Business Model 15Section 5: Respondent Demographics 25The content of these pages are © 2010 Frost & Sullivan. All rights reserved. Growth Team Membership™ Research. 3
  • Survey Purpose and RespondentsResearch ObjectiveTo understand the most pressingexternal and internal challengesshaping R&D/innovation andproduct development executives’2010 planning.MethodologyWeb-based survey platformSurvey PopulationTarget respondents were Managerlevel and above R&D/innovationand product developmentexecutives from companies There were 103throughout Europe survey respondents Growth Team Membership™ Research. 4
  • External Factors Shaping R&D/Innovation and Product Development Strategies Growth Team Membership™ Research. 5
  • Top Three External Factors KEY TAKEAWAY: Strategies are heavily influenced by the need to stand out from the competition through new products or sustainability initiatives. Intensifying competition 14% Need for green/sustainability initiatives 16% Need for product/service innovation and 25% capabilities 0% 25% 50% Survey Question: Please indicate the three business environment factors that have the most impact on your 2010 R&D/innovation and product development strategies.N = 85 Growth Team Membership™ Research. 6
  • External Factors Impact on R&D/Innovation and Product Development KEY TAKEAWAY: For 2010, two of the top three external factors impacting strategies are seen as positive. Positive Impact Negative Impact 100% 100% 75% 73% 50% 0% Need for product/service innovation Need for green/sustainability initiatives Intensifying competition and capabilities Survey Question: Please indicate the impact that each of the following forces have on your 2010 R&D/innovation and product development strategies.N = 85 Growth Team Membership™ Research. 7
  • Top Three External Factors (By Business Model) KEY TAKEAWAY: There is a considerable overlap in external challenges regardless of business model. B-to-B B-to-C Hybrid Need for product/service External innovation and capabilities Tapping into global market Tapping into global market Factor 1 opportunities (25%) opportunities (28%) (34%) Need for Need for product/service Need for product/service External green/sustainability innovation and capabilities innovation and capabilities Factor 2 initiatives (16%) (50%) (25%) Changes in customer External /government regulation Rising/high material (input) Intensifying competition Factor 3 (14%) costs (25%) (26%)N = 85 Growth Team Membership™ Research. 8
  • Key R&D/Innovation and Product Development Challenges Growth Team Membership™ Research. 9
  • Key R&D/Innovation and Product Development ChallengesSnapshotAll Companies B-to-B Companies B-to-C CompaniesTop three challenges: Top three challenges: Top three challenges:1 Identifying and developing 1 Streamlining research, 1 Obtaining external funding for breakthrough innovation design and development innovation (e.g. government) ideas activities to create cost efficiencies 2 Maximising portfolio value2 Streamlining research, while mitigating portfolio risk design and development 2 Identifying and developing activities to create cost breakthrough innovation 3 Managing an open innovation efficiencies ideas process effectively3 Matching innovation projects 3 Matching innovation projects to unmet customers needs to unmet customers needs Growth Team Membership™ Research. 10
  • Top Five Key R&D/Innovation and Product Development Challenges KEY TAKEAWAY: R&D/innovation and product development’s challenges are highly varied—ranging from identifying breakthrough ideas to budget allocations across the product portfolio. Challenge 1 Identifying and developing breakthrough innovation ideas (18%) Streamlining research, design and development activities to create cost Challenge 2 efficiencies (10%) Challenge 3 Matching innovation projects to unmet customers needs (12%) Challenge 4 Managing an end-to-end innovation process (11%) Challenge 5 Allocating portfolio spend across short-, medium-, and long-term horizon projects (13%) Survey Question: Please indicate the top five challenges shaping your R&D/innovation and product development decision-making in 2010.N = 71 Growth Team Membership™ Research. 11
  • Root Cause of Top Five R&D/Innovation and Product Development Challenges KEY TAKEAWAY: Process or Systems Technology are cited as the primary root cause of R&D/Innovation and Product Development’s top challenges. 100% Staff Staff 25% 25% Staff 38% Staff 43% Process Process 50% 14% 100% Process Systems 63% Technology Process 75% 62% Systems Technology 43% Systems Technology 12% 0% Identifying and Streamlining Matching Managing an open Allocating portfolio developing research, design innovation projects innovation process spend across breakthrough and development to unmet effectively short-, medium-, innovation ideas activities to create customers needs and long-term cost efficiencies horizon projects Survey Question: For the top five challenges you selected above, please indicate whether the root cause of the challenge is staff, systems technology, or process.N = 71 Growth Team Membership™ Research. 12
  • Top Five R&D/Innovation and Product Development Challenges (By Business Model) KEY TAKEAWAY: The challenges remain primarily the same across business models only varying by their prioritization. B-to-B B-to-C Hybrid Streamlining research, design Obtaining external funding for Identifying and developing Challenge 1 and development activities to innovation (e.g. government) breakthrough innovation ideas create cost efficiencies (21%) (25%) (24%) Identifying and developing Maximising portfolio value Streamlining research, design Challenge 2 breakthrough innovation ideas while mitigating portfolio risk and development activities to (18%) (14%) create cost efficiencies (12%) Creating and implementing Matching innovation projects to Managing an open innovation Challenge 3 unmet customers needs (14%) process effectively (29%) metrics to measure innovation portfolios performance (13%) Streamlining research, design Maximising portfolio value Managing an open innovation Challenge 4 process effectively (10%) and development activities to while mitigating portfolio risk create cost efficiencies (17%) (13%) Allocating portfolio spend Obtaining external funding for Challenge 5 Finding suitable partners to across short-, medium-, and innovation (e.g. government) license technology (17%) long-term horizon projects (10%) (29%)N = 71 Growth Team Membership™ Research. 13
  • R&D/Innovation and Product Development Effectiveness and Expenditures Growth Team Membership™ Research. 14
  • R&D/Innovation and Product Development Expenditures andEffectiveness SnapshotAll Companies B-to-B Companies B-to-C Companies Rank their R&D/innovation Rank their R&D/innovation and Rank their R&D/innovation and and product development product development product development effectiveness as “above effectiveness as “average” effectiveness as “above average” average” Allocate approximately 5% of Allocate approximately 3% of Allocate approximately 5% or 10% of their annual revenue their annual revenue to their annual revenue to to R&D/innovation and R&D/innovation and product R&D/innovation and product product development budget development budget development budget Expect to increase their Expect to increase their budget Expect to increase their budget budget for the development of for the development of short-term for the development of medium- short-term horizon or incremental projects horizon or incremental projects term horizon projects Expect their staffing levels to Expect their staffing levels to stay Expect their staffing levels to increase moderately in 2010 increase moderately in 2010 increase moderately in 2010 Expect their budgets to stay Expect their budgets to increase Expect their budgets to stay the the same in 2010 same in 2010 in 2010 Growth Team Membership™ Research. 15
  • R&D/Innovation and Product Development’s View of Its Effectiveness (By Business Model) KEY TAKEAWAY: Respondents in B-to-C companies are more likely to rank their function’s effectiveness as “Average.” All Companies B-to-B Companies Below Average Below Average Exceptional 10% Exceptional 10% 17% 8% Above Average Above Average Average 46% 34% 45% Average 30% Hybrid Companies B-to-C Companies Exceptional Average 13% 20% Exceptional 29% Average 42% Above Average 29% Above Average 67% Survey Question: Please assess the overall effectiveness of your R&D/innovation and product development function compared to those in other firms within your industry.N = 64 Growth Team Membership™ Research. 16
  • 2009 R&D/Innovation and Product Development Budgets (By Business Model) KEY TAKEAWAY: B-to-C companies are more than twice as likely to allocate 3% of their company revenue to their innovation budgets, than firms with other business models. 50% 43% 43% 40% The red percentages are for all respondents. 33% 31% 29% 30% 13% 20% 17% 11% 11% 7% 13% 14% 11% 6% 11% 4% 10% 8% 8% 8% 8% 8% 8% 6% 2% 0% 0% 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% or more Percentage of Total B-to-B B-to-C Hybrid All Companies Company Revenue Survey Question: Please provide your 2009 total R&D/innovation and product development budget as a percentage of total company revenue:N = 55 Growth Team Membership™ Research. 17
  • 2009 vs. 2010 R&D/Innovation and Product DevelopmentProject Pipeline (All Companies) KEY TAKEAWAY: Companies are increasing their budget allocations to short-term horizon innovation projects in 2010.100% 2% 2% 3% Decrease Substantially 6% 9% 14% 19% 12% 15% Decrease Moderately 34% 40% Stay the Same 41% 41% 48%50% 41% 42% 31% 33% Increase Moderately 29% 14% 10% 8% Increase Substantially 0% 3% 2% Short-term horizon Medium-term Long-term horizon Disruptive Incremental incremental horizon incremental technology technologies improvement technology technology innovation projects innovation innovation projects: projects: adoption projects: adoption adoption within 2 in 4 to 10+ years within 2 years to 4 years Survey Question: In comparison to 2009, your 2010 R&D/innovation and product development budget for each of the following project categories will:N = 64 Growth Team Membership™ Research. 18
  • 2009 vs. 2010 R&D/Innovation and Product DevelopmentProject Pipeline (By Business Model: B-to-B Companies) KEY TAKEAWAY: B-to-B companies are increasing their 2010 budget allocations to short-term horizon innovation projects.100% Decrease Substantially 12% 15% 17% 8% 10% Decrease Moderately 32% 41% 44% Stay the Same 46% 54%50% 49% 36% 31% Increase Moderately 39% 27% 7% 8% 10% Increase Substantially 0% Short-term horizon Medium-term Long-term horizon Disruptive Incremental incremental horizon incremental technology technologies improvement technology technology innovation projects innovation innovation projects: projects: adoption projects: adoption adoption within 2 in 4 to 10+ years within 2 years to 4 years Survey Question: In comparison to 2009, your 2010 R&D/innovation and product development budget for each of the following project categories will:N = 43 Growth Team Membership™ Research. 19
  • 2009 vs. 2010 R&D/Innovation and Product DevelopmentProject Pipeline (By Business Model: B-to-C Companies) KEY TAKEAWAY: B-to-C companies are increasing their spend on medium-term horizon projects for 2010.100% Decrease Substantially 14% 14% 14% Decrease Moderately 29% 14% 50% 43% Stay the Same 29% 57%50% 57% 33% 29% 43% Increase Moderately 29% 14% 14% 17% Increase Substantially 0% Short-term horizon Medium-term Long-term horizon Disruptive Incremental incremental horizon incremental technology technologies improvement technology technology innovation projects innovation innovation projects: projects: adoption projects: adoption adoption within 2 in 4 to 10+ years within 2 years to 4 years Survey Question: In comparison to 2009, your 2010 R&D/innovation and product development budget for each of the following project categories will: N=7 Growth Team Membership™ Research. 20
  • 2009 vs. 2010 R&D/Innovation and Product DevelopmentProject Pipeline (By Business Model: Hybrid Companies) KEY TAKEAWAY: Hybrid companies plan to increase their budget for short-term horizon innovation projects.100% Decrease Substantially 7% 20% 33% 29% Decrease Moderately 21% 47% 33% 29% Stay the Same 27% 36%50% 20% 40% 33% 21% 35% Increase Moderately 33% 14% 7% 7% 7% 0% Increase Substantially Short-term horizon Medium-term Long-term horizon Disruptive Incremental incremental horizon incremental technology technologies improvement technology technology innovation projects innovation innovation projects: projects: adoption projects: adoption adoption within 2 in 4 to 10+ years within 2 years to 4 years Survey Question: In comparison to 2009, your 2010 R&D/innovation and product development budget for each of the following project categories will:N = 14 Growth Team Membership™ Research. 21
  • 2010 vs. 2009 Staffing Plans (By Business Model) KEY TAKEAWAY: Regardless of business model, respondents expect a moderate increase in staffing levels for 2010. All Companies B-to-B Companies Increase Increase Substantially Decrease Substantially Decrease 5% Moderately 10% Moderately 16% 12% Stay the Same Stay the Same 35% Increase 32% Increase Moderately Moderately 48% 42% Hybrid Companies B-to-C Companies Increase Decrease Substantially Moderately Increase Decrease 13% 14% Substantially Moderately 29% 27% Stay the Same 14% Increase Moderately Increase Stay the Same 33% Moderately 27% 43% Survey Question: In comparison to 2009, your 2010 R&D/innovation and product development staff will:N = 63 Growth Team Membership™ Research. 22
  • 2010 vs. 2009 Budgets (By Business Model) KEY TAKEAWAY: The majority of respondents’ 2010 budgets will stay the same or increase. All Companies B-to-B Companies Decrease Decrease Increase Increase Substantially Substantially Substantially Decrease Substantially Decrease 3% 3% 6% Moderately 8% Moderately 11% 10% Increase Increase Moderately Moderately 29% 27% Stay the Same Stay the Same 51% 52% Hybrid Companies B-to-C Companies Decrease Increase Substantially Substantially 7% Stay the Same 7% 14% Decrease Moderately Increase Increase 17% Moderately Substantially 27% 43% Increase Stay the Same Moderately 46% 43% Survey Question: In comparison to 2009, your 2010 R&D/innovation and product development budget will:N = 63 Growth Team Membership™ Research. 23
  • Anticipated Company Performance in 2010 (By Business Model) KEY TAKEAWAY: R&D/innovation and product development executives are optimistic about their company’s performance in 2010. All Companies B-to-B Companies Decrease Decrease Moderately Moderately Increase 4% 5% Increase Substantially Substantially Stay the Same 26% Stay the Same 28% 21% 19% Increase Increase Moderately Moderately 48% 49% Hybrid Companies B-to-C Companies Decrease Moderately Stay the Same 7% Increase 13% Stay the Same Increase Substantially 14% Substantially 29% 36% Increase Increase Moderately Moderately 43% 58% Survey Question: In comparison to 2009, your company’s performance by the end of 2010 will:N = 61 Growth Team Membership™ Research. 24
  • Respondent Demographics Growth Team Membership™ Research. 25
  • Demographics Respondents tended to be from private, B-to-B companies whose 2009 revenue was below € 70 Million Enterprise Type Business Model Over half of the Public respondents work in 18% a private company. Hybrid Company 31% B-to-B Company 60% Venture Capital 20% Private B-to-C Company 62% 9% N = 98 N = 94 Company Revenue 60% 49% 30% 18% 18% 6% 9% 0% Below € 70 Million € 70 Million to €3 € 348 Million to € € 696 Million to € 7 More than € 7 Billion 47.99 Million 695.99 Million Billion N = 97Survey Question: Please indicate the type of enterprise best represents your organisation. Growth Team Membership™ Research. 26
  • Demographics: Top Six Participating Industries Information and Communication Technologies 17% Electronics and Security 17% Automotive and Transportation 18% Energy and Power Systems 20% Chemicals, Materials, and Food 20% Healthcare and Life Sciences 28% 0% 20% 40% Survey Question: Please indicate which of these Industry categories best describes you organisation (please indicate all that apply).N = 103 Growth Team Membership™ Research. 27
  • Contact GTM If you have any questions or comments about this or our other surveys, please contact us at GTMResearch@frost.com Growth Team Membership™ Research. 28