“Now the big
corporate laboratories are either gone or a shadow of what they were.
Companies tinker with today’s products rather than pay researchers to
think big thoughts. More often than not, firms hungry for innovation
look to mergers and acquisitions with their peers, partnerships with
universities and takeovers of venture-capital-backed start-ups. The
traditional separation of research and development… is rapidly disappearing, especially in the information-technology
However, this transformation does not mean that the glorious era of game-changing technological breakthroughs is over:
“The approach to R&D is
changing because long-term research was a luxury only a monopoly could
afford. In their heyday, the big firms dominated their markets.
AT&T ran the telephone network, IBM
dominated the mainframe-computer business and Xerox was a synonym for
photocopying. The companies themselves saw the cost of basic scientific
research as a small price to pay for such power.
technology firms are much less vertically integrated. They use networks
of outsourced suppliers and assemblers, which has led to the
splintering of research divisions. Even though big American firms still
spend billions of dollars on
R&D, none has any intention of filling the shoes left empty by Bell Labs or Xerox PARC. Research and development… are once again becoming entwined. Old-fashioned R&D is losing its ampersand.“
The new paradigm involves integrating researchers into the everyday flow of the business. Instead of being given carte blanche to dream up new ideas, however, these researchers are typically assigned to commercially-viable projects and given specific time frames. As The Economist explains, the ultimate goal at companies like Microsoft, Google and IBM is to blur the distinction between “research” and “development,” such that products emerge even faster from the research pipeline.
[image: AT&T Bell Labs from The Economist]