T55 - "The CEO's View On Measuring R&D" [2005 Presentation Slides]

The Management Roundtable Audiocon Series, Management Roundtable, Watertown, Massachusetts, USA
September 14, 2005 -- [68 pages]

Description: Corporations need fifteen plus metrics to measure themselves. It cannot be done with less without leaving some important ground uncovered. Cases of as many as 125 metrics have been documented for some companies, such as AT&T in its heyday. The corporate set of metrics is composed of measures that can only be calculated at the overall corporate level combined with selected measures that are originated by the organizations that support the corporate level, such as R&D and product development.

In an analogous manner, each organization and function that supports the corporate level has a set of measures that are necessary to run that organization or function. A select few of these supporting organization metrics are part of the corporate set of metrics. The rest of the R&D metrics are "expected" to be managed successfully within the supporting units, the details of which are only necessary on a case-by-case basis at the corporate level.

Then, within each of these organizations there are a number of departments and functions. Again, in an analogous manner, each of these component departments and functions also has a set of measures. In larger organizations, this tiered hierarchy may continue several more levels. The three levels just described will be the focus of this audio session.

* The few R&D and product development metrics that are part of the corporations set of metrics.
* The set of metrics necessary to direct and manage the R&D and product development activities.
* The metrics that measure the functions and activities within R&D and product development.

This presentation will address 6 separate subject areas where CEOs look to make sure metrics are actively maintained and monitored for R&D and product development. Selected measures in each of the six areas will be discussed during the audio session. The six areas are:

1. Business Results
2. Productivity & Return On Innovation
3. Capacity Management
4. Individual Investments In Technologies & Products/Projects
5. Core & Functional Competencies
6. Intellectual Property

During the course of discussing each of these six areas, and some representative metrics and measures for each area, suggestions will be made as to how to decide which few measures should be selected for monitoring at higher levels in the organization hierarchy.

Some specific measures that will be discussed across the six areas include: revenues and profits due to new products, Productivity, return on innovation and variants of it, project and pipeline portfolio metrics, R&D throughput metrics, project metrics, functional productivity measures, and intellectual property measures.

Research results from GGI and other recognized research firms will be cited during the audio session to provide benchmarks as to current industry practices and expectations where data is available.

Participants will take away an understanding of how many metrics are prudent, the kinds of measures that are appropriate at each level in a hierarchy, and examples of specific metrics in each of the six areas along with the benchmarks in each of these areas where available.

The Table of Contents of this document is depicted below:

SECTION TITLE

CEO’s Goal
Business Results - Most Popular CEO Metrics
Mind Teaser #1 - New Product Sales
Mind Teaser #2 - Product Life Cycle
Return On Innovation
Capacity Management
Project Investments
Functions 
Intellectual Property
Summary
• • • • • • • • • • • • • • • • • • • • • • • • • • • •• • • • • • • • • • • •
GGI Business Profile

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