GGI RapidNews: Volume 9, Issue 6 - R&D

GGI RapidNews R&D Product Development eZine: Volume 9, Issue 6 - June 12, 2008
GGI RapidNews is published approximately once a month.

Thank you to the 209 people who responded for their companies in our biennial primary research project of North American industry. We appreciate the time it took you to respond accurately to our robust survey questionnaire. All participants should have received their complimentary "Summary" copy of the results at this time. If you participated and did not receive your "Summary," please contact Ervin Kule at eak@goldensegroupinc.com. Ervin is GGI's Manager of Market Research. He can also be reached at 781-444-5400 x202.

The 2008 Biennial Survey theme was "Tangible Innovation." Much is said and written about the "perceived to be somewhat soft" topic of innovation. GGI's research focused on selected aspects of the innovation body of knowledge that are tangible and can be actively managed by companies and their executives. We also refreshed our ongoing biennial research of the past decade regarding the usage of R&D and product development metrics by industrial and high tech companies. Industry Week has recently published the "Top 10 Metrics In 2008" and contrasted them to our research from 1998 to identify the changes during the past decade.

John Teresko, "Metrics Matter [Top 10 @ 1998 vs 2008]," Industry Week, Penton Publishing, Cleveland, Ohio, USA, WWW Posting April 17, 2008.

Our research covered 88 different metrics that measure the overall results obtained from investments in R&D and Product Development. It is clear that the measurement emphasis is changing to reflect industry's initiatives in intellectual property, innovation, productivity, lean, and other areas. In a few years there are likely to be a number of metrics that will move up to become Top 10.

Industry Week also asked us to write a small piece about some of these trends in metrics that we observed during our research. Most of these trends occur below the Top 10 Metrics which have stayed fairly constant over time. This piece was also recently published.

John Teresko, "Seven Emerging Trends In R&D Metrics," Industry Week, Penton Publishing, Cleveland, Ohio, USA, WWW Posting April 17, 2008.

The majority of the research effort focused on "Tangible Innovation" versus "Metrics". To date, we have not made any of these findings public and will likely do so only sparingly in public media. We will be providing selected highlights to RapidNews readers in the coming months.

We have two reports available for sale to companies that might be interested. Our flagship report is "MR42" which is a summary of all questions across the population of respondents. It includes full color graphics of each question. We are also offering a less expensive scaled-down version, MR41, which is text only at about half the price.

For more information please visit our 2008 Biennial Survey web site. Here you can find our Research Description, Product Description, Product Brochure, Tables Of Contents for the reports, and/or place an order for one of these publications. Pricing and ordering information may also be found in The Wisdom iStore in the "Primary Research" section. All reports are available in hard copy, or electronic.pdf format for posting on company intranets.

Condensed from "Why the Party's Over," Fortune Magazine, May 5, 2008, Volume 157, Number 9, Pages 222 - 224 and F1 - F62, published by Time Inc., New York, NY, USA, ISSN 0015-8259.

Fortune announced the 500 largest US Corporations for 2007. The Top 10 revenue performers of this year were Wal-Mart, Exxon Mobil, Chevron, General Motors, ConocoPhillips, General Electric, Ford Motor, Citigroup, Bank of America and AT&T respectively. Exxon kept it's previous rank as first in profit for one more year thanks to high oil prices that netted $40.6 billion on $372.8 billion in revenue.

Some new companies who entered the list this year were Fannie Mae, Kraft Foods, GMAC, AES, Jabil Circuit. Some companies that dropped from the list were Avaya, Beazer Homes USA, BlueLinx Holdings, Caremark Rx, and CDW.

The last company to make it into the 500 club in 2007 was Scana with $4.62 billion in revenue. This represents a $0.3 billion increase over 2006 when it took $4.32 billion to make it to the 500 club.

Overall, after an amazing 2006, the 2007 Fortune 500 companies profits dropped by 17.8%. June 13th 2007 marked the first profit decline in five years. Since then the market has continued this trend for four consecutive quarters. 183 companies reported lower profits for 2007 versus 156 companies for 2006. 57 companies lost money in 2007 versus 43 in 2006. Total 2007 losses were $116.7 billion versus $48.5 billion in 2006.

Voices like Jeremy Gratham, Chairman of GMO, had warned about the upcoming decline. He had pointed out as a reason the risk return relationship between safe and risky bonds. The gap between interest rate of corporate bonds at 7.7% and US Treasuries bonds at 5.3% narrowed significantly. Investors who were paying more for high return investments turned to safer investments with lower yields treasury bonds. That stopped the boom cycle and started the decline. Corporate bonds plunged in value.

Many companies with consumer exposure fell in the 500 list. Financial institutions and home builders like Fidelity National Financial and Toll Brothers fell 171 and 120 places respectively. Companies that moved up in the ranks included Freeport-McMoRan Copper & Gold [258 places] followed by Community Health Systems, Global Partners, Pilgrims Pride, Aleris International, and Google [91 places].

The optimistic side of this currently gloomy picture is that profits have a compounded rise of 5.7% since 2000. In the best-case scenario, the decline that started in the third quarter of 2007 will be better by the end of 2008.

Condensed from "Couch-Potato Nation", Fortune Magazine, September 3, 2007, Vol 156, Number 5, Page 34, published by Time Inc., New York, NY, USA, ISSN 0015-8259.

There is almost a common sense that American workers are the most hard working in the world. This sense is being challenged by the latest data of the UN International Labor Organization which looks at working hours around the world.

Although American workers remain high in the ranks compared to other industrialized Nations like Norway, the Netherlands, and even Japan, they are lagging behind Switzerland and Britain. More interestingly, the USA is also behind developing countries like Mexico and Thailand. American worker leisure time has increased over the past 40 years, a characteristic of all wealthy and prosperous economies.

This trend is signaling danger in a competitive global economy. Markets tend to fix disequilibriums. When anything tradable sells for different prices in different places, those differences soon disappear. American workers are already the most highly paid in the global market where there is a huge gap in labor price between developed and developing nations. In order to keep the current living standards, and to offset the tendency of the markets in fixing differences, American workers will have to compensate by working more hours. This will be a challenge given the latest UN ILO data.

An integrated metrics program will result in greater speed in new product development, more profitable products, and improved performance of your research and development environment. What does such an integrated program entail? Find out by attending GGI's Product Development Metrics Summit to be held June 17-19, 2008 in metro Boston.

The Metrics Summit is a series of 3 seminars, focused on 3 major areas of importance to R&D executives and managers. Download a Brochure. Download a Summit At-A-Glance.

All three seminars are geared to top-level professionals that manage entire organizations, departments, budgets, and senior program management executives. An excellent approach would include two to four key staff members who could produce a result for the R&D organization as a whole.

If you wish, please view a list of Companies who have participated in prior GGI Summits. We are grateful to the September and December 2005 participants who provided us with a Testimonial, Testimonial. We are grateful to the March and September 2006 participants who provided us with a Testimonial, Testimonial. We are grateful to March and August 2007 participants who provided us with a Testimonial, Testimonial. We are grateful to the January 2008 participants who provided us with a Testimonial.

Bring your team and come away with your company's solution! This is an excellent opportunity to quickly leverage the power of metrics. Discounts apply for teams of 3 or more attending from the same company. Teams of 3 or more receive an additional discount of $254 per person.

The Lean Product Development Guidebook: Everything Your Design Team Needs to Improve Efficiency and Slash Time to Market, by Ronald Mascitelli, Renee Winett (Editor),Technology Perspectives December 2006, ISBN-13: 9780966269734.

This book is the author's second in a series of guidebooks for practitioners in product development who are interested in eliminating waste in the design and development process, specifically in wasted time (to market). The material is presented in chronological order from the earliest stages of project inception through transition of the product to manufacturing.

The author leads off with his experienced-based list of "Top Ten" sources of waste in new product development. He then proceeds to introduce lean tools and methods that specifically address each of these sources.

Several definitions set the context of the discussion. The author introduces a definition of "Value" as he feels that it is easier to identify what is not value, than it is to define what is waste. In product development, "all of the value generated by the design team is embodied in the deliverables that they create".

The author then proceeds to introduce several, over two dozen, practical and easy to implement lean tools and methods. His version of Value Stream Mapping, Stand-up Meetings, and the Visual Project Board are particularly noteworthy. Many of the methods are similar to those in use by Toyota, as the author admits.

For more information about The Lean Product Development Guidebook or to order a copy of the book, go through GGI's Bookstore to the Amazon.com Web Site.

Discounted Item: Periodically, GGI's iStore features one item that we discount 40%. We are now offering our 2004 Survey Summary Report, MR32c, in pdf format.

2004 Survey Summary [Electronic Copy - Corporate License], Goldense Group, Inc., Needham, MA, USA, $715.00 [List Price $1,192.00]

GGI's Featured Item changes approximately every other month and is always offered at 40% discount. To order this material, please go to GGI's Featured Item on the GGI Home Page or find this item in the Primary Research section of The Wisdom iStore.

The "2008 Survey Highlights" report and the "2008 Survey Summary" report will be announced in June. Both are currently available to order in the Primary Research section of The Wisdom iStore, but will be "back ordered" for approximately one more week.

2004 Product Development Metrics Survey - Product Selection, IP Management, and Top Corporate Metrics: The Summary Report (MR32h) and Highlights Report (MR31h) for GGI's 2004 Biennial Product Development Metrics Survey are now available for purchase by the public through GGI's Wisdom iStore. These reports are completely based on primary research performed by GGI researchers. The research includes 202 respondent companies. There was a 5% response rate.

McKinsey & Company, Texas Instruments, Rockwell, Kimberly Clark, JDS Uniphase, Shure, Curtiss Wright Flight Systems and Datacard are representative of companies that purchase market research from GGI.

* Top Corporate Metrics Used in Industry RD&E

We have already shared many results with GGI RapidNews readers since we began this line of business in 1998. 2004 Survey results ran in six RN issues, RN V5I11 - RN V6I5, which may be found in the RN archives, along with results from prior years.

1. 2004 SURVEY HIGHLIGHTS: A text-only report (75 pages), including the full text of all the results and analysis of the survey population analyzed as a whole, and

2. 2004 SURVEY SUMMARY: A report of composite results, where the survey respondents are analyzed as a whole (149 pages, includes a full set of graphed answers for every survey question).

3. 2004 SURVEY RESULTS: A report of composite results, where the survey respondents are analyzed as a whole AND five different cross-sections of the survey data contrasting Public vs Private, High Tech vs Low Tech, Big vs Small Revenues, Large Number of Employees vs Few Employees, and Process vs Repetitive, vs Discrete vs Job Shop (313 pages, includes a full set of graphed answers for survey questions).

Individual sections of the research reports, as well as logical combinations of sections are also available. All reports are available in printed or electronic versions.

2002, 2000, 1998 Product Development Metrics Survey: The Summary and Highlights Reports for GGI's prior Biennial Product Development Metrics Surveys

GTK- Gateway to Knowledge is a DIRECTORY OF THOUSANDS OF LINKS to providers of engineering, purchasing, and manufacturing technologies and services. If you hit the right subjects, it is more useful than a search engine! The "main entrance" to GTK can be found at:

For those of you that do not want to go through the main entrance above, some of the Gateways that we believe you will find useful or entertaining are highlighted below.

GGI's Calendar of Industry Events contains an up-to-date listing of links to Conferences, Seminars, Distance Learning Centers, Colleges & Universities, Executive Education, and Corporate-Sponsored Universities. Categories we follow are:

If you are looking for a conference or other learning opportunity, check out the Calendar. This free service for our readers is located in the left side of GGI's Home Page. Look under "Free Tools & Services/Calendar."

Alexander Haig's World Business Review: Brad Goldense has made several appearances on Alexander Haig's World Business Review. Streaming video is available for all shows, which aired on August 4, September 29 and December 15, 2002 and on May 20, 2003. See below for details.

May 20, 2003 Broadcast of September 29th In-Studio with Alexander Haig (22.5 minutes): Streaming video for this segment is available on GGI's web site.

December 15, 2002 In-Studio with Alexander Haig (7.5 minutes) on CNBC paid programming: Streaming video for this segment is available on GGI's web site.

September 29, 2002 In-Studio with Alexander Haig (22.5 minutes): Streaming video for this segment (as well as the entire 30-minute show) is available on GGI's web site.

August 4, 2002 On-Location at GGI (3.5 minutes): This On-Location field report is available in streaming video on GGI's web site.

The web page includes links to download a streaming video player, if you do not currently have one installed on your computer.

GGI RapidNews is an e-mail publication from Goldense Group, Inc (GGI). Its subject matter includes survey findings, company news, book and article reviews, key industry conferences and R&D information of interest to clients and associates. Please send communications to rn(at)goldensegroupinc.com. Thank you.