The First and Only Measure of R&D Productivity
Everyone agrees that R&D drives growth, but without quantifiable metrics, managers have been flying blind. Now science replaces intuition.
Restart Your Growth Engine
R&D productivity has declined 65% over the last 30 years, so the average firm is getting 65% less growth for each R&D dollar spent. R&D is the sleeping giant in our economy.
Maximize Profitability Now
The average company is leaving $182 million in annual profits on the table by over or underinvesting in R&D. Realize immediate gains by optimizing R&D levels.
How R&D Manager Works
Firms are leaving money on the table because they haven’t had a reliable way to value their R&D. Like the baseball scouts in Moneyball, they’ve been using their intuition to select the best players, when they should be basing decisions on performance.
R&D Manager is a comprehensive suite of tools that puts managers in control of their R&D–driven growth because, like Sabermetrics, it uses measurement to identify how to create value in the organization.
The first tool, RQ Benchmarker, calculates your company’s returns to R&D using a powerful empirically validated algorithm called RQ™ (short for Research Quotient). RQ is analogous to human IQ. High RQ firms have greater R&D productivity, and greater returns to R&D investment. RQ Benchmarker tracks your company’s RQ over time, so you can see your organization’s progress based on new practices or give an early warning if you are getting off track. It also compares your RQ to competitors, so you know if you are driving more value from R&D than they are.
The second tool, R&D Modeler, allows you to interactively simulate the impact of different R&D spending levels on future revenues and profits. This tool allows your firm to right size its R&D, by finding the exact spending level that maximizes profits based on your company’s unique R&D capability. 96% of firms’ investment is well outside the optimum: 63% are overspending, and on average are leaving $258 million of profits on the table. 33% are underspending, missing the opportunity for another $36 million in annual profits if they would increase R&D spending by just 10%.
The ultimate engine for growth is to increase your RQ. The third tool, RQ Diagnostics, creates opportunities for you to increase your R&D productivity by identifying which business practices are associated with greater RQ. It compares your R&D practices to those used by other firms and shows you the relationship between those practices and RQ. You can shift your performance by shifting toward higher RQ practices.