Do Your R&D!

By Harry T. Roman

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TABLE OF CONTENTS
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

R&D in Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

The R&D Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

R&D and Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

R&D Project Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Doing R&D Right . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

DO YOUR R&D! 1
INTRODUCTION

T
he most important invention Thomas Edison gave us was not an
invention at all. It was the process of invention, the codification of
the discrete steps to take a raw idea to a commercial product. This
idea was the basis of his invention factory concept—which later morphed
into what we recognize today as team-based, corporate R&D. It is widely
applicable across all sectors of the R&D community—industrial, academic
and governmental.

By the time Edison died in 1931, major companies had formalized their own
corporate R&D facilities, as shown below:

Edison Menlo Park 1876; West Orange 1887

General Electric 1885
J&J 1891
Merck 1891
National Starch 1895
Du Pont 1903
Benjamin Moore 1904
Westinghouse 1904
Exxon 1919
Englehard 1920
RCA 1920
Bell Labs 1925
Mobil 1925
Union Carbide 1925
Hoffman La Roche 1929
Campbell Soup 1939
Allied Signal 1943
Nabisco 1958

During World War I, military leaders summoned Edison to Washington, D.C.,

to bring his inventive genius and R&D process to bear on the German U-boat
problem, searching for ways to better detect them. In Washington, D.C., he
assembled teams of inventors, scientists, engineers and technologists to work
on the problem. After the war, such assemblies led to the formation of the
Naval Research Labs in 1923. Later, he influenced the formation and structure
of the Manhattan Project teams [the development of the atomic bomb], and
the major national labs in the 1950s and 60s that followed, including NASA.

DO YOUR R&D! 2
Today's U.S. innovative leaders include Amazon, Google, Microsoft, Tesla and
3M. These companies have encouraged innovation by giving their employees
time and money to work on individual projects.

For instance, it's no secret that Amazon is one of the world's most innovative
companies. Starting out as a niche service selling books online, it now is not only
a dominant retailer, but has pioneered new categories such as cloud computing
and smart speakers.

3M has R&D Internships for students. As an R&D Intern working in their core
discipline areas, the students collaborate with senior 3M researchers on projects
more focused in technologies and products that 3M is best known for. These
include technologies and products based on 3M traditional core technologies—
such as adhesives, abrasives, optical materials, fluorochemicals and advanced
polymers. Or they could also work in any number of 3M’s proprietary process
technologies—including non-wovens, microreplication, extrusion processing and
precision coatings.

And the innovation advancements continue on in all of these companies. Just

Google them to find out what each company is up to!

R&D is powerful stuff, the lifeblood of new product development, the ground-
work of what we refer to as technologically-driven progress. However, R&D
is often seen as an expense that is difficult to quantify, especially in harsh
economic times and tight budgets. Those who do R&D as part of their
routine work activities have a powerful, visceral feel for it. Great leading
companies like Du Pont and 3M swear by its application, and are noted for
continuous innovation over long periods of time—especially Du Pont, one of
the oldest companies in the nation. You might say it is imprinted into the
corporate DNA. The business end of a company can, however, have serious
doubts about just what needs to be done and financed through R&D.

If there is a place a company can quickly lose its edge, it is in R&D. Too many
top-notch organizations succumbed to cutting their R&D budgets—and down
the line, paid the price. To do R&D right, you must know where you are going
and why; and what technologies you intend to use to get there. It is part of the
strategic planning of a company, using its intellectual property and specialized
knowledge to project its competitiveness out into future markets. R&D is the
process that converts uncertainty into risk. It is technological due diligence.

In this volume, I shall combine my 36 years of industrial R&D experience

and new product development, with 10 years of teaching the principles of
R&D project management as an adjunct graduate professor at the New

DO YOUR R&D! 3
Jersey Institute of Technology [Newark College of Engineering]—along
with many publications/presentations on this topic. All this knowledge and
experience gets mixed together with my decade of docent presentations
and special lecturing at the Thomas Edison National Historical Park in West
Orange, N.J. It also includes decades of experience in inventing, patenting
and commercialization, along with some consulting. I hope you enjoy and
profit from learning about R&D.
~Harry Roman

DO YOUR R&D! 4
R&D IN PERSPECTIVE

T
he top five nations spending R&D dollars in 2020 are:

1. The United States—more than $553 billion

2. China—more than $475 billion

3. Japan—more than $186 billion

4. Germany—more than $116 billion

5. South Korea—more than $88.2 billion

And the top companies spending those dollars? In 2020, the top R&D spenders are:

1. Samsung: $14.9 billion

2. Alphabet: $14.8 billion

3. Volkswagen: $14.5 billion

4. Microsoft: $13.6 billion

5. Huawei: $12.5 billion

6. Intel: $12 billion

7. Apple: $10.7 billion

8. Roche: $9.8 billion

9. Johnson & Johnson: $9.7 billion

10. Daimler: $9.6 billion.

This international data is available through various annual R&D reports,

summaries and industry magazines.

DO YOUR R&D! 5
The urgency or intensity with which a nation spends R&D funds can be expressed
by looking at the percentage that R&D funding is to a nation’s economy [GDP].

Obviously, these numbers change from year to year; and the amount of R&D
intensity also varies year to year, among major industries.

Industrial R&D expenditures are likely to reflect the nature of the industry
and its competitiveness. For instance, in the utility industry, the intensity
[measured as a percentage of revenue] is probably less than one percent;
while in the pharmaceutical business, it can be well over 20 percent. The
national average for all industries is about 3.5 percent.

DO YOUR R&D! 6
THE R&D PROCESS

L
et’s examine the simple, seven-step invention process that allows
anyone on the planet—be they professional or amateur—to perform
Edison-style, systematic R&D to create new products. This process
was the magic of Edison, scientifically combining invention with the
marketplace…what we call entrepreneurship. For him, such a process
manifested itself as vertical integration of his talent and resources; but
today, it may be performed in a variety of ways—utilizing partnerships, as
well as shared, or contracted services. Here are the seven key steps:

1) Identify a problem worth solving.

2) Evaluate the economics/market needs.

3) Identify constraints, impacts and challenges.

4) Identify/test potential solutions…invent!

5) Validate invention against steps 1, 2 and 3. Repeat steps 1-5, if necessary.

6) Market the invention.

7) Develop and improve the invention.

This team-based effort is repeatable, and easily understood. It tells us that

invention is an iterative process, tied to an important understanding of what
people want—and what the market is willing to accept as a solution. Further,
once the new product is launched, one must continually develop and improve
it. Inventions designed with constraints—for the social, environmental, legal
and regulatory impacts of the new product on the modern world—must be
given the same fidelity in analysis as the invention's technical and economic
aspects. Thus, we may finally conclude that invention is both interdisciplinary
and multidimensional in its outlook. It is a process that must be planned,
organized and implemented with care and strategic intent. Invention is
definitely, a “leadership” thing.

DO YOUR R&D! 7
R&D AND RISK

T
he complete manager is both a manager and a leader—tactical
and strategic in outlook. In these days of cost-cutting and "next-
quarter-itis," it is easy to lose focus on the strategic aspects of
doing business, especially R&D. Don't fall prey to this trap. It will most
certainly come back to haunt you.

Business is all about taking risks. You wouldn't propose an expensive program
to your senior management, if it contained a high degree of uncertainty; but
you would take one to them wherein you could quantify the risks involved.
We take chances and gamble on things, precisely because we know the risk
or odds for success. Such theory brings me to the value of R&D:

"R&D is the process that converts uncertainty into risk."

Since the future contains all sorts of uncertainty, we do R&D to narrow

that uncertainty down into portfolios of risk we are able to understand,
and concentrate corporate resources upon. It's the vision thing again,
connecting senior management to future dreams—all tempered with
quantitative analysis and realistic odds for success.

Not too long ago, I heard some speakers from one of the national labs quote a
very interesting statistic. Immediately following deregulation of the telephone
industry, severe cost-cutting happened in the R&D areas. Then, more than
a decade later, the industry was spending a total amount of money on R&D
that was at least four times greater than the R&D budgets combined for all
the companies, prior to deregulation. I guess they learned the lesson that the
more competition that exists, the more the need for R&D.

After working 36 years in R&D, and teaching graduate courses about how to
manage it, I offer the following observations—my own personal insights:

• No company ever became great because it cut the most out of its
budget; or downsized better than anyone else; or had the greatest
accounting system for tracking costs; or reduced salaries and fired
everyone over 45. Companies become great because they have the
courage to establish a vision of the future, and pursue that vision with
passion and determination—making adjustments along the way—and
having the stomach and conviction to take the necessary R&D risks.
Great companies dream first, and then plan on how to get the funds

DO YOUR R&D! 8
 to accomplish their goals. They don’t limit their dreams by how much
money they happen to have in their wallets at the time.

• Simply "doing the big deal" is not going to make you a great company
either. The big deals are few and far between. You win by making some-
thing, and then selling it; and doing it before your competitor does. And
once you have established yourself in the market, you do two kinds of
R&D: one that will lead to incremental improvements to keep you ahead
of the copycats; and revolutionary R&D that will catch your competitors
flat-footed—completely by surprise. R&D is a continuous activity of the
modern corporation. It should never be seen as just another expense. It
is an absolutely necessary investment in the future.

• R&D is not for the impatient manager. Leaders know that good technology
takes resources to develop. It is an investment in time, vision and money.
You do R&D when the sun is shining on your business, so there will be some-
thing in the bank when the dark clouds of competition roil overhead. If you
are uncompetitive today, perhaps you did not have the patience and wisdom
to do R&D in the past, to anticipate this situation. R&D is an insurance policy
against the inevitable roller coaster rides of doing business. According to Du
Pont, one of the all-time greats in doing R&D, it takes about 164 raw ideas to
create four really good ones. Be prepared to practice patience.

• Developing technology is not the toughest part of R&D. It’s getting the
buy-in of other company departments. Contrary to popular belief, most
new products fail not because of technological defects. They fail because
the various departments within a company have insulated themselves
from each other, and don't pull together as a team. They have developed
their own cultures. R&D works best in a company when its spirit tran-
scends departmental boundaries—and it becomes, in essence, a corporate
culture. This type of team spirit creates increased corporate cooperation.
About 75% of new product failures are attributed to interdepartmental
breakdowns—the equivalent in football of “fumbling the ball.” R&D project
managers should keep this thought uppermost in mind, if they are
building interdepartmental project teams.

• R&D is supposed to be messy. It is a lot like war. There are false-starts;

weapons that don't work right the first time; and lots of cross-talk
over the airwaves. It's a free and spontaneous exchange of ideas and
concepts, with people trying to make sense out of the uncertainty of the
future. It tries to quantify risk through the scientific process—and the
results achieved from relentless inquiry. To the accountant type, it looks
like an undisciplined process—just ripe for cost controls and monthly

DO YOUR R&D! 9
 progress reports. In reality, from the disarray, something of value to the
company emerges. The leader appreciates the new product idea(s); and
is comfortable managing the ambiguities inevitable in R&D. It is not tradi-
tional project management—and should never be confused with it.

• R&D depends on experienced people who know the history of the company.
They tell you where the dead ends are; they know the right people to talk
to; they can help you put a team in place quickly to solve critical problems;
and, know how to get the real work done. A nurturing environment is essen-
tial to R&D. Good interpersonal relationships and the informal organization
chart drive R&D. That is precisely why it appears to be chaotic. Limit both
of these information networks (relationships and an informal organization
chart), by fear and budgetary intimidation—and the well of creativity will
dry up. No new products will come to the fore. You won't have anything left,
except uncertainty, to deal with—just what your competition would like.

• In an R&D environment, people need to communicate rapidly up, down,

and across the organization, making low/flat organizational structures para-
mount to quick decision-making. Combining these methods with trust makes
for the rapid communication of ideas, and cross-pollination of technological
concepts—powerful stimuli for innovation.

• You are best served by doing both centralized and dispersed forms of R&D;
but just dispersed R&D will never result in competitive advantage. Too many
things work against its success. Too much distributed R&D has resulted
from the misguided notion that every last thing a company does must be
economically justified—immediately, and to the "nth" degree. The result is
often being "penny-wise and a pound foolish." You can have the accounting
correct—and still get your "clock cleaned" by the competition! From my
experience, it is better to be competitive, with some sloppiness in the
accounting, and the hard evaluation of the R&D projects' worth, rather than
the other way around.

To sum up:

• Manage your R&D resources wisely. Not to do R&D is foolish.

• Remember, develop a portfolio of short, medium and long-range

investments; then, have the courage to stay the course. But start...
always start….with what you want to accomplish—don't limit your
dreams by your current corporate allowance.

DO YOUR R&D! 10
• Dream first. Define the future you envision for your company, and plan
the R&D programs, projects and organizational structures that will exploit
your particular strengths; then, figure out how to get the money.

• If money is short, then develop a phased approach to your R&D, one that
sets a timetable with measurable gates, milestones, or critical junctures
for senior management to review and approve. But never lose sight of
that future vision. Build relentlessly toward it.

• Be a leader. Do your R&D!

DO YOUR R&D! 11
R&D PROJECT MANAGEMENT

T
he roots of modern day R&D project management date back to the
late 1800s, when Thomas Edison was forging his invention factory/
industrial R&D concept. It is plainly evident in the small cluster of
buildings [which still stand today for public visitation] that formed the
central focus of his legendary West Orange Labs. Here in his epicenter of
creativity and invention, a two-acre nucleus of buildings formed the heart
of Edison’s revolutionary enterprise…an enterprise that would come to
define today’s modern industrial model.

The small buildings arranged to the side of the main prototyping building
[“invention factory”] contained important specialty expertise and equipment
that Edison needed to support the multidisciplinary nature of invention.
There was a physics/electrical lab, a chemistry lab, a metallurgical shop,
a model-making shop; engineers, scientists, mathematicians, inventors,
technologists, machinists, draftsmen, and electricians supported all these
endeavors. Edison knew way back then that bringing ideas from concept
to market required a multitude of talents and skills. He made sure to have
marketing, legal, accounting, economic and sales expertise onhand, as well.

Today’s modern business structure emerged from this integrated approach

Edison formed for solving problems and launching new products. He became
the preeminent industrial project manager, forming interdisciplinary project
teams, often overseeing as many as 30-40 teams at once. Edison was the
premiere integrated thinker of his time. He matched people, talents, resources
and disciplines to creatively solve multidimensional problems.

It is interesting to note that the two-acre parcel of buildings at West

Orange produced enough new product ideas, to keep the surrounding
twenty acres of massive buildings around it busy turning out new products.
Those factory buildings are gone now; but at one time, the great inventor
had 30 companies and 10,000 employees working under the imprimatur
of Thomas Edison Industries. This foundation was the iron core strength
of the West Orange labs, a focus for turning ideas into new products; and
creating many jobs, as well. In fact, we can estimate the multiplicative
power of Edison’s R&D. We know about 250 people worked in his invention
factory, and in those little specialty buildings. If all that expert brainpower
and value kept 10,000 people employed, then Edison's form of R&D had a
leverage factor of 40 to 1. Why would any executive fight against spending
money on R&D?

DO YOUR R&D! 12
Edison’s seminal work at West Orange succeeds in perpetuating the industrial
revolution of the late 1800s, up to present times. His work literally codifies the
process of conducting and focusing R&D toward the making of new products—a
process that revolutionized the cottage industry of invention into a commercial
powerhouse. In turn, it inspired generations of inventors and entrepreneurs. It
was Edison’s greatest invention.

History aside, R&D project management can be intimidating. Here are seven
best practices to help you get started:

• Read the industry trade presses.

• Investigate technology solutions and talk to the vendors.

• Talk to people in IT and on the business side.

• Figure out where the business value is.

• Understand how the investment can be paid back.

• Look for an open and flexible solution.

• Ask for help when you need it.

DO YOUR R&D! 13
DOING R&D RIGHT

O
ver the three-plus decades I have performed R&D, in my positions as
project manager/program manager, I should like to end this volume
with some tips about doing R&D right. No particular order or priority
here, simply a listing of topics I remember most.

• Be a snowplow for the team. Move obstacles and clear the path for the
team to progress.

• Meet often with your project team. Keep the team engaged, and aware of
how its work relates to the bigger company goals and mission.

• Make sure team members have the ability to grow and mature in their
professions, as well as advancing the team forward.

• If you are managing interdepartmental teams, strive for everyone to

share in the team successes. Keep all the departments represented in
the loop about what is going on. Communicate regularly.

• Make sure the team knows and understands the value to the company
of the R&D being performed. Cost-benefit analyses are important
in keeping the team and its work uppermost in the minds of senior
management. This point is most important. If the R&D is internally
directed, it will result in operating cost and efficiency improvements for
the company.

• Avoid problems between R&D staff and operating department personnel

who “don’t have time for R&D.” When introducing robots into nuclear
power plants, I assembled a team of R&D and operating personnel to
do two important things before any robots were considered for applica-
tion: thoroughly examine the cost-benefits of robots in the plants and
how would they be evaluated; and, identify a variety of early potential
applications. The final team report, which took two years to complete,
was followed by seven years of application and large savings for the
company. It pays to do up-front work and preparation with your team.

• Keep lab notebooks. Document all inventions and new technology developed.
Protect intellectual property! File patent applications; and strictly control new
technology discussions, in both oral and written venues.

DO YOUR R&D! 14
• Thomas Edison had a great four-step philosophy for entrepreneurship,
which is also applicable to R&D project teams:

– Think out-of-the-box

– Be entrepreneurial

– Fail your way to success

– Constantly improve your products and processes

• Make sure your team knows that failure is part of the R&D equation.
Learning from failure is a very powerful way to advance your goals. Hold
post-mortems. Tear down sessions following failures. Learn from the
experiences together.

• Be on the lookout for how the technology your team is developing might
be combined, or used in conjunction with, that of other corporate teams.
Leveraging R&D findings between teams is beneficial. It can lead to whole
new synergies and families of technology your company can use. Inter-
team relationships are both tactically and strategically important.

• Closing out R&D projects and finalizing all costs is just as important
as launching new projects. Make sure this important task is always
performed. It reflects how importantly and seriously you, as a project
manager, regard the company’s resources.

Remember: It is not what you know that is important, but what you can do
with what you know, that positions the company in a strategic position in
the marketplace!

DO YOUR R&D! 15
ABOUT THE AUTHOR

H
arry T. Roman holds 12 U.S. Patents, has received numerous
engineering, invention and teaching awards, and has published
more than 550 scientific papers, articles, monographs and books.
In 1999, the New Jersey Technology Education and Engineering Association
named Roman a Distinguished Technology Educator. In 2005, the New Jersey
Inventors Hall of Fame honored him with an Inventor of the Year award, for
his application of mobile robots in hazardous work environments. In 1996,
IEEE honored Roman with a Meritorious Achievement Award, for developing
continuing education products for IEEE members. Again in 2006, IEEE honored
him with an Outstanding Engineer award. Roman also received IEEE’s 2015
Region 1 Excellence in Teaching award. Every month, more than 250,000
educators read his feature articles appearing in various national publications.

In PSE&G’s R&D group, where Roman worked for 36 years, he directed and
consulted on more than $100 million worth of projects and programs; and he
taught graduate-level R&D project management courses at the New Jersey
Institute of Technology [NJIT]. Throughout his engineering career, Roman
worked with schools around the state, bringing the excitement of real-world
problem-solving into the classroom. Retired since 2006, he has published more
than 70 resource books, math card games and science kits for teachers—
products valued for their “head and hands” approach to teaching, creativity,
invention, STEM, engineering, and alternate energy topics, in the classroom.

Roman now spends many hours in the classroom. He works with teachers
and students in West Orange, Montclair and Livingston, conducting special
student project team challenges. He is an advisor/author to the Edison
Innovation Foundation, and docent/special lecturer at the Thomas Edison
National Historical Park, in West Orange. For the past three years, he
has been teaching graduate school at Montclair State University, in their
teaching college, where he co-teaches a unique course about applying
STEM techniques in the classroom. Roman also admits to writing and
publishing poetry and short stories.

DO YOUR R&D! 16
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