Exploring the differences in performance measurement between research and development: evidence from a multiple case study

Abstract

Researchers and practitioners have recently paid great attention to research and development (R&D) performance measurement, although it is acknowledged to be a very challenging task because of R&D intrinsic uncertainty and complexity levels. In this paper, the problem of designing a performance measurement system (PMS) for R&D activities is addressed; specifically, we investigate if and how the design of the PMS is influenced by the type of activity it is applied to, namely Basic and Applied Research or new product development (NPD). We first develop a theoretical framework that comprises the main constitutive elements of a PMS for R&D. Then the framework is used for supporting a multiple case study analysis involving eight Italian technology-intensive firms. The research results show that the criteria for designing the constitutive elements of the PMS are radically different in Basic and Applied Research and NPD. The reasons behind the observed dissimilarities in the design criteria are widely discussed in the paper, as well as their implications for R&D managers.

R versus D: estimating the differentiated effect of research and development on innovation results

“…Research is considered a more complex activity (Leifer and Triscari, 1987;Chiesa and Frattini, 2007), involving the performance of more non-routine tasks than development and with a greater importance of discontinuous jumps in contrast with the more incremental nature of development (Karlsson et al, 2004). In addition, the time horizon is much longer in research than in development, where pressure to market usually constrains it between six months and two years.…”

“…They establish close links with production and marketing departments and, ideally, also with actual or potential customers (Leifer and Triscari, 1987). In addition, they build much upon team work, usually interdepartmental (Chiesa and Frattini, 2007).…”

“…In addition, researchers should be given the opportunity to take an occasional break such as a sabbatical and to be involved in a variety of projects .To sum up, research needs to be very open and sometimes borders on chaos (Chiesa, 2001). On the other hand, development is much more subject to formal planning, with a clear definition of hierarchy and fixing project milestones and pressuring on deadlines (Chiesa and Frattini, 2007), so that any significant deviation of the plan should become the subject of formal discussion (Chiesa, 2001).…”

“…People involved in development activities are required to have a broader perspective, covering science, engineering and the market, and be able to manage across different corporate functions. Moreover, while in research the most creative people should not become managers, in development people should have an entrepreneurial spirit and combine a long-term strategic view with day-to-day activities (Chiesa and Frattini, 2007).…”

“…style of management, as is shown by case studies and the opinion of R&D managers (see Chiesa and Frattini, 2007). In fact, research and development are usually performed by different departments of the firm which are under the responsibility of different managers.…”