June 2012 Vol. 5 Issue 2  CONNECT INNOVATION RESEARCH REPORT Pursuing Emerging Innovation: 2012 Global R&D/Innovation and Product Development Priorities Survey   By Holly Lykke-Ho Gland Research Lead Growth Team Membership™ Frost & Sullivan Frost & Sullivan’s Growth Team Membership™ (GTM) recently completed its 2012 survey of R&D/innovation and product development executives globally. The executives were asked to identify their most pressing challenges for 2012. GTM will focus its best practices research to address the prominent issues identified in the survey. R&D/Innovation and Product Development in 2012—A Snapshot Generating an accurate and relevant technology roadmap is the primary challenge of R&D/innovation executives Insufficient personnel is the root cause of R&D’s primary challenge In comparison to 2011, budgets and staffing levels are expected to increase in 2012 The majority of companies have some staff assigned to open innovation (OI) Open innovation is pursued primarily for idea generation Creating an effective collaboration framework is the primary challenge with open innovation 2012 R&D/Innovation and Product Development Survey Executive Summary This year’s survey indicates R&D executive struggle with two chronic challenges: (1) managing the product portfolio and (2) finding the next disruptive idea. In regards to portfolio management challenges, respondents struggle to develop accurate technology maps for planning, to prioritize innovation projects, and measure their portfolios’ success rate. Overcoming these challenges requires R&D executives to map out their portfolio strategy and develop key performance indicators to guide project prioritization and monitoring. Identifying the next breakthrough idea rarely involves a “Eureka” moment, but does require time and resources. While companies understand the need to develop emerging technologies, they are reluctant to commit substantial resources to high-risk projects. This risk aversion appears to be impacting R&D budget allocations—budgets for incremental innovations are increasing, while disruptive technology budgets remain stagnant. The survey asked respondents to “root cause” their top challenges by indicating if they stem from issues with staffing, process, technology/systems, or strategic alignment. R&D executives attribute their challenges to two primary causes: understaffing and processes (ineffective or nonexistent process). On a more positive note, R&D executives foresee additional resources—both staffing levels and budgets are expected to increase in 2012. Given the pressure on R&D executives to tap into new ideas and emerging technology, survey respondents were asked about their use of open innovation. The majority of respondents employ some form of open innovation team (OI)—typically a small, dedicated sub-group within R&D. It comes as no surprise that OI’s primary role in the product development life cycle is idea generation and that customers are the primary source of ideas. Even though companies are committed to using OI to increase their ability to develop emerging or disruptive technologies, respondents struggle with the fundamentals of establishing an OI process: securing internal buy-in, getting resources for idea testing, and creating a collaborative framework with external partners. Respondent Demographics There were 353 respondents. The respondents work predominantly for privately held (42%) rather than public (40%) companies. The majority of the respondents (61%) work in a business-to-business environment. Most of the respondents (32%) come from firms with revenues below $100 million (USD). Access the full report for a more detailed analysis of the survey results—including budget expenditures and analysis by business model. Access the Americas priorities survey report. Access the European priorities survey report. About the Author Holly Lyke-Ho-Gland is the Research Lead for Frost & Sullivan’s Growth Team Membership™ (GTM), an annual subscription program that supports the individual members of a CEO’s executive team in achieving their company’s top-line growth objectives.                  Now onDemand   21st Century Technology and Business Trends for the Future   The 7 Highly Effective Secrets to Building a Successful Marketing Strategy   A Practical & Accurate Approach  to Estimating Your Product Development Costs   Actionable Insights: The Key to Creating Self-Service Satisfaction   The Enterprise Desktop: From Service Obstacle to Experience Enabler         Share your views and experiences on Innovations in New Product Development—submit a paper, case study, article or blog:   Email Frank Smith for more information and to contribute.       Frost & Sullivan Launches The Team Experience   Help Shape the Event Agenda   We Want Your Input   Subscribe Me   Subscribe a Friend   Forward to a Friend   To Advertise     Event Calendar   Our Solutions   Growth Team Membership™   Chairman's Series On Growth   GIL Global 2012: The Global Community of Growth, Innovation and Leadership   GIL Community Newsletter     Sales & Marketing   Customer Contact   ConNEXTions   Competitive Intelligence   Medical Devices   Click to subscribe to additional eBulletins