Recent Trends in R&D
Global Software Product Market in 2009 is pegged at USD 300-320 Billion. Currently, US contributes to about 52% of this market
The revenue expectations from new product continue to increase, but companies are looking to keep the total R&D investments low.
Companies believe that in next five years majority of the revenues will come from the APAC region and they need to be prepared
Majority of companies are increasing R&D spend in emerging geographies such as India and China for two reasons:
- Reach and understand the unique customer needs of emerging markets
- Reduce R&D cost
For most of the software product companies, the R&D headcount is close to 1/3rd of the total headcount at the company level and people cost contribute towards a significant proportion of the total cost followed by infrastructure, travel and communication
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Zinnov Launches 2010 R&D Benchmarking Studies
Zinnov is launching a comprehensive R&D survey to address the following needs:
- Industry specific PDLC benchmarking: The need to understand how leaders and peer companies are performing across various PDLC specific to industry type. Zinnov R&D benchmarks span across four industry verticals.
- Software/Internet Products
- Semiconductor
- Consumer Electronics
- Telecom and Networking
- Detailed analysis of R&D budget, innovation metrics, Talent, growth markets, Qualitative trends and early signals shaping up the product industry etc.
- Globalization Strategy: Companies often plan and execute their globalization strategy in isolation leading to uncertainties of the value being derived. There is a need to understand the qualitative and quantitative aspects of global sourcing including engagement models, PDLC activity offshored, % of work offshored to Vendor vs. Captive, financial insights etc.
- Lack of Disciplined Methodology:Average of Average really does not mean anything to many executives. Many benchmarking studies do not provide the correct granular level information and aggregate too much resulting in poor decision making. We have designed a powerful methodology to solve for this
- Comprehensive Taxonomy : Our taxonomy and quantitative modeling is very powerful as you will get analysis by R&D Spend, Globalization location, by process, by metrics and by engagement model. A revolutionary approach in benchmarking. Click here to sign up
30 Plus Global Locations Analyzed by Zinnov for tracking talent pool across emerging countries. We have designed a robust quantitative methodology to evaluate the existing and potential talent pool to work in the R&D area (Across verticals and skill-sets) | |
Interesting Graphs from Zinnov 2009 R&D Benchmarking Studies
- Global 1000 R&D investments growth trend
- Total R&D Investments as Percentage of Net Sales
- Globalization Landscape for top 1,000 R&D spenders
- R&D Globalization Intensity for Software and Internet product companies
- R&D Investment by PDLC Stage
- Applied Research effort conversion ratio
- Talent pool landscape in CEE and Russia
- Average Cost per FTE across global locations for R&D
R&D Globalization Trends:
Sound bites from the global grounds:
"It is probably easier to build engineering led products than product management led products from global locations"
Source: VP Engineering of a large product company- Silicon Valley, CA
"We are able to improve agility of our product organization through use of contract/service provider workforce at our global centers. This allows us to manage the needs during release cycles effectively"
Source: PMO – Boston Area, MA
"Innovation capability at global centers is based on the expectation of the global stakeholders. If the expectation is low, the capability tend to be low as well"
Source: Discussions from Confluence 2010- Santa Clara, CA |
