Measurements and Incentives for Central Research

Abstract

OVERVIEW:Corporations everywhere are seeking maximum value from central research and development. R&D productivity measures continue to receive attention, but they introduce risk into the management process, and they do not necessarily impact individual behavior. This article focuses on incentives that motivate researchers and research organizations to maximize their contribution to corporate strategy. In addition to incentives traditionally used in R&D organizations, GM Hughes Electronics has found two new processes to be effective: business unit direction of central research projects, and results-based compensation for every research employee.