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Improving R&D/Marketing relations: R&D‘s perspective

Ashok K. Gupta

College of Business Administration, Ohio University, Athens, OH 45701, USA

David Wilemon

School of Management, Syracuse University, Syracuse, N Y 13244, USA

Abstract

Successful product innovation hinges on close R&D/marketing relationships, especially in technology-based organizations. How- ever, there is evidence that linkage problems are common and when they are not overcome failure is the usual result.

R&D’s perspective on what R&D, marketing and senior management can do to improve their relationship with marketing is presented. The recommendations are based on suggestions from R&D directors involved in new product development efforts in 83 technology-based companies. Also presented is how the need for integration has changed over time and where it is going in the future.

INTRODUCTION

As American and European competitiveness has slipped in world markets, innovation has become a major corporate priority (Business Week 1989). But the increasing demands for innovation cannot be addressed by the old, segmented organizational structures. Suc- cessful innovation requires integrative approaches to problem solving by interdepartmental teams and organizational cultures that support teamwork.

Successful product innovation often hinges on close R&D/Marketing relationships and teamwork. The quality of these relationships is especially important for high-technology companies facing turbulent and often chaotic environments, For them, continuous marketing of technological innovations is essential for survival. Therefore, a productive and

R&D Management 20, 4, 1990

harmonious relationship between R&D and Marketing is important.

Although R&D/Marketing integration and teamwork is essential for successful innovation, Ruekert and Walker (1987) found that personnel in companies operating in complex and dynamic environments have less favour- able attitudes than their counterparts in relatively tranquil settings concerning how well interdepartmental conflicts were resolved (pp. 242). Gupta and Wilemon found that credibility problems at this critical interface in technology-intensive companies contributed to poor inter-group relationships (1988a, b). Ryans and Shanklin (1986) in their study of high-technology companies, observed that, ‘in spite of the critical need for high-tech companies to link their R&D and marketing efforts, evidence continues to show that linkage problems tend to be endemic to high-tech companies worldwide.’ (pp. 28) Souder’s (1988) study of the conse- quences of R&D/Marketing disharmony on project success suggests that nearly 59% of the projects experienced some type of interface disharmony. He found that most of the projects that experienced harmonious relationships succeeded while most disharmon- ious projects failed.

Why do interface problems exist? The literature suggests several reasons such as problems arising from a lack of mutual respect and credibility; from the use of organizational structures that emphasize seg- mentation rather than integration; from geographic separation of these two groups; from lack of communication; from a lack of senior management support and interest ; from personality differences ; from differ-

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ences in individuals’ orientations such as organizational us. professional ; from corporate culture; reward systems; and incentives (Lucas and Bush, 1988; Souder, 1988; Gupta et al., 1988, 1987, 1986, 1985; Ryans and Shanklin, 1986; Ruekert and Walker, 1987; Kanter, 1983).

The literature also has identified several organizational practices that can facilitate R&D/Marketing integration. In most of these studies R&D and Marketing personnel have not been the basis for recommendations to improve interface relationships. Alternati- vely, recommendations in the literature have been derived from categorical data on successful and unsuccessful projects or data from high and low integration companies.

ASHOK K. GUPTA AND DAVID WILEMON

THE CURRENT SITUATION

RESEARCH FOCUS

This article will present ideas from those directly involved on what R&D, Marketing, and senior management can do to improve the R&D/Marketing relationship. This article reflects R&D’s perspective. The article suggests a number of behavioural, cultural, and organizational changes which can help to achieve cooperation between R&D and Mar- keting. Our recommendations are based on suggestions from R&D directors on improving relationships with Marketing. First, we will present R&D’s perceptions of the current status of the R&D/Marketing interface, how has it changed over the last five years and where it is going in the future. Next, we discuss the actions R&D can take to improve relationships with Marketing groups. R&D’s expectations from marketing and senior management are presented in subsequent sections, along with our conclusions and implications.

Our findings are based on a study of R&D directors involved in new product development efforts in 83 technology-based companies from the chemical, electrical, electronics, information processing, telecommunications, instrumentation and control, and semicon- ductor industries. Our survey relied primarily on open-ended questions. Details concerning our methodology are presented in Appendix 1.

Although a majority of R&D directors (60%) perceive that the need for R&D/Marketing cooperation has increased in their companies over the last five years and the quality of the relationship has significantly improved during this period, about half report dissatisfaction with their interactions with Marketing. They indicated that their relationship with Marketing was ‘average’ or ‘not good.’ About a quarter of the surveyed R&D directors felt that: The degree of conflict between R&D and Marketing is uery high; communication between them is always distorted; and that the conflicts between them have to be frequently resolved by the senior management. About two-thirds (63%) of the R&D directors perceive that the ‘balance of power’ is weighted towards Marketing. Half feel that Marketing does little to understand R&D’s views about product development issues. Figure 1 summarizes these findings. Al- though the quality of this critical interface has improved over the last five years, there is considerable room for improvement.

WHY R&D/MARKETING RELATIONSHIPS HAVE IMPROVED

How has the quality of the R&D/Marketing relationship changed over the last five years? About 60% of R&D directors perceive that the quality of the relationship has improved, while 18% perceive that it has deteriorated. To those R&D directors who mentioned that R&D/Marketing relationship quality had improved or deteriorated, we asked for the major reasons for this change. A content analysis of the responses yielded the following reasons for improvement (Figure 2).

Need for Teamwork

About half of the R&D directors said that R&D/Marketing relationships in their companies improved due to a clear realization on the part of senior management, R&D, and Marketing that teamwork rather than a relay race or sequential approach to new product development is essential in a fast-changing, highly competitive environment. Increased failure of new products, longer product

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Improving RdiDIMarketing Relations : R&D’s Perspective 279

Need for R&D/Marketing integration has increased Dissatisfied with the quality of the relationship

R&D spends considerable effort to improve relations

Marketing spends little effort to improve relations

Quality of RllDlMarketing relationship is poor Marketing information is always distorted

Conflicts are frequently resolved by Sr. Management

Degree of R&WMarkefng conflict is high

0 2 0 4 0 60 80 Percentage of R I D Directors Agreelng (N=81)

Figure 1 R&D’s Perception of the Current Situation

Increased empathy 37

OD programs and HRM practices 35

Institutionalizing integration

0 1 0 20 30 4 0 5 0 60 Percentage of R&D Directors Responding (N=46)

Figure 2 Reasons for Improvement in the Quality of RBDIMarkcting Relations During Last Five Years

development cycles, the introduction of products that customers did not want, were all factors leading to the realization of the need for teamwork. Better and more communication, inclusion of R&D personnel in market research taskforces, formation of small business teams with both R&D and Marketing personnel, and the sharing of marketing data with R&D were all used to generate a team spirit and enhanced relationships among the two groups.

Increased Empathy A second factor in improving relationships was an increase in mutual understanding respect, and trust between R&D and Market- ing. About 37% of the R&D directors cited

this reason for improvement. Several examples that reflected the increased empathy included : having R&D and Marketing managers that understand each other and who maintain good personal relationships; R&D’s realization that its future depends on corporate profitability; greater respect for each other’s pressures and limitations; and R&D’s willingness to respond quickly to help Mar- keting meet its needs. We posit that increased empathy and trust between the two groups also increases the quality of information exchanges.

Changes in OD Programs and HRM Practices About 35% of the R&D directors noted that Organizational Development (OD) programs


280 ASHOK K. GUPTA AND DAVID WILEMON

Emphasis on new products

Change in companyphibsophy 29

Increased competition

Product complexity

Customer sophistication

0 10 20 30 4 0 5 0 Percentage of R&D Dlrectors Respondlng (N=48)

Figure 3 Why the Need for Integration has Increased During the Last Five Years

and Human Resource Management (HRM) practices in their companies had helped to increase empathy and better relationships between R&D and Marketing groups. Some examples of OD programs and HRM practices which R&D found helpful included : Job rotations for R&D and Marketing personnel; in-house seminars on effective teamwork attended jointly by both groups; interpersonal skills development programs; and hiring of R&D people who are sensitive to customer needs and Marketing people with technical backgrounds.

Institutionalizing Integration Senior management support and organizational structures that help institutionalize integration were cited by about 30% of R&D directors as reasons for improved R&D/Mar- keting relationships. Holding regular joint R&D/Marketing meetings with senior management; giving joint responsibility to R&D and Marketing for new product strategy development ; appointing the same divisional head for R&D and Marketing; establishing formal product development processes requiring early integration of R&D and Mar- keting efforts (such as using the Quality Function Deployment technique described by Hauser and Clawing, 1988), requiring joint customer visits; and reducing spatial separation between the two groups are examples of how companies are fostering integration.

However, about 18% of the R&D directors indicated that R&D/Marketing relationships

in their companies have deteriorated over the last five years. Some reasons given include: Role of Marketing not understood by technology-oriented senior management ; Marke- ting’s unwillingness to offer and support new products to compete on non-price variables; Marketing’s unwillingness to spend time in R&D, Marketing’s impatience and desire to dominate; and heavy personnel turnover in both R&D and Marketing thwarted the development of effective long-term relationships.

WHY THE NEED FOR INTEGRATION IS CHANGING

R&D directors strongly believe that R&D/Marketing cooperation is essential for successful new product development. Also, 60% of the R&D directors perceive that the need for R&D/Marketing integration has increased over the last five years. The basis for R&D’s perceptions are given above (Figure 3).

Emphasis on New Products About 44% of R&D directors felt the need for better R&D/Marketing relationships has increased over the last five years due to increased need and emphasis on developing new products. The changed emphasis is expressed in shortened product lifecycles, the need for continuous product improvements, faster product introductions, and declines in competitiveness.


Improving R&D/Marketing Relations .I R&Dk Perspective 28 1

Change in Corporate Culture Many companies have realized that success in product innovation requires better R&D/Marketing relationships; consequently better management of the R&D/Marketing interface. About 29% of R&D directors, for example, pointed to changes in their company’s culture from technology-driven to market-driven over the last five years, thus contributing to the increased importance of better R&D/Marketing relationships. This new corporate philosophy further recognizes the need for : R&D to have a strong customer focus; goal-oriented new product development programs ; building ‘marketing-mus- cle;’ clear distinction between the roles of Marketing and Sales; quick incremental product modifications (rather than slow ‘radically new’ product development); and joint R&D/Marketing new product strategy formation. Such changes have increased the importznce of better R&D/Marketing relationships.

Increased Competition Another reason noted for change in R&D/Marketing cooperation is increased competition. Intense competition led to the changes in company philosophy and increased emphasis on new products which called for greater functional integration. About 27% of the R&D directors perceived increased competition as driving the need for better relationships. The need for quickly developing and introducing products to customers before the competition necessitates closer coordination and cooperation between R&D and Marketing whether in domestic or global markets.

Product Complexity About one-fifth of the R&D directors indicated that the increased complexity of products has also increased the need for closer R&D/Marketing working relationships. Marketing people need better understanding of the technological characteristics of the product and therefore more interaction with R&D. R&D needs greater customer input in designing complex products, therefore, emphasizing greater involvement of marketing

and customers during the product development process. Each feels that the other has something to offer. Due to increased product complexity, they find that their interactions can be more profitable.

Customer Sophistication Some 10% of R&D directors pointed out that customers are becoming more demanding and less forgiving. Couple this with growing competition, the importance of the RBrDIMarketing relationship increases. As one R&D director said, “If we cannot deliver what customers want due to the infighting between R&D and Marketing, they will go elsewhere. And believe me, there are lots of companies waiting to get our business.”

WHAT CAN R&D DO?

We asked R&D directors, “What can R&D do to improve its relationship with Marketing and achieve greater integration efforts?” We received 278 responses from 80 R&D directors. The results of the content analysis of their responses is summarized in Figure 4. The actions they suggested for improving relationships with Marketing included :

Promote Mutual Understanding About 82% of the R&D directors emphasized the need to ‘just talk more often,’ plan frequent meetings and to communicate with Marketing directly, not via senior management. R&D directors emphasized that they could encourage Marketing to visit R&D labs and develop programs for marketing which explain R&D activities, technological choices and their business implications. R&D could visit customers with Marketing and send their people to Marketing seminars and presentations.

Encourage Teamwork A majority of the R&D directors (59%) said that they could encourage a team approach to developing new products by involving Mar- keting in setting R&D’s research direction and by jointly developing new product strategies, schedules, and objectives. R&D could



Promote mutual understanding

Encourage teamwork

Be more responsive to market needs

Promote quality information exchanges

Increase involvement in formulating business strategies

0 20 4 0 6 0 8 0 100 Percentage of R&D Directors Responding (N=80)

Figure 4 What can R&D do?

work with Marketing to set project priorities. This is particularly important due to the increased product complexity and customer sophistication.

Be Responsive to Market Needs About 40% of the R&D directors suggested their relationships with Marketing could improve significantly if R&D would become more responsive to market needs and pressures. R&D could, they said, become more tolerant of frequent product changes request- ed by Marketing, respond more quickly to Marketing’s requests, develop a sense of urgency, honour mutually agreed upon dead- lines, and consider more pragmatically the use of market data in technical decision- making.

Quality Information Exchanges To establish credibility and trust, R&D people could provide more useful information to Marketing than mere technical details. R&D could ask Marketing to provide information which is useful to them. This requires telling Marketing what information is useful to R&D. About 29% of R&D directors gave examples which explained this point. They suggested that R&D could ask for justifica- tion of requests from Marketing; could publish reports for Marketing that substanti- ate product claims ; provide reliable project status reports to Marketing; could provide technical assessment of competing products ; and could provide documentation of product

applications. R&D also could improve Mar- keting’s recommendations by demanding that they be based on thorough, objective joint research (Gupta and Wilemon, 1988b).

Involvement in Business and Marketing Programs R&D directors emphasized a strong need for R&D people to come out of their labs and join the mainstream of business. This not only makes good business sense, it may help R&D over the long haul by stimulating new business and by generating additional fund- ing for future R&D activities. Some 29% of R&D directors suggested that R&D could get involved in Marketing programs such as developing advertisement claims, attending trade shows, and preparing user manuals and helping make sales presentations. The impact of such activities on R&D is an important area for future research.

R&DS EXPECTATIONS OF MARKETING

Seventy-nine R&D directors said what they ‘wished’ Marketing people would do to achieve better R&D/Marketing relationships. A summary of their 177 statements is given in Figure 5 . Details are provided below.

Be A Team Player R&D directors wanted Marketing to be an active team player during the entire new product development process. About half of

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Improving R&D/Marketing Relations : R&D’s Perspective 283

Encourage Teamwork

Promote mutual understanding

Improve marketing research

Hire more qualified people

Balance long and short term needs

Develop clear product specifications

0 1 0 2 0 30 40 5 0 Percentage of R&D Directors Responding (N=79)

Figure 5 What can marketing do?

the R&D directors wished that Marketing would get involved early, communicate frequently, and openly share business priorities and time schedules. R&D directors also want Marketing to treat R&D as an ‘equal’ and share credit for new product success with the same enthusiasm as failures.

Promote Mutual Understanding About 38% of the R&D directors want Marketing to help R&D understand Market- ing, its pressures, and its constraints. At the same time, R&D directors want Marketing to develop greater appreciation for technology and its limits. R&D would like Marketing people to visit their labs, exchange personnel periodically, socialize more often, and take them on customer visits.

Improve Marketing Research The quality of marketing research was of considerable concern to about one-third of our sample. They suggest that the R&D/Mar- keting relationship could be improved significantly if Marketing paid adequate attention to the quality of their research by relying more on facts and less on opinions. The directors want R&D to be included in the market research process right from the beginning so that important questions would be asked and a better understanding of

customer needs and market potential could be achieved.

Hire More Qualijied Personnel Some of the R&D directors were concerned with the quality of the Marketing personnel in their organizations. About 27% felt that many Marketing people did not really know enough about Marketing to be effective. Some of the R&D directors indicated that their company’s Marketing people had a sales orientation and not real Marketing expertise. The R&D directors suggest that Marketing departments should hire people who are innovative, risk-takers, willing to learn, have technical backgrounds, and understand the significant role Marketing can play in new product development.

Balance Long- and Short- Term Needs About a quarter of the R&D directors wanted their Marketing counterparts to develop a balanced orientation toward long- and short- term goals. They felt that Marketing’s orientation was too short-term. The R&D directors emphasize the need for Marketing to help align R&D goals to corporate objectives. The directors also wanted Marketing to assign some of their people to explore long-term projects with R&D.

R&D Managemenr 20, 4, 1990


Show personal interest in Prod Dev Perceive R&D as business partner

Reward R&D/Marketing jointly Balance long and short-term requirements

Understand Marketing’s importance Encourage greater communication

Change organizational structure Support training programs & seminars

Increase resources Change hiring policies

Encourage teamwork

0 1 0 20 3 0 4 0 5 0 Percentage of R&D Directors Responding (N=73)

Figure 6 What can senior management do?

Develop Clear Product Specifications Twenty-one percent of R&D directors wanted Marketing to develop product specifications in consultation with R&D and ‘real’ customers. While studying customer requirements of new products to develop product specifications, Marketing also needs to assess service requirements. Failing to identify service requirements can contribute to product failure. While developing specifications, Marketing would be in a position to appreciate the design issues involved in new product development and would be practical or at least realistic with respect to cost and features. The Quality Function Deployment (QFD) technique described by Hauser and Clawing (1988) seems beneficial for defining product specifications and integrating R&D, Marketing, Manufacturing, and Engineering personnel. Quality Function Deployment is a formal procedure that facilitates communication between various functional groups and helps to integrate customer requirements of a product during its design stage.

R&DS EXPECTATIONS OF SENIOR MANAGEMENT

We asked R&D directors, “What would you like senior management to do to improve R&D/Marketing relationships in your organ-

ization?” We received 240 statements describing R&D’s expectations of senior management from 73 R&D directors. About a quarter of our respondents also said that senior management is currently doing ‘little’ to improve R&D/Marketing relationships. A summary of their comments is presented in Figure 6 while the specific details are discussed below.

Encourage Teamwork Management needs to realize that new product development is a team-task involving various functional groups. About half of our respondents suggested that senior management needs to encourage and emphasize teamwork. Senior management can promote joint R&D/Marketing discussions, joint planning and budgeting, joint market research, and joint reporting to them.

Show Personal Interest in NPD Simply emphasizing and encouraging teamwork is not enough. About 36% of the R&D directors suggest that senior management must also exhibit its commitment and interest to innovation. This could be done by attending product planning meetings, project status meetings, and by holding periodic off-site review meetings. Senior management could


Improving R& DIMarketing Relations : R&D’s Perspective 285

also ‘become’ part of the NPD team by accompanying R&D/Marketing in their visits to important customers.

Perceive R&D as ‘Business Partner’ Some R&D directors (29%) feel that R&D is left out of the mainstream of business and experiences a subservient status in the organization. They want to be included in more business decisions related to technology and new products. They also want to provide technical assistance for product modifications, assume primary cost and productivity responsibilities, and establish customer con- tacts to understand their new product requirements first-hand.

Reward R&D/Marketing Jointly The issue of reward equity for R&D and Marketing was raised by some 25% of the R&D directors. To make team efforts work, they suggest that senior management jointly rewards R&D and Marketing and makes the successful team heroes (Reich, 1987). Team rewards beyond annual bonus based on corporate performance need to be imple- mented. Recognition of the entire NPD team also was suggested. Many R&D directors indicated that R&D does not get rewarded for a product’s success to the same extent that Marketing does.

Balance Long- and Short- Term Requirements About a quarter of the R&D directors suggest that senior management needs to balance short- and long-term business needs. They emphasize that R&D and Marketing could be expected by senior management to develop short and long-term goals for incremental product improvements and for major product breakthroughs. Senior management could learn to identify changes taking place in the corporation’s environment and foresee their short and long-term impact on business. R&D directors do recognize the pressures senior management faces that forces them to adopt short-term orientations. They suggest, however, that senior management neverthe- less needs to consider the long-term implications of their actions.

Understand Marketing’s Importance Several of the R&D directors in these technology-intensive organizations felt that their senior management does not have an appreciation of Marketing’s role in new product development. About 22% suggest that senior management needs to develop a much better understanding of markets and Marketing. Marketing should be required to get involved with R&D at an early stage of the product development process. It was emphasized that strategic marketing planning should be carried out by Marketing in collaboration with other functional groups, and not done alone, if a company is to achieve excellence.

Encourage Greater Communication To improve the R&D/Marketing relationships senior management could communicate directly to R&D and Marketing and encourage middle managers to pass on ideas from ‘the bottom’ to the top and share top management’s vision and strategic concerns with them. To facilitate organizational learn- ing, open discussion of product success and failure should be encouraged. Some 20% of the R&D directors suggest that bureaucracy and paperwork be replaced with informal face-to-face communication. Teams could be encouraged to solve their problems them- selves, rather than relegate them ‘upstairs’ for resolution.

Change Organizational Structure About 20% of the R&D directors suggest that senior management needs to make important organizational structural changes to facilitate greater communication and better relationships between R&D and Marketing. The changes suggested include : locating the two groups together; placing one person in charge of product development and Marketing; and creating ‘integrator’ roles ; to develop healthy working relationships and increased communication between R&D and Marketing. The emphasis recommended would be on ‘coordination and communication,’ not on ‘command and control’ (Reich, 1987).


286

Support Training Programs and Seminars Sixteen percent of the R&D directors in our sample suggest that senior management would do well to encourage and provide resources for seminars, workshops, and training programs for R&D and Marketing personnel. The purpose of these would be to develop a better understanding and appreciation for each other’s roles, constraints, and pressures. This can help build trust and credibility, important for productive teamwork. Our research reveals that the majority of R&D directors (62%) have not attended such programs and 84% of those who have attended them did not find them very useful. It is, therefore, suggested that greater attention be paid to developing more productive training programs.


sonnel with science and engineering backgrounds.

Increase Resources About 16% of the R&D directors suggest that greater allocation of funds and personnel be made to R&D and Marketing in order to work on new products. They pointed out that Marketing people are often preoccupied with existing products. Thus, some Marketing personnel should only be given responsibility for new products. If additional resources cannot be made available, senior management needs to restrict the number of ongoing projects based on their importance to the organization.

Change Hiring Policies About 12% of the R&D directors in our sample pointed to the discrepancy between hiring practices and that organization’s innovation strategies. If the organization is not going to engage in extensive basic research, it should hire R&D personnel who appreciate having a customer focus and who perceive incremental innovation as worthwhile. It was emphasized that such companies should not hire researchers who believe that their performance will primarily be evaluated by the research papers they produce. The R&D directors also suggest that in addition to considering the technical competence of R&D candidates, their interpersonal skills should be evaluated too. R&D directors further suggest hiring more Marketing per-

CONCLUSIONS AND IMPLICATIONS

The importance of better R&D/Marketing relationships has increased over the last five years. During the same period, the quality of relationship has also improved. Neverthe- less, about half of the R&D directors responding to our survey report dissatisfaction with the quality of the R&D/Marketing relationships in their own organizations. The new realities of the marketplace character- ized by increased emphasis on new products; a need for faster product development; greater competition ; increased product complexity; increased customer sophistication; and a greater reliance on strategic alliances with external organizations have necessitated an even more harmonious and productive R&D/Marketing interface. R&D’s prescrip- tion for improved relationships is summarized in Figure 7 in descending order of importance. Its suggestions to improve the relationship with Marketing centre on the following :

Emphasizing Teamwork The new global competitive environment requires that companies must innovate quickly, continuously, and collectively. This necessitates close working relationships among people at all stages of the new product development process. Designers and engi- neers must be familiar with Sales and Marketing and vice versa (Reich, 1987). Most of the R&D directors in our study suggested a greater need and desire to learn about Marketing. Similarly, they want Mar- keting to acquire greater appreciation for technology and technology management. Bower and Hout (1988) report that companies that are able to bring out new products faster in the marketplace organize work in small, self-managing, and multifunctional teams. Wind and Mahajan (1988) observed that parochial approaches to new product development have contributed to high product failure rates, a proliferation of non- innovative products, and a large number of poor quality and/or low value products.

Improving RdDIMarketing Relations : R&D's Perspective 287

SUMMARY

TO IMPROVE R&D/MARKETING RELATIONSHIP

R&D Can

Know marketing, help Marketing understand R&D

Encourage team approach to NPD

Be more responsive to market needs

Give and demand better quality information to Marketing

Increase involvement in business and marketing programs

Marketing Can

Be a team player

Understand R&D, help R&D know Marketing

Improve marketing research quality

Hire more qualified personnel

Balance short and long-term needs

Clearly define product specifications

Senior Management Can ~ ~~

Encourage teamwork

Show personal interest in product development activities

Perceive R&D as business partner

Reward RLD and Marketing jointly

Balance long and short-term business needs

Understand Marketing's importance

Encourage greater communication

Change organizational structure

Support training programs and seminars that emphasize integration

Increase resources

Change hiring policies

Figure 7

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288

Senior management can play an important role in encouraging teamwork. They must recognize that integration of efforts is essential and must be achieved. Senior management can encourage joint R&D/Marketing discussions, joint planning and budgeting, joint market studies, and even joint reporting in some situations. It also needs to take personal interest in achieving successful new product development efforts. Senior managers also can attend joint product planning meetings, project status meetings, hold off- site joint review meetings, and accompany R&D/Marketing teams to visit and learn from key customers.


standing of each others’ pressures; and responsiveness, extra efforts need to be made to change the organizational structure and reduce the spatial and social separation between them. Spatial separation could be reduced by housing the two groups in the same building, on the same floor, and adopting an open office interior design (Raab, 1988). In addition, a few individuals could be assigned as integrators. These individuals would act as linking pins, thereby increasing communication and coordination. Social get-togethers, job rotations, joint customer visits, and joint attendance in seminars and workshops help reduce social separation and increase mutual understanding, trust, and creativity. The possibility of joint studies of market opportunities for new products and of developing accurate product specifications may also be realized. R&D may feel more integral to the process and will be far less likely to resist incorporating changes in product specifications.

Rewarding Teamwork To promote cooperation and collaboration among people team rewards and recognition can help. As Reich (1987) argues, “we must begin to celebrate collective entrepreneur- ship, . . . we need to honor our teams, . . . we need to downplay the myth of the entrepren- eural hero and celebrate our creative teams.” In our interviews with R&D and marketing managers during another study we found that beyond a banquet or a plaque, team efforts usually are not recognized. For the most part, team members are rewarded individually. Many R&D directors perceive lack of equity in reward systems that favour Marketing. Such a system is not conducive to interfunc- tional teamwork. R&D directors also often feel that they are ‘left out’ of main business streams and, too often, only enjoy ‘second class’ status. A good way to motivate R&D and help build effective teams would be to include R&D in strategic business decisions; recognize the importance of technology in creating competitive advantage ; change the way R&D’s performance is evaluated; and assign cost and productivity responsibilities to R&D besides basic research (Mower and Wilemon, 1989). This way also helps to levelop a balanced long- and short-term xientation in the organization.

cacilitating Communication The natural tendency of individuals is to form :ommunication and social networks with hose who are nearby and alike. To facilitate :ommunication; interaction; trust; under-

Increasing NPD Resources Personnel, time, and money were often perceived as key resources by our R&D directors. Some of the pressure for these resources could be relieved if the number of ongoing projects could be restricted based on a priority system within the organization. Management, therefore, needs to align its NPD projects with company objectives.

R&D directors also were concerned with the quality of Marketing personnel. Many feel that the Marketing people they deal with do not fully understand the role of Marketing in new product development; do not differen- tiate between Marketing and Sales; and often do not appreciate and understand technology. There also is need to examine the hiring practices of Marketing and R&D personnel (Lucas and Bush, 1988). In describing Du- Pont’s experience with managing innovation, Cohen (1988, p. 48-49) suggests, for example, that, “In selecting a staff that will minimize risk in new ventures, we found that the best candidates were not necessarily outstanding scientists but practical problem-solvers and team players. In general, personnel with multidisciplinary skills do better than special- ists. Most important, they must be comfort- able with change.”


Improving R&D/Marketing Relations : R& D’s Perspective 289

Bobby Inman, Exceutive Committee mem- ber and Project Adviser for a report prepared by the Council on Competitiveness in the U.S.A., notes, that, “Global competition has created new ground rules for technology. The keys to success are speed and teamwork. We’ve been too slow, too fragmented, too uncoordinated, and too adversarial. We’ve got to be faster, more focused, and more collaborative.” It is the premise of this paper that through the education and careful consi- deration of both context and contributions of all members in the innovation process, the changes envisioned by Inman can best be understood and achieved. In this paper R&D’s perspectives have been provided to achieve just these results.

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ACKNOWLEDGMENT

Research support from the College of Busi- ness Research Grant at Ohio University is gratefully acknowledged. The authors would like to thank Susan Thomas, our research associate at Syracuse University, for many helpful comments during the preparation of this manuscript.

APPENDIX 1

Research Methodology The data were collected via a survey of R&D directors in 83 technology-based companies. Companies with R&D expenditure of at least 2% of sales were selected from chemical, electrical, electronics, information processing, instrumentation, semiconductors, and telecommunications industries. three hundred and thirty-six (336) such companies were selected from Business Week’s Corpo- rate R&D Expenditure Survey.

Eighty-three R&D directors responded to our survey resulting in a response rate of 24.7%. Industry representation of respondents in the sample was similar to that of population.

The questionnaire consisted of several open-ended questions which asked the respondents :

1. Has the quality of the relationship between R&D and Marketing in your organization improved in the last five years? How? Why?

2. Has the need for R&D/Marketing cooperation in your organization increased in the last five years? How? Why?

3. What is R&D currently doing and what could it do to improve relations with Marketing?


4. What is Marketing currently doing and what could it do to improve relations with R&D?

5. What is Senior Management doing to improve R&D/Marketing relationships? What could it do?

Responses to these open-ended questions were content analyzed. The survey respondents also were asked to state their perceptions of the quality of R&D/Marketing relations ; their satisfaction with it; the degree of conflict at the interface; the balance of power between R&D and Marketing; the efforts invested in understanding the other party’s point of view; and the frequency with which conflicts had to be resolved by senior management. A seven- point Likert scale was used to measure their perceptions.

The demographic profile of our R&D respondents is as follows.

Average :

Total work experience How long with present

How long in present

Worked in non-tech

Percentage : Worked in non-technical

Undergraduate degree in

Undergraduate degree in

Graduate degree in

Graduate degree in

MBA Ph.D.

Age

company

position

department

department

Engineering

Science

Engineering

Science

46 years 23 13

4

3 years

27%

46%

41

25

35

16% 34

RdiD Management 20, 4, 1990

improving r\u0026d/marketing relations: r\u0026d's perspective

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