ATP's Impact on Accelerating Development and Commercialization of Advanced Technology*
Frances Jean Laidlaw
Motorola, Inc.
Schaumburg, IL 60173

Abstract

One of ATP's legislated mandates is to accelerate industry's development and commercialization of new technologies. This survey of 28 projects funded in 1991 found that ATP helped cut technology development cycle time by 50% in most cases. Slightly more than half of the interviewees provided quantitative estimates of the economic value of reducing cycle time by a single year. Most interviewees expected the positive impact on cycle time experienced in the applied-research stage to flow through to later stages in the technology development cycle allowing them to enter the marketplace more quickly. Cycle-time improvements in other technology development projects were attributed by the companies to their ATP project. Two types of acceleration were implied: (1) overcoming delays in starting technology development projects, and (2) speeding up performance of research once it is under way.

Introduction

This paper is based on a study to evaluate the impact of the ATP on applied research cycle time of companies participating in the program. A larger objective was to determine if the ATP is successfully meeting its legislated mandate to accelerate the development and commercialization of technology. The study focused on applied research cycle time, because high-risk applied research is largely what the ATP funds, and at this still early stage of the ATP that is the period of time most feasible to evaluate. Although there is a large body of literature and an established discipline on improving production cycle time and even product-development cycle time, this is not the case for applied-research cycle time. The investigation of applied-research cycle time is a relatively new and emerging discipline.

Why Reduce Cycle Time?

McGrath, Anthony and Shapiro stated:

If manufacturing and total quality management were viewed as the industrial battlegrounds of the late 1970s and 1980s, product development and cycle-time reduction are the battlegrounds of the 1990s. The advantages that come from reducing time to market and consistently developing better products are so significant that they will shift the competitive balance in favor of companies that can achieve them first. A company that can efficiently introduce more new products, react faster to market and technology changes, and develop superior products will win battles with its competitors. The key to achieving these advantages is improving the product development process and getting to market more quickly. This is why it will become the battleground of the 1990s (McGrath, Anthony, & Shapiro 1992).

Though most of the articles to date on reducing R&D cycle time focus more on the "D" (development) than the "R" (research), an article that highlights industry's increasing interest in reducing applied research cycle time is Bob Burkhart's "Reducing R&D Cycle Time," prepared for the Industrial Research Institute (IRI). It states that research at the "fuzzy front end" carries high uncertainty; and successful output cannot be readily scheduled, as with the development phase. Only after identifying the potential causes for uncertainty in the decisions and activities of the research phase might barriers be reduced or removed by applying appropriate solutions; for as knowledge grows, risk recedes and the capacity to advance in a shorter time frame materializes.

Research Design

The study assessed the impacts on cycle time of participating in the ATP, based on a telephone survey of the twenty-eight 1991 ATP awardees. The 28 awardees surveyed included 18 single company awardees and the lead organization of each of 10 joint venture projects. Together, the 28 projects in the sample comprised 10% of the projects the ATP had funded as of the time the study was performed. Interviewees were encouraged to be candid and forthright with their responses. They were assured that their individual responses would be without company or personal attribution.

Table 1. Taxonomy of 1991 interviewees

1. How important is it for your company to reduce cycle time (time to market)?
   
2. Why is it important for your company to reduce applied research cycle time?
   
3. How much (by what percent change) did participation in the ATP affect your ATP project's applied research cycle time?
   
4. Do you expect the impact on cycle time in the applied research stage to flow through to other stages in the technology development life cycle?
   
5. Can you give a ballpark estimate of the economic value of reducing your cycle time by one year?
   
6. How were the cycle time improvements achieved (i.e., what did you do differently as a result of participating in ATP)?
   
7. Did the cycle time improvements (that were a result of participating in ATP) carryover to other technology development projects outside of the ATP project?

Research Results

The research results describe the impact that the ATP program had on the 28 awardees from the 1991 competition, as related by the principal investigator of each project's lead organization. No attempt was made to generalize the results beyond the particular cases studied.

The Importance of Reducing Applied Research Cycle Time

Twenty-seven, or 96% of the 28 interviewees, indicated that it was "very important" for their companies to reduce cycle time, while 1 (4%) indicated that it was "important." These results are consistent with findings from an open literature review that found that cycle-time reduction was viewed as important because it enhances a company's global competitiveness and helps a company to better achieve its performance goals. These results are also consistent with (though not identical to) findings from other studies.

Reasons to Reduce Applied Research Cycle Time

When the 28 interviewees were asked "Why is it important for your company to reduce cycle time?" most gave more than one reason. There is obvious overlap among the types of reasons given, but in order to preserve the flavor of the responses, these were kept separate rather than grouped under umbrella headings:

1. Meet Competitive Challenge [12 interviewees]
   
2. Satisfy Customers [9 interviewees]
   
3. Attract Additional Capital [8 interviewees]
   
4. Enhance Technology Development Process [7 interviewees]
   
5. Reduce Costs [6 interviewees]
   
6. Survive [5 interviewees]
   
7. Enhance Quality [5 interviewees]
   
8. Increase Return on Investment (ROI) [5 interviewees]
   
9. Respond to Changing Market [3 interviewees]
   
10. Dominate Market [3 interviewees]
    
11. Reduce Risk [3 interviewees]
    
12. Grow [2 interviewees]
    
13. Increase Sales Volume [2 interviewees]
    
14. Increase Market Share [2 interviewees]
    
15. Combat Perceived Weakness [2 interviewees]
    
16. Develop Critical Capability [2 interviewees]
    
17. Take Advantage of Window of Opportunity [2 interviewees]
    
18. Collaborate [2 interviewees]
    
19. Choice of Competitive Strategy [2 interviewees]
    
20. Maintain Technical Leadership [1 interviewee]
    
21. Establish Intellectual Property Rights [1 interviewee]
    
22. Follow Industry Practice [1 interviewee]

The finding that the most frequently given reason to reduce applied research cycle time was to meet competition is consistent with the paramount finding from the literature review that cycle-time reduction is important because it enhances global competitiveness. Other research that has explored the relationships among technical content, innovation, cycle time, and break-even time, has found that increasing technical content and degree of innovation has strong delaying effects on cycle time. As postulated by Powell (1998), ATP's acceleration of cycle time may to some extent offset the negative effects of innovation on cycle time.

Impact of ATP Participation on Applied Research Cycle Time

To the question, "How much (by what percentage change) did participation in the ATP affect your ATP project's applied research cycle time?" the median response of the 28 interviewees was that participation in ATP reduced their ATP project cycle time by 50% or 3 years (see Table 2). The median response was that without ATP, the same project would have taken 6 years. In terms of years saved, the range was from 1 to 2 years at the low end, to 10 years and more (infinity) at the high end. In terms of percentage cut in cycle time, the range was 25% to 80%.

Table 2. Impact of ATP participation on applied research cycle time

Flow-Through of ATP's Impact on Applied Research Cycle Time to Later Stages in the Technology Development Life Cycle

When asked, "Do you expect the impact on cycle time in the applied research stage to flow through to other stages in the technology development life cycle?" 24 (86% of the 28 interviewees) said yes. One interviewee suggested that this is better described as a cascade effect, not a flow, since it is not linear. He described it as a driving force that has a broad effect. This implies that, at least in some cases, speeding up the R&D may have a disproportional impact on the later stages in technology development.

Economic Value of Reducing Applied Research Cycle Time By One Year

When asked, "Can you give a `ballpark estimate' of the economic value of reducing applied research cycle time by one year?" 22 (79% of the 28 interviewees) gave either a quantitative or qualitative "ballpark estimate." Fifteen, or 54% of the 28 interviewees, gave a quantitative estimate.

Table 3. Ballpark estimates of economic value of a one-year reduction in applied research cycle time, in order of decreasing value

ATP Effects that Helped Reduce Applied Research Cycle Time

When the 28 interviewees were asked "How were the cycle-time improvements achieved; in other words, what did you do differently as a result of participating in ATP?" they gave 58 answers. When the answers are grouped by the type of ATP practice that helped interviewees reduce cycle time, we find that there are five major ATP categories. Table 4 shows aggregate total frequencies and percentages.

Table 4. ATP effects that helped interviewees to reduce cycle time

1. ATP's Required Project Planning and Management [15 interviewees]

For this sample of 28 interviewees representing 28 projects from the 1991 competition, the detailed project planning that ATP required and the project management it provided to ensure that companies followed the project plan were most frequently cited as the ATP effect that helped interviewees to reduce cycle time. It was felt, in general, that the well laid-out plan required by ATP from the companies lent stability to the applied research program. According to one interviewee: "Of greatest value, with ATP we had a well-laid-out plan, and followed the plan without interruption. Without the ATP plan, the vagaries of our business would have caused us to vary the plan. If we were not having a good year financially, we would probably have pulled the plug but ATP's involvement lent stability to the research program." ATP's requirement for an integrated business and R&D plan with its emphasis on concurrent engineering seemed to speed things up. This was described by one interviewee: "For us, product testing typically comes later in the product development cycle. ATP wanted us to work early-on with potential customers and users. One of our primary interests from the very beginning was to work with potential users. We wanted to work in a `true manufacturing envelope' with `true manufacturing equipment.' ATP made this happen." Other project planning and management techniques that were said to be important to cycle-time reduction and attributed to the ATP involvement included: using a systematic approach; developing definable time lines and value; benchmarking and selecting technology applications; integrating the voice of the customer; assuring quality; and enhancing documentation procedures.

2. Achievement of a Critical Mass of Resources Through ATP Funding [12 interviewees]

ATP funding was important to applied research cycle-time reduction because it enabled interviewees to gain the critical mass of resources necessary to conduct the applied research. This was mentioned by interviewees from small for-profit companies, medium-to-large for-profit companies, and nonprofit consortia. For most interviewees, this meant increasing staffing, but a couple mentioned material resources, and one said that the company was able to more fully dedicate existing staff to the applied research project. An interviewee from a large company stated: "Major companies are structured into decentralized divisions each little fiefdom (division) has a budget. Our division didn't have adequate funding to pursue this project." An interviewee from a small company stated, "ATP enabled us to acquire a critical mass of resources. The corporation has limited resources. We looked around. We wouldn't have had enough resources to reach critical mass to develop and leverage resources. As a small company, we wouldn't have been able to do the R&D, period."

3. Attraction of Additional Financial Support through ATP "Halo Effect" [12 interviewees]

Some interviewees mentioned their improved ability to stimulate interest and acquire capital to continue pursuing their advanced technologies as an important ATP effect on cycle time. The additional infusion of capital was said by some to have been critical. Many of the scientists and engineers appear to have taken on an entrepreneurial role to support and speed the development of their technology.

4. Greater Project Stability Through Focus on Technical Issue [10 interviewees]

Six interviewees commented that participating in the ATP enabled them to shorten the applied research cycle time by allowing them to concentrate on solving the technical problem.

5. Enhanced Collaboration [6 interviewees]

Six interviewees said ATP enhancement of collaboration helped reduce the applied research cycle time. Four interviewees explained that: "ATP brought strange bedfellows together who were competitors. ATP also brought members of the supply chain together to define what they needed in the supply chain. As a result, it helped us and other members of the supply chain to move further, faster." "Perhaps most importantly, ATP brought competing companies together. This would not have otherwise happened. They never would have worked with each other without ATP. Within mega-corporations, there is oftentimes much personal competition between the senior executives. The benefit of a joint venture is that senior executives from different companies are sometimes more willing to share ideas with executives from other companies than with peers in their own organization. This enhances the innovative thinking and collaborative processes. The members of the ATP joint venture were so compatible with each other that they moved smoothly like a dance team it got to the point that in meetings that they were building on each other's words and finishing each other's sentences." "Beyond enhancing collaboration between competitors, ATP enhanced collaboration between technology developers and technology purchasers. We developed the technology in a joint venture partnership. Two of our partners didn't want to buy R&D directly from us, but they wanted to invest in our technology development under the auspices of ATP." "Through ATP, we structured a mutual win-win with a joint venture partner that had a complementary set of technology skills that enabled both of us to develop the technology more quickly."

Carryover of Cycle-Time Improvements Resulting from ATP Participation to Non-ATP Applied Research Projects

When the 28 interviewees were asked, "Did the cycle-time improvements that were a result of participating in the ATP carry over to other technology development projects?" 24, or 86% of the 28 interviewees, said yes; 3 (11%) said no; and 1 (3%) said they didn't know if cycle-time improvements "carried over." Most of the interviewees explained ways in which the ATP-fostered cycle-time reductions were transferred to other technology development projects. These responses are listed in Table 5, grouped by nature of response and placed in order of total frequency of mention.

1. "Yes, Enabling, Generic, Precompetitive Technology" [9 interviewees]

Nine interviewees, or 32% of the sample, said that cycle-time improvements that were a result of participating in ATP were carried over to other technology development projects because the ATP resulted in an enabling technology that had broader applications that allowed them to speed up other projects. Two different interviewees explained this well: The first said, "Through ATP, we built a better understanding of technology. We can spin-out products at a faster rate because we have a fundamental understanding of core technology with multiple applications." The second said, "It turned out that the technology we were developing through ATP had utility for other applications. It has become a technology platform for other applications" (Note that this effect could also be viewed in the context of intra-firm spillovers and economies of scope.)

2. Adopting "ATP Practice" to Related Projects [6 interviewees]

Six (6) interviewees, or 21% of the sample, said that cycle-time improvements resulting from their ATP participation were carried over to related projects within the company, with other government organizations, and with industry because they are applying ATP-required planning and project management practices to other projects. One interviewee explained: "Our organization has changed. We were once a small independent research entity but things have changed significantly. We've received a large contract from industry. . . . The ATP cultural imperative and requirement that experiments be written up in a rigorous fashion did have an impact we are giving the write-ups to an archivist; and we are using similar methods on our industrial contract. We do not have a separate quality assurance department, but following the ATP practice, we have embedded quality into our day-to-day work habits."

3. "Yes, Extended Adoption of New Methodologies and Processes" [4 interviewees]

Four (4) interviewees, or 14% of the sample, reported that cycle-time improvements were enabled by the adoption of new methodologies and processes resulting from their ATP participation. As one interviewee explained, "Peer pressure being what it is, once two groups come up with a way to reduce cycle time others immediately find out what is going on and apply the new methodology to their own group." As another explained, "We used ATP funds to do process development. It was a building block for other developments. We now have a reliable base to build on and benefit from the cumulative effects."

4. "Yes, Cultural Change" [2 interviewees]

Two (2) interviewees, or 7% of the sample, believed that the cycle-time improvements that were a result of participating in ATP resulted in a cultural change that carried over to other projects. As one stated, "By doing this on a faster speed in the ATP project, we built a culture that expects to do things faster. By focusing on long-term needs, it allowed us to better manage short-term needs."

5. "Yes, A Little." [3 interviewees]

Three (3) interviewees, or 11% of the sample said, "Yes, the cycle-time improvements were carried over `a little,' in other words, to a minimum extent," but didn't elaborate as to how.

6. "No, No Change." [3 interviewees]

For the three (3) interviewees, or 11% of the sample, who said that cycle-time improvements were not carried over, they attributed the lack of carryover to internal organizational dynamics. For example, one interviewee stated: "No but our company is going through a series of changes we're restructuring every operation into decentralized units. The company is breaking up into smaller units. This reduces opportunity for cross-fertilization. In another organization with a more centralized research system, more benefits could have been derived. This is frustrating because the potential existed but could not be realized."

7. "Don't know." [1 interviewee]

One interviewee, or 3.6% of the sample, said they didn't know if there was a carryover to other projects.

When ATP practices result in cycle-time improvements that are carried over, we can say that to some extent, these practices have been institutionalized. In fact, this study found that the representatives for the lead-company awardees thought that ATP-originated practices were, for the most part, carried over, (hence institutionalized). Interviewees attributed the carryover to the enabling technologies that positioned the companies to execute a number of subsequent spin-off activities faster; to the use on related projects of ATP-acquired practices that foster project acceleration; to the wider application of new methodologies and new processes that reduce cycle time; and to cultural changes associated with adopting a faster pace as a way of life. They discussed how participating in the ATP program enabled them to remove organizational barriers to cycle-time reduction. But beyond brief characterizations, they did not provide much detail. To the extent that other work in the ATP-funded companies was accelerated by the companies' participation in the ATP, the benefits of ATP on the participating companies may be systemic in nature and greater than anticipated.

References

Burkhart, Robert E. "Reducing R&D Cycle Time." Research Technology Management, May_June 1994, pp. 27_32.

Laidlaw, Frances J. Acceleration of Technology Development by the Advanced Technology Program. National Institute of Standards and Technology, Gaithersburg, MD, NISTIR-6947, September 1997.

McGrath, Michael E., Michael T. Anthony, and Amram R. Shapiro. Product Development: Success Through Product and Cycle-Time Excellence. Boston: Butterworth-Heinemann, 1992.

Powell, Jeanne W. Small-Firm Experience in the Advanced Technology Program. National Institute of Standards and Technology, Gaithersburg, MD: Paper presented at the High-Technology Small Finance Conference, University of Twente, The Netherlands, June 1998.

Silber & Associates. Survey of Advanced Technology Program, 1990-1992 Awardees, Company Opinion About the ATP and Its Early Effects. January 30, 1996.

Author Biography

Frances Laidlaw is a manager in R&D at Motorola specializing in technology planning. She holds a doctoral degree in Engineering, an M.B.A. from Columbia University, and a B.A. from the University of Illinois. Before joining Motorola, she was a Fulbright fellow conducting post-doctoral research at the University of Paris; and before that, a doctoral student at George Washington University, and a consultant-on-staff in the Advanced Technology Program at the National Institute of Standards and Technology.

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