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Technology and the Canadian Forest-Product Industries ... - ArtSites

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<strong>and</strong> one o<strong>the</strong>r that was strongly oriented to technical services, R&Dgroups annually draw up one-year <strong>and</strong> longer-term plans. R&D prioritiesare worked out in corporate-wide discussions <strong>and</strong> R&D groupshave to compete for <strong>the</strong>ir funds each year.The orientation of in-house R&D is toward applied <strong>and</strong> developmentalresearch: only one firm did basic research <strong>and</strong> that was only 5per cent of its total research. If <strong>the</strong> two smallest R&D operations areexcluded, <strong>the</strong> firms claimed that between 25 per cent <strong>and</strong> 85 per centof <strong>the</strong>ir R&D was applied <strong>and</strong> between 15 per cent <strong>and</strong> 75 per centwas developmental. Six firms allocated 10-25 per cent of <strong>the</strong>ir staff<strong>and</strong> budget to technical services or troubleshooting. For <strong>the</strong> smallestR&D group, technical services constituted 75 per cent of activities,<strong>and</strong> one large laboratory allocated 50 per cent of its R&D effort totechnical services for <strong>the</strong> operating divisions.Rationale for In-House R&DIn noting <strong>the</strong> advantages of in-house R&D <strong>the</strong> respondents revealedcommon lines of thought:We are able to respond to our needs in a timely fashion. If it's asmall project <strong>the</strong>re is too much red tape to go outside.We can bring developments along at a schedule that is appropriateto us. A major investment with a 20-year time horizon cannotwait for Paprican. We can relate R&D to specific investmentopportunities that make sense to us. Finally, we can relate to ourparticular window on <strong>the</strong> market. Technological shifts have to bedetailed in <strong>the</strong> marketplace <strong>and</strong> related to capital investmentprojects.R&D is a people resource for <strong>the</strong> rest of <strong>the</strong> firm. Divisions wouldhave to streng<strong>the</strong>n <strong>the</strong>ir technological capability without us. Wecan more quickly respond to attack a problem; <strong>and</strong> while historically<strong>the</strong> industry was more process-oriented <strong>and</strong> open it isbecoming more product-oriented <strong>and</strong> closed <strong>and</strong> proprietary informationis becoming more important.Close ties to business.In-house R&D provides for rapid transfer of technology <strong>and</strong> isrelevant to our business in <strong>the</strong> D stage so it is very commercial. Itreduces maintenance costs; it provides marketing advantages;<strong>and</strong> <strong>the</strong> industry is becoming more closed.34

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