Observations on R&D Budgeting There is no shortage of literature on R&D budgeting (EIRMA 1983, Br... more Observations on R&D Budgeting There is no shortage of literature on R&D budgeting (EIRMA 1983, Brockhoff 1994). This reflects the wide gap that exists between the promises of approaches that are derived from decision theory, and the lure of the simplicity offered by easy-to-use rules of thumb that seem to govern R&D budgeting in practice. The theoretical approaches often lack the specificity that is required by the prospective users and place heavy demands on the data required in their application. The rules of thumb are often backward looking and are considered to be too mechanistic to respond to today's requirements of a rapidly changing company environment. As a compromise, simulation models have been suggested that help to generate good solutions for R&D budgets with respect to key company success indicators, such as sales growth, rate of innovation or shareholder value (Brockhoff 1989). These simulations incorporate specific budgeting rules that need to be identified from p...
Die Vielfalt betriebswirtschaftlicher Probleme und der Wechsel der im Laufe der Zeit gewahlten Sc... more Die Vielfalt betriebswirtschaftlicher Probleme und der Wechsel der im Laufe der Zeit gewahlten Schwerpunkte ihrer Behandlung kann auf engem Raum nicht erfast werden. Um trotzdem einen Eindruck davon zu vermitteln, wie sich Problembehandlungen entwickelt haben, werden einige exemplarisch herausgehoben.
Internationalization of Research and Development, 1998
Management of foreign R&D units proves to be a difficult task. This has to do with the observ... more Management of foreign R&D units proves to be a difficult task. This has to do with the observation that, to date, little “hard” data on this topic are available that could guide management in its decisions. For this purpose, evaluations of R&D success would be most important. Only very few studies seek to measure success. Technical success can be measured at the project level as well as the program level. However, this is only a necessary condition for the achievement of economic success. This is difficult to measure because it can be observed only after a substantial time lag and because many departments other than R&D need to collaborate optimally to make this success happen. Thus, while it is difficult to measure the overall economic R&D success of an organization, it appears to be even more difficult to determine the appropriate share by which individual laboratories have contributed to success. Some of the literature puts trust in the ability of experienced managers to solve this problem by asking them to reveal their perceived evaluation of success for individual laboratories. However, the particular division of labor between laboratories and the dispersed customers for whom they work might involve specific biases, depending on whom one prefers to interview. Figure 18 classifies different approaches that one could take. Most frequently, R&D managers from headquarters (Box (4)) have been asked to evaluate the R&D performance of individual laboratories or the success of the overall R&D organization of their company. It is obvious that their answers could be biased in support of their own unit and could downgrade other units that they may view as competitors for scarce internal resources. A few other studies ask managers of foreign R&D units to evaluate its success from their point of view (Box (5)). This could stimulate an opposite bias. No study is known that would contrast evaluations from different viewpoints to check the validity of the responses. This leaves open a wide field for further studies. It is obvious that by comparing responses from interviewees who might be located at different boxes and by finding significant differences, one would immediately become aware of biases and problem areas that need further attention. Similar biases become obvious by comparing the views of R&D managers and scientists in the same laboratories (Compare Boxes (4) and (7) or (5) and (8)). Let us illustrate this point with reference to a strictly national study: in a study of German R&D laboratories, it was found that while managers thought that reducing budget overruns was the second most important issue in securing higher laboratory success, bench engineers in the same laboratories perceived that reducing delays in decision making was the second most important issue in this respect. This can have severe consequences: if such differences in the perception of issues cannot be resolved, many of the management efforts might well be futile. However, the limitations of research perspectives on international R&D cannot be resolved in short time, and, therefore, we issue an early warning to keep this limitation in mind.
Internationalization of Research and Development, 1998
Before trying to tackle problems of internationalization it might be good to answer the question ... more Before trying to tackle problems of internationalization it might be good to answer the question why a company may want to entertain more than one R&D laboratory at different locations. The problem of internationalization in the sense of assuming a headquarters laboratory and at least one more laboratory in a different country, would then appear as a generalization of the first problem.
Industrial Research for Future Competitiveness, 1997
It is clear from the memorandum by Stine that research serves more than one function. In another ... more It is clear from the memorandum by Stine that research serves more than one function. In another early study on basic research in industry, Berthold (1968, pp. 175 et seq.) collects quotations from U.S. and German research managers who stress the importance of keeping pace with their scientific environment and to make good use of its results, on top of developing innovative ideas.
Industrial Research for Future Competitiveness, 1997
As mentioned with reference to the Finmeccanica organization, projects that build more than one p... more As mentioned with reference to the Finmeccanica organization, projects that build more than one potential could be funded by more than one source. This inevitably leads to the question: who ‘owns’ the project? A convincing response to this question is that each funding source owns a share of the project equaling its relative contribution to the total project budget, as agreed upon between the laboratory and the sponsors, unless some other sharing rule has been negotiated. Budget overruns or budget savings may be experienced due to the uncertainty that is inherent in research work. In our view, benefits and costs of the uncertainty should be enjoyed or borne by the laboratory.
Betriebswirtschaftslehre in Wissenschaft und Geschichte, 2012
Objektspezialisierung (2.4.3) und Unterschiede in Paradigmen (3.2.2) wer den hier an Beispielen v... more Objektspezialisierung (2.4.3) und Unterschiede in Paradigmen (3.2.2) wer den hier an Beispielen verdeutlicht. Studierende und Praktiker fragen immer wieder nach der Theorie des Unternehmens. Sie sind manchmal verzweifelt, manchmal enttauscht, wenn ihnen diese Frage nicht mit einem Hinweis beantwortet werden kann. Moglicherweise wurde auch eine alle „Ratsel“, Sichtweisen und Foci integrierende Theorie entweder fur die Technologie der Betriebswirtschaftslehre aussagenleer bleiben oder einen Komplexitats grad erreichen, der einer Handhabung entgegensteht. Ahnliches ist schon einmal festgestellt worden, als in die Simulationsmodelle vom „industrial dynamics“-Typ immer mehr integriert wurde, um das gesamte Unterneh men, seine Fuhrung und sein Marktumfeld zu erfassen. Allein das Marke ting Modell eines Unternehmens nach diesem Ansatz wurde im Ruckblick von einem der fuhrenden Marketing-Forscher als „sinnlos“ und „viel zu kompliziert“ bezeichnet. Abstraktion ist fur die Theoriebildung unver meidlich. Das fuhrt zu unterschiedlichen Sichtweisen auf das Objekt der Betriebswirtschaftslehre.
Prognoseverfahren für die Unternehmensplanung, 1977
Bei den in diesem Kapitel zu behandelnden Verfahren ist entscheidend, das eine oder mehrere expli... more Bei den in diesem Kapitel zu behandelnden Verfahren ist entscheidend, das eine oder mehrere explizit benannte unabhangige Variablen mit dem zu prognostizierenden Ereignis oder Ereignisvektor in Beziehung gesetzt werden. Dabei ist es fur den Ansatz, nicht fur die Ergebnisse, unerheblich, ob diese unabhangigen Variablen auch durch andere, vielleicht besser erklarende, ersetzt werden konnen. Die in Abschnitt 7. vorgestellten Ansatze werden als nicht-okonometrische Ansatze bezeichnet, weil ihnen kein durch wirtschaftstheoretische Uberlegungen begrundetes und mathematisch formuliertes Erklarungsmodell fur den Zusammenhang zwischen abhangigen und unabhangigen Variablen zugrunde liegt1). Das schliest nicht aus, das die geschilderten Verfahren durch statistische Techniken gepruft werden, nachdem eine testfahige Formulierung fur sie gefunden ist.
Im 19. Jahrhundert entstehen vermehrt grose Aktiengesellschaften, auch auserhalb von Branchen, fu... more Im 19. Jahrhundert entstehen vermehrt grose Aktiengesellschaften, auch auserhalb von Branchen, fur die sie in fruheren Jahren mit staatlichem Monopol ausgestattet und privilegiert worden waren. Bei ihrer Leitung entstehen Agency‐Probleme, fur die mit vorsichtigen Schritten nach Losungen gesucht wird. Nach dem Versagen von Staatsaufsicht werden sie gesehen in einschrankenden Regelungen fur die handelnden Personen, Aufsicht durch die Eigentumer, materiellen Anreizen und der Hoffnung auf moralisches Handeln. Die Emergenz dieser Instrumente als Vorlaufer aktueller Diskussionen wird dargestellt. Eine situativ begrundete Ordnung der Instrumente bildet das Ergebnis.
Observations on R&D Budgeting There is no shortage of literature on R&D budgeting (EIRMA 1983, Br... more Observations on R&D Budgeting There is no shortage of literature on R&D budgeting (EIRMA 1983, Brockhoff 1994). This reflects the wide gap that exists between the promises of approaches that are derived from decision theory, and the lure of the simplicity offered by easy-to-use rules of thumb that seem to govern R&D budgeting in practice. The theoretical approaches often lack the specificity that is required by the prospective users and place heavy demands on the data required in their application. The rules of thumb are often backward looking and are considered to be too mechanistic to respond to today's requirements of a rapidly changing company environment. As a compromise, simulation models have been suggested that help to generate good solutions for R&D budgets with respect to key company success indicators, such as sales growth, rate of innovation or shareholder value (Brockhoff 1989). These simulations incorporate specific budgeting rules that need to be identified from p...
Die Vielfalt betriebswirtschaftlicher Probleme und der Wechsel der im Laufe der Zeit gewahlten Sc... more Die Vielfalt betriebswirtschaftlicher Probleme und der Wechsel der im Laufe der Zeit gewahlten Schwerpunkte ihrer Behandlung kann auf engem Raum nicht erfast werden. Um trotzdem einen Eindruck davon zu vermitteln, wie sich Problembehandlungen entwickelt haben, werden einige exemplarisch herausgehoben.
Internationalization of Research and Development, 1998
Management of foreign R&D units proves to be a difficult task. This has to do with the observ... more Management of foreign R&D units proves to be a difficult task. This has to do with the observation that, to date, little “hard” data on this topic are available that could guide management in its decisions. For this purpose, evaluations of R&D success would be most important. Only very few studies seek to measure success. Technical success can be measured at the project level as well as the program level. However, this is only a necessary condition for the achievement of economic success. This is difficult to measure because it can be observed only after a substantial time lag and because many departments other than R&D need to collaborate optimally to make this success happen. Thus, while it is difficult to measure the overall economic R&D success of an organization, it appears to be even more difficult to determine the appropriate share by which individual laboratories have contributed to success. Some of the literature puts trust in the ability of experienced managers to solve this problem by asking them to reveal their perceived evaluation of success for individual laboratories. However, the particular division of labor between laboratories and the dispersed customers for whom they work might involve specific biases, depending on whom one prefers to interview. Figure 18 classifies different approaches that one could take. Most frequently, R&D managers from headquarters (Box (4)) have been asked to evaluate the R&D performance of individual laboratories or the success of the overall R&D organization of their company. It is obvious that their answers could be biased in support of their own unit and could downgrade other units that they may view as competitors for scarce internal resources. A few other studies ask managers of foreign R&D units to evaluate its success from their point of view (Box (5)). This could stimulate an opposite bias. No study is known that would contrast evaluations from different viewpoints to check the validity of the responses. This leaves open a wide field for further studies. It is obvious that by comparing responses from interviewees who might be located at different boxes and by finding significant differences, one would immediately become aware of biases and problem areas that need further attention. Similar biases become obvious by comparing the views of R&D managers and scientists in the same laboratories (Compare Boxes (4) and (7) or (5) and (8)). Let us illustrate this point with reference to a strictly national study: in a study of German R&D laboratories, it was found that while managers thought that reducing budget overruns was the second most important issue in securing higher laboratory success, bench engineers in the same laboratories perceived that reducing delays in decision making was the second most important issue in this respect. This can have severe consequences: if such differences in the perception of issues cannot be resolved, many of the management efforts might well be futile. However, the limitations of research perspectives on international R&D cannot be resolved in short time, and, therefore, we issue an early warning to keep this limitation in mind.
Internationalization of Research and Development, 1998
Before trying to tackle problems of internationalization it might be good to answer the question ... more Before trying to tackle problems of internationalization it might be good to answer the question why a company may want to entertain more than one R&D laboratory at different locations. The problem of internationalization in the sense of assuming a headquarters laboratory and at least one more laboratory in a different country, would then appear as a generalization of the first problem.
Industrial Research for Future Competitiveness, 1997
It is clear from the memorandum by Stine that research serves more than one function. In another ... more It is clear from the memorandum by Stine that research serves more than one function. In another early study on basic research in industry, Berthold (1968, pp. 175 et seq.) collects quotations from U.S. and German research managers who stress the importance of keeping pace with their scientific environment and to make good use of its results, on top of developing innovative ideas.
Industrial Research for Future Competitiveness, 1997
As mentioned with reference to the Finmeccanica organization, projects that build more than one p... more As mentioned with reference to the Finmeccanica organization, projects that build more than one potential could be funded by more than one source. This inevitably leads to the question: who ‘owns’ the project? A convincing response to this question is that each funding source owns a share of the project equaling its relative contribution to the total project budget, as agreed upon between the laboratory and the sponsors, unless some other sharing rule has been negotiated. Budget overruns or budget savings may be experienced due to the uncertainty that is inherent in research work. In our view, benefits and costs of the uncertainty should be enjoyed or borne by the laboratory.
Betriebswirtschaftslehre in Wissenschaft und Geschichte, 2012
Objektspezialisierung (2.4.3) und Unterschiede in Paradigmen (3.2.2) wer den hier an Beispielen v... more Objektspezialisierung (2.4.3) und Unterschiede in Paradigmen (3.2.2) wer den hier an Beispielen verdeutlicht. Studierende und Praktiker fragen immer wieder nach der Theorie des Unternehmens. Sie sind manchmal verzweifelt, manchmal enttauscht, wenn ihnen diese Frage nicht mit einem Hinweis beantwortet werden kann. Moglicherweise wurde auch eine alle „Ratsel“, Sichtweisen und Foci integrierende Theorie entweder fur die Technologie der Betriebswirtschaftslehre aussagenleer bleiben oder einen Komplexitats grad erreichen, der einer Handhabung entgegensteht. Ahnliches ist schon einmal festgestellt worden, als in die Simulationsmodelle vom „industrial dynamics“-Typ immer mehr integriert wurde, um das gesamte Unterneh men, seine Fuhrung und sein Marktumfeld zu erfassen. Allein das Marke ting Modell eines Unternehmens nach diesem Ansatz wurde im Ruckblick von einem der fuhrenden Marketing-Forscher als „sinnlos“ und „viel zu kompliziert“ bezeichnet. Abstraktion ist fur die Theoriebildung unver meidlich. Das fuhrt zu unterschiedlichen Sichtweisen auf das Objekt der Betriebswirtschaftslehre.
Prognoseverfahren für die Unternehmensplanung, 1977
Bei den in diesem Kapitel zu behandelnden Verfahren ist entscheidend, das eine oder mehrere expli... more Bei den in diesem Kapitel zu behandelnden Verfahren ist entscheidend, das eine oder mehrere explizit benannte unabhangige Variablen mit dem zu prognostizierenden Ereignis oder Ereignisvektor in Beziehung gesetzt werden. Dabei ist es fur den Ansatz, nicht fur die Ergebnisse, unerheblich, ob diese unabhangigen Variablen auch durch andere, vielleicht besser erklarende, ersetzt werden konnen. Die in Abschnitt 7. vorgestellten Ansatze werden als nicht-okonometrische Ansatze bezeichnet, weil ihnen kein durch wirtschaftstheoretische Uberlegungen begrundetes und mathematisch formuliertes Erklarungsmodell fur den Zusammenhang zwischen abhangigen und unabhangigen Variablen zugrunde liegt1). Das schliest nicht aus, das die geschilderten Verfahren durch statistische Techniken gepruft werden, nachdem eine testfahige Formulierung fur sie gefunden ist.
Im 19. Jahrhundert entstehen vermehrt grose Aktiengesellschaften, auch auserhalb von Branchen, fu... more Im 19. Jahrhundert entstehen vermehrt grose Aktiengesellschaften, auch auserhalb von Branchen, fur die sie in fruheren Jahren mit staatlichem Monopol ausgestattet und privilegiert worden waren. Bei ihrer Leitung entstehen Agency‐Probleme, fur die mit vorsichtigen Schritten nach Losungen gesucht wird. Nach dem Versagen von Staatsaufsicht werden sie gesehen in einschrankenden Regelungen fur die handelnden Personen, Aufsicht durch die Eigentumer, materiellen Anreizen und der Hoffnung auf moralisches Handeln. Die Emergenz dieser Instrumente als Vorlaufer aktueller Diskussionen wird dargestellt. Eine situativ begrundete Ordnung der Instrumente bildet das Ergebnis.
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Papers by Klaus Brockhoff