Breakthrough R&D Programs Not Being Shut Down, Says Babson's Rice

ByJohn S. McClenahen A less-than-stellar U.S. economic recovery from the 2001 recession might be excuse enough for any number of companies to drastically cut or even shut down major R&D programs. But that's apparently not happening -- at least not on any wholesale scale. "The big surprise for us is that in this difficult time, they are not shutting down their long-term, breakthrough programs," says Mark P. Rice, dean of the F.W. Olin Graduate School of Business at Babson College in suburban Boston. Nevertheless, R&D outlays are being scrutinized, with some companies rethinking the issue of balanced portfolios versus blockbuster R&D programs and the speed and paybacks of incorporating innovations into products, he indicates.