US firms see competitive edge in `co-op' approach to costly R&D
Austin, Texas — Research and development have become so complex and costly that some forward-looking companies are turning to a new approach that stresses cooperation over competition. ``In the computer and microelectronics areas, the easy work has been done. Many companies can no longer afford on their own the kind of research that will keep them in the running.'' This perspective by John E. Lacey, executive vice-president of Control Data Corporation, is shared by a growing number of corporate managers in the United States and abroad.
Three years ago, following a proposal made by Control Data chairman William C. Norris, a group of high-tech business leaders pooled research resources and formed the Microelectronics and Computer Technology Corporation (MCC).
At the time, skeptics doubted the feasibility of the concept. Naysayers claimed the competitive spirit that is key to American corporate success would short-circuit such cooperation, if antitrust watchdogs did not stop it first. Even if the venture got to the research stage, pessimists felt jealousies between companies would discourage development of any important breakthroughs.
Today, however, MCC ``is alive and well and deep in the business of research,'' according to retired Adm. Bobby Ray Inman, former deputy director of the Central Intelligence Agency, the man chosen by the original 12 member companies to head up the research consortium.
``In the three years since MCC was created, we've seen an enormous shift in attitudes'' about cooperative private research, says Control Data's Mr. Lacey.
Already the antitrust agency of the Justice Department has recorded more than 30 cooperative research projects since Congress passed the National Cooperative Research Act. The 1984 law protects companies participating in such projects from antitrust actions.
Examples of cooperative ventures include research by US Steel and Bethlehem Steel on thin-sheet steel casting; by Honeywell and Bellcore (Bell Communications Research, itself a research consortium of former AT&T subsidiaries) on telecommunication services; and by Eaton Corporation and Fiat of Italy on truck transmissions. Other consortia to research computer software design and energy production are in the planning stages, according to Mr. Inman.
The rapidity with which the cooperative approach to private research is being picked up is a particularly good sign to Inman. In a recent interview, the ever-smiling former director of the top-secret National Security Agency said, ``The cutting edge will be the speed with which the companies take the technology and use it.'' The Japanese know how to research together and then compete in the marketplace and American companies must learn to do the same, he adds.
The original plan for MCC called upon member companies to send researchers of their choosing to the consortium, but Inman would not have it. ``Looking at the quality of personnel needed and the candidates offered, there was a mismatch,'' says Inman. Today, despite some ``initial stress'' among some member companies over the altered course, Inman has assembled a professional research staff of 261, about 65 percent of whom are ``direct hires'' from outside the member companies.
Inman says he is confident that MCC has assembled ``a first-class staff with some of the best researchers in this business.'' He adds that a steadily growing research budget, reportedly approaching $100 million, along with high enthusiasm in the consortium's labs ``could lead to some surprises substantially earlier than forecast.''
With a grin and raised eyebrows he says, ``We're already talking to patent lawyers on some interesting innovations.''
Inman then returns to what he considers the greatest concern: He wants to be sure the technology MCC's researchers come up with is actually used. He says the diversity of the consortium's membership -- which includes such companies as Kodak and Boeing, in addition to electronics firms -- will help insure the arrival of new ideas on the market.
Inman believes that continued development of the consortium concept to include more foreign companies -- such as Bellcore's venture with a German firm to develop high-speed fiber-optics devices -- could encourage American companies to quicken their lab-to-market delivery.
Eventually, Inman says, such ventures could help the US improve its trade imbalances with countries eager for American technology. He feels the US ``still has the broadest base for creating technology of any country in the world,'' and adds, ``We could trade some access to our technology for access to their markets.''