Thursday, August 4

Location of R&D Centers

If you are a Taiwanese bike manufacturer and you want to conduct R&D, do you locate your R&D center in Taiwan, China, or Holland?

If you are a U.S. coffee chain, in which country-markets do you look for ideas as part of your innovation process?

If you are a budding electronica music producer, do you move to London or set up shop in Indonesia?

Roberts (1995, p. 55) presents a chart that shows the percentage of total R&D activities in Japanese, North American, and European firms that occurs outside the home country (foreign R&D). In 1995, European firms had the highest percentage of R&D occcuring outside the home nation (over 30% took place overseas). Followed by the United States at about 15%, then Japan at less than 10%. Quite a difference. The chart also shows that all these countries are increasing the percentage of R&D activities that occurs outside the home nation, with Japan showing the biggest increase.

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