FAQ

１．How to measure the productivity of Research and Development?

It shall be measured with ROR ( Return on Research) basically but the problem here is that it is easy to measure R&D expense, while it is not easy to catch the Return(amount of the profit) .
As an example, the following formula is proposed .
3% of the new products turnover(for 5 years)+ 2% of the improved product turnover(for 3 years)+ the amount of saving by process improvement .
It may differ according to the type of industry and the position of a company.
The importance is your contribution to the company. The expectation for the research and development division shall be clarified from the management strategy. If the strategy requires maintaining its sales of present products , the Return is necessary to be measured by sales of the improved products.
If the development of a new market is the principal object of management, it is necessary to be measured by sales of the new products. In any cases, the management strategy shall be correctly translated into the business strategy, and then into the products strategy, and the marketing strategy, and then into the R&D strategy.
The measurement of R&D productivity has its meaning only when the purpose and the target of the research and development strategy synchronize with the business objective.


２．What makes your new products a big hit?

The law of diminishing returns rules when the time is called Dog Year and the products metabolism is being so extreme. You cannot expect reasonable sales at the second share of the market. The speed is the secret of your new products hit to propose them to the market in advance of the other companies.
A leisurely fashion shall not be permitted that the production department receives a new products after the performance is convinced by the research and development.
R&D sector with Marketing sector and Production sector should be united from the beginning of the development. Moreover, it may sound paradoxical a little but you should rethink “the market-in” or “the market-oriented”. It is not in time to have prepared seeds (technology etc.) after some needs are found. A target shall be aimed from the first place to a product (performance and price) at the very beginning, or it may be necessary to meet some needs by stretching arms from seeds.


３．What is the KFS(Key Factor for Success) of new venture?

It is said that a new venture named parachuting cannot succeed where the sector of the new venture is set away from your present business area. However, I think there is KFS somewhere else since a good example shows an old-established Miso(soybean paste) manufacturer became successfully to a semiconductor maker.
(１)To utilize abilities which you have in your hands
It is not easy to realize abilities you have. It is necessary to plan a new business based on what you have rather than what you have to prepare. In the case of Miso manufacturer above-mentioned, they are "Acquisition of sufficient volume of part-time worker", "Pure-clean water", and "Geographical advantage of center at the Silicon-Island”.
(2)To cut off the new venture from your existing business
Your way of management etc. have been optimized and may be the best to your existing business. But it is not rare that the optimized and familiar methods become stumbling blocks for the new venture that has to face the quite different aspects.
Especially, an existing business should devote oneself to the supporting role to make the footwork of a new business light, and the judgment (that is, responsibility) and the action be entrusted to the autonomy of the new business.
And, in order to stimulate the motivation, the rewards to the performance shall be clearly defined,.
(３) To maintain a small-scale organization
A new business shall be kept small so that each member has to demonstrate his/her power to
maximum and can not say “It is not my duty”. It may be up to 50 -100 people. The expansion strategy shall be taken by dividing continuously.


４．The difference between Business Process Improvement(Kaizen) and Business Process Reengineering(BPR)?

Kaizen and BPR are complete different things.
Kaizen is the method to expect the productivity increase of a business process by increasing the efficiency of each jobs and works which consist of the business process. On the other hand, BPR takes the deductive approach At the very beginning, you have to think which job or work needs to be more efficient in order to increase the productivity of a business process. Kaizen has a tendency which falls easily into an organization- movement or spiritualism as it is about to improve the efficiency of the entire job or work.
BPR has the advantage that the result is early because of the immediate effects.


５．Will the productivity be improved by use of IT ?

It is wrong to expect that if IT is implemented, productivity will go up. IT is a mere tool. Do you think that the dishes become delicious, and the restaurant prospers if a sharp knife is used?
First of all, you have to find a business process which needs to be efficient based on your company policy and strategy. And then, what is the bottleneck of the efficiency? And then, how can you eliminate the bottleneck?
If the best means is IT to eliminate it, IT can improve the productivity. IT is a sharp tool and it is difficult to carry out a business without it. Do not think inductive what IT can do for you but think deductive why you need IT. That is the way to utilize IT capability fully for you.