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R&D's New Face

HP Labs: Five Big Bets

In March, less than a year after it hired Prith Banerjee as director of HP Labs, HP announced that it would shift its focus from a large number of smaller research projects to a few "big bet" projects in five areas: information explosion, dynamic cloud services, content transformation, intelligent infrastructure and sustainability. "These are the big research challenges that we think are most important to our customers in the next decade," says Banerjee, formerly the engineering dean at the University of Illinois at Chicago.

Explains Banerjee, "We had taken the approach of letting 1,000 flowers bloom and hoping a few would pan out. We'd have two or three people on a project, but now we'll have 20 to 30 large projects, each with 10 to 20 researchers working in teams." HP Labs has a total of 600 researchers in seven labs around the world.

Some observers have suggested that the new strategy was yet another retreat from long-term basic research. But Banerjee insists otherwise. In the past, he says, less than 10% of HP Labs' budget went to exploratory, or "blue sky," research. Under the new plan, spending will be split evenly among such research, applied research and advanced product development.

A major thrust is more collaboration with other companies, universities and venture capitalists. The HP IdeaLab Web site gives would-be partners sneak previews of prototypes. In May, HP asked universities for ideas on collaboration in its five research areas.

Of course, this strategy is backed by bottom-line business sense. It not only allows HP to cull ideas from a wider pool; it also lets it mitigate risk and share research costs.

Still, Chesbrough finds it interesting that HP "would bring in not a career engineer or scientist from the company, but an academic. Instead of the go-it-alone attitude, I see this as evidence of a much more collaborative, distributed process."

IBM: 'Collaboratories'

IBM has given up the insular approach to research that marked its earlier years, Chesbrough says. While the company remains strong in basic research in materials, semiconductors and the like, it has turned its efforts more toward services and support technologies, he says.

Shortly after John Kelly ascended to the top of IBM Research, he announced that IBM would spend more than $100 million over three years on each of four "high risk" basic research areas: nanotechnology, cloud computing and Internet-scale data centers, a new integrated systems and chip architecture, and managing business integrity through advanced math and computer science. Another 15 research topics would be funded at $30 million to $50 million each, and many more at lesser levels, he said. And IBM would increase collaboration.

Part of the new game plan is "collaboratories," mostly small, regional joint ventures with universities, foreign governments or commercial partners that tap into local skills, funding and sales channels to quickly get new technology into the marketplace. For example, in February, IBM said it would form a nanotechnology collaboratory with Saudi Arabia to develop and market water desalination, solar energy and petrochemical applications.

Mark Dean, a vice president at IBM Research, says IBM is adding some big exploratory projects. "For example," he says, "how does DNA interact with carbon nanotubes for self-assembly of circuits?"

Dean says IBM is increasingly collaborating with customers. For instance, it is working with "a prominent candy company" to apply a prototype Web analysis tool to find hidden patterns and meanings in structured and unstructured information. The tool, he explains, "will look at trends and biases within a culture to predict whether a particular brand of chocolate will be bought."

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