“To many executives, the subject of R&D accountability is a mystery.”
Consider their fictional account of a CEO talking to her CTO about this topic, from the book “Third Generation R&D.”
“I don’t have the faintest idea how to hold R&D accountable,” says the CEO. “A business, sure…sales, costs, earning, growth…All of those things are measurable in units I understand. How do I judge R&D, patents, new products introduced, cost reductions? How?”
“By none of those things,” the CTO responds. The CTO pauses for effect.
“You hold R&D accountable exactly as you hold a business…or a function of a business…accountable. By its performance with reference to commitments made in the plan….Those commitments may be expressed in units you are less comfortable with, but units you can still manage: arriving at milestones, reducing uncertainty, a new product introduction, a cost reduction on time…”
The CTO pauses again.
“The real, and the only, prospective measurables reside in the progress toward agreed-upon objectives. And the use of these measurables is effective only if the business leadership has participated in establishing the portfolio of objectives.”
Make a plan with executives. Establish goals and metrics. Measure them. Close the loop. Don’t be an idiot.