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A novel approach to measuring firms’ R&D performance

As an R&D manager, how can you measure the R&D (research and development) performance of your firm? How does knowing the importance of different R&D measures allow R&D managers to formulate more effective strategies to improve their firm’s R&D performance?

Negin Salimi (in collaboration with Dr. Rezaei) has answered these questions in their recent published paper titled “Evaluating firms’ R&D performance using best worst method” in the journal Evaluation and Program Planning

Knowing the importance of different R&D measures helps R&D managers spend time, money, energy and resources on the vital aspects of their objectives more efficiently. A major shortcoming of earlier studies is that they all assign the same weight to the measurement factors of R&D performance. In this study, the authors propose a multi-criteria decision-making method (MCDM), called best worst method (BWM), to identify and apply different weights to different perspectives (customer, internal business, innovation and learning, and financial) and measures of R&D performance of 50 high-tech SMEs in the Netherlands.

The findings of this study can be helpful to R&D managers in two ways: firstly, by knowing their R&D performance in a more accurate way (which is proposed in this study), firms can better see their competitive position compared to their competitors. Secondly, regardless of its position, having knowledge about the importance of different R&D measures, R&D managers can formulate more effective strategies to improve their R&D performance based on their own objectives.