Outsourcing and R&D fears are overblown

6 Feb 2006

Concerns about the impact of outsourcing and R&D on product development are overblown, new research from Computer Associates reveals. The survey says resource optimisation in terms of people is the most pressing challenge facing R&D organisations.

“Our research again underscores the fact that people are the most important asset in any critical development initiative,” said David Hurwitz, vice-president of marketing, Business Service Optimisation (BSO) at CA.

“By addressing resource allocation challenges, companies can achieve significant competitive advantages and improve their bottom-line business performance,” Hurwitz added.

The survey revealed that, despite the market attention paid to outsourcing, it is not the top trend impacting R&D. Almost 60pc of respondents said globalisation and outsourcing has little or no impact on their product development success.

Two other trends cited as being much more significant are customer involvement in R&D, cited by 70pc of respondents as a major or significant trend, and the continued pressure to reduce costs, cited by 60pc.

“If you are properly managing your resources, it doesn’t matter if they are outsourced or distributed all across the globe,” said Mike Pritts, vice-president of development at Misys Healthcare. “The key to meeting customer demand and driving innovation is the ability to quickly identify and deploy the right people at the right time, regardless of location.”

Of all the challenges companies face, more than 85pc of respondents cited finding available resources from within their organisations as the most significant R&D issue.

While companies may have sufficient R&D staff, they struggle with the ability to identify, deploy and optimise those resources. Resource optimisation is also a strong contributor to other top development issues cited in the survey, including difficulty in estimating, planning and delivering development projects (81pc), commitment to aggressive or unrealistic milestones (80pc) and allocation of enough time in the workday to be innovative (78pc).

“Excellence in R&D requires a focus on people,” said Gisela Wilson, director, product life-cycle management solutions at IDC. “R&D organisations with strong resource optimisation and capacity-planning capabilities are best able to accelerate time to market and gain competitive advantage as a result.”

By John Kennedy