ORGANIZED COMMERCIAL
N o . 2 in α Series
CHEMICAL
DEVELOPMENT
Orienting D e v e l o p m e n t A n d Research ROBERT B. SEMPLE Wyandotte Chemicals Corp. Wyandotte, Mich.
Commercial chemical d e v e l o p m e n t provides the V eyes a n d ears of research, guiding the research p r o g r a m d o w n the most profitable avenues
layer of authority, it may b e necessary to establish a separate division. Some of the most important functions of the commercial chemical development department are:
J H O U L D the chemical development group be a part of sales, a part of research, or an independent divisional activity report ing to a general management executive? Each alternative may be found in equally well-managed companies, so obviously an interesting debate is possible! Wyandotte has found association of this activity with the research organization to be a practical and efficient arrangement. There are two principles of organiza tion that brought the company to this decision. The first is that a special ac tivity is best associated with that part of the company's organization to which it is the most vital. The second is the de sirability of efficient communications in both thought and deed. With these two approaches in mind, let us look at the question—"Where does com mercial chemical development best fit into the organization scheme?" The always dominating factor of the personalities and character of the principal men in an organization does have a habit of upsetting the best reasoning on com pany structure. Companies do differ in their special problems and special oppor tunities. If the top research executive, however fine a research man he may be, does not have trie grasp or "feel" for com mercial chemical development, this activity will suffer under his jurisdiction just as it would suffer under a top sales execu tive if he had a similar lack of develop ment "feel." Similarly if the professional stature of the development executive is too big to be crowded under an additional V O L U M E
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1. To survey and test markets for chemi cals. 2. To assist in determining the exact form of new product desired b y in dustry, and to characterize the prod uct by establishing specifications. 3. To prepare technical information sheets, brochures, and advertisements describing the product and encour aging prospects to spend time and money trying to use your product. 4. To work -with prospects to modify the new product to their require ments or to change their process or approach so they will want to use what you can make. As varied as these duties may seem, they nevertheless all have one common charac teristic or requirement and that is a re search attitude. Each prospect is a sepa rate experiment, each brocrmre a progress report. Each sale of a new product is made essentially to check t h e acceptance of the material. This does not mean that the development representative does not use sales techniques; he certainly does. Nevertheless, he is quite basically a re search man. In Wyandotte's case, both the top sales and research executives are well qualified to have C C D under their wing. However, »
APRIL
2 8,
1952
the sales division doesn't really need this department as such. It can continue ex panding the markets for its present prod ucts without their help almost indefinitely. The absence of the CCD function does not lead to the early demise of a sales division. And since the department is a relatively small group in relation to the sales department, the question of relative importance is ever more pronounced. When the sales division needs a new man, it cannot resist the temptation to look over its shoulder at the CCD man, who in their opinion isn't doing anything much anyhow, and pull him into sales. But even in those companies where this straightforward transfer of personnel does not take place, there is the more dangerous transition in the thinking of CCD men from the research attitude that is proper for them to the sales attitude of their col leagues in the division. It can't be helped. Sales emphasis is on big volume, steady sales, low sales cost, today's problems. And so it should be, but this is not the controlling atmosphere for CCD. There is little question of the value of CCD to research. Development provides the eyes and ears of research, observing the needs of industry and guiding the re search program down the most profitable avenues. This need for outside eyes and ears is amply illustrated by the fact that it is always filled by someone in research, whether a CCD group exists there or not. It is certainly more desirable to have it done by skilled people than by research executives in their so-called spare time. 1721
Τ? OBERT Β . SKMFLE took t w o degrees from
MIT
and in 1933 joined Monsanto as m a n a g e r of the organic division, pilot plant department. L a t e r he was successively assistant director of general development, director of petroleum chemical sales, and director of general development. H e is now president of Wyandotte Chemical Corp., which he joined i n 1949. H e is an ardent proponent of the idea t h a t chemists a n d chemical engineers should u n d e r t a k e a "thoughtful a n d aggressive program of understanding influences other than technical t h a t a r e important in this world of ours, in policies a n d politics."
In contrast to what w e h a v e said about sales, the very life of a research division depends u p o n a successful commercial chemical development program. N o mat ter h o w good the research department is or h o w sound its program, unless t h e n e w products of its research are skillfully and successfully introduced into commercial application, the research department vvhithers on t h e vine. This vital depend ence of research upon C C D is in itself a sufficient stimulation t o guarantee that the research division will not neglect C C D functions and needs and is a guarantee to the development function of its continu ing existence and nurturing. There are usually t w o other points of contention in assigning development to research. T h e first of these is t h e feeling in sales that h a v i n g other m e n from their company call on "their" customers and prospects destroys continuity of contact. In addition, they feel development men may say or d o things prejudicial to the company, or n o t consistent with good sales practices. Different
Contacts
T h e latter argument, obviously, would apply in any case whether t h e development man were p a r t of sales or part of re search. T h e other argument is more subtle. It should b e noted, however, that the de velopment m a n seldom calls on t h e same people as t h e salesman. His contacts are largely with research a n d production people, a n d m u c h less with purchasing personnel. I n m a n y cases sales personnel assist development by following u p de velopment samples. Still, although t h e salesman is talking directly with t h e d e velopment prospect on a product on which the salesman is usually poorly informed, there are few if any, tragedies t h a t occur due to h a v i n g two men from one company call on a prospect. T h e benefits of multi level a n d multi-functional contacts b e
tween t h e company a n d t h e prospect a r e real and important. Provided complete reports a r e written a n d sent to sales, a n d other reasonable coordination maintained, there seems little harm d o n e due to these calls a n d con siderable benefit as a result of bringing t h e company n a m e t o t h e attention of more members o f t h e prospect's staff. W h e r e Advertising? A corollary of this, by t h e w a y , is t h e question of advertising. Sales sometimes questions the right of development to con tact their prospects even t h r o u g h adver tising media, but here again t h e approach of development is completely different from thai of sales. Development advertis ing is directed at research a n d production people. I t introduces a product, supplies information, and maintains t h e research attitude emphasized earlier. I t s p r i m a r y purpose i s not t h a t of selling products b u t to arouse interest a n d promote t h e ex p e n d i t u r e of energy a n d money in behalf of the test tube b a b y . T h e second contention is t h a t develop ment, in setting t h e inital price of t h e chemical and in other ways, is predeter mining sales policy. Development m a y b e establishing procedures and policies w h e n the product is i n an early stage of d e velopment that sales must live with w h e n they inherit the product. This is a legiti mate protest, b u t one that c a n b e taken care of b y a clear definition of t h e b o u n daries of jurisdiction of each division. For example, it is the policy at W y a n d o t t e that development does not appoint dis tributors for new products since this might conflict, after t h e product goes to sales, with t h e distributor setup sales has. I n those f e w cases where a distributor will be an important help in developing m a r kets for new chemicals, t h e a p p o i n t m e n t can b e m a d e only with t h e consent of t h e sales division concerned. Similarly when prices are set or changed, sales is
given ample opportunity to express its views, a n d if there is a difference of opin ion, t h e executive department adjudicates. I n general, a careful study of this con tention will show relatively few problems a n d most of those w h i c h do exist will, with a little good will, resolve themselves. A sales-development committee t h a t meets regularly can provide t h e opportunity to handle t h e rest o f these problems before they b e c o m e serious. T h e r e is still t h e possibility of organiz ing development as a unit independent of both sales and research. This is where the principle of efficient communications comes in. If the development group con sists entirely of field a n d office m e n , with no laboratory personnel, t h e function they would perform independent of research would b e different in n o important w a y from their function as a part of research. Nothing h a s heen gained, except perhaps a feeling of freedom a n d importance,,and much h a s been lost t o t h e company good. T h e very heart o f the function of develop ment is t h e supply of information to r e search a n d the transfer of information from research to the field. This is sharply reduced b y the insulating effect of divi sional boundaries. Application Laboratories Also U n d e r Development I n some companies, development h a s u n d e r its jurisdiction various applications laboratories. Tlie thought here is that development, being most familiar with t h e problems of industry, can find solutions to these problems most efficiently. This is not affected in t a k i n g t h e entire develop m e n t group and moving it into research on t h e organizational chart. If it is so desired, a n d feasible in t h e activities of the company, development can retain con trol of t h e applications laboratories. In m a n y cases, however, this results in an unnecessary duplication of expensive labo ratory facilities a n d equipment a n d of t h e b u r d e n of technical administration. In our company, for example, we first tried putting a d e v e l o p m e n t representative in a district sales ofBce with several sales m e n a n d soon found their n u m b e r h a d increased b y one. T h e n w e tried develop m e n t as a separate division a n d found w e h a d insulation, W e n o w have development as a part of a research a n d development division. Development has only a small percentage of t h e total personnel, b u t they have half of t o e division name, and ac cording to their*, that's about their proper importance. ORGANIZED Commercial Chemical Development was the topic of t h e annual open meeting of the Commercial Chemical Development Association, New York, March 20, 1952. Other papers on the program will be presented in succeeding issues of C&EN.
Product d e v e l o p m e n t a n d its role in t h e m o d e r n research setup will b e f e a t u r e d in n e x t w e e k ' s continuation of this series
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CHEMICAL
A N D ENGINEERING
NEWS
