Sisters Under the Skin - C&EN Global Enterprise (ACS Publications)

Nov 5, 2010 - But both types of organization earmark about the same small fraction of their total spending for this kind of research. Another point of...
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Sisters Under the Skin Little difference in R&D programs of research institutes and commercial labs, NSF study shows R E SEARCH INSTITUTES a n d commercial

laboratories seem to have little in common. Yet there is a striking similarity in the way they conduct their research and development programs. For example, very little basic research is done in either research institutes or commercial labs. But both types of organization earmark about the same small fraction of their total spending for this kind of research. Another point of similarity is that both research institutes and commercial labs get more than 50% of their income from government contracts or other governmentsupported research. The National Science Foundation, continuing its definitive studies of research and development in the United States, has just published a new study "Research and Development by Nonprofit Research Institutes and Commercial Laboratories." This survey, conducted for N S F by Syracuse University, analyzes activities in 1953The 12 institutes surveyed include "all known nonprofit research institutes in the United States. Thirty-eight of the original listing of 50 nonprofit research 5002

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institutes were eliminated, some because they fell more properly into the classification of commercial laboratories, or because it was determined that they were not research organizations.,> Research institutes surveyed: Franklin Institute, Mellon Institute of Industrial Research, Β attelle Memorial Institute, Herty Foundation Laboratory, Haskins Laboratories, Ar­ mour Research Foundation, Southern Research Institute, Midwest Research Institute, Texas Research Foundation, Cornell Aeronautical Laboratory, Stan­ ford Research Institute, Southwest Re­ search Institute. Here is a look at the research ac­ tivities of nonprofit research institutes and commercial laboratories as revealed by the NSF study. • Type of Research. There is a popular belief that basic research is the principal function of research in­ stitutes. Yet the survey shows that in 1953 research institutes allocated only 69o of their expenditures to basic re­ search. The reason for this lies in the structure and organization of most institutes.

Although some research instituteswere founded within a university com­ munity to expand research activities, the majority of the institutes were founded to supply a service to industry or business. This service, scientific in character, is directed toward solving industrial problems. Thus, the direc­ tion and character of the work is largely determined by the short term needs of industry or business. Result—applied research directed at solving specific problems makes up the bulk of the work done by nonprofit research institutes. From consideration of the operation of institutes and large commercial laboratories, NSF concludes there is little difference between the character, history of research activity, and func­ tions of research institutes and com­ mercial labs. In addition, there is no difference in the type of scientific or administrative personnel on the re­ search staffs of the two types of organizations. However, there is a definite prestige value connected with pure research, and all institutes and most commercial labs indicated that they are doing the maximum feasible amount of basic re­ search. In the commercial labs, basic, unsponsored research is directed to ward fields that show good prospects for commercial exploitation. While in­ stitutes do more nonpurposive unspon­ sored basic research, the bulk of the

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work in this field is conditioned by the possibility of future profits. • Government Role. The phenome­ nal growth of research institutes and commercial labs doing research and development is directly tied to govern­ ment activities during World War II and the postwar period. The survey shows that approximately 75% of the institutes and large commercial labs were founded after 1940. The first phase of growth occurred during the war and was the direct re­ sult of military stimulation of business and industry. However, the scientific needs of national defense in the post­ war period have caused even greater growth. Contracts from the military agencies represent the major part of government work in the institutes and labs. In the institutes, government con­ tracts accounted for 66% of the money spent for R&D in 1953. In all com­ mercial labs government contracts ac­ counted for 54% of the funds, but in labs spending more than $500,000, government support amounted to 66% of the total. With government spending account­ ing for such a large share of income, institutes and commercial labs regard government support as a necessary evil. The money is essential, but government contracts pose many problems. These problems are connected with obtaining and administering govern­ ment contracts. There is a feeling that Government is unsympathetic toward the problems of the researcher. In­ stead of stressing progress in the in­ vestigation under way, Government concerns itself too much with the dis­ cipline of bookkeeping and auditing. In addition, the organizations say the aims of government research programs are often too vague. • Competition· Nonprofit research institutes axe iiùl coiapetitive organizations from the business point of view, NSF concludes. While there is some "friendly" competition among institutes, there is no vigorous competition for

sponsors. Under current conditions, research institutes operate in a seller's market. In commercial laboratories competition for industrial sponsors is not too severe. In the rivalry for industrial business, commercial labs compete on the basis of service and quality. A good job done for an industrial firm will generate repeat orders. But in competing for government contracts, past performance and quality of work count for little or nothing, commercial labs say. Each new contract is let on the basis of competitive bids, and awards are made mainly on the basis of cost and price. In addition, more than half the commercial labs surveyed think that Government favors the nonprofit institutes at the expense of commercial organizations. What's ahead? Most organizations think that there will be considerable expansion during the next five to 10 years. However, in view of the rapidly changing needs and desires of industry and Government, organizations were unwilling to predict the size and direction of future expansion. Copies of "Research and Development by Nonprofit Research Institutes and Commercial Laboratories" may b e obtained for 50 cents from the Superintendent of Documents, Washington 25, D. C.

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