Case Google, Inc.*

Google, Inc. spends several billion dollars annually on R&D but the company has faced increasing questions about the payoff from such spending. To that end, Google is giving its mobile-focused research group, Advanced Technology and Projects, more funding and a new building but it is putting a time limit on most innovation projects. Most projects are limited to two years, after which they are killed, moved into Google, spun off into independent firms, or licensed to others.*

Executive Chairman, Eric Schmidt, says: We like this model because it puts pressure on people to perform and do relevant things or stop. Ive spent an awful lot of time on projects that never end and products that never ship.*

The group is currently working on a number of projects including Ara, a smartphone with switchable components; Spotlight Stories; interactive animations; and short films for smaller phone screens; and Tango, a 3-D mapping technology that was recently moved into Google to support the firms augmented-reality gaming efforts.

Discussion Questions

1. Critically evaluate the new policy that places a two-year limit on innovation projects and develop your position for or against the policy.

2. Is this a policy that other business-to-business firms might adopt to bring more discipline to the new product development process? Explain.