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The Global Race for Talent According to a 2011 survey by PricewaterhouseCoopers, one-third of global CEOs said their firms were unable to innovate effectively because of severe talent con-

straints.1 To alleviate this talent crunch, many multinationals have looked beyond

CASE IN POINT EVEN THOUGH HEWLETT-PACKARD COMPANY is deeply rooted in Silicon Valley, its corporate research arm, HP Laboratories, spends only 20% of its budget in the United States; 80% is spread among research centers in the United Kingdom,

the confines of their own research labs to tap every available pool of expertise.

This has led to a fierce global race for scientific, engineering and technology talent; multiple studies confirm that one of the main drivers of R&D offshoring is access

to qualified people. Companies can’t find enough high-end analytical minds even in

Silicon Valley.2 In one study, the buyers of offshoring services said they were increasingly offshoring innovation-centered processes, including product design, engineering and R&D (see graphic below).3

Israel, India, Russia, China and Japan.5 “Wherever the best researchers are, we need to tap into those brightest minds. And the best researchers happen to be located in regions that have very strong universities that are producing top-quality PhDs,” said Prith Banerjee, director of HP Labs and senior VP for research.6

OFFSHORING R&D: NOT JUST CALL CENTERS ANYMORE

4

RESPONSES CITING 'ACCESS TO QUALIFIED PERSONNEL' AS 'IMPORTANT' OR 'VERY IMPORTANT'

74%

67%

71%

66%

PRODUCT DESIGN, ENGINEERING, R&D 1

Church, E., et al. Eds. 2012. “Delivering Results: Growth

and Value in a Volatile World.” 15th Annual Global CEO Survey. PricewaterhouseCooper. 1-39. 2

Dutta, S. 2011. “The Global Innovation Index 1000: Ac-

INFORMATION TECHNOLOGY

celerating Growth and Development.” INSEAD. 1-358. 3

Couto, V., et al. 2008. “Offshoring the Brains as Well as the

Brawn.” Booz & Company and Duke University Offshoring Research Network. http://www.booz.com/media/uploads/ Offshoring_the_Brains_as_Well_as_the_Brawn.pdf. (Accessed 17 February 2012.) 4

Ibid.

5

Jaruzelski, B., Dehoff, K. 2008. “Beyond Borders: The

Global Innovation 2000.” Strategy + Business. (53): 1-18.

2

ADMINISTRATIVE BACK OFFICE

6

Ibid.

7

Ibid.

8

Ibid.

9

Ibid.

BATTEN BRIEFING INNOVATORS’ ROUNDTABLE SERIES

65%

PROCUREMENT

CALL CENTER

Profile for BattenInstitute

Briefing_GlobalRandD_Feb12  

[From the Innovators' Roundtable Series] Corporate innovation does not take place only within the vacuum of a company’s R&D unit. New produc...

Briefing_GlobalRandD_Feb12  

[From the Innovators' Roundtable Series] Corporate innovation does not take place only within the vacuum of a company’s R&D unit. New produc...