posted 3 March 2010 | Mark Bernstein    view bio

PARC hosted a fieldtrip for TTI/Vanguard attendees following their recent “Shifts Happen” conference in San Francisco. [Through private conferences that they describe as "part classroom, part think-tank, and part laboratory", TTI/Vanguard is a forum for senior-level executives that links strategic technology planning to business success.]

For me, hosting this fieldtrip was an interesting proposition since it was 10 years ago that they had last visited what was then Xerox PARC. I knew it wasn’t going to be very difficult to show how different we were, but it wasn’t going to be easy to choose what to show. In the end, we provided a set of demo-presentations [agenda] that exposed the breadth of our competencies and the application spaces we’re exercising.

Yes, shift happens. The question is: how?

Surprisingly, the questions I was asked before and after the demo-presentation tour weren’t that different. Basically, folks were looking for simple answers or replicable formulas to some pretty fundamental challenges:

• How do we do what we do?
• How do we do it differently than before?
• How do we make the right choices?

Wouldn’t we all like to know?? Well, here’s what I (think I) said.

There’s no single formula, but…

PARC doesn’t commercialize its technologies into markets directly. When a technology from one of our research projects can demonstrate business value in an application, we look to partners who have the capability and market understanding to optimize the form and function for their customers. Those commercialization partners can be entrepreneurs, industrial clients, venture investors, or others. They’re our greatest asset because they help us bridge technology challenges and strategic business opportunities. How do we know what’s hot? I don’t know, but we can tell when it’s too early and we certainly know when it’s too late.

PARC is becoming a center for commercial innovation. We still do core research, but we need to generate business results to keep at it. Half of our revenue comes from sources other than Xerox, but we wouldn’t have arrived there without some leeway from them to do so. (This notion of leeway may also apply to government funding, which when aligned with our objectives gives us the breathing space to work on foundational research that’s too early for the commercial market.) How do we manage being an independent subsidiary? Our experience with other clients in other industries all over the globe has kept our relationship with Xerox clearer and better than ever. Moreover,

PARC doesn’t work with competitors in the same field of use. We maintain confidentiality unless we have permission to do otherwise. That’s how we manage all our research and our business relationships. We also take patenting seriously because it is one of the foundational assets we create from our research. With guidance from our intellectual capital management team to inform what and how much intellectual property (IP) to capture, we protect the interests of our clients who use our services and commercialize our technology. IP also allows us to continually grow our competency and asset base as we extend the scope and breadth of our research into new or competitive areas. But how do we manage the research decision-making process?

PARC manages its research investments from a portfolio perspective. We have deep scientific understanding that supports all our fields of research. And we make little research bets to test if big bets are warranted. We try to test assumptions quickly to learn fast and optimize our market timing. But it’s not a question of balancing basic vs. applied research here — we ascribe to Pasteur’s Quadrant of “use-inspired” basic/exploratory research. Value is created from what you can do with what you know.

We accept that failure is valuable. PARC still relies on its researchers for their passion, intuition, and insight to help guide resource investments. Only now, they are coupled with like-minded business development folks who work with them from concept ideation to technology prototype — pushing, questioning, informing, guiding… encouraging them to take risks and explore possibilities, but with purpose and urgency.

tags: field of use, intellectual property, Pasteur's Quadrant, portfolio management posted in business of breakthroughs, conferences & talks, our culture & processes, our milestones