FO/LIFO), controlled and replenished?What are the key foci for control efforts (quality, labor cost, downtime, and product use)?Should maintenance efforts be oriented to prevention or to breakdown?What emphasis should be placed on job specialization? Plant safety? The use of standards? 1.6Functional Tactics in Research and Development (R & D)With the increase rate of technological change in most competitive industries, R & D has assumed a key strategic role in many firms. In the technology intensive computer and pharmaceutical industries, for example, firms typically spend between 4 and 6 percent of their sales dollars on R & D. In other industries, such as the hotel/motel and construction industries, R & D spending is less than 1 percent of sales. Thus, functional R & D tactics may be more critical instruments of the business strategy in some industries than in others.First R & D tactics should clarify whether basic research or product development research will be emphasized. Several major oil companies now have solar energy subsidiaries in which basic research is emphasized, while the smaller oil companies emphasize product development research. The choice of emphasis between basic research and product development also involves the time horizon for R & D efforts. Should these efforts be focused on the near term or the long term? The solar energy subsidiaries of the major oil companies have long- term perspectives, while the smaller oil companies focus on creating products now in order to establish a competitive niche in the growing solar industry.R & D tactics also involve organization of the R & D function. For example, should R & D work be conducted solely within the firm, or should portions of that work be contracted out? What emphasis should be placed on process R & D versus product R & D? If a firms posture is offensive, as is true for small high-technology firms, the firm will emphasize technological innovation and new product...
