The relationship of the intensity of business–level process research and development (R&D) and the return on investment (ROI) under different strategic orientations of 'differentiation' and 'cost leadership' was examined using a longitudinal covariance structure modelling method. It was found that there is a high level of stability associated with process R&D allocations. While this degree of stability creates some difficulty in significance testing, it was found that increases in business–level process R&D intensity have rather quick and ephemeral positive direct effects on ROI after the current year in all three strategic samples. However, by the fourth lagged year the direct effects become negative. While enhancements to process R&D are revealed to be dubious in terms of favourable ROI outcome in the aggregate, their influence is the most favourable in the sample pursuing a cost–leadership strategy.
International Journal of Technology Management – Inderscience Publishers
Published: Jan 1, 1990
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