Google, Apple Labeled “Efficient Innovators”

    November 14, 2006

Two of eBusiness’s most “informal” companies are top performers when it comes to making good use of their money, according to a new study. It may not come as a surprise, but Google and Apple are both extremely efficient at translating their research and development funds into products.

Consulting firm Booz Allen Hamilton put out the report, and John Potter, a vice president, spoke about its conclusions. “Our research found that most companies can achieve a greater return on their R&D spending if they view innovation as an end-to-end process that begins with a new idea and ends with a satisfied customer,” he said.

Potter noted, however, that “the most effective innovation is often not the most expensive.” Sandisk, which manufactures flash memory, proved his point by making the efficiency list – Sandisk’s pockets are, of course, considerably less deep than those of Google and Apple.

Sandisk, Apple, and eBay number among 91 other companies that, as the San Francisco Chronicle’s Tom Abate describes it, “outperformed the rest of the thousand companies in sales and profit growth while spending less on R&D as a percentage of sales.” Other “high leverage innovators,” as defined by Booz Allen Hamilton, include Dell, eBay, Yahoo, and a personal favorite – Toyota.

Owners of Google’s stock are likely to be especially happy about the study’s results. The company’s frivolous (and/or fun) spending on items like a replica spaceship has raised a few eyebrows, but this report confirms that Google isn’t exactly throwing its money away. It’s also probable that Yahoo is quite pleased with itself right now, having managed to keep up with one of its major competitors. Microsoft did not make Booz Allen Hamilton’s list.


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Doug is a staff writer for WebProNews. Visit WebProNews for the latest eBusiness news.