June 06, 2008

HP takes venture capital approach to its labs

HP labs shake up promises 'big bets' on fewer technologies

By Jeremy Kirk, IDG News Service

Hewlett-Packard is forging ahead with a revamp of its research labs that it hopes will put cutting-edge developments into its products much faster.

The shake-up, publicly announced in March, comes after an analysis that found its 23 research labs were spread too thinly, tackling some 150 projects simultaneously. Now, the labs will only take on 20 to 30 "big bets," technologies that HP believes will meet the next wave of business IT demands, said Prith Banerjee, director of HP Labs.

HP threw open the doors to its Bristol lab on 5 June, home to 100 researchers working on projects such as plastic replacements for the glass in flat-panel displays and the semantic Web, a way of labelling information that enables better searching on the Internet.

HP is one of the few companies that still funds extensive research, said Banerjee who quit as dean of the college of engineering at the University of Illinois in Chicago to take the HP job last August. The old way the lab was organised "made sense for its time" but didn't enable research to be incorporated quickly into products, he said.

Martin Sadler, director of the systems security lab and an 18-year labs veteran, said "we kind of drifted a little bit."

As few as two people could propose and approve a research project, Banerjee said. That's changed. Now researchers draw up 25-page proposals that are floated before an internal review board composed of technologists, lab directors and a new group -- marketing and product development experts.

It marks a closer link with the business side, one that Banerjee said is similar to how venture capital funds decide what technologies to invest in. "Our gut tells use it's the right approach," he said. "You have to be sure you don't make the wrong bets."

The new strategy for HP's labs hasn't resulted in higher turnover in an environment where competitors such as Microsoft, Google and IBM vie for talented researchers and engineers. "If people are grumpy, it's over the little things, nothing substantive," Sadler said.

The selected projects are centred around five themes: how to manage an ever-increasing amount of data; Web-based services; digitising analog content; developing "intelligent" infrastructure that requires less human management; and sustainability, which looks at the environmental impact of IT.

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