Electronic Design

Let's Innovate Ourselves Out Of The Downturn

Innovation. Designers have plenty of it. In fact, innovation is one "commodity" for which the United States is famous. Some say that necessity is the mother of invention. Today, the need to bring the economy out of the doldrums should provide plenty of incentive to innovate.

Whether a company is large or small, the effort it puts into developing new products must take precedence. Al-though this year's depressed revenues and profits have caused many firms to reduce staffs, trim budgets, and even cut back on plans for product development/introduction, these same firms haven't cut their R&D budgets.

In contrast, the slowdown has hit a number of startups hard, drastically curtailing the amount of venture funds available to these innovative companies. This has caused a few companies to call it quits, a few more to form alliances, still others to be acquired, and some to rethink and refocus their product development plans.

The business slowdown has definitely forced manufacturers to take a hard look at the industry and re-examine their product development plans. In last year's hot economy, almost any product introduced had a chance at garnering some market share. Today, the firms that might have purchased those new products are being much more selective, looking for options that provide a significant advantage to them, and more value to their customers. Small, incremental product improvements are no longer adequate. Products must deliver a lot more for the money—new features, significant improvements in integration, major increases in flexibility, and so on.

To achieve such lofty goals, we must not trim back research and development, which is truly our industry's lifeblood. R&D is responsible for crafting the new processes and algorithms that form the foundation for creating a range of products, from chips to systems. In tough times, it's tempting to cut all budgets. But without innovation through continued R&D, the economy won't move forward.

The hard-hit communications and data-networking industries are perhaps the best examples of how the continuing effort to create innovative new products may pull particular sectors out of a major slowdown. Over the last few months, a steady flow of both new and established companies have paraded their forthcoming wares in front of me. Frankly, I'm genuinely impressed with the gains in integration, performance, and functionality that these suppliers have put on the table. They're enabling the next generation of network systems to deliver outstanding value and performance.

On other technology fronts, advances in microprocessor architectures, memory design, and analog/mixed-signal capabilities are leading the way to a wave of new systems and solutions that will get us past the turbulent times we are now facing.

We can and must continue to innovate and thus move the industry forward. Let's stoke those fires and put our economy back on the growth track.

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