Transfer, Turnover and Promotion among R&D Professionals in Japan

Abstract

This article analyzes the relationship between turnover/transfer and promotion of R&D professionals by scientific field and industry. Knowledge contributed to innovation is divided into two distinct types: functional knowledge and product-system knowledge. The former is knowledge about specialized disciplines, components, and functions. The latter is knowledge of how to integrate functional knowledge: knowledge about the linkages between components, coordination between functions, and consumer demand and competition in product markets. It is mainly acquired by working with the various functions, components, and disciplines that should be integrated to create a product-system. The managers in organizations where the outputs require a high level of product-system knowledge have a great responsibility for the coordination of functional areas and the linkages between components. Therefore, they have to be trained by rotating among the areas that need to be integrated. On the other hand, managers in organizations where a high level of functional knowledge is imperative should improve this expertise by engaging in a specific functional or disciplinary area.

The first hypothesis of this article is that in organizations where product-system knowledge is important, the more R&D professionals transfer among jobs, the higher their probability of promotion to managerial positions. The second hypothesis is that mid-career hires are at a disadvantage when it comes to promotions, since they have fewer opportunities for such transfers, the participation in projects and the informal communication that enable development of product-system knowledge. In order to examine these hypotheses, we analyze the relationship between the number of transfers and the promotion probability and that between the turnover experience and the promotion probability in the electronics and telecommunication industries, the pharmaceutical industry, and the two types of national laboratories: basic research laboratories and applied research laboratories. The pharmaceutical industry and the two types of national laboratories need high levels of functional knowledge, on the other hand, product-system knowledge is important in the electronics and telecommunication industries. The over 900 samples analyzed for this article were obtained from questionnaire surveys held in private companies and national laboratories in 1999.

The result shows that the following relationship was observed only in the electronics and telecommunication industries, where product-system knowledge is important: the more R&D professionals transfer, the more probability of promotion they have; those who have changed organizations are at a disadvantage for promotion. Therefore, it seems to be reasonable for R&D professionals who desire to be promoted to managerial positions to hesitate before moving among private companies.

According to previous research results, turnover from laboratories in private companies to national laboratories tends to be a positive change. R&D professionals who moved in this direction were attracted by the greater freedom to do research and the superior research environment in national laboratories. Their level of academic achievements, measured by the number of papers published and research presentations given at academic conferences, was greater than that of their peers in national laboratories. On the other hand, there are many R&D professionals who have moved among private companies because of strong dissatisfaction with their previous companies. Their level of achievements, measured by number of patents, is lower than that of professionals in private companies who have never changed organizations. The results of this article imply that prospects for promotion may influence these differences between the turnover to national laboratories and the turnover to private companies.