Rebuild Corporate Research for a Stronger American Future
The American research enterprise, long the global leader, faces intensifying competition and mounting criticism regarding its productivity and relevance to societal challenges. At the same time, a vital component of a healthy research enterprise has been lost: corporate research labs, epitomized by the iconic Bell Labs of the 20th century. Such labs uniquely excelled at reverse translational research, where real-world utility and problem-rich environments served as powerful inspirations for fundamental learning and discovery. Rebuilding such labs in a 21st century “Bell Labs X” form would restore a powerful and uniquely American approach to technoscientific discovery—harnessing the private sector to discover and invent in ways that fundamentally improve U.S. national and economic competitiveness. Moreover, new metaresearch insights into “how to innovate how we innovate” provide principles that can guide their rebuilding. The White House Office of Science and Technology Policy (OSTP) can help turn these insights into reality by convening a working group of stakeholders (philanthropy, business, and science agency leaders), alongside policy and metascience scholars, to make practical recommendations for implementation.
Challenge and Opportunity
The American research enterprise faces intensifying competition and mounting criticism regarding its productivity and relevance to societal challenges. While a number of reasons have been proposed for why, among the most important is that corporate research labs, a vital piece of a healthy research enterprise, are missing. Exemplified by the Bell Labs, these labs dominated the research enterprise of the first half of the 20th century but became defunct in the second half. The reason: formalization of profits as the prime goal of corporations, which is incompatible with research, particularly the basic research that produces public-goods science and technology. Instead, academic research is now dominant. The reason: the rise of federal agencies like the National Science Foundation (NSF) with a near-total focus on academia. This dynamic, however, is not fundamental: federal agencies could easily fund research at corporations and not just in academia.
Moreover, there is a compelling reason to do so. Utility and learning are cyclical and build on each other. In one direction, learning serves as a starting point for utility. Academia excels at such translational research. In the other direction, utility serves as a starting point for learning. Corporations in principle excel at such reverse translational research. Corporations are where utility lives and breathes and where real-world problem-rich environments and inspiration for learning thrives. This reverse translational half of the utility-learning cycle, however, is currently nearly absent, and is a critical void that could be filled by corporate research.
For example, at Bell Labs circa WWII, Claude Shannon’s exposure to real-world problems in cryptography and noisy communications inspired his surprising idea to treat information as a quantifiable and manipulable entity independent of its physical medium, revolutionizing information science and technology. Similarly, Mervyn Kelly’s exposure to the real-world benefit of compact and reliable solid-state amplifiers inspired him to create a research activity at Bell Labs that invented the transistor and discovered the transistor effect. These advances, inspired by real-world utility, laid the foundations for our modern information age.
Importantly, these advances were given freely to the nation because Bell Labs’ host corporation, the AT&T of the 20th century, was a monopoly and could be altruistic with respect to its research. Now, in the 21st century, corporations, even when they have dominant market power, are subject to intense competitive pressures on their bottom-line profit which make it difficult for them to engage in research that is given freely to the nation. But to throw away corporate research along with the monopolies that could afford to do such research is to throw away the baby with the bathwater. Instead, the challenge is to rebuild corporate research in a 21st century: “Bell Labs X” form without relying on monopolies, using public-private partnerships instead.
Moreover, new insights into the nature and nurture of research provide principles that can guide the creation of such public-private partnerships for the purpose of public-goods research.
- Inspire, but Don’t Constrain, Research by Particular Use. Reverse-translational research should start with real-world challenges but not be constrained by them as it seeks the greatest advances in learning—advances that surprise and contradict prevailing wisdom. This principle combines Donald Stokes’ “use-inspired research” with Ken Stanley and Joel Lehman’s “why greatness cannot be planned” with Gold Standard Science’s informed contrariness and dissent.
- Fund and Execute Research at the Institution, not Individual Researcher, Level. This would be very different from the dominant mode of research funding in the U.S.: matrix-funding to principal investigators (PIs) in academia. Here, instead, research funding would be to research institutes that employ researchers rather than contract with researchers employed by other institutions. Leadership would be empowered to nurture and orchestrate the people, culture, and organizational structure of the institute for the singular purpose of empowering researchers to achieve groundbreaking discoveries.
- Evolve Research Institutions by Retrospective, Competitive Reselection. There should be many research institutes and none should have guaranteed perpetual funding. Instead, they should be subject to periodic evaluation “with teeth” where research institutions only continue to receive support if they are significantly changing the way we think and/or do. This creates a dynamic market-like ecosystem within which the population of research institutes evolves in response to a competitive re-selection pressure towards ever-increasing research productivity.
Plan of Action
The White House Office of Science and Technology Policy (OSTP) should convene a working group of stakeholders, alongside policy and metaresearch scholars, to make practical recommendations for public-private partnerships that enable corporate research akin to the Bell Labs of the 20th century, but in a 21st century “Bell Labs X” form.
Among the stakeholders would be government agencies, corporations and philanthropies—perhaps along the lines of the Government-University-Industry-Philanthropy Research Roundtable (GUIPRR) of the National Academies of Sciences, Engineering and Medicine (NASEM).
Importantly, the working group does not need to start from scratch. A high-level, funding and organizational model was recently articulated.
Its starting point is the initial selection of ten or so Bell Labs Xs based on their potential for major advances in public-goods science and technology. Each Bell Labs X would be hosted and cost-shared by a corporation that brings with it its problem-rich use environment and state-of-the-art technological contexts, but majority block-funded by a research funder (federal agencies and/or philanthropies) with broad societal benefit in mind. To establish a sense of scale, we might imagine each Bell Labs X having a $120M/year operating budget and a 20% cost share—so $20M/year coming from the corporate host and $100M/year coming from the research funder.
This plan also envisions a market-like competitive renewal structure of these corporate research labs. At the end of a period of time (say, ten years) appropriate for long-term basic research, all ten or so Bell Labs Xs would be evaluated for their contributions to public-goods science and technology independent of their contributions to commercial applications of the host corporation. Only the most productive seven or eight of the ten would be renewed. In between selection, re-selection and subsequent re-re-selections, leadership of each Bell Labs X would be free to nurture its people, culture and organizational structure as it believes will maximize research productivity. Each Bell Labs X would thus be an experiment in research institution design. And each Bell Labs X would make its own bet on the knowledge domain it believes is ripe for the greatest disruptive advances. Government’s role would be largely confined to retrospectively rewarding or disrewarding those Bell Labs Xs that made better or worse bets, without itself making bets.
Conclusion
Imagine a private institution whose researchers routinely disrupted knowledge and changed the world. That’s the story of Bell Labs—a legendary research institute that gave us scientific and technological breakthroughs we now take for granted. In its heyday in the mid-20th century, Bell Labs was a crucible of innovation where brilliant minds were exposed to and inspired by real-world problems, then given the freedom to explore those problems in deep and fundamental ways, often pivoting to and solving unanticipated new problems of even greater importance.
Recreating that innovative environment is possible and its impact on American research productivity would be profound. By innovating how we innovate, we would leap-frog other nations who are investing heavily in their own research productivity but are largely copying the structure of the current U.S. research enterprise. The resulting network of Bell Labs Xs would flip the relationship between corporations and the nation’s public-goods science and technology from asking not what the nation’s public-goods science and technology can do for corporations, but what corporations can do for the nation’s public-goods science and technology. Disruptive and useful ideas are not getting harder to find; our current research enterprise is just not well optimized to find them.
This memo produced as part of the Federation of American Scientists and Good Science Project sprint. Find more ideas at Good Science Project x FAS
Rebuilding such labs in a 21st century “Bell Labs X” form would restore a powerful and uniquely American approach to technoscientific discovery—harnessing the private sector to discover and invent in ways that fundamentally improve U.S. national and economic competitiveness.
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