European Healthcare, Auto Sectors Lead Top 20 R&D Spending
By Ellen Chiu and Steffen Rufenach
October 30, 2013
It’s all about digital. That’s the message of Booz & Co.’s ninth annual study of the world’s 1000 largest publicly listed corporate R&D spenders. The 2013 Global Innovation 1000 study finds that currently, companies are spending 8.1% of their R&D budgets on digital tools. Of the $638 billion spent on R&D by this year’s firms, roughly $52 billion was allocated to procuring, deploying, and supporting digital enablers. Software and Internet companies, naturally, invested the largest percentage of their total R&D budget on these tools. This focus sees the potential of new digital tools in supporting innovation efforts – new computer software can help improve the innovation process and is part of every stage of the life cycle.
R&D spending increased by 5.8% this year; the average annual growth rate has been 5.5% since 2002. China-based companies maintained the fastest growth rate, though it has slowed significantly. Meanwhile, firms based in North America continued to outspend those based in Europe and Japan.
The top 20 companies were responsible for about 25% of the Global Innovation 1000’s total R&D spending in 2013. The dominant corporations in the top 20 ranking are from the computing and electronics, healthcare, and auto industries.
Leading the ranking is German carmaker Volkswagen, which invested $11.4 billion in the 2012 fiscal year. Volkswagen is also the biggest winner this year in terms of both rank – it jumped 10 spots on the list to #1 – and value – its R&D spending increased by $3.7 billion. The only other German company to make the top 20 list is fellow automaker Daimler at #14.
Four European companies in the healthcare sector made the top 20 – Roche at #3, Novartis at #7, Sanofi-Aventis at #15, and GSK at #17. Seven companies from Europe are among the biggest investors in R&D. Despite the region’s continuing economic struggles, European firms increased spending by 4.5%.
However, no European names made the Top 10 Most Innovative Companies 2013. In this perception ranking, nearly 400 senior managers and R&D professionals were surveyed and asked to name the most innovative company, across all industries. U.S. firms dominated this list with nine of the 10 entries. The lone exception? South Korea’s Samsung, which came in after Apple and Google at #3.