Today, corporate funding makes up more than half of private R&D expenditure. But when results decline, many slash their R&D budget to focus on core markets.
“Often with dreadful consequences.” (Lerner, 2012)
I mentioned Kodak above, whose R&D spending “fell from $1.6 billion in 1992 to $859 million in 1994” (Lerner, 2012). The CEO at the time, George Fisher, opted to focus on film. He expanded, approving new facilities. The impact was severe as Kodak arrived late to the digital imaging party.
In 2012, Kodak filed for bankruptcy.
Nokia was not that different from Kadak. Leadership was fixated on maintaining its grip on the low−end space in the mobile phone market.