As we have reported to the Conference Board some nine months ago, the industrial option of ignoring science and technology, or even of cultivating low-tech, is steadily losing appeal. This is not to say that elements of that option, such as Chapter 11 or even nationalization such as the railroads cultivated some years ago, are unprofitable. But there are values in choosing to do R&D, if one happens to do the right science and engineering and chooses to pace both its costs and its utilization in appropriate balance with the economics and productivity of the rest of the enterprise.

Science, however, has certain inherent disadvantages, such as coming from a culture which is non-proprietary. This culture is also committed to rapid dissemination, and through education and scholarship to assimilation and extension. And this utilization of new knowledge is often by what are, at least supposed to be, the brightest people in the world, operating in the most individualistic and far-ranging modes. Technology, on the other hand, has been carefully composed to be proprietary and frequently effectively secret. In nations of independent enterprise, this tradition has served competitively exceedingly well. The most familiar embodiment is in the patent system, but of course everybody knows that local containment and trade secrecy far exceed even the formalized proprietorship of patents.

Now you all know very well the dichotomy we are facing here. It is the mid and post Twentieth Century condition that technology nowadays requires science to flourish. And know-how is no longer sustained by the genius of individual inventors or sharply creative engineers, whose contributions are nevertheless still indispensable and extensive, but no longer adequate. By the way, we have some notable examples of this principle, such as in the automobile industry, whose total R&D spending stand at the top of all industries, but whose science involvement has until very recently been negligible. In contrast, the Japanese have used particular scientific bases such as materials science, and information and automata principles, along with scientific statistical quality control (discovered and developed in the United States) to bring out superior products.

We are pleased to have been asked to report briefly to you what we believe are modern trends in science and engineering, which will, increasingly influence the character of industrial research and development, and above all, its success in supporting the financial and operational objectives of the corporation. We shall communicate this message mostly by examples. These involve particular aspects of scientific discovery and study, which appear to support promising industrial progress. However, both the complexity of the new science, and the span of knowledge covered, mean that ingenious and insightful management must be applied in order to get commercial results in a reasonable time. It appears that an increasingly useful way to work at this is by systems engineering - systems administration. But now, in order for both executive and technical managers to be able to use systems concepts effectively, there has to be a broad base of knowledge of underlying principles. This then has to be utilized by shrewd selection of priorities and pathways, steadily to enhance the total systems understanding, so that the pay-offs from particular products or services, will truly reflect the mainstream of economic need and opportunity, rather than being incidental, even though superficially attractive by-ways.

For example, in information handling and communications, we know that encoding of knowledge is the crucial systems element and human information needs to be put into electronic or photonic form. There is in the systems parameter of capacity which is reflected in nature's wave spectrum, the electromagnetic spectrum.

Systems perspectives of this kind are fortunately rare and in important fields like chemistry of life processes or physics of energy transfer, only fragments can be provided. Nevertheless, it is important to do this and to seek always to fill out the major gaps in systems description and specification, so that increasingly meticulous selection of R&D topics for eventual commercialization can be made. A key element is in the handling of large volumes of information systematically and the great surge of digital computer and communications capabilities nowadays helps this dramatically. Likewise, the systems aggregation will constantly remind the executive and technical leader that there is no substitute for quality and that a few inspired and creative people will far outpace large communities of diligent but relatively routine workers as effective commercialization is sought.

Overall, then, we shall see that in a given industry the steady acquisition of a systems scheme for the business in which the technology and its indispensable scientific support are concretely specified rather than being abstractly designated as something relating to atoms and molecules that will be filled in by a given research program, as needed. This systems acquisition is indispensable. Doubtless, learning from it can lead to large yawns when the degree of detail needed for effective systems scheme, whether for fertilizer, crop controls, semiconductors, fibers or fish farms becomes evident. But it does seem that such increasing scientific detail will be essential to recognize opportunities and priorities for technology and that the companies investing steadily in the underlying science will find it a precious strategic resource for management and planning, as much as a direct stimulus for the technology that it can eventually produce.