Time wars: Is there a financial undertow from accelerating technical advance?

OVERVIEW: "We spend too much on technology, and we don't earn enough from i t!" This quote, attributed to Siemens' CEO Heinrich von Pierer in 1994. ant icipates the essential question explored in this article. Is the strategy o f ever-heavier commitments to internal R&D spending to establish al? advant age in time-based competition inherently; self-limiting? Investment-mix shi fts to support accelerating technical advance as well as deteriorating rate s of new cash returns to those shifts have been widespread throughout U.S. manufacturing since the mid-1970s. While no causal linkage between the two trends is detectable in the aggregate, there is a strong possibility that s uch a linkage functions at the level of specific sectors ann industries. Th is has implications for both broad and deep industrial restructuring as wel l as the deployment of time-based competition as a corporate strategy.