THE ECONOMIC CONTRIBUTION OF 

THE DEPARTMENT OF THE NAVY 

TECHNOLOGY TRANSFER PROGRAM

DEPARTMENT OF THE NAVY

Technology Transfer Program Office

October 2010
Contents

Executive Summary..........................................................................................1

Purpose of Study ...............................................................................................3

Limitations.........................................................................................................3

Methodology......................................................................................................3

Findings ..............................................................................................................5

T2 Company Profiles ......................................................................................5

Profiles by Company Size ...............................................................................6

Profiles by Agreement Type ............................................................................7

CRADAs .....................................................................................................7

PLAs ............................................................................................................9

LP-CRADAs.............................................................................................11

IMPLAN Results.............................................................................................11

Future Directions............................................................................................13

Conclusion........................................................................................................14

Notes..................................................................................................................14

Appendix...........................................................................................................15

IMPLAN........................................................................................................15

Sample Survey (CRADA).............................................................................17

The Economic Contribution 

of the Department of the 

Navy Technology Transfer 

Program

Submitted by:

Indiana Business Research Center

Kelley School of Business

Indiana University

100 S. College Avenue, Suite 240

Bloomington, Indiana 47404

Jerry Conover

Director

Timothy Slaper

Project Manager

Tanya Hall

Research Analyst

Matthew Kinghorn

Research Analyst

Sponsored by:

Department of the Navy 

Technology Transfer Program Office

http://www.onr.navy.mil/tech-transfer
Indiana Business Research Center | 1

Technology transfer (T2) agreements can have 

significant economic benefits in the civilian sector, 

especially for small, entrepreneurial start-up 

companies that are the backbone for innovation and 

economic growth.

The Indiana Business Research Center (IBRC) collected 

operating and financial data for more than 100 T2 

agreements (“deals”) with naval laboratories. These T2 

deals are directly responsible for 670 jobs. Of the 103 

agreement partners—predominantly firms but also 

including universities and nonprofits—most provided 

employment data, reporting that these deals created or 

maintained over 400 jobs (see Table 1). The IBRC estimates 

that T2 agreements directly supported more than 260 

additional jobs based on the expanded economic output 

associated with the agreement partners that did not answer 

the employment questions.

Two-thirds of the agreement partners that participated 

in the survey were small, with fewer than 100 employees, 

as shown in Table 2. More than half of the small T2 

partners reported that, on average, 12 jobs were created or 

retained as a result of their T2 agreements, highlighting the 

noteworthy effect that T2 agreements can have on small, 

innovative start-up companies.

For every job that T2 agreements directly support, an 

additional three jobs are created in the civilian economy 

through economic ripple effects. The T2 deals considered in 

this study, therefore, are responsible for supporting more 

than 2,600 civilian jobs. 

1

Agreement Type New 

Jobs

Retained 

Jobs Total

CRADAs 117 66 183

PLAs 129 94 223

Subtotal as Reported by 

Survey Respondents 246 160 406

Estimated employment 

for respondents that did 

not report employment 

statistics

264

Total Direct Employment 670

Size of Organization Respondents %

N=84

Very Small (1 to 9 employees) 32%

Small (10 to 99 employees) 35%

Medium (100 to 499 employees) 16%

Intermediate (500 to 999 employees) 0%

Large (1,000 to 4,999 employees) 5%

Very Large (5,000+ employees) 13%

Table 2: T2 Respondents by Company Size

Table 1: Employment Directly Attributed to T2 Agreements

“For every job that T2 agreements directly support, an additional three jobs are created 

in the civilian economy through economic ripple effects. The T2 deals considered in this 

study, therefore, are responsible for supporting more than 2,600 civilian jobs. ”

EXECUTIVE SUMMARY
2 | The Economic Contribution of the Department of the Navy Technology Transfer Program

The estimated direct economic output associated with 

these 103 agreements totaled $200 million. The economic 

ripple effect of this output generated an estimated $345 

million in additional economic activity. Thus, the economic 

impact of these T2 deals for the civilian economy totaled 

over a half billion dollars (in 2009 dollars). The federal, 

state and local taxes generated by this economic activity are 

estimated to total $60 million, averaging nearly $614,000 

per agreement (see Table 3).

Of the 103 deals considered in the report, 64 percent 

were cooperative research and development agreements 

(CRADAs) and 30 percent were product license agreements 

(PLAs), with the balance consisting of limited purposeCRADAs (LP-CRADAs). On average, a CRADA supported 

over eight jobs while a PLA, on average, supported 10 jobs.

Compared to the U.S. average compensation per worker 

of $56,100, the direct T2 compensation per full-time job 

averaged $79,300 per year. 

In contrast to a return on investment (the percentage 

return of a one-time capital expenditure that is generated 

annually from an investment) or a benefit-cost analysis (the 

comparison of the total dollar cost of a project or activity 

with the total dollar benefits), the “economic impact” of a 

project or a company is a one-year snapshot that measures 

the dollar and employment magnitude of the economic 

activity generated by that project or by the presence of that 

company. The economic impact, or economic footprint, can 

be compared to the size of an economy (gross domestic 

product) or the number of people employed in a region, 

state or country.

The estimated economic impact presented in this report 

applies only to the agreement partners that participated 

in the study. The economic footprint of these 100-plus 

deals cannot be considered averages for all Department of 

Defense T2 agreements or agreement partners. It would 

be inappropriate, therefore, to extend the results to the 

universe of all T2 agreements. 

N=103

Direct Economic Effect $200 million

Estimated Economic Ripple Effects $345 million

Total Economic Impact $545 million

Estimated Taxes Generated from 

Economic Activity $60 million

Average Compensation per FullTime Job $79,300/year

Table 3: Economic Impacts of T2 Agreements

“Compared to 

the U.S. average 

compensation 

per worker of 

$56,100, the direct 

T2 compensation 

per full-time job 

averaged $79,300 

per year. ”
Indiana Business Research Center | 3

Purpose of Study

The Indiana Business Research Center (IBRC) at Indiana 

University’s Kelley School of Business was commissioned 

to quantify the economic contribution of technology 

transfer (T2) from Department of the Navy laboratories 

(DoN labs) to the civilian sector, consisting predominantly 

of companies and university partners. The T2 agreements 

(or “deals”) assessed in the study included cooperative 

research and development agreements (CRADAs), patent 

license agreements (PLAs), and limited purpose-CRADAs 

(LP-CRADAs) that involve research, technology transfer, 

technology transition and technology licensing. This report 

systematically quantifies and summarizes the economic 

impact of T2 agreements—employment, economic output 

and productivity—for more than 100 companies and other 

deal partners. 

This report presents the economic impact of these T2 

agreements. The economic impact, or economic footprint, 

refers to the magnitude of the economic activity associated 

with a business or other economic entity—e.g., a university 

or DoN lab—that may be compared to gross domestic 

product for a county, state or country.

This report begins by noting the limitations of the study 

findings to ensure that the reader interprets the results in 

their proper context. Second, the methodology is presented. 

Third, the findings are discussed in terms of company 

size and agreement type. Fourth, the report presents 

the estimated economic impact of T2. Finally, there is a 

discussion about future directions for research on T2. 

Limitations

The findings of this study should not be generalized to 

all T2 agreements or agreement partners. Constraints on 

data collection and the inability to scientifically select a 

sample of agreement partners imply that the results do not 

necessarily apply to all T2 deals. The T2 database provided 

for this analysis does not include details about partner 

companies (and universities or other entities) that would 

allow researchers to make statistical inferences about T2 

partner firms that did not participate. The reader should 

therefore not use the results from participating partners to 

extrapolate the economic benefits to any other T2 partner 

or set of partners.

The research team encountered several limitations that 

affect the study findings. Foremost, in the interest of DoN 

confidentiality considerations, the database provided by 

the DoN did not include points of contact for deal partners. 

In most cases, the IBRC team sent letters encouraging firms 

to participate in the survey to the president of the company 

in the hope that the letter would reach the appropriate 

person. In many if not most cases, the research team 

garnered the name of the company president from Internet 

searches or business databases such as Dun and Bradstreet. 

This strategy worked in general, but there were sometimes 

considerable delays from the time the letter was sent until 

the appropriate person received the letter. In one case, a 

contract manager did not receive the survey invitation until 

after the survey had closed (about two months after the 

initial mailing).

The cooperation of the company and the “ORTA” 

(managers of T2 activity, based in the Office of Research 

and Technology Applications at each DoN lab) was critical. 

Many ORTAs helped the IBRC by encouraging their 

contacts at the various partner companies to complete 

the survey without disclosing the contacts to the IBRC. 

Because the ORTAs are considered trustworthy sources 

and would be able to convince the partner firms that 

the T2 research and the survey were supported by the 

DoN, the IBRC asked ORTAs to use their email contacts 

with their partner companies to promote the survey. 

Although it was not optimal to be heavily dependent on 

the ORTAs for distributing the survey information, this 

allowed the contact information to remain confidential. 

While confidentiality remained intact, the research team 

was so constrained by the lack of information about the 

agreements and partner firms and inability to contact 

partner firms directly that the ability to complete the study 

was in jeopardy. Were it not for additional data provided 

by TechLink (see the methodology section for details), 

the study would not have been able to hit the 100-deal 

threshold. 

This study does not report a return on investment 

(ROI)—the percentage return of a one-time capital 

expenditure that is generated annually from the 

investment—because capital expenditure data for the 

DoN labs and agreement partners were not available. 

Neither does this study present a benefit-cost analysis 

that compares the total dollar cost of a project with the 

total dollar benefits over the life of the project. In order to 

calculate the benefit-cost ratio, one would need detailed 

expenditure data for DoN compensation, materials and 

capital, as well as partner compensation, material input, 

capital expenditures and associated revenues for each T2 

agreement. 

Methodology

The Department of Navy provided the Indiana Business 

Research Center data on more than 2,000 CRADAs, PLAs 

and LP-CRADAs from 1999 to mid-2009. These data 

included the agreement number (if available), start year of 

agreement, agreement subject, and the industry partner’s 

name (if available), address, and phone number. Using 

this information as a foundation, the IBRC researched 

partner entities via web searches and business information 

databases such as Dun and Bradstreet to identify potential 

points of contact, verify the existence of the companies 
4 | The Economic Contribution of the Department of the Navy Technology Transfer Program

and other company details. About 800 agreements were 

removed from consideration because partner information 

was inadequate or non-existent. It is likely that many 

of those companies removed from consideration had 

changed names or ownership and were, as a result, not 

traceable. Given that the goal of the study was to measure 

the economic benefits of 100 agreements and, the research 

team reasoned, the longer a start-up company existed the 

more likely it would be purchased by another firm and 

thus no longer be traceable, it would be better to survey 

the partners of the more recent deals. Hence, the research 

team contacted all T2 partners with a PLA, a CRADA 

or LP-CRADA in years 2005 to 2009 for a total of 622 T2 

partners. 

In order to estimate the economic impact of a partner 

firm’s T2 agreement, the research team needed companylevel data. As a result, the research team spent several 

months developing and refining the survey instrument. 

Early versions of the survey were deployed in two pilot 

studies in order to determine the best method of obtaining 

survey results from T2 partners. Based on feedback 

from the pilot surveys and several conversations with 

partner firms/individuals about the best way to encourage 

participation, the team settled on using a web-based survey 

as the primary means of collecting company information. 

In addition, the team refined the survey questions and 

implemented a strategy to encourage participation by 

encouraging each DoN laboratory’s ORTA to advocate on 

behalf of the research and the survey. 

The “deal count” threshold for the study, as specified in 

the project scope of work, was at least 100 agreements for 

which to quantify the economic benefits. The final count 

totaled 103. The majority of data were collected via the 

survey, with some data gathered from previous research 

conducted by TechLink.1 TechLink conducted a study that 

estimated the economic benefits of the T2 agreements it had 

facilitated, and the methodology for measuring economic 

impacts was the same as that used by the IBRC. While the 

TechLink data collection method was different—they could 

call their company partners directly while the IBRC had to 

use a survey—the fact that TechLink used the same method 

to estimate economic ripple effects allowed for a seamless 

integration of our results. In order to ensure that the “deal 

timeframe” was consistent between the survey data and the 

TechLink data, only 19 of the 70 TechLink study responses 

were included.

As with the TechLink study findings, the findings 

from this study cannot be generalized to all T2 agreement 

partners. Rather, the results provide a snapshot of the 

economic benefits from the 103 T2 agreements for which 

the IBRC was able to compile data. 

Pursuant to measuring the economic ripple effects of T2, 

the IBRC research team used the traditional input-output 

modeling approach to assess the size of the economic 

linkages and economic impact associated with the T2 

agreements. The IMPLAN® modeling system software 

developed by Minnesota IMPLAN Group, Inc., has been 

used by more than 1,000 public and private institutions to 

measure the size of their economic presence in their local or 

state economies.2

A critical data input for IMPLAN analysis is the change 

in company output due to an “event,” in this case the 

presence of a T2 agreement. The research team relied 

on the amount of additional annual revenue that survey 

respondents attributed to their T2 agreements for the 

change in company output. In some cases, however, survey 

respondents did not provide responses for their increased 

revenues. In these instances, the research team used either 

the change in employment and payroll or the change in the 

annual dollar value of operating expenses as data inputs 

for the IMPLAN model. 

Three types of effects estimated by the IMPLAN 

model—direct, indirect and induced effects—are important 

to understanding the nature of the economic ripple effects 

generated by the T2 agreements in the United States. Direct 

effects express the increase in final demand (revenue) or 

employment that firms experience as a result of their T2 

agreements. 

Indirect effects measure the change in dollars or 

employment caused when firms with T2 agreements 

increase their purchase of goods and services from 

suppliers and, in turn, those suppliers purchase 

more inputs and so on throughout the economy. A 

pharmaceutical manufacturer with a T2 agreement, 

for instance, will buy test tubes from a supplier. The 

manufacturer of the test tubes buys electricity to power 

its plant, buys material inputs for those test tubes and 

hires people to run the equipment. These transactions 

constitute the indirect ripple effects associated with the 

pharmaceutical manufacturer’s purchases. The degree to 

which the money re-circulates in the area’s economy—or 

the magnitude of the multiplier—is determined by whether 

the manufacturer is located within the geographic unit of 

analysis. For this study, the entire U.S. was considered the 

area of interest, so impacts were estimated for the nation as 

a whole.

Finally, induced effects—whether in dollars or 

employment—reflect changes in spending that result from 

the household income of employees that, in turn, change 

as output changes along the economic supply chain. For 

example, as a firm’s production and sales increases, the 

output of the supply chain increases correspondingly. 

Those output changes also result in changes in household 

income and spending. Induced effects represent the change 

in overall economic output and employment resulting from 

those household spending changes. 

The total of all economic effects is the size of the 

economic impact and is the sum of the direct, indirect and 
Indiana Business Research Center | 5

induced effects. The IMPLAN model also tracks the tax 

effects associated with all the transactions and economic 

activity associated with the direct and ripple effects. For 

example, household spending at retailers generates state 

sales tax. In addition, those retailers also pay property 

taxes to local governments. As a result, this analysis 

estimated the state and local government tax flows. 

The other reported measure is the multiplier. The 

multiplier is the magnitude of the economic response in a 

given geographic area associated with a change—either an 

increase or a decrease—in the direct effects. For example, 

every dollar of revenue attributed to T2 agreements is 

estimated to be multiplied by about 2.7 within the United 

States. Put another way, every dollar of revenue linked 

directly to a T2 deal generates, on average, an additional 

$1.70 in economic activity throughout the national 

economy.

As stated above, the IBRC and TechLink studies used 

the same method to measure the economic ripple effects 

but different data collection methods. TechLink provided 

the IBRC the necessary data inputs for the IMPLAN model, 

but no other information about the T2 partners other 

than the agreement number. (The research team used the 

agreement number to purge those records from its survey 

sample. Those deal partners did not receive a survey.) As a 

result, the TechLink data were not as complete as the data 

collected by the survey. Thus, the descriptive information 

about the T2 agreement partners, e.g., company size, is 

limited to the 84 completed IBRC-initiated surveys. See the 

appendix for a sample of the IBRC survey.

Findings

T2 Company Profiles

The IBRC sent the T2 survey to 622 agreement partners, of 

which 84 (14 percent) successfully completed the survey. 

This relatively low participation rate was not unexpected, 

due to the lack of contact information and the fact that the 

survey requested primary data on financially sensitive 

information. The 84 usable survey responses make up the 

subset of data for the company and agreement type profiles 

below. 

This section first discusses general characteristics of the 

84 agreement partners, followed by a breakout of results 

by company size. Placed in the context of predominantly 

small company size, the T2 benefits are impressive. The 

findings are then broken out by type of agreement.

As Table 4 shows, the majority of the agreements were 

CRADAs, followed by PLAs and LP-CRADAs. This is 

consistent with the nearly a 4:1 ratio of CRADAs to PLAs 

in the T2 deal database. 

A large portion of the T2 agreements were with smaller 

companies—start-ups, spin-offs and other new business 

ventures by entrepreneurs (see Table 5 and Table 6). Most 

respondents classified themselves as a small or very small 

private company. A small percentage of these agreement 

partners are minority- or woman-owned (14 percent) and 

four agreement partners reported that they had been DoD 

laboratory federal employees who spun off businesses. 

Most of the agreement partners were in either the 

manufacturing (42 percent) or the professional, scientific 

Survey Information Quantity %

IBRC survey set 622

Incomplete surveys (useable) 62 10%

Completed surveys 84 14%

 CRADAs 61 73%

 PLAs 17 20%

 LP-CRADAs 6 7%

Usable TechLink agreements 19

 CRADAs 5 26%

 PLAs 14 74%

Size of Organization 

(Number of Employees)

Survey 

Set % Respondents %

N=622 N=84

Very Small (1 to 9) 11% 32%

Small (10 to 99) 33% 35%

Medium (100 to 499) 14% 16%

Intermediate (500 to 999) 6% 0%

Large (1,000 to 4,999) 7% 5%

Very Large (5,000+) 4% 13%

Unknown 25% -

Table 4: Survey Responses by Agreement Type

Table 5: Company Size

Organization Type %

N=84

Private Company 84%

University or College 2%

Nonprofit (Research) 0%

Nonprofit (Service) 5%

Government 2%

Other 7%

Table 6: Organization Type
6 | The Economic Contribution of the Department of the Navy Technology Transfer Program

and technical services sector (38.5 percent). Within 

the manufacturing sector, no one particular industry 

dominated. However, within the professional, scientific, 

and technical services sector, nearly two-thirds of the 

partner firms are in the scientific research and development 

services industry. The majority of the partner firms in the 

scientific R&D services industry are located in California 

or Maryland, with their neighboring states in the West and 

Mideast also dominating the U.S. R&D landscape. 

More than half of the agreement partners had one or 

more prior experiences with a Department of Defense 

laboratory in the form of a government contract, Small 

Business Innovation Research (SBIR) grant, or another 

CRADA (see Table 7). This prior collaboration experience 

appears to strongly influence the company’s desire to 

pursue additional technology transfer agreements. Fifteen 

agreement partners reported that their technologies were 

in perpetual development and it is thus highly likely that 

their partnerships with DoD laboratories will continue as 

the technologies continue to evolve. Sixty percent of these 

continuing agreements were with agreement partners who 

had CRADAs and the remainder had PLAs.

Profiles by Company Size

In this section, the T2 agreement partners are categorized 

into three general strata: small (1 to 99 employees), medium 

(100 to 999 employees) and large (1,000+ employees) 

organizations.

Medium-sized agreement partners took the shortest 

amount of time to develop their technology and also 

experienced the largest increase in the technology readiness 

levels (TRLs),5 as shown in Table 8a through 8c. Small 

and large agreement partners tend to spend more time 

developing their technology than medium-sized agreement 

partners and their technology readiness profile appear to 

be similar, in contrast to medium-sized firms. 

When looking at employment results by company 

size, it becomes apparent that small agreement partners 

experienced the most growth due to the T2 agreement. 

About half (51 percent) of the small agreement partners 

created or retained jobs as a result of the technology, 

averaging nearly 12 full-time, mostly permanent positions 

per company at salaries averaging $57,700 (see Table 9). 

Considering their small size, increasing or retaining an 

average of 12 employees could have a significant impact 

on the company. Large agreement partners reported an 

average increase or retention of five permanent, full-time 

Prior Experience %

N=84

Had Prior Experience? 70%

 SBIR3 40%

 STTR4 20%

 CRADA 31%

 PLA 8%

 Government Contract 51%

 Other 5%

Table 7: Prior Experience with DoD Laboratory

Respondent 

Averages

# of Survey 

Respondents

N=56

Time to develop

technology (months) 46 42

TRL at beginning 4.0 37

TRL at end 5.7 37

Had prior experience 

with DoD lab 71% 51

Respondent 

Averages 

# of Survey 

Respondents

N=13

Time to develop 

technology (months) 28 6

TRL at beginning 2.6 10

TRL at end 4.9 8

Had prior experience 

with DoD lab 85% 11

Respondent 

Averages

# of Survey 

Respondents

N=15

Time to develop

technology (months) 57 4

TRL at beginning 4.7 13

TRL at end 6.0 12

Had prior experience 

with DoD lab 80% 10

Table 8a: Technology Development, Small-Sized 

Partners (1 to 99 Employees)

Table 8b: Technology Development, Medium-Sized 

Partners (100 to 999 Employees)

Table 8c: Technology Development, Large-Sized 

Partners (1,000+ Employees)
Indiana Business Research Center | 7

employees, a modest gain given the initial size of these 

firms. 

Smaller agreement partners also had the most to gain 

in terms of average annual increases in gross revenue (see 

Tables 10a through 10c). It is interesting to note that small 

deal partners have relatively minor increases in expenses 

associated with the agreements, yet over half (55 percent) 

either expected or experienced increases in revenue 

averaging $2.9 million. Conversely, the expense associated 

with the agreements of large partners averaged $1.1 

million, but they expected or experienced relatively modest 

increases in average annual gross revenue ($502,500). For 

larger agreement partners, the fact that T2 agreements 

appear to “lose money” may reflect difficulty in obtaining 

information across multiple departments (engineering, 

payroll, finance, etc.). 

Profiles by Agreement Type

CRADAs

Sixty-one of the 84 survey respondents had CRADA 

agreements. From the start of a CRADA to the finish, these 

Small 

(1 to 99 

employees)

Large 

(1,000+ 

employees)

Agreement affected fulltime employment 51% 20%

Average number of new 

jobs per company 6.5 3

Average number of 

retained jobs per company 5.4 2

New or retained jobs that 

were permanent 96% 100%

Average annual salary of 

new or retained job $57,700 $50,000

Table 9: Effect of T2 Agreements on Employment by 

Partner Size

Value or Percentage # of Survey Respondents

N=56

Average annual direct expenses associated with agreement $234,030 36

Experienced cost savings due to agreement 27% 55

Average annual value of cost savings $57,545 55

Type of cost savings experienced:

Equipment cost savings 71% 15

Payroll cost savings 21% 15

Research cost savings 50% 15

Material or component input cost savings 36% 15

Other cost savings 14% 15

Expected or experienced increased revenue 55% 56

Average annual increase in gross revenue/company $2,911,030 32

Increased revenue due to:

Improved or extended an existing product 34% 32

Increased sales 28% 32

Other 53% 32

Table 10a: Financial Implications of T2 Agreements for Small-Sized Agreement Partners

Note: The calculation for average annual value of cost savings omits an outlier that originally strongly skewed the results. 

Notes: Values are calculated based on the number of agreement 

partners who answered the respective questions. Medium-sized firms 

reported no effect on full-time employment.
8 | The Economic Contribution of the Department of the Navy Technology Transfer Program

Value or Percentage # of Survey Respondents

N=13

Average annual direct expenses associated with agreement $158,945 11

Experienced cost savings due to agreement 39% 13

Average annual value of cost savings $10,000 13

Type of cost savings experienced:

 Equipment cost savings 40% 5

 Payroll cost savings - -

 Research cost savings 100% 5

 Material or component input cost savings 60% 5

 Other cost savings - -

Expected or experienced increased revenue 15% 13

Average annual increase in gross revenue/company* - -

Increased revenue due to:

 Improved or extended an existing product 50% 2

 Increased sales 50% 2

 Other 50% 2

Value or Percentage # of Survey Respondents

N=15

Average annual direct expenses associated with agreement $1,017,140 12

Experienced cost savings due to agreement 27% 15

Average annual value of cost savings $673,300 15

Type of cost savings experienced:

 Equipment cost savings - -

 Payroll cost savings - -

 Research cost savings 75% 4

 Material or component input cost savings - -

 Other cost savings 50% 4

Expect to or experienced increased revenue 40% 15

Average annual increase in gross revenue/company $502,500 4

Increased revenue due to:

 Improved or extended an existing product 50% 6

 Increased sales 67% 6

 Other 17% 6

Table 10b: Financial Implications of T2 Agreements for Medium-Sized Deal Partners

Table 10c: Financial Implications of T2 Agreements for Large-Sized Deal Partners

*Medium-sized companies did not report actual or expected increases in revenue.
Indiana Business Research Center | 9

respondents spent on average nearly 52 months (4.3 years) 

developing the CRADA’s technology, during which time 

the technology readiness level (TRL) increased almost two 

levels. The average TRL moved from 3.9 at the beginning 

to 5.7 the end of the agreement. Figure 1 presents the TRL 

profile of the CRADA partners at the beginning and end of 

their agreements. 

Agreement partners entered into CRADAs with 

several objectives and expected outcomes. As presented 

in Table 11, the top four CRADA objectives are to use the 

DoN laboratory, further develop the technology, develop 

a prototype for naval applications, and gain access to 

material or component input for a product or service. 

The top four expected outcomes consisted of advancing 

the research on the technology, developing/improving 

a technology process, commercializing a product and 

increasing company profits. 

Thirty-six percent of the partners with CRADAs 

reported that the agreement affected their full-time 

employment by creating an average of 5.3 new jobs 

per company. Seventeen of the 22 agreement partners 

reported that the agreement retained an average of 3.9 jobs. 

Interestingly, 14 of the 22 agreement partners reported 

that they created new jobs as well as retained current jobs. 

The majority (88 percent) of the jobs were permanent. 

These jobs averaged $67,700 annually and were primarily 

located mostly in the Far West (33 percent), followed by the 

Southeast (21 percent) and Mideast (17 percent).6

Nearly all of the agreement partners generated CRADArelated expenses (90 percent). Nearly 33 percent reported 

cost-avoidance or savings due to the T2 partnership. The 

annual expense associated with the average CRADA in the 

survey set was around $400,000, with slightly more than 

half of the expenses devoted to employee compensation 

(52 percent). The high percentage devoted to employee 

compensation is due to each company having an average of 

three employees working on the CRADA’s technology. 

PLAs

Seventeen of the 84 survey respondents had PLA 

agreements. The vast majority (82 percent) of them had 

commercialized their technologies and were at various 

stages of production at the time of the IBRC survey (see 

Table 12). Compared to CRADAs, PLAs spent less time in 

technology development (42 months vs. 52 months). The 

remainder of this section will refer to all PLAs included 

in the analysis, 17 from the IBRC survey and 14 from 

TechLink, for a total of 31 PLAs. 

Nearly three-fourths (22, or 71 percent) of the agreement 

partners reported the PLA outcome had affected fulltime employment, with several mentioning that their 

employment numbers were expected to grow in the near 

future. On average, each partner created nearly six jobs and 

Figure 1: CRADAs and Their Technology Readiness Levels

“Collectively speaking, these 22 

agreement partners created or retained a 

total of 223 jobs, with more than half of 

these jobs considered permanent. ”

0 2 4 6 8 10 12 14 16

9: Actual application of technology is in its final form

8: Technology is proven to work; end of true system

7: Prototype near or at planned operational system

6: Model/prototype is tested in relevant environment

5: Fidelity of breadboard technology improves significantly

4: Basic technological components are integrated

3: Active R&D is initiated

2: Invention begins

1: Scientific research begins translation to applied R&D

Number of Partners

Deal Start (N=53) Deal End (N=49)

Mean TRLs

Start: 3.9

End: 5.7
10 | The Economic Contribution of the Department of the Navy Technology Transfer Program

retained about nine jobs. Collectively speaking, these 22 

agreement partners created or retained a total of 223 jobs, 

with more than half of these jobs considered permanent. 

Similar to the CRADA jobs, they tend to be located in the 

Far West region (41 percent). Of the 12 agreement partners 

reporting, average employee compensation was around 

$53,000. 

A PLA technology can have a significant effect on the 

company’s finances. Although only three of the 31 PLA 

agreement partners reported cost savings, the returns 

were more evident in the average annual change in profits 

and gross revenues. Twenty-four of the PLAs (77 percent) 

reported an average increase of nearly $4.8 million in their 

gross revenues and 14 agreement partners (45 percent) 

reported an average profit of $2.3 million. Most (71 percent) 

of the increased gross revenues were a result of improving 

or extending an existing product. 

Nearly half of the respondents (48 percent) received 

either new or increased contract work due to the PLA’s 

technology, totaling 138 contracts. These PLA partners 

received an average of nearly 17 new or additional 

contracts each at an average value of nearly $11.1 million. 

Eight partners reported that these contracts created or 

retained 60 full-time jobs within their organization, 75 

percent of which are permanent. 

Five agreement partners also reported that they had 

licensed the technology to other entities. The average 

license duration is nearly 10 years and the average expected 

annual gross license revenue was reported at slightly more 

than $4 million. 

Objective # of 

Responses % Expected Outcome # of Responses %

N=61 N=61

Use of DoN lab equipment and/

or personnel 24 39% Advance research on a technology 33 54%

Further develop technology 22 36% Develop/improve a 

technology process 32 53%

Develop a prototype for naval 

applications 16 26% Commercialize a product 24 39%

Material or component input for 

a product/service 16 26% Increase profits for the company

15 25%

Develop a prototype for internal 

applications 13 21% Publish a paper on research findings 11 18%

Pure, basic research 11 18% Enter into a PLA 11 18%

Conduct clinical trials 9 15% Other 9 15%

Access to software, data, or 

programming code 8 13% Develop a commercial offthe-shelf product 6 10%

Other 8 13% Develop a patentable 

invention 5 8%

Submit an invention 

disclosure 4 7%

Table 11: CRADA Objectives and Expected Outcomes

Note: Respondents were able to select multiple answers to the question, hence the larger number of responses than the number of CRADA 

responses

PLA Commercialization %

Commercialized the technology 82%

Current stage of development or commercialization

 Technology/product improvement 0%

 Early-stage/start-up production 24%

 Initial rollout marketing/sales planning 18%

 Full-scale production 18%

 Marketing/sales for full-scale production 18%

Table 12: PLAs and Degree of Commercialization
Indiana Business Research Center | 11

LP-CRADAs

Only six of the 84 survey respondents had LP-CRADAs, all 

but one of which was for material transfers. The objectives 

for those material transfers varied, as Table 13 shows. 

Likewise, the ultimate end user of the LP-CRADA varied, 

but most respondents indicated the end user would be 

either the U.S. Navy or another DoD agency. 

Only one of the six companies intended to 

commercialize the LP-CRADA technology to civilians. 

None of the respondents experienced or expected changes 

in their full-time employment. Some did incur financial 

expenses averaging $69,000, 73 percent of which were 

for employee compensation. There were also benefits 

stemming from the agreement. One company reported 

$80,000 in cost savings in equipment, research and material 

or component input expenses. Additionally, one company 

expected increased revenues due to the technology transfer 

in the form of payroll savings, but did not provide an 

estimate of the increased revenues. 

IMPLAN Results

The financial impact of the T2 program extends beyond 

the firms that hold agreements. In order to estimate the 

economic ripple effects of this program, the research team 

used the IMPLAN economic modeling software to conduct 

a standard input-output analysis of the private sector 

revenues generated by T2 agreements in 2009.

Of the survey respondents, 82 organizations provided 

the financial information needed to generate economic 

impact estimates. As mentioned previously, information 

for an additional 19 companies was provided by TechLink 

to bring the total number of agreement partners included 

in the input-output analysis to 101. These T2 agreements 

generated a total annual economic footprint of $545 million. 

As Table 14 shows, $200 million of this total is associated 

with the direct sales of T2 deal partners. Through 

those partners’ purchases of production inputs and the 

household spending of employees, this direct output 

generated another $345 million annually in economic 

ripple effects throughout the nation. A useful indicator 

for understanding the economic impact is the multiplier. 

The ratio of total effects to direct effects yields a multiplier 

of 2.7. This means that each dollar of output generated 

directly by these T2 agreements supported an additional 

$1.70 in economic activity in the broader economy ($1.00 + 

$1.70 = $2.70). 

The level of direct output creates an estimated 670 jobs 

for these 101 companies with T2 agreements. The ripple 

effects caused by purchases and household spending 

support another 1,960 jobs. The resulting employment 

multiplier of 3.9 indicates that 2.9 additional jobs are 

created for each new job generated by a T2 agreement. 

Employment multipliers tend to be higher than output 

multipliers since household spending (i.e., induced effects) 

supports many part-time and low-wage jobs in industries 

such as entertainment, food service and retail. 

Another way to consider the impact of T2 agreements is 

to look at the effects on a per-agreement basis. Given that 

these estimates are based on data gathered from 101 firms, 

each T2 agreement in this analysis generates an average of 

$5.4 million in annual economic output and creates 26 jobs. 

Many types of firms or institutions hold T2 agreements. 

Of the 101 survey respondents, 40 were engaged in 

some form of manufacturing while another 41 were in a 

professional, scientific or management field (see Table 

15). Agreements with chemical manufacturers generated 

the largest total economic output effect at $154 million 

annually and the largest multiplier at 3.0. The four firms in 

the information industry had the largest economic effect 

per agreement with an average total output of $16 million. 

Objective of LP-CRADA # of 

Responses

Test for the benefit of the Navy 3

Test for potential internal applications 2

Pure, basic research 2

Develop a product/service that uses the 

technology 2

Other 1

Material or component input for a 

product/service 1

Further develop the technology 1

Direct 

Effects

Indirect 

Effects

Induced 

Effects Total Multiplier

Economic Output ($ Millions) $200 $190 $155 $545 2.7

Employment 670 910 1,050 2,630 3.9

Table 13: LP-CRADA Objectives

Table 14: Nationwide Economic and Employment Footprint of Selected T2 Agreements, 2009 

Note: Respondents were able to select multiple answers to the 

question, hence the larger number of responses than the number of 

LP-CRADA responses
12 | The Economic Contribution of the Department of the Navy Technology Transfer Program

The numerous agreements in the professional, scientific 

and management fields had the second highest total 

economic effect, but averaged $3.2 million in total output 

per agreement—the lowest mark among these industries. 

As shown in Table 16, the 41 agreements in the 

professional, scientific and management industry have the 

largest total employment effect but the lowest employment 

multiplier. This is because this industry does not have a 

large supply-chain footprint. In contrast, manufacturing 

sectors, with the exception of fabricated metals, have larger 

employment multipliers due to the relatively large share 

of their top-line revenue that is consumed by purchasing 

production inputs—a large supply-chain footprint—which 

supports employment in other sectors. 

The T2 agreement partners tended to be in industries 

that offer high compensation per job (see Table 17). The 

estimated average annual compensation per job (including 

wages, benefits and payroll taxes) for each position created 

by a T2 agreement was $79,300. In contrast, the U.S. 

Bureau of Economic Analysis reports that average annual 

compensation for all U.S. jobs in 2008 (the most recent year 

available) was $56,116. 

The increase in revenues and employment attributed 

to T2 agreements also generate a range of tax revenues 

paid to federal, state and local governments. The IMPLAN 

economic modeling software calculates tax revenue 

estimates from corporate profit taxes, indirect business 

taxes (e.g., sales, property and excise taxes), personal 

taxes (e.g., income and property taxes) and employer and 

employee contributions to social insurance. Table 18 shows 

that the 101 agreements considered in this analysis spurred 

an estimated $62 million in annual tax revenues. That 

# of 

Agreements

Direct Output 

($ Millions)

Total Output 

($ Millions) Multiplier

Professional & scientific, management and 

administration 41 $47 $130 2.8

Miscellaneous industries 16 $25 $49 2.0

Chemicals, including pharmaceutical and plastics 

mfg. 14 $51 $154 3.0

Industrial machinery and miscellaneous equipment 

mfg. 11 $35 $93 2.7

Computer and electronic equipment mfg. 11 $13 $38 2.9

Information processing and communications 4 $23 $64 2.8

Fabricated metals mfg. 4 $7 $17 2.4

Total 101 $200 $ 545 2.7

# of 

Agreements

Direct 

Employment

Total 

Employment Multiplier

Professional & scientific, management and 

administration 41 300 860 2.9

Miscellaneous industries 16 60 200 3.3

Chemicals, including pharmaceutical and plastics 

mfg. 14 80 550 6.9

Industrial machinery and miscellaneous equipment 

mfg. 11 70 420 6.0

Computer and electronic equipment mfg. 11 20 130 6.5

Information processing and communications 4 110 370 3.4

Fabricated metals mfg. 4 30 90 3.0

Total 101 670 2,620 3.9

Table 15: Economic Footprint of Select T2 Agreements by Industry, 2009 

Table 16: Employment Footprint of Select T2 Agreements by Industry, 2009
Indiana Business Research Center | 13

comes to roughly $613,900 in annual taxes collected per T2 

agreement in the survey set.

Future Directions

The goal of this study was to quantify the economic 

footprint for 100 T2 agreements. The research team also 

collected rudimentary information on the development of 

agreement technologies—progress along the technology 

readiness path—and characteristics of agreement partners. 

In conducting this research, the team considered how to 

gain a better understanding of the economic benefits of 

T2 and how the DoD might maximize the benefits of T2. 

This experience suggests at least two potential research 

extensions.

The first extension could investigate the agreements 

dated between 1999 and 2004. For this report, the research 

team focused on agreements for naval laboratories between 

2005 and 2009 since it becomes increasingly difficult 

to identify and monitor the agreement entity (and the 

appropriate point of contact to participate in the survey) 

over time. However, it may have been more difficult for 

the respondents to estimate the financial returns and 

employment benefits for these more recent technology 

agreements which are often at a lower level of readiness. 

It has been hypothesized that many types of technology 

require years of development before their market potential 

can be fully realized. If so, many of the technologies from 

pre-2005 agreements may have even greater economic 

benefits than those chronicled here. It would be desirable, 

therefore, to survey companies that had T2 agreements 

before 2005. This would allow a better understanding of 

the length of time it takes for companies to fully develop a 

technology after partnering with the DoN laboratory. 

This survey would require vigorous ORTA support and 

assistance. Otherwise, the results of the research would 

be less robust than this study and yield only tentative 

conclusions.

The second proposed research extension is to expand the 

methodology and scope of the survey to attempt to track 

how a technology from the 1999 through 2004 timeframe 

developed and evolved. If it indeed takes several years for 

an agreement to bear significant commercial fruit, the path 

for high-value technologies could be charted. 

There would be challenges, however. Nearly half of the 

622 partners in the survey sample were small, i.e., they 

employed fewer than 100 people, and over 60 percent of 

the survey respondents were small. Small start-up firms 

can be the most dynamic and entrepreneurial members of 

the economy. They can also be the most transient. Many 

start-ups are acquired by larger firms that, in turn, may be 

purchased by even larger companies. Tracking the start-ups 

and their agreement technologies will require even more 

vigorous ORTA support, assistance, time and resources. 

A more comprehensive study would not necessarily 

need to engage all ORTAs. It may be preferable to select a 

dozen ORTAs to help facilitate direct contact with a couple 

dozen partners to flesh out how technologies evolve and 

move from the lab to the market. The research would be 

more akin to a collection of case studies in technology 

development, but would also include an economic impact 

analysis. The case study findings could be used as a 

foundation for the DoD to track and monitor technology 

transfer and transition in the future.

The case studies could also serve as a foundation 

for perfecting the method to collect data for measuring 

the economic benefits of T2, as well as improving the 

management of the technology transfer and transition 

agreements. While the method to estimate economic effects 

is well-established (using IMPLAN and other modeling 

software), producing unassailable estimates of an economic 

footprint, or, for that matter, the benefit-to-cost ratio and 

other measures of economic performance, is predicated 

upon good hard data. An online survey is not the best 

method to collect these data. A far superior method would 

entail a detailed data collection and reporting procedure 

Federal State and 

Local Total 

Tax Revenue ($ Millions) $39 $23 $62

Table 18: Tax Revenues Generated by Select T2 

Agreements, 2009

Average 

Compensation 

per Job

Chemicals, including pharmaceutical 

and plastics mfg. $83,400 

Computer and electronic equipment 

mfg. $90,200 

Fabricated metals mfg. $67,400 

Industrial machinery and 

miscellaneous equipment mfg. $99,000 

Information processing and 

communications $70,400 

Professional & scientific, management 

and administration $75,600 

Miscellaneous $87,600 

Total $79,300 

Table 17: Estimates of Compensation per Job for 

Companies with T2 Agreements by Industry, 2009
14 | The Economic Contribution of the Department of the Navy Technology Transfer Program

for both the laboratory as well as the agreement partner. It 

would take time to design, implement and evaluate such 

a procedure. Once the procedure was perfected, data for 

all DoD agencies involved with T2 could be collected. This 

would, in turn, enhance the measurement of the economic 

benefits of T2 for all of the DoD. Without being able to 

measure the economic performance of T2, it is difficult if 

not impossible to manage it. 

Conclusion

Technology transfer not only benefits the warfighter; it 

can also have significant economic benefits for the civilian 

sector. An examination of 103 T2 agreements with naval 

laboratories shows that these deals contribute 670 jobs 

directly. Those jobs help to support an additional 1,960 jobs 

throughout the economy. 

The estimated direct economic output associated with 

these 103 agreements totaled $200 million, which in turn 

generated an estimated $345 million in additional economic 

activity. The economic impact of these T2 deals thus totaled 

over half a billion dollars in the civilian economy.

The economic impact of T2 is especially important for 

small, entrepreneurial start-up companies. It is widely 

accepted that such firms are the most dynamic and 

innovative in the economy, representing the engine of 

future economic growth.

This study focused on 103 agreement partners. The 

constraints placed on the research methodology limits 

the ability to extend the results to the universe of all T2 

agreements. Extensions and improvements to this study—

extending the timeframe and broadening the scope—would 

require robust commitments and assistance from ORTAs 

and the Department of Defense offices of technology 

transfer and transition. The research team recommends 

a series of technology transfer and transition case studies 

that could be used as a foundation for the DoD to track and 

monitor technology transfer and transition in the future 

and more accurately measure the economic benefits of T2 

in the civilian sector.

Notes

1. TechLink helps the Department of Defense 

commercialize leading-edge new technology by 

partnering DoD labs with private sector companies 

for technology licensing, transfer, and research and 

development. Located at Montana State University, 

TechLink has worked with approximately 75 percent of 

the 123 Defense labs and centers nationwide, facilitating 

more than 650 technology transfer partnerships, 

including over 200 license agreements. See http://www.

techlinkcenter.org/ for more information.

2. Please see the appendix for a more detailed description 

of the IMPLAN software, or explore the IMPLAN 

website at: http://implan.com.

3. The Small Business Innovation Research (SBIR) 

program is a set-aside program for domestic small 

business concerns to engage in research/research 

and development (R/R&D) that has the potential for 

commercialization. Federal agencies with extramural 

research and development budgets over $100 million are 

required to administer SBIR programs using an annual 

set-aside of 2.5 percent for small companies. 

4. The Small Business Technology Transfer (STTR) 

program is very similar to the SBIR program and is 

funded by federal agencies with extramural research 

and development budgets over $1 billion annually 

setting aside 0.30 percent for small businesses. One of 

the differences between the two programs is that STTR 

recipients must formally collaborate with a research 

institution in Phase I and II of the grant.

5. Technology readiness levels (TRLs) indicate the level 

of technology maturity based on its capabilities for an 

intended purpose. For example, TRL 1 is the stage of 

basic science research, and the highest, TRL 9, represents 

technologies that have passed testing under expected 

operating conditions. See the sample survey in the 

appendix for more TRL definitions. 

6. These regions are defined by the Bureau of Economic 

Analysis at http://www.bea.gov/regional/docs/regions.cfm.

“The estimated direct economic output 

associated with these 103 agreements 

totaled $200 million, which in turn 

generated an estimated $345 million 

in additional economic activity. The 

economic impact of these T2 deals thus 

totaled over half a billion dollars in the 

civilian economy.”
Indiana Business Research Center | 15

IMPLAN

Minnesota IMPLAN Group, Inc. is the company responsible for the production of IMPLAN data and software. Using 

classic input-output analysis, IMPLAN can be used to measure the effect on a regional or local economy of a given change 

or event in the economy’s activity. It also allows the user to build economic models estimating the effects of a proposed 

industry or economic change in a specific economic region. 

How Did IMPLAN Come to Be? 

In the late 1970s and 1980s, the U.S. Department of Agriculture’s Forest Service found itself wrestling to answer questions 

about the economic impact of its work. Legislation required the forest service to report annually on the impact of its 

activities. So the forest service had developed a mainframe computing tool called IMPLAN, short for “impact analysis for 

planning.” The Minnesota IMPLAN Group mission has been to provide affordable, user-friendly software and economic 

data that their clients can use to study regional economies—not just the effects of lost logging business, but what tourism 

or manufacturing contributes to the economy, what the results of increased or decreased product demand or employment 

in a particular industry will be, or how effective government spending is in bringing about economic development. 

The Economic Theory behind IMPLAN 

IMPLAN is built on a mathematical input-output (I-O) model developed by Wassily Leontief, the 1973 Nobel laureate in 

economics, to express relationships between sectors of the economy in a chosen geographic location. In expressing the 

flow of dollars through a regional economy, the input-output model assumes fixed relationships between producers and 

their suppliers based on demand. It also omits any dollars spent outside of the regional economy—say, by producers who 

import raw goods from another area, or by employees who commute and do their household spending elsewhere. 

The idea behind input-output modeling is that it’s the inter-industry relationships within a region that largely 

determine how that economy will respond to change. In an I-O model, the increase in demand for a certain product or 

service causes a multiplier effect, layers of effect that come in a chain reaction. Increased demand for a product affects 

the producer of the product, the producer’s employees, the producer’s suppliers, the supplier’s employees, and so 

on, ultimately generating a total effect in the economy that is greater than the initial change in demand. Say demand 

for Andersen Windows’ wood window products increases. Sales grow, so Andersen has to hire more people, and the 

company may buy more from local vendors, and those vendors in turn have to hire more people... who in turn buy more 

groceries. The ratio of that overall effect to the initial change is called a regional multiplier and can be expressed like this: 

(Direct Effect + Ripple Effects) / (Direct Effect) = Multiplier

The term “multiplier” can’t be used generically, though. Multipliers always express the ratio of overall effect to 

initial change by one of three measures: output (dollars’ worth of production), labor income, or jobs generated. So there 

are output multipliers, income multipliers, and employment multipliers. In gauging economic effects, one must be 

careful about which multiplier is being talked about. Users of IMPLAN or of any input-output model have to make the 

determination of what the initial change in the economy is—that is, whether they want to study a change in production, 

labor income, or employment. In general, output multipliers range from 1.3 to 1.8. But employment and labor-income 

multipliers can bounce around a lot more, depending on production and wage-per-worker data for a given industry and 

geographic region. Multipliers are very industry-sector and region specific. 

As for defining those sectors, Leontief identified just 10 back when he first started working on input-output modeling 

in the 1920s. Today, Minnesota IMPLAN Group differentiates in its software and data sets between 509 sectors that are 

recognized by the U.S. Department of Commerce. Each sector has a unique output multiplier, because each industry 

sector has a different pattern of purchases from firms inside and outside of the regional economy. (The output multiplier 

is in turn used to calculate income and employment multipliers.) 

Appendix
16 | The Economic Contribution of the Department of the Navy Technology Transfer Program Appendix | 16

Estimating a multiplier is not the end goal of IMPLAN users. Most wish to estimate other numbers and get the answers 

to the following questions: How many jobs will this new firm produce? How much will the local economy be affected 

by this plant closing? What will the effects be of an increase in product demand? Based on those user choices, IMPLAN 

software constructs “social accounts,” which are mathematical representations of economic interactions—the flow of 

dollars from purchasers to producers within the region. The data in those social accounts will set up the precise equations 

needed to finally answer those questions users have—about the impact of a new company, a plant closing, or greater 

product demand—and yield the answers. 

Economists typically construct input-output models using aggregated production, employment, and trade data from 

local, regional, and national sources, such as the U.S. Census Bureau’s annual County Business Patterns report, and the 

U.S. Bureau of Labor Statistics’ annual report called Covered Employment and Wages. The IMPLAN database contains 

county, state, ZIP code, and federal economic statistics which are specialized by region, not estimated from national 

averages. Minnesota IMPLAN Group has data sets for the entire United States for the years 1990 through 2007. In addition 

to gathering enormous amounts of data from government sources, the company also estimates some data where they 

haven’t been reported at the level of detail needed (county-level production data, for instance), or where detail is omitted 

in government reports to protect the confidentiality of individual companies whose data would be easily recognized due 

to a sparse population of businesses in the area. 

IMPLAN’s accessibility and ease of use also make it a target of criticism by some economists, who charge that in the 

wrong hands, the software—or any input-output model—will produce inflated results at best, and at worst, completely 

ridiculous projections. Anyone can point and click their way to an outcome without fully understanding the economics 

in which the tool is grounded and without knowing how to look at data sets with a nuanced eye. The IBRC has two 

analysts that have attended advanced training in the use of the IMPLAN modeling software. The estimates that the IBRC 

analysts generate are pressure-tested and triple-checked to ensure that they are accurate and reflect the most trustworthy 

application of the modeling software. In all instances, the most conservative estimation assumptions and procedures are 

used to produce the IMPLAN results. 

Most of the above IMPLAN software description was culled from the magazine article “The Number Machine,” Twin 

City Business, February 2008. It can be found online at: http://www.tcbmag.com/features/features/95796p1.aspx.
Indiana Business Research Center | 17

Sample Survey (CRADA)

A Survey to Measure the Economic Benefits of Technology Transfer—CRADA

The Department of Navy Technology Transfer Office has commissioned the IBRC to measure the economic impacts 

of technology transfer (T2) on the U.S. economy. You have received this survey because your organization has a T2 

agreement with the U.S. Navy. The survey should take about 20 minutes, less, if you have the data handy. 

Except for your time, there are no risks associated with participating. You do not need to identify yourself as the 

respondent. If you are unable to provide exact figures in response to a question, please give your best estimate. If 

you have any questions regarding this survey, please contact Tanya Hall at halltj@indiana.edu or 812-855-5507.

1. Please complete information about the technology involved in the transfer agreement(s):

a. CRADA number: _________________________________________________________________________________

2. Name of the technology: ____________________________________________________________________________

a. What is the common name of this technology? _____________________________________________________

b. In layman’s terms, please briefly describe the technology transferred to your organization: _____________

3. Is this same technology involved in another CRADA, PLA, or other T2 agreement? (circle one): YES/NO

If yes, please list any other CRADA, PLA, and/or LP-CRADA numbers associated with this technology: _____

___________________________________________________________________________________________________

4. Is this technology in a perpetual development loop? (please circle one): YES/NO

5. What is the expected total length of time, from start to finish, to develop this technology (in months)? _____

___________________________________________________________________________________________________

Part I: Cooperative R&D Agreement (CRADA)

6. Date the CRADA started and ended (mm/dd/yyyy): 

Started: _____ / _____/ _____

Ended: _____ / _____/ _____

7. At the start of the CRADA, what was the technology readiness level? (please circle one — refer to appendix for 

definitions)

1 2 3 4 5 6 7 8 9 n/a

8. At the end of this CRADA, what was (or will be) the technology readiness level? 

1 2 3 4 5 6 7 8 9 n/a

9. What is, or was, the objective of this CRADA? (please check all that apply)

 Use of DoD laboratory equipment, material, data and/or personnel

 Pure, basic research 

 Conduct clinical trials

 Further develop the technology

 Develop a prototype for internal applications

 Develop a prototype for Naval applications

 Material or component input for a product or service

 Access to software, data, or programming code

 Other (please explain) ___________________________________________________________________________

10. When you entered into the CRADA, what were the expected outcomes? (please check all that apply)

 Develop a patentable invention

 Advance research on the technology

 Develop/improve a technology process

 Publish a paper on research findings

 Submit an invention disclosure
18 | The Economic Contribution of the Department of the Navy Technology Transfer Program Appendix | 18

 Increase profits for the company

 Enter into a patent license agreement 

 Commercialize a product

 Develop a commercial off-the-shelf product (COTS)

 Other (please explain) ___________________________________________________________________________

11. Would this CRADA’s technology create or retain full-time jobs for your organization? (please circle one): YES/NO

(if NO, skip to Question 12)

a. If yes, how many full-time jobs have been, or will be, created or retained? (on an average annual basis) __

b. Are these jobs permanent positions? (please circle one): YES/NO

c. Where are these jobs located? (please identify the top three locations below) 

1. Primary state or country ________________________________________________________________________

2. Secondary state or country _____________________________________________________________________

3. Other states or countries _______________________________________________________________________

d. What is the total annual value of their corresponding salaries plus benefits? $ _________________________

12. At peak activity on this CRADA, how many company full-time equivalent employees were dedicated to 

working on the CRADA’s technology? (if CRADA has not yet reached its expected peak, please estimate peak 

employment)_______________________________________________________________________________________

13. Did your organization experience (or expect to experience) cost-avoidance or savings due to this CRADA’s 

technology? (please circle one): YES/NO (if NO, please skip to Question 14)

a. If yes, what type of cost-avoidance or savings did your organization experience (or expect to experience in the 

future) (please check all that apply)

 Equipment cost-avoidance or savings

 Payroll cost-avoidance or savings

 Research cost-avoidance or savings

 Material or component input cost savings

 None 

b. What was the average annual cost-avoidance or savings that your organization realized from this CRADA’s 

technology? $____________________________________________________________________________________

14. Did your organization experience (or expect to experience) increased revenue due to this CRADA’s technology? 

(please circle one): YES/NO (if NO, skip to Question 15)

a. If yes, what was the source of the increased revenues that your organization experienced or expects to 

experience in the future due to the CRADA’s technology? (please check all that apply)

 Improving or extending an existing product

 Net present value of future cash flows related to increased sales

 Other (please describe) _____________________________________________________________________

 No value realized or expected

b. What was the average annual increase in gross revenue that your organization realized from this CRADA’s 

technology? $ ___________________________________________________________________________________

15. What is your organization’s average annual expense, including payroll and material input expenses, associated 

with this material transfer agreement and its technology over the life of the agreement?

a. Average total expense: $__________________________________________________________________________

b. Of this expense, what percentage is represented by employee compensation? ______________________ %

Part II. Miscellaneous Questions

16. Are there any plans to continue working with the Department of Navy with this technology? (please circle one)

YES/NO

a. If yes, under what contractual arrangements? (please check all that apply)

 CRADA: Cooperative Research and Development Agreement
Indiana Business Research Center | 19

 PLA: Patent License Agreement

 LP-CRADA: Equipment Transfer

 LP-CRADA: Material Transfer

 LP-CRADA: Section 1401 First Responder

 Other (please specify) ______________________________________________________________________

17. How would you classify your organization?

 Private Company  University or College

 Non-profit engaged in research  Non-profit providing services

 State or local government  Other (please specify) 

18. Please state the industry that best describes your company or organization, for example, pharmaceutical 

manufacturer. ______________________________________________________________________________________

19. What Industry code—the North American Industry Classification System (NAICS)— best reflects your company or 

subsidiary? ________________________________________________________________________________________ 

NAICS can be found at: http://www.census.gov/eos/www/naics/

20. Is this company a minority-owned (MBE) or women-owned (WBE) business? (please circle one): YES/NO

21. Is this organization a spin-off by a federal employee from a Department of Defense lab? (please circle one): 

YES/NO

22. Did your organization have previous experience with the Department of Defense? (please circle one): YES/NO

a. If yes, how has your organization worked with the Department of Defense? (check all that apply)

 SBIR: Small Business Innovation Research

 PLA: Patent License Agreement

 STTR: Small Business Technology Transfer Program

 Government Contract

 CRADA: Cooperative Research and Development Agreement

 Other (please specify _______________________________________________________________________

23. How would you classify the size of your company? (please check one) 

 Very small (1 to 9 employees)  Intermediate (500 to 999 employees)

 Small (10 to 99 employees)  Large (1000 to 4999 employees)

 Medium (100 to 499 employees)  Very large (5000+ employees) 

24. Please list the state where the majority (or all) of this technology’s employment and R&D is occurring: _____

___________________________________________________________________________________________________

25. Please list other states where this technology’s activity is occurring, if applicable: ________________________

26. In the event that IBRC researchers have questions regarding your response, may we contact you? (please circle 

one): YES/NO

a. If yes, please provide your contact information and check the best contact method:

Name: ________________________________________________________________________________________

Phone number: ________________________________________________________________________________

Email: ________________________________________________________________________________________

Thank you for your time and input!

Please return your completed survey to:

Indiana Business Research Center

Kelley School of Business, Indiana University

100 S. College Street, Suite 240

Bloomington, IN 47404
20 | The Economic Contribution of the Department of the Navy Technology Transfer Program Appendix | 20

TRL Definition Description

1 Basic principles observed and 

reported.

Lowest level of technology readiness. Scientific research begins to be 

translated into applied research and development (R&D). Examples 

might include paper studies of a technology’s basic properties.

2 Technology concept and/or 

application formulated.

Invention begins. Once basic principles are observed, practical 

applications can be invented. Applications are speculative, and there 

may be no proof or detailed analysis to support the assumptions. 

Examples are limited to analytic studies. 

3

Analytical and experimental 

critical function and/or 

characteristic proof of concept. 

Active R&D is initiated. This includes analytical studies and laboratory 

studies to validate physically the analytical predictions of separate 

elements of the technology. Examples include components that are 

not yet integrated or representative. 

4

Component and/or breadboard 

validation in a laboratory 

environment.

Basic technological components are integrated to establish that they 

will work together. This is relatively “low fidelity” compared with the 

eventual system. Examples include integration of “ad hoc” hardware 

in the laboratory. 

5

Component and/or breadboard 

validation in a relevant 

environment.

Fidelity of breadboard technology increases significantly. The 

basic technological components are integrated with reasonably 

realistic supporting elements so they can be tested in a simulated 

environment. Examples include “high fidelity” laboratory integration of 

components.

6

System/subsystem model or 

prototype demonstration in a 

relevant environment.

Representative model or prototype system, which is well beyond that 

of TRL 5, is tested in a relevant environment. Represents a major step 

up in technology’s demonstrated readiness. Examples include testing 

a prototype in a high fidelity laboratory environment or in a simulated 

operational environment. 

7 System prototype demonstration 

in an operational environment. 

Prototype near or at planned operational system. Represents a major 

step up from TRL 6 by requiring demonstration of an actual system 

prototype in an operational environment (e.g. in an aircraft, in a 

vehicle, or in space). Examples include testing the prototype in a test 

bed aircraft.

8

Actual system completed and 

qualified through test and 

demonstration.

Technology has been proven to work in its final form and under 

expected conditions. In almost all cases, this TRL represents the 

end of true system developmental test and evaluation of the system 

in its intended weapon system to determine if it meets design 

specifications.

9 Actual system proven through 

successful mission operations.

Actual application of the technology in its final form and under 

mission conditions, such as those encountered in operational test 

and evaluation (OT&E). Examples include using the system under 

operational mission conditions. 

Appendix: Technology Readiness Levels (TRLs)

Source: Defense Acquisition Guidebook