Data Resources Incorporated has forecast a long-term decline in the growth rate of capital spending because technology can provide a higher return. A growing strategy for profitability in many companies is services, which will become a more important contribution in the next decade. General Electric and Xerox are good examples of this strategy. The percentage expecting any amount of growth fell somewhat, to 75 percent from 80 percent for 1998. Increases in alliances and joint ventures were seen by 92 percent, continuing the strong response in the previous years.
Real gains continue to be made in research as well as development.
Development and protection of intellectual capital and new competencies are of utmost importance. Skunk works are one way to stimulate this development. Acquisitions and alliances are another. Effective management of knowledge, and the ability to adapt to change, are two critical keys for the future success of innovation and competitiveness in U.S. industry.