Center for Science, Technology, and Economic Development (CSTED) > Selected Reports

The Engineering Research Centers Program

The National Science Foundation (NSF) established the Engineering Research Centers (ERC) program in 1985 at least partly on the basis of a widely held perception that U.S. industrial competitiveness was declining in the face of the emerging global economy. One major thrust of the program was designed to increase patterns of interaction between universities and industry. Overall, the program's objectives included strengthening academic engineering research and encouraging the development of a cross-disciplinary engineering systems approach as one way of addressing the competitiveness problem. The program was designed as a three-way partnership: universities, in addition to receiving government support from NSF for the establishment of the Centers, were to recruit industrial firms as ERC members that would provide additional financial support and maintain close ties with ERC activities.

ERCs are complex organizations. They seek to achieve multiple objectives, account to multiple stakeholders, depend on multiple funding streams, and produce multiple outputs. To quote or paraphrase a variety of NSF officials and documents such as ERC program announcements and other reports, the ERCs were to pursue the following objectives:

1) pursue cross-cutting interdisciplinary research and education using an engineering systems approach;

2) conduct research that relates to "next-generation advances," the results of which are to be "useful to industry without being too near-term in focus";

3) have as explicit economic and practical goals the enhancement of the international competitiveness of U.S. industry -- "their novel features" in terms of a 1986 National Research Council report;

4) provide a new means of fostering the transfer of knowledge and technology developed at the Centers into the marketplace;

5) establish liaison programs with industry that would lead to continuous and mutually beneficial interactions; and

6) inculcate students with a broad understanding of what is needed to bring sophisticated products all the way from the laboratory to the market.

Following the initial cycle of the ERC program solicitation and evaluation of proposals, six ERCs were funded. Subsequent annual cycles of awards and review have resulted in the funding of twenty-three additional Centers, but several of the Centers have been phased out of the program prior to completion of the available award cycle of a total of eleven years. By the end of eleven years, ERCs are expected to "graduate" from the program and become self-sustaining entities, unless they choose to compete for a brand-new ERC award with a significantly different focus and are successful in that competition. At the time of the inception of this study, the eighteen Centers listed in Table 1 were being funded by the program, and a total of more than 700 industrial partnerships, involving approximately 550 different firms, were in effect.[1]

Study Objectives

As part of an ongoing effort to assess the impact of the ERC program along various dimensions, SRI International was contracted by NSF to conduct a study examining the patterns of interaction that have emerged between the Centers and industry as a consequence of the program and the overall impact of the interactions on industry. More specifically, the study design was aimed at identifying the types of results or outcomes of ERC-industry interactions; the frequency with which those results occur; and the relative value or benefit of reported interactions and results of interaction from the perspective of the companies involved. "Value" was to be defined more broadly than just financial terms.

The scope of the study as designed by NSF means that it is important to emphasize that it reports findings that relate to only one facet of ERC activities: the type, distribution and value of the results of ERC interactions derived by industrial firms that participate. Because it focuses only on one set of stakeholders, it is not an effort to evaluate the ERC program in any broad, overall sense, nor is it an effort to evaluate the performance of any individual ERC, even in terms of this effort's focus on the dimension of benefits to participating firms. It does not examine the impacts of ERCs as models of interdisciplinary research and education on the structure of their host universities, nor does it measure the academic outputs of ERCs in terms of research publications, students, or-except in the general sense of benefits derived-discrete measures of technology transfer.[2]  Moreover, it provides no analysis of the behaviors of the ERCs in balancing the multiple objectives set for them, and thus the dynamics of their individual relationships with member firms.
 

The findings of this study provide new evidence about the relative distribution and importance of the various tangible and intangible outcomes of ERC participation to industrial sponsors, particularly as it relates to improved competitiveness. This represents a partial gauge of whether the ERC program is accomplishing the objectives for which it was established, at least in terms of one set of stakeholders.

The findings also provide an updated and extended assessment of the character of ERC benefits to industry compared with earlier studies, particularly the General Accounting Office's 1988 survey of industrial sponsors of the ERCs.[3]  In addition to providing an opportunity to gauge possible changes in the character of relationships between ERCs and industrial sponsors over time, the study offers an expanded interpretation of the value of ERC membership to sponsor firms.

Finally, the study relates the anticipated and realized benefits firms receive from their participation in ERC's to plans for future continuation of sponsorship. The ERC program provides a limited term of funding for a maximum of eleven years, after which the Centers are expected to "graduate" to self-supporting operations unless they are successful in competing for a new ERC award. A number of the ERCs are now approaching the end of their 11-year award or have already done so. To the extent that ERCs are dependent on multiple funding streams, they must balance the diverse and not necessarily compatible objectives set for them by the multiple stakeholders. Graduating ERCs can expect to find themselves in a very different environment without the base support from NSF.