1. Maintain research

If we do this then the analysis presents us with compelling reasons to review and change our general strategy.

I am not comfortable with the idea of risk and the paradox of these results is that in order to make more money from R&D we have to undertake more high risk research, whereupon our overall financial risk will decline to an acceptable level.

If we do proceed with an aggressive series of changes to alter our current research strategy then if it does indeed pay off as the analysis indicates, the actual cost of the technology will be small by comparison with anything we've so far identified from outside the company.

The probable project value (PPV) for our high risk research activities is about 12 times our project costs making them a very attractive investment - provided they do eventually pay off.

2. Abandon Research

If we instead do this, although in the short term we will have saved some money, where will we go in the long term to get new technologies to support and grow our businesses.

I remind you that our recent expensive attempt at acquiring new technology by buying Syndicated Systems, Inc. has been disappointing and our efforts to shop around outside for new technology are also not without risk, although we don't know what that level of risk is.