Agilent Technologies to Split Company, Who Gets R&D?

Agilent Technologies plans to split into two separate companies, but for those tied to its Research Laboratories the split may not be as clean. Agilent, which announced its plans Thursday, is looking to spin off its electronic measurement company into a separate publicly traded company and retain the Agilent name for its life sciences, diagnostics and applied markets company.

Agilent Techologies Santa ClaraCurrently, the R&D department, with its 250 employees worldwide, serves both sides of Agilent’s business and is headquartered in Santa Clara, Calif., according to the company’s Securities and Exchange Commission filing. Overall, Agilent employs a total of approximately 20,000 workers.

Here’s what the company says about its R&D arm in its SEC filing:

At the cross-roads of the organization, the Research Labs are able to identify and enable synergies across Agilent’s businesses to create competitive differentiation and compelling customer value.

The technical staff have advanced degrees that cover a wide range of scientific and engineering fields, including biology, chemistry, computer science, distributed measurement, electrical engineering, image processing, materials science, mathematics, nano/microfabrication, microfluidics, software, informatics, optics, physics, physiology and signal processing.

Splitting the Baby

During a conference call with analysts, Bill Sullivan, Agilent’s CEO, briefly touched on the future of the labs. “We are dividing the corporate labs to correspond to the two businesses, driving technologies into revenue more quickly,” Sullivan said.

Some may say that’s easier said than done. But Sullivan appears to have a strategy to move the labs forward after the split. One way is to deliver “complete workflow solutions” to each of the two companies’ respective customers.

“We will provide a core data system platform to easily enable application development in the lab and correlate data from research to the clinic, allowing for deeper insight by researchers. We will do some bolt-on acquisitions that complete and build on the workflow. These will be focused on sequencing and related technologies, molecular diagnostics and consumables,” Sullivan says.

Bill, Dave and Agilent

Although it’s not clear how Agilent’s R&D staff will ultimately fare after the split, it’s not like the company has never faced the issue of spinoffs before. Think back to HP’s Bill and Dave.

In 1939, Bill Hewlett and Dave Packard created the beginning of the test and measurement company in their legendary Palo Alto garage. That part of the business later moved toward a  focus on computers and morphed into technology titan Hewlett-Packard, which led to a spinoff of the test and measurement business in 1999, creating Agilent Technologies.

But the spinoffs didn’t stop there. Agilent went on to later reinvent itself with four other major spinoffs. “We are once again making a bold move, as we have done many times in the past, to ensure a future of sustainable growth for both the LDA and EM companies,” says Sullivan, in a statement.

Comments

  1. BY Fred Bosick says:

    The splitting off of the R&D department from HP and creating Agilent was a mistake, as is the current effort to split off *part* of the R&D department. It’s a classic result of next quarter results rather than long term innovation. The incompetent executive ranks literally have no idea how to handle R&D staff. Probably because the executives don’t understand what this staff does.

    HP used to make test equipment, minicomputers and nearly indestructible RPN calculators. Now, it’s a me-too, merchant PC builder trying to emulate IBM by overcharging customers with SaaS “services”.

    How the mighty have fallen…..

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