competitors, market size and segmentation, government 

 regulatory policies, image, corporate objectives, bud- 

 getary limitations, needs of production operations, 

 and definitions of the lines of business in addition 

 to purely technical considerations. Market research 

 and information on user needs are essential elements 

 in effective research planning; industry remains con- 

 vinced that reliance on strictly rational components 

 and technological opportunities are doomed to failure. 



Although the criteria for both countries can be 

 grouped as technical, social, and economic, they are 

 defined differently in the two systems, and thus have 

 different practical significance. The differences in 

 S&T policy are rooted in the difference between a bu- 

 reaucratic system of planning and evaluation and a 

 market system. In the USSR an administrative bureau- 

 cracy defines the relevant criteria and judges suc- 

 cess on the basis of how well organizations meet mul- 

 tiple plan targets for output, costs, and profits as 

 defined by formal rules. In practice, these rules 

 have no necessary relation to the efficient use of 

 resources, which are economized only incidentally in 

 response to explicit instructions and definitions. 

 Prices are also set administratively in an arbitrary 

 and autonomous manner. In effect, Soviet R&D perform- 

 ers face neither true output markets nor true input 

 markets. An organization's performance is not eval- 

 uated in any market external to the organization but 

 directly and immediately by administrative superiors 

 on the basis of how well it seems to be meeting 

 planned objectives. 



In the United States the market largely determines 

 choices especially in industry. Specifications for 

 success are set by the customer, not by an adminis- 

 trative boss in some government office. The market 

 test is a comparison of one firm with another in the 

 same field. Success depends on the behavior of one's 

 competitors as well as one's own performance. Thus, 

 a private firm may achieve its production, sales, and 

 cost goals and lose money, or it may fail to meet its 

 goals and yet do better than its competitors. The ul- 



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