It's often said that Thomas Edison's finest invention wasn't the light bulb or the record player; it was the concept of an ongoing industrial innovation and development process. Corporations from Edison's own General Electric to Ma Bell, Corning, and Kodak took his idea and ran with it, setting the stage for the modern R&D lab.

While independent inventors were once the main source of patents, since the 1930s, corporate labs have been the dominant wellspring of invention. For decades, these organizations drove corporate growth, and they developed many of the fundamental inventions that run modern life: Bell Labs and the transistor, RCA and color television, GE and MRI technology. In the process, R&D has become the ultimate corporate sacred cow. Until recently, corporate gospel has been that sustained high investment in research will lead to a boatload of insanely great products that will carry a company to a new level, driving growth in profits and staking out vibrant emerging markets. But it's time to ask some hard questions: Does corporate research and development really work? And if it does, why are so many prestigious and supposedly well-run firms continually blindsided by competitors?