Asia Pacific Conference on Management of Technology and Technology Entrepreneurship Melaka , 29-30 October 2008
improved our quality of life over the last fivedecades .Large amounts of money are spent all over theworld on R&D, in order to ensure futuresustainability . Research is an investment, notan expense, invest in commercial R&D is usuallyinvolve a high-risk investment with a deferredpayoff although like the other high-risk investments, return can be extremely attractive. From different point of view the increasingcomplexity and inter-disciplinary nature of theR&D process in turn has increased the cost of research therefore research become less attractivewithout partners to share the cost .
R&D and Distributed Team:
Research and development are subject todifferent location drivers. Many firms started toacquire their knowledge from external sources .Trends over the last decade have seen China andIndia emerge as attractive R&D destinations forU.S. Changes in telecommunications and dataprocessing capabilities make it possible tocoordinate research, marketing and productionoperation around the world 
Hegde and Hicks noted that overseas R&D sites are auxiliaryoutposts, subservient to home R&D laboratories.“corporate growth and positioning” and“knowledge sourcing” are two forces which resultin companies having a more global R&D,.Technological change is a highly dynamic processthat may quickly relocate to take advantage of optimum conditions for growth . For mostR&D teams, being virtual are a matter of degree.
Small and Medium Enterprises (SME):
Importance of SMEs
:Small and medium sized enterprises (SMEs)are a major part of the industrial economies [56, 57]in that they serve a very critical function of Creating new jobs and reducing unemployment[58-60]. Their survival and growth has thereforebeen a prominent issue. Beck et al. explores therelationship between the relative size of the Smalland Medium Enterprise (SME) sector, economicgrowth, and poverty alleviation using a sample of 45 countries, and found that a strong, positiveassociation between the importance of SMEs andGDP per capita growth.SMEs in the beginning of R&D activitiesalways face capital shortage and need technologicalassistance. In most countries, SMEs dominate theindustrial and commercial infrastructure 
Manyeconomists believe that the wealth of nations andthe growth of their economies strongly dependupon their SMEs’ performance . In manydeveloped and developing countries, small andmedium-sized enterprises (SMEs) are the unsungheroes that bring stability to the national economy.They help buffer the shocks that come with theboom and bust of economic cycles. SMEs alsoserve as the key engine behind equalizing incomedisparity among workers 
China’s recent rapidgrowth is also linked to the emergence of manynew small firms in village townships and in coastalareas, often in new industries 
SMEs and Virtual Teams:
SMEs seem to be appropriate units to behavelike network nodes because of their lean structure,adaptability to market evolution, activeinvolvement of versatile human resources, ability toestablish sub-contracting relations and goodtechnological level of their products 
In light of the above
SMEs have advantages in terms of flexibility, reaction time, and innovation capacitythat make them central actors in the new economy
The traditional independence of small firms isbeing replaced by a network environment.Hanna and Walsh  found that if smallfirms want to make a step change in theirtechnological and innovation base they may have torethink their approach to cooperation. SMEs needto focus on core competences for efficiencymatters; they need to cooperate with externalpartners to compensate for other competences andresources. This is especially the case in the field of new product development , where SMEs facespecific problems compared to large firms .Most firms today do not operate alone; they arenetworked vertically with many value-chainpartners . The typical Taiwanese productionsystem is a cooperative network of SMEs that areextremely flexible and respond quickly thoughunder-capitalized and sensitive to market demandand highly integrated in the global economy 
Gassmann and Keupp found that managers of SMEs should invest less in tangible assets, butmore in those areas that will directly generate theirfuture competitive advantage (e.g., in R&D togenerate knowledge, and in their employees’creativity to stimulate incremental innovations inalready existing technologies).
SMEs Readiness for Virtual teams working:
Lin et al. found that although almost allsenior executives and managers were committed tothe IT investments in enterprise during theimplementation stage, most of these organizationsdid not manage user resistance effectively.Zhouying  pointed out in China e-commerce isdeveloping very slowly amongst SMEs, whichaccount for 60 per cent of the total value of industrial production, and 98 per cent of the totalpopulation of enterprises. The SMEs are one of thesectors that have a strong potential to benefit fromadvances in ICTs and the adaptation of new