GE's RnD Budget and Warranty

In a seminar given by Dow's CTO Bill Banholzer, a veteran from GE Global Technology, he briefly mentioned an interesting budgetary strategy of GE's RnD. The warranty of the products from GE, is budegted into RnD's spending. That means, if you RnD folks screw up the design, which leads to a reliability problem of the products, you need to pay for the warranty.

Sounds like a smart idea to me.