The selection of R&D projects is the most important of all the R&D management activities. Unless an R&D department is working on the right R&D projects, all its efforts could come to zero. Consequently, most R&D organizations spend a great deal of time trying to select the right projects. What is rarely seen in these efforts to select the right R&D projects, however, is the value of having an overall R&D strategy before selecting R&D projects.
A R&D strategy is important because it helps a R&D organization select projects in terms of a broader outlook rather than just bit by bit. When a R&D department has an overall strategy and has some strategic goals, it will more likely select projects that are in tune with its technical strengths, the capabilities of the company, and the demands of the marketplace. In order to develop a sound R&D strategy, certain prerequisites must be in place.