The Five Steps Involved in Developing R&D Strategy

R&D Strategy & Organization: Managing Technical Change in Dynamic ContextsStep 1. Belief that R&D Strategy solve Problems
 
Although the idea of developing a R&D strategy may be accepted, usually development of an R&D strategy will not come about unless a R&D strategy is used for solving a problem. Which means, the effort that goes into developing a R&D and the conflicts that may occur about how R&D resources should be allocated are so great that unless a R&D organization has a clear R&D strategy it rarely will make the effort or face the conflicts. On the whole, R&D organizations require a strategy when they wish to use new technologies for future products. If, on the other hand, a R&D organization relies solely on utilizing existing technology to develop new products, then it may not need a R&D strategy.
Total R & D Management: Strategies and Tactics for 21st Century Healthcare ManufacturersUsually, R&D managers recognize that a R&D strategy will help them when they have doubts about how R&D resources are being used. For instance, the R&D managers of a FMCG company perceived the for need R&D strategy when they were forced to consolidate all the R&D on coffee that previously was carried out in several laboratories. To accomplish this task, they recognized that they had to have a R&D strategy to prioritise and coordinate all the R&D being done on coffee. Later they perceived the need to develop a R&D strategy related to R&D being done on beverages in a few laboratories. In short, although developing a R&D strategy is a nice idea, this idea will not be put into practice unless R&D managers perceive that a R&D strategy can solve a problem.

Step 2. Creating Planning Staff within a R&D Organization
 

R&D Decisions: Strategy Policy and Innovations (Routledge Research in Strategic Management)Creating a planning staff or establishing a strong commitment by the R&D managers in a small R&D organization to devote enough effort to R&D strategic planning is necessary. Although line managers within a large R&D organization by themselves can develop a R&D strategy, in practice, if there is no planning staff to facilitate the development of a R&D strategy, there will never be a R&D strategy.
Although some companies have a R&D strategy, it was not easy to develop one. The R&D planners normally run into two types of problems: analytical and organizational problems. The analytical problems surface when the R&D planners first attempt to facilitate the development of a R&D strategy. They find that there is no accepted methodology for developing a R&D strategy. Although R&D managers in some companies, consultants, and academicians all had their opinions on what a R&D strategy should be and on how it should be formulated, almost none of them have a complete picture of the process. In addition, the opinions of these various R&D managers, consultants, and academicians often were in conflict with each other or were irreconcilable. Thus, the R&D planners have to develop their own methodology. In addition, R&D planners also find that members of the R&D staff are generally not interested in developing a R&D strategy. Because of this, R&D planners have to spend majority of their time during the first few years persuading the R&D staff to do R&D strategic planning and then educating them with regard to how a R&D strategy can be developed.
The experiences of these R&D planners are typical. Someone usually has to develop the methodology to be used in doing R&D strategic planning. Someone also has to be the champion of R&D strategic planning, or it will not get done. In theory, R&D managers in a large R&D organization can handle these responsibilities. In practice, R&D line managers in a large R&D organization normally have so many other responsibilities that they neglect R&D strategic planning. Thus, a R&D planning group usually proves to be necessary to getting R&D strategic planning done.
In a small R&D organization, on the other hand, R&D line managers are the only ones who can develop an R&D strategy because staff positions rarely exist. Thus, to get R&D strategic planning done, the R&D line managers in a small R&D organization must add the responsibilities of an R&D planning group to their normal responsibilities. These R&D managers usually will not be able to devote much time to developing a planning methodology. On the other hand, because they have responsibility for managing the R&D groups, if the R&D managers in a small R&D organization do develop an R&D strategy, they should have less difficulty in getting this strategy accepted and implemented. The key to planning in either situation is that the doers, not the planners, must do the planning. The role of the planners is to facilitate the planning process, which is an important, although seldom appreciated, role.
Third Generation R & D: Managing the Link to Corporate StrategyStep 3. Connecting R&D Strategic Planning to R&D Operations
To get a R&D staff to develop a R&D strategy, R&D planners (or R&D line managers) have to find ways to relate R&D strategic planning to R&D operations. This connection between R&D strategic planning and R&D operations has two aspects.
Members of the R&D staff have to be able to see that their interests are served through developing a R&D strategy. Thus, R&D planners must find a mechanism that involves R&D strategic planning and at the same time the R&D staff. One of the primary purposes of such forums is to get these R&D people to talk with each other. This cross disciplinary forum can turn out to be a useful mechanism not only for improving communication, but also for getting R&D strategic planning accepted. Once involved in interdisciplinary forum, these R&D people can get interested in technical activities as well.
STRATEGIC ALLIANCES FOR NEW PRODUCT R&D: Strategy, Innovation, Research and Development ManagementThe R&D projects that are actually selected and the R&D strategy need to be meaningful. In other words, a R&D strategy is not meaningful if it does not influence which R&D projects are selected and carried out. A R&D organization in a household products company addressed viewing the development of a R&D strategy as involving two phases. In the first phase the senior R&D managers defined the overall direction of the R&D strategy. During the second phase, middle-level R&D managers defined the R&D strategy through the projects they selected and carried out.
Step 4. Linking R&D Efforts/Strategy to Customers’ Needs
Fourth Generation R&D: Managing Knowledge, Technology, and InnovationAlthough it is important for a R&D organization to link its strategic operations, this is not enough. For a R&D organization’s strategic plans, this strategic plans must be clearly linked to customers’ future needs. Therefore, besides doing R&D strategic planning, a R&D organization must also get marketing done in its company. Two of the hard questions that must .be addressed in a strategic marketing are
1) Who will the company’s customers be in the future?
2) What will those customers need in the future ?
In answering these questions well, one must understand economic, regulatory, geographic, and social trends and opportunities.
Step 5. Active Support of the Senior Management
To get its R&D strategy integrated with business plans, an R&D organization must have the active support of senior business managers. To gain the active support of senior business managers, an R&D organization must explain the value of R&D in business terms-for example, with regard to how R&D will help the company (1) satisfy customers’ needs, (2) cut costs, (3) expand into new markets, or (4) minimize distribution problems.
Science and Corporate Strategy: Du Pont R and D, 1902-1980 (Studies in Economic History and Policy: USA in the Twentieth Century)
Those R&D organizations that have been able to gain the active support of senior business managers for their R&D strategy were helped by organizational factors. For example, in a chemical company the R&D organization was able to gain the active support of senior business managers because the chief executive officer is one of the major proponents of R&D in the company. As opposed to most of the other senior business managers in this company, this chief executive previously managed the division of the company that sells to industrial customers. Because the customers of this division are more knowledgeable about what R&D can contribute, this CEO realized how valuable R&D can be and thus has not only supported R&D strategic planning but also has actually encouraged the R&D organization to do it.
At another company, a key factor that allowed the R&D organization to first gain and then maintain the support of senior business managers was leadership among senior business managers. Stability and continuity in leadership was important because it took a few years for the senior business managers of having a R&D strategy. By learning year after year what the R&D was trying to accomplish with a R&D strategy, the senior management was able to appreciate the benefits. The R&D department, in turn, could build progress that it had made with these senior business managers in previous years.
The key to taking each of the steps discussed above is picking a problem that the R&D organization is facing that also calls for a more systematic analysis of the use of R&D resources. The value of carrying out a series of concrete steps is that together they serve as stepping-stones to improve R&D strategic planning. Moreover, because they produce tangible results along the way, they also help elicit support for the R&D strategic planning process.
One way in which a R&D organization can maintain the vitality of planning process is through carrying out a series of concrete efforts that produce tangible results on their own, but also allow R&D people to improve planning expertise. A second method involves benchmarking studies in which the R&D people compare the strengths and weaknesses of their company’s technologies in relation to the strengths and weaknesses of their competitors’ technologies. The R&D people can gain two things through this effort: 1) they gain a much better understanding of how their company stands in relation to competitors and 2) they learn how to analyze their technologies. For example, they learn how to think more precisely about how their technical work could improve the performance of the company’s products. A third effort that the R&D organization can consider involves using the techniques of portfolio management to evaluate the potential and payoffs of various technologies.