In this very globalized world that is ever evolving and improving, it is necessary that we adapt to this change not only to survive but to thrive. This is especially true for entrepreneurs and large co-operations. Being innovative and updating your business is vital to growth and sustainability. In order to accomplish this, you need a Research and Development Department. Research and Development (RD) also known as Research and Technical Development (RTD) refers to the innovative and investigative activities that a co-operation or government conduct in developing new services or products or that lead to the improvement of existing products, services or procedures.
Whether the company is large or small, a Research and Development Department helps in the development of new products or and to discover and create new knowledge about scientific and technological topics: For the purpose of uncovering and enabling development of valuable new products, services, and processes. RD plays a critical role in the survival of a company. Investing in such a department will undoubtedly change how your business competes with others, your customer satisfaction rate and your company's overall growth and longevity. This is one way in which you can transform your company by doing product or service scientific research and investing in technology and future capabilities that will increase profitability and overall long-term viability.
Research and Development Departments differ from company to company with two main models that work depending on what it is that you hope to achieve for your company. Keep in mind that RD is not limited to a particular sector or industry. It is for you, whether you are in pharmaceuticals, IT, advertisement, entertainment, goods services etc. Whatever your line of business is there is a model that can benefit your organization. Now that we have looked at the whole idea of RD and its usefulness, we can delve deep into why it is right for your company.
A Breakdown of Research and Development
RD constitutes the first stage of development for a potential new service or product. Engineers and researchers play an important part here as they primarily make up an RD Department. A thorough study must be done before a new product can be developed. This phase of the investigation involves a lot of applied research regarding the target market, product specifications, the cost of the product and a timeline for the actual production to begin and end. Having and evaluating your target group is essential as it provides you with information regarding the usefulness and functionality of your product and how well it will be received before product design and production begins. This will save you time and money in some cases.
When you are ready to move on to developing your product, your scientific research team and engineers must ensure that it meets the regulatory guidelines and standardized specifications in order for the product to be accepted by the relevant bodies.
Quality checks are important and must be handled by your RD Department in a meticulous manner. Whatever your team puts out will be a reflection of your company and sets the tone for your business. Since this area of your company has the most intimate details about the goods or service you are about to market it is important that they adhere to set protocols and procedures before launching the product.
A Brief Overview of Research and Development
The term was developed around the mid-1960's and has become the dominant approach for technology development and investment in the scientific infrastructures (Dr. D Madjoubi 2009). There is a linear approach that RD consists of that three stages:
1. Basic Research- research that tries to understand a subject matter more completely and build on the knowledge that relates to it. This is the first step in research and development, formulated to give an understanding of information without applying this information to a product, policy or process. The results of this are considered to be an alternative or potential area of interest to the company. This can be a time-consuming venture.
2. Applied Research- is goal oriented and specific. It aims to develop methods to address a specific niche. It does this by systematically studying and understanding information to determine and develop products, policies and operational processes. The investigations are all focused on specific commercial/customer objectives regarding a product, process or service. It can also be somewhat costly.
3. Development Research- this is when the results of the research are used to develop or design the specific product the research was intended for. The method of production is considered and the design prototype as well. One thing to note is that, at this stage, research generates requisite knowledge and designs for production and converts these into prototypes. The actual product that is launched for commercial sale/distribution has to be engineered based on the research plans and prototype.
Some well-known products that we know of today came into being as a result of RD, are; penicillin and nuclear power plants.
Why a Research and Development Department is Right for Your Company
As a business owner, customer satisfaction is a top priority. RD is a valuable tool that you can use for growing and improving your business. It involves researching your market and your customer needs and developing new and improved products and services to fit these needs. In a global industrial landscape that is changing fast, firms must continually revise their design and range of products. This is necessary as well due to the fierce competition and the evolving preferences of consumers. Without an RD department, a firm must rely on strategic alliances, acquisitions, and networks to tap into the innovations of others. Here are the top reasons why it is right for your company:
It allows you to tap into a new area of business which allows you to bring a new product or service to customers
It allows you to improve/enhance your current product, thereby satisfying your customers
It keeps your company sharp regarding the latest trends and practices so that you can capitalize on them
It gives your company focus and allows for long-term development
It makes your company relevant and competitive
It attracts more investors to your company
Helps you to acquire larger shares in the global market
It could mean more profit for your company
Setting up a Research and Development Department
As a business grows and develops it may face new challenges that require solutions. This is where your RD team comes in. There are two basic Research Development Models that have emerged in companies throughout the commerce spectrum. The first RD model consists of a department that is staffed mainly by engineers who develop new products, this typically involves an extensive amount of research. The second model involves a department comprised of industrial scientists or researchers, all tasked with applied research in technical, scientific or industrial fields, which is aimed at the facilitation of the development of future products or the improvement of current products and/or operating procedures. The structure of your RD Department ensures that the right outputs and inputs are available to support the functioning of the research, product development, and marketing of the product. You will need a coherent RD strategy that explains the scope and direction that the structure of the department will take on and the necessary human or financial resources that need to be allocated in the different areas.
Here are some steps to design your whole RD process:
1. Create Ideas- Brainstorming is important in order to identify issues and come up with specific ideas on how to tackle those issues. It gives you the chance to narrow in on a target solution in order to design a product that meets those requirements.
2. Research- This requires a team of industrial scientists or researchers, who are all skilled in applied research in technical, scientific or industrial fields, as well as engineers. The researchers will assess the effectiveness of the product, see how it compares in the market by doing research and surveys and create a prototype. It is necessary to work alongside the engineers or developers at this point to see how practical the product will be.
3. Development- This is where the actual product is developed and regulatory guidelines are checked to ensure that the product is safe and of good quality. The price and product distribution are also done during this time.
4. Launch- Even though the evaluation continues at this stage, this is where your product really begins to speak for itself. Once you have introduced your product to the market you might find that a little redesign is needed at times. Other times you might need to discard the entire project. Whatever you decide, ensure that the cost is worth it in the end.
The Challenges you might face with your RD
In creating an RD Department you might face some challenges and it would be unfair to not mention them. The initial cost to set up can be a bit off-putting but the rewards you reap over time will be totally worth it. When you set a timeline for a product, ensure that you follow through without making too many excessive adjustments. This way you do not have to wait too many years for the research to become an actual product that you can launch. Because we all know that waiting too many years may result in the product losing its relevance. Ensure that you study the market to know when to launch your product and keep abreast of your competitors because truth be told if a better version of your product has been launched, yours will be rendered useless. Keep in mind too that your level of capital risk increases as more is spent.
The Advantages of RD Departments
It is no easy task to set up a Research and Development Department but here some benefits of having one:
Tax Breaks- Your expenses are often tax deductible. This varies from country to country so you should do your research.
Cost- Yes, you can save money through research. You do this by identifying more cost-effective ways to manufacture goods or carry out a service. This works both ways and might increase your profit margins or reduce the price of the product so that more consumers can purchase it.
Patents- Through research-based developments, your company can acquire patents for goods or services produced. This will solidify your companies position is a specific industry, which can lead to long-term profit gain.
Resources- When your company is innovative, it attracts the best and most brilliant minds.
When you have brain power on your side, it usually means better quality and more growth. RD is different from most activities performed by a corporation because of its process of operation. Research and Development typically not performed with the expectation or goal of immediate profit. It instead focuses on long-term profitability for a company or organization. Some companies that employ entire departments just for the purpose of research and development put in substantial capital to make it a reality. You have to estimate the risk-adjusted return on you RD expenditures, and this will inevitably involve risk of because no immediate payoff is experienced and the general return on investment can be somewhat uncertain.
Your company needs a Research and Development Department and that is the plain truth. In order to stay competitive and move with the times, you have to be progressive and innovative. Your products and services have to be relevant in order for your business to survive in this global economy. By choosing the right experts for your team, which will then create or develop the right atmosphere for product development, your company will exceed even your own expectations. This way, you can watch your organization grow from strength to strength and still be prosperous in the years to come. Keep in mind that one of the main aims of an RD Department is to support growth over time. Your company should be innovative and on top of its production game at all times and this is where your RD team comes in. Remember, the aim is not only to survive in business but to thrive.
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