The Importance of R&D in Corporate Innovation
R&D is directly tied to the innovation process for corporations. It encompasses all of the developmental activities of a product (or service) prior to launch and gives companies a solid chance to stay ahead of the competition.
We can't stress enough the importance of R&D in corporate innovation. It lays the groundwork for an organization’s entire future., Without a dedicated effort toward innovation, a company's chance of survival in the market drops significantly. Corporations need change, change starts with innovation, and innovation starts with R&D. When followed correctly, it's a formula for success. The key is to not merge steps. Often, people believe R&D and innovation are the same things. Don't make that assumption! You know what they say about people who assume, right?
What Is the Difference Between R&D and Innovation Management?
Research and development are the set of innovative activities performed by corporations. For example, the R&D Department within an organization is where scientists and other professionals develop new technologies. In contrast, innovation management is the process of taking new concepts and ideas and implementing them, resulting in the introduction of new or improved products or services.
Understanding the Importance of R&D in the Innovation Process
We feel as though you've drawn some ideas as to why R&D is essential to the innovation process. We're going to clarify it just in case.
1. It Provides Knowledge and Insight
Sometimes business leaders get lucky when swinging a bat in the dark, hoping they'll hit the success target. And by sometimes, we mean never. Corporate innovation is in no way a process that should be done blind. That being said, everything starts with a wild idea. Sometimes that idea goes nowhere. Sometimes it does. But that is the point of R&D, to figure out if you have a good idea on your hands or not.
Note: There are three types of research that can be done, listed below.
- Basic research: The objective is to fully understand one subject area forming the basis for applied research.
- Applied research: Applied research aims to answer one specific question to an existing problem.
- Development research: A systematic project that uses existing knowledge gained from research or practical experience to develop a new product, service, or process.
2. It’s a Powerful Investment
Although the costs can be high, investing in R&D is a powerful investment into your corporation’s future capabilities, and ultimately, success. Corporate innovation isn’t meant to be a short-term solution. (Sorry, no immediate gratification here.) It’s a long-term innovation strategy for continuous, sustainable leverage in the marketplace. R&D consistently drives innovation and when combined with a dedicated innovation management program, your company stays increasingly competitive and can keep up with (and exceed) shifting customer demands.
Note: Businesses that invest in R&D can receive different forms of funding, such as tax incentives like the SME incentive, the RDEC incentive (for large organizations), and grant-funded SMEs.
3. Improves Existing Products and Efficiencies
Corporations can gain a competitive advantage with research and development. It leads to improvements to existing products, right? And if the product is improved, the process of improving said product is likely done much more efficiently. There's no need for any "do-overs" or constant struggles—wasting time trying to fix or update the product. And like we mentioned in reason #1, having the knowledge and insight into the move your company is about to make makes it a lot less intimidating.
Bonus points: When R&D efforts efficiently lead to an improved something or other in your corporation, it typically reduces marginal costs and/or increases marginal productivity.
4. Allows New Product Development to Stay Competitive
This is an easy transition from the first few reasons because it essentially combines all into one. Efficiency, low costs, improved productivity, knowledgeable decision-making, innovative ideas, the list goes on really. Of course, new product development can be the strongest tactic of them all (explaining the title to this section), but all of these efforts give your corporation a significant competitive advantage. How can it not?
Disruptive innovation. While R&D does play a huge role, it doesn't necessarily start there. Innovation starts with idea creation and innovation management. Once that wild idea is born and there is a clear path to manage it, R&D can begin to push it on its way, or not.
Increased market envelopment, cost efficiency, competitive advancements, and trend-matching are important reasons corporations need to include R&D in the innovation process. R&D can help your company survive the changing market, stay relevant, and re-stake your claim as a market giant.
rready has been helping medium to large organizations change the face of their businesses with intrapreneurial powers. We've supported over 4000 employees to validate, test, and improve their ideas through innovation management as a service and internal development. Only a culture that consistently values ideas and creativity will continuously produce bottom-up innovation. If you're rready to impact your business for the better and experience cultural transformation, contact us today.Get started today