Strategy for research and development

Research and development (R&D) needs to be carefully planned and managed

to succeed. It is easy to waste money on developing ideas that go nowhere, but
getting it right can lead to business stability, security and long-term profits.

For an introduction to formal project management see our guide on project

management - the basics.

You should also decide how much money and resource you are willing to
commit to R&D at this strategy stage.

Planning

R&D should be included in your overall business plan. The plan should
illustrate the direction you want the business to take and how R&D fits in with
your other business activities. Set out clear objectives, time frames and budgets.

A clear plan can prevent the project straying from your business goals and
wasting valuable resources and money.

You can also use certain interactive tools to find your strengths and identify the
areas you need to work on if you want your business to grow.

You may need to involve staff with specific skills to draw up the plan, for
example finance staff to set up budgets. You may also need outside help. See
the page in this guide on exploring your ideas.

Your plan should set out the steps that need to be taken from the inception of
the ideas to the product launch.

You should allocate the necessary resources to the project, including funding,
staff and time. You might decide to set up a specific team to work on the
project. See our guide on budgeting and business planning.

Management

Good management is vital to reduce risk of failure and realise as many ideas as
possible.

To manage R&D projects effectively you should:

 make sure staff involved in R&D understand the business' overall

strategy
 ensure these employees understand what is commercially realistic
  assess the changing risks and potential of projects as they progress,
continually developing a rigorous business case
 ensure that intellectual property ownership issues are resolved
 recognise when a project isn't going to work - see the page in this guide
on eliminating ideas that are not viable
 understand the relative importance of different projects to your business

Internal research and development

You can carry out your own research and development (R&D) in-house. If you
do not have the resources, you could consider outsourcing to external
contractors.

Managing projects

You can use internal project managers to carry out R&D. In many smaller
businesses an existing member of staff can take on the role of a project manager
alongside their existing duties.

Project managers are responsible for making sure that a project is planned,
developed, implemented, controlled and closed. Project managers can:

 ensure a minimum level of quality and that results meet required

outcomes and expectations
 free up other staff members to get on with their area of work and increase
efficiency both on the project and within the business
 make things simpler and easier for staff with a single point of contact
running the overall project
 encourage consistent communications amongst staff
 keep costs, timeframes and resources to budget

Research can include looking at:

 potential new customer bases

 how a new product may affect your business
 whether a new product will meet customer needs and specifications
 upgrading your product/design

Benefits of internal research

Your business can benefit from individual tasks such as redesigning your logo
to help you stand out from your competitors in competitive markets. The
overall, longer term benefits to your business include increasing productivity
and profitability, enhancing your brand and staying competitive in your
marketplace.

Some larger companies have dedicated R&D departments. This may not be
viable for you if you run a smaller company. If you do not have the internal
resource, you can choose to outsource some, or all, elements of R&D to an
external contractor including design, project management and specialist
expertise.

External research and development

If you have considered keeping your research and development (R&D) in-
house, but feel you do not have the resources or desired skill set, you may
choose to outsource all or some of it to outside experts.

If you're not likely to require a full-time position, you have the option of hiring
either for a specific project or on a longer-term basis, perhaps on a freelance or
fixed-term contract.

Hiring project managers

Project managers are responsible for making sure that a project is planned,
developed, implemented, controlled and closed.

Hiring designers

Using a professional designer will help you make better design-related decisions
and focus more strongly on your customers' needs. You can draw on a
designer's skills throughout a project, from strategy and idea generation to
implementation and evaluation.

Designers can help you deliver a broad range of R&D including:

 research to help you discover the difference between what customers say
they want and what they really want
 websites
 branding
 packaging

Working with universities and colleges

Academic research can help businesses develop new ideas or enhance existing
ones. Your business can benefit commercially from relevant research into
processes and technologies, while universities and colleges gain new sources of
funding and researchers achieve a better understanding of industry needs.