Paper Example on Importance of Research and Development

Introduction

Research and development is a key area in any organization. It plays a vital role in the success of a business and contributes to the sustainability of a venture. It ought to be noted that many companies do not understand the importance of R&D until it is too late. Equally, it provides a platform for creativity and innovation to flourish in an organization, and innovative breakthroughs have happened only because of the painstaking efforts of the R&D function. Therefore, perseverant efforts are needed when one is in pursuit of research since every failure in an R&D effort increases the pressure to perform.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

R&D helps a business to have a competitive edge over its competitors. It develops plans much ahead of other functions, and it needs to have a clear foresight about future problems that need solutions. Thus, it can act as a catalyst for speeding up the growth of the organization by way of introducing breakthrough products in the market. The aspect is very relevant in today's competitive scenario when customers are hankering after new products and new technologies (Noumair 2016). Thus, the firm that can successfully leverage its R&D efforts by translating the efforts in building new products so as to find itself ahead of its competitors. On the same note, expenses on R&D can be considered not as expenditure but as an investment.

The ROI on R&D efforts can take a while to materialize, but once success is achieved, the financial returns can be quite high. Pharmaceutical companies, chemical corporations, automotive firms, lubricant establishments invest massive amounts of capital expenditure and revenue expenditure for this reason. These companies strive to be ahead of others in their learning curve. It should be noted that some companies are technology leaders, while others are followers while some industries prove to be laggards. Let us take the case of mobile phones. Today, there are different types of models that are being launched in the market that are the result of intensive R&D efforts. Apple, Sony, 3M are the companies that are known for their breakthrough technologies - some of these technologies are albeit disruptive because they make the existing technologies redundant. It is noted that the 3M's Scotch-Brite is one example that brought in the hygiene factor and capitalized on it while the turnaround time for new products in toothpaste (dental care products) has considerably shortened. Thus, many firms have converted problems into opportunities only because of their R&D efforts (Mosionek 2011). These companies eventually became technology leaders since they create churn in the market.

All the modern inventions -laptops, palmtops, music players, iPods, mp3players, automatic washing machines, dishwashers, water filters are all examples of R&D efforts that had a successful outcome. Who would have thought that mosquitoes would provide an opportunity for new product development in the form of mosquito mats, repellent creams, vaporizers many other products? It should be noted that digital photography has made the conventional technique redundant and computers have confined the typewriters to the museum while electronic mail has rendered the snail mail defunct.

The world moves through scientific inventions and discoveries which are a result of sustained R&D effort. The aspect leads to long-term business sustainability. Also, R&D efforts are necessitated to meet the regulatory norms such as green technologies that reduce pollution. Hybrid cars, electric cars, catalytic converters in vehicles are examples of successful R&D exertions. Hence, the role of R&D in shortening the time to market becomes extremely important. Equally, unless the R&D efforts in the lab cannot be scaled up within a reasonable time frame, little can be expected regarding the functional credit to be assigned to R&D.

In India, the problems faced by R&D functions are one too many, and it is high time the scenario changed. It ought to be noted that Germany is known for world-class engineering and the US is known for its research agenda. India, despite having a talent pool, still lacks in indigenous research (Bandyopadhyay 2017). We have a situation where foreign companies like GE and Shell come and set up R&D centers here and gain a competitive advantage globally. Similarly, the aspect becomes hugely relevant to make an organization's future ready, to equip the business with the wherewithal required for commercialization of lab efforts through large-scale production.

Equally, the R&D function can reasonably predict future technology trends. In an environment filled with resource constraints, its efforts in the right direction will enable allocation of scarce resources for the proper purpose. Equally, it helps a business earn revenues through licensing of technology and expertise transfer. It should be noted that information technology has developed so much in the last few years that change has become the norm in such sectors. Therefore, there is a need for greater coordination between academic research and industry research.

Conclusion

Companies tend to focus more on "development" and less on "research" mainly to meet short-term operational goals. It must be understood that R&D has a strategic orientation and using the R&D function to meet short-term operational goals is anything but a wise move. Some firms use R&D as a cost center because of the depreciation allowance that is given by the Income Tax department.

References

Bandyopadhyay, N. (2017). Business Development Strategy in India for Overseas Construction Management Companies. Research In Medical & Engineering Sciences, 2(1). doi: 10.31031/rmes.2017.02.000528

Mosionek, M. (2011). Financing of companies' research and development activities in Poland. Oeconomia Copernicana, 2(2), 75-102. doi: 10.12775/oec.2011.009

Noumair, D. (2016). Research in Organizational Change and Development. Emerald Group Publishing Limited.