The Importance of R&D in Corporate Innovation

R&D is directly linked 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 has a much lower chance of surviving in the market. 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. This is where innovation vs R&D comes into play: while R&D is about discovery and development, innovation is the application of those discoveries in the marketplace.

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 may stumble upon success by taking blind swings. 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 activities. to figure out if you have a good idea on your hands or not.

2. It’s a Powerful Investment

Although the costs can be high, investing in R&D projects is a powerful investment into your corporation’s future capabilities, and ultimately, success. Corporate innovation strategy 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.

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?

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.