MEANING OF RESEARH AND DEVELOPMENT

Research and development, also known as R&D, is the process

by which a company develops new technology or improves
existing technology. Developing an effective R&D department can
require a large capital investment that many small businesses
may not be able to afford.

Research and development (R&D) refers to the part of a

company's operations that seeks knowledge to develop, design
and enhance that company's products, services, technologies or
processes. Along with creating new and innovative products and
adding features to old ones, R&D connects various parts of a
company's strategy and business plan, such as marketing
and cost reduction.
 IMPORTANCE OF R & D TO A COUNTRY
Creating high level jobs
Creating high added value products
Gives prestige through inventions
Attract investment by multinational corporations

IMPORTANCE OF R & D TO A BUSINESS

Have competitive advantage over firms
Create Intellectual property (IP) is a category of property that
includes intangible creations of the human intellect, and
includes copyrights, patents and trademarks
Maintain customer loyalty
Able to charge high price , worth the money
Publicity
Lower costs
• Leaps in Market Participation
Market participation refers to the ability to attract new
customers and win customer interest. At its core, research
and development is about innovation, about offering consumers
something they have never seen before. When R&D can pull off
such a product offering, the interest that consumers have can
cause a sharp leap in market participation and sales. It may even
create an entirely new market for the company.
• Cost Management Benefits
Research and development does not produce value directly in
relation to how much funding the department receives. It is
unique in this property; the success of R&D depends more on the
practices, talents and innovations of the people working there
than on how much money the department receives. This means
that a company can actually spend less money on research and
development than many competitors
• Marketing Abilities
R & D strategies allow companies to create strong marketing
campaigns and advertising strategies. The two work together
very well. The research and development department works to
make new product designs or add features, and the marketing
department interprets these changes in the most exciting light
possible in order to attract customers, creating synergies
between the two branches.
• Trend Matching
Many times a market is already embracing a trend, and the
research and development department can be used to make the
business active in that trend and increase sales. For example, in
markets rapidly embracing green products, a company can use
R&D to make products out of natural ingredients, recycled
materials or biodegradable substances, allowing for the release
of an eco-friendly version of the product that increases sales.
When R&D can catch up with trends, the business is seen as
• Esprit de Corps
• An important, if somewhat intangible benefit of a company's
orientation toward research and development is esprit de
corps– a French phrase that translates, roughly, to "group
spirit,"
• Companies that encourage innovation, especially those that
empower employees to follow their passion, are markedly
more productive than others. An ongoing study reported in the
Harvard Business Review noted that "great companies think
differently." One of those differences is their emphasis on
innovation as a core value; it's invariably accompanied by
group spirit. The combination makes these companies highly
stable and productive.
• -------------
• advantages of R&D for small business
• If you have an innovative idea for a new product or service, here are seven
ways R&D can help you bring it to life:
• 1. Unique selling point – R&D can help you develop unique products and
services. These don't always have to be entirely new. R&D can drive
product improvement or innovation within the existing business offering.
Here are some tips on researching new product and service ideas.
• 2. Income – unique products and services resulting from successful R&D
projects can bring financial benefits to business. This is usually through
generating new or enhanced income streams, but R&D can also attract
potential new investors to your business. Read about equity
finance and joint ventures and business partnerships.
• 3. Funding – doing R&D can have cost implications for small business.
However, R&D can also offer many opportunities for businesses to seek
public-sector innovation, research and development grants or even EU
funding for innovation.
• Tax relief – you can claim R&D tax relief to reduce your company's tax bill
or, alternatively, choose to receive a tax credit instead by way of a cash
sum paid by HM Revenue and Customs. Only qualifying R&D expenditure
will be considered for tax relief purposes –
• 5. Competitive edge - through R&D, you can develop advantage over your
competitors and establish yourself as leaders in the market. Development
of new products and services can also generate new intellectual property
for your business which could further benefit you financially. Read
about protecting intellectual property.
• 6. Collaboration – collaboration can be a key element of any R&D project,
and is often crucial to achieving success. Collaboration can take place
between your business and another enterprise, university or college. It
allows for the transfer of skills and knowledge, and access to facilities,
expertise and potentially new ideas that would otherwise be out of reach
of your business. See how to work with UK universities and colleges.
• 7. Reputation - engaging in R&D can help you strengthen your brand and
reputation. If you’re collaborating with a trusted, reputable partner or a
strong scientific institution, the commercial success of resulting products
and services can benefit from their involvement. Find out what makes for
a successful brand - see branding – the key ingredients.
How pace of change in an industry, organisational change