Focused Operations Management

Chapter 21. Managing Research and Development

Research and development (R&D), a topic of utmost importance because of its complexity, encompasses three interrelated elements:

1. Project management

2. Resource management

3. Technology management (identifying opportunities, marketing the product, managing technological innovation, and more)

This chapter focuses mainly on managing the R&D department that has components of these three elements.

Complexity of R&D Management

Research and development management is characterized by:

• A multiplicity of projects competing for the same resources

• High levels of marketing and technological uncertainty

• Complexity in managing employees with a high level of specific expertise

• A multiplicity of specializations in various technological areas

• Inherent conflicts between the two permanent bottlenecks:

  • —Marketing and sales personnel

  • —R&D personnel

• Pressure from customers and management to reduce response times and costs

• Continual reduction of the product or technological service life cycle

Improving R&D enhances the firm's value. To achieve this enhancement, there is a need to deal with the main problems faced by R&D management.

Experience with R&D departments demonstrates several typical important problems:

• Business thinking and subordination to the market and its needs

• Effect of project type on management requirements

• Conflict between generic development and specific development

• Overspecification and overdesign

• Viewing development as a process

• Working without a Complete Kit or ...