R&D – is it time to realise the benefits of outsourcing?
R&D has always been essential to cutting-edge engineering development and has been responsible for advances in technology on land, sea and air that are in use today.
However, R&D needs to take on an even greater role as new technologies, new competitive threats and increasing budget pressures exert their influence. Spending needs to work harder, faster and produce greater value.
R&D is the key to unlocking solutions to these demands, and outsourcing could provide the knowledge and resources required. R&D is considered the final frontier of outsourcing but can offer a variety of benefits which are overcoming this opinion, as outlined below:
Create and Develop New Products
To deliver an optimum solution, an R&D company needs to have a clear understanding of its customers’ needs and the market(s) in which they operate.
Being technical in nature, some R&D companies may want to exploit the latest technologies to solve the demand. While this may meet performance targets, budget and market need will not be met. The customer must be provided with solutions that meet the commercial need as well as the technical.
Increase Flexibility
Commercial and operational requirements mean a quick response is needed to introduce new products and services to market. Outsourcing R&D enables organisations to react more quickly than would otherwise be possible. By outsourcing projects, organisations can immediately call upon a resource pool with the skills to deliver the appropriate solution.
Additionally, outsourcing R&D allows organisations to manage multiple projects without increasing headcount.
Exploit Technology
With technological change accelerating, it can be difficult for organisations to exploit the latest advances in new and established technologies. Emphasised by the fact that solutions can employ a number of different technologies, each one will invariably have different proprietary standards associated with it.
By outsourcing R&D, organisations can access technology previously developed for other markets and benefit from the linking of technology, rapid-prototyping and product development processes regardless of sector.
Reduce Development Times
New product development costs require a tightly focused project, minimising costs and development times and getting the product to market as soon as possible optimising competitor advantage.
If an R&D provider works in the applied research stage of the technology development cycle, they can bridge the gap between academic research and technology development. Combined with fast-track product development processes means the R&D supplier will have the technical capability to develop the appropriate solution, delivered in compressed timescales and to budget.
Access World-Class Talent
With competition for top talent, companies are finding it difficult to attract and maintain sufficient technical knowledge across core business areas. Building an in-house team to the competency required is both time-consuming and expensive and even more difficult to justify for a single project.
Many companies are calling upon specialists as and when required in order to meet the needs of their R&D programme.
Control and Manage Risk
Developing solutions in-house can be risky, especially when the technology is new, or the company does not have a complete understanding of it. This can deprive the business of valuable resources, time and money if the solution does not deliver.
By using an R&D consultancy, the risk involved in technical development is passed to a third party. Furthermore, with a fixed price contract, the outsourcing organisation is better able to manage the budget.
Trusted Advisor
Outsourcing R&D often involves development from initial study through to finished design ready for manufacture. However, in some cases the organisation undertaking the product development may have the resource but not the expertise. In these circumstances, R&D companies can bridge the technology gap providing consultancy and impartial advice.
With the additional commercial confidentiality considerations, up-front time and financial investment risk associated with engineering projects there has been a reluctance to consider outsourcing R&D .
However, the outsourcing of R&D in engineering markets is becoming increasingly accepted. With increasing pressures on development budgets, resources and from new commercial entrants, using an R&D organisation with proven experience and reputation in outsourcing can provide the benefits and results required to thrive in this competitive environment.
Gill Research & Development Limited is an innovative hardware, software and product design consultancy, offering services to external clients and sister Gill companies.
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