The Knowledge Source

Beyond Project Management

No matter how good the R&D projects the company may have, without systems in place that ensure the original project plans are monitored, modified, and made to happen in optimum way, can be a failure. The ultimate objective of managing R&D is to give results that increase the value of the company in its business and to create new businesses.

R&D’s role in value enhancement is usually expressed in one or more of the classic dimensions such as cost, speed, quality, and image. Successful R&D organizations operates to achieve its outcomes by emphasizing the following goals: (a) a well established communications between organizations; (b) linked structural interfaces across different functions of the business; (c) creating a sense of importance and urgency in individual researchers to established a common understanding and objective of the project and integrated view of how one affects the others in achieving the common objective; (d) transparency: sharing of uncertainty; (e) creating an atmosphere of freedom; (f) willingness to terminate projects which requires a good technical answers, business judgment, and communication skills to justify to the team the reasons; and (g) corporate-wide optimization of resources.

There are 7 key practices that can help managing the process effectively: (a) a key component is the ability to express how technical objectives relates to the business objectives, allowing rigorous communication; (b) a process that jointly develops clearly articulated, mutually agreed-upon, strategically evaluated project objectives, with clearly defined results; (c) a process for setting priorities and allocating scarce but flexible resources; (d) a backlog of ideas; (e) an aggressive approach to project design that addresses most significant technical uncertainties as early as possible; (f) a practical approach to project management and information systems; and (g) an appropriate project-team structure, composition, and authority – the professional management of complex projects along with appropriate integrative mechanisms such as project management office in place.

Typically, project manager plans, supervises, and leads the subtasks and end result, defines goals, and deals constantly with time and cost parameters but most often than not, not solely own the authority over the project. The management decision is the most important factor in the success of the project and how it will be supported can spell a difference. A key element of system-wide project management is the founding of interdisciplinary teams and close, mutually supportive working relationship among the members. It also requires effective team work and leadership which most often than not is the difficult aspect of the project management because by nature, members of the team are diverse (in terms of technical expertise or knowledge) and have different cultures. Each organizations have their own unique way of doing things which primarily depends on what type of organization or business they are in and what other systems they have that integrates their processes. Though there are more and more project management concepts and systems already evolving, there is still complex issues arise during the project implementation and we can say that there is no right recipe or formula that fits. It is because every project is unique though there are main areas that are alike.

Organizing for Smooth Transition from Research and Development to Production

The transition period between the end of the R&D cycle and the beginning of serial production is often jam-packed with problems and conflicts. There are five distinct stages in the classical transition of R&D to manufacturing which involves massive problems such as (a) responsibility factor where there is often a perception that R&D has nothing to do with the tasks related to manufacturing; (b) the maturity of design problem which is due to the desire to meet a deadline to customer (many of the companies launched their new product prematurely); (c) the problem of redesigning for manufacturing where pinpointing of incompetence between R&D and manufacturing occurs.

Fortunately, these interface problems are becoming easier and more manageable through the use of innovative organizational concepts such as (a) organizational methods which new organizational concepts may contribute positively to lower the division-of-responsibility barrier; (b) computer-aided design and manufacturing methods which proven to be contributing to a smooth transition in a number of ways; (c) adapting optimized production technology (OPT) and just-in-time (JIT) methods which the principles in its broad sense can be interpreted as meaning to avoid large investments in anything not necessary to assure the smooth flow of work tasks and resources in the organization; (d) the concurrent engineering approach along with applying the total quality management approach (TQM) resulting to a more flexible work environment that accepts and adapts to the continuous innovation process which proven to bridge the gap between two generations of a product, allowing the companies practicing this method to extend market share.

A number of technology-driven industries, including semiconductor manufacturing in its early development as well as other related industries more recently, have been characterized by the failure of many R&D initiatives to reach the goal of affordable products that can be manufactured on a large scale. What is lacking is a life-cycle template to serve as a methodology for smooth transition from R&D to volume manufacturing. In many of these cases, the failure is due in large measure to the inability of corporate management, using a specific set of attributes, to technically assess the economics of transition from the laboratory to large-scale production.

Many local companies in the Philippines were not an exception to these problems as well. Many of the previous products launched prematurely and proven to be unsuccessful contributing to these problems and it costs the company valuable losses. These costly learning have been an areas for development and continuous improvement. As we often say, it is only through the actual experience that we will learn the most (learning curve of the company which is also directly related to Knowledge Management concepts), but with the help of emerging new concepts and principles, companies will be much less vulnerable to failures and prevent further losses.

Minimizing the Research and Development Cycle

If a company is to create a perfect and fully performing product before the beginning of the manufacturing cycle, it must allocate sufficient time to R&D. But with the current dynamic business environment, products have much shorter life spans with many products being replaced by newer models in an ever increasing pace and the traditional paradigm of R&D cycle simply not applicable anymore. A reason for this is that the window of market opportunity for commercial success of a product is too brief. To be successful, a company must be organized to introduce its products as closely as possible to the beginning of this time window. Factors that affect the length of R&D cycle that must be considered are: (a) technological uncertainties and innovation risks which may become extremely complicated as interdependencies are introduced in different stages of the cycle; (b) supply of critical materials and parts which requires special attention since inventory policies such as the just-in-time (JIT) policy simply won’t apply due to the uniqueness of R&D organization compared to other units; and (c) bottlenecks in the R&D organization itself since outputs rely primarily on people. People should have the precise knowledge, experience, and expertise to do the job because the real output of R&D organization is not just a prototype or a physical product but also the knowledge and information that accompany it (assuming it is not yet finished and documented). Suggested methods that are effective in reducing cycle time are: (a) managing uncertainties and risks involved by early identification, reducing and monitoring, parallel development, simulation and rapid prototyping by using computer simulation and modeling; (b) applying rational inventory policy for R&D which JIT model is simply inappropriate and requires a different policy which can be a combination of several known policies; (c) reducing bottlenecks in R&D organization by, first, identifying most critical bottlenecks and take appropriate action to open them to speed up the process and shorten the cycle.

The sequence of activities from the R&D decisions to commercialization involves not only the factor of time delays, but substantial uncertainties. Organization should provide an interface system for multiple sources of information and functionality, ensuring that R&D as well as other groups in the organization has the right data and tools to make the right decisions supporting the interoperability between groups, thus resulting to reduced cycle times and move discovery (or innovation) forward. Designing a system that supports different groups’ functions and responsibilities across the entire organization requires an integration and synergy of various systems in-place. Goals, responsibilities and roles of each group should be clear prior to the start of the implementation of the R&D projects so that later on problems such as conflicts between groups can be minimized.

Interfacing R&D with Marketing and Production

Management of innovation requires different and multiple roles. Each role has some unique contributions to make in terms of technical expertise, process facilitation, and organizational resources. Each role requires flexibility when changes occur and organization should be deliberate and conscious about the learning process. R&D interfaces with various units within the company such as general management, production, and marketing. The main cause for more than half of the R&D project failures have occurred for non-technical reasons such as lack of continuing and collaborative relationship between R&D and various groups e.g., marketing, engineering, production (this is due to various reasons such as culture, turf, KM capability, etc.).
Problems that can be encountered during the interfacing can be overcome by setting and agreeing on goals within and across the organization. Potential conflicts can be minimized (if not totally eliminated) by having simple approaches to information management and communication in a more constructive way. The degree of harmony and joint involvement between R&D and the other groups in the company have a significant effect on the success of R&D projects. Effectiveness of information transfer (in a much greater framework: KM – Knowledge Management) and the understanding of user needs are the major variables affecting project outcomes.

Managing the interfaces between different groups is a major challenge to managing innovations. Most projects fail due to lack of communication and openness between various groups in the organization which later producing enormous amount of conflicts (not to mention that competency in terms of where the right knowledge required resides, thus a sound knowledge management is crucial). Company culture should form part of any systems that can help streamline the interfaces between groups. Managing a diverse group of experts such as R&D is even up to now a challenge to management on how to synergize each groups to manage interfaces in a holistic and integrative approach.