Technological uncertainty: The difference between R&D vs normal problem solving (blog)
Having worked in the Research & Development (R&D) space now for over four years, I have seen claims processed from breadstick bakers to candle stick makers and everything in between.
However, in many industries, there is still a major lack of claims and I believe the top reason for this is confusion over what activities actually qualify as R&D. Many companies have found it difficult to tell the difference between a standard industry problem vs an R&D one.
The answer comes down to risk and uncertainty (in the science and technology space).
When you have a problem to overcome, there will be either:
- A solution already out there that already exists and can be used immediately. As there are little to no risks involved in it working, this is a standard problem.
or
- There won’t be anything readily available to you and you will need to embark upon a journey to find a solution. As there will be lots of unknowns to overcome, this is R&D.
If you are truly doing Research & Development, there will typically be an element of trial and testing, design iterations, experimentation, feasibility studies, theory vs practice studies and so forth. This is what leads to risk and uncertainty.
Let’s explore five different sector examples and see if you can spot where there’s R&D.
1: Architecture
Imagine the two following scenarios:
Project 1: A residential house is being upgraded to Passive House standards. The architect carrying out this job has had success with 3 other houses just like that this year. No innovation is required - just a rule book with step-by-step instructions.
Project 2: The same goal is to be achieved- a Passive House standard - but now change that residential house to a private school. The building is a Grade 2 listed and therefore restricts you from using “everyday methods”. Now add in a swimming pool and, finally, instead of there being five people in the house, there are now 500 students in the school.
Uncertainty: Any architect will agree that project 1 holds little chance of there being R&D activity. They already have a tried and tested method that can be applied without risk or worry. On the other hand, Project 2 will be able to claim for R&D. This build will have a multitude of uncertainty, as a readily tried and tested method cannot be simply applied.
2: Food Production
Imagine yourself as a food manufacturer facing the following two project scenarios:
Project 1: Your top-selling product is the Chocolate Fudge Cake. It’s so good that you decide to make three different flavours of it: fudge, white chocolate, and orange chocolate. As the recipe is fairly straightforward - and you’ve made it countless times before - you know exactly what ingredients to add to get your desired results.
Project 2: Now you decide to make a vegan-friendly version of your top-selling cake. You want it to taste the same, smell the same, and have the same consistency, but how do you do that with no eggs, no milk, no butter, and no chocolate chips?
Uncertainty- Using plant-based alternatives and hoping for the same outcome will surely bring about major uncertainties. Many test batches will need to be created, ingredients will need to be measured and added at different times to record changes in taste, components, and texture. As the unknowns are vast, project 2 would most likely be able to claim for R&D.
3: Construction:
Two companies have been tasked to build a new motorway
Company A’s brief: “Build a basic motorway in 12 months. Follow the same procedure as you’ve done for the other four motorways you’ve built for us”.
Company B’s brief: “Build the same basic motorway in 12 months but this time include 20% of the materials from recycled products. Furthermore, in line with Government changes, you will need to reduce the carbon journey of this project by 25% in comparison with Company A.”
Uncertainty: In this case, Company B will most probably be undergoing R&D to meet the additional requirements.
Briefs change the game for R&D to take place within a project - what may appear to be a simple project, could in fact be the most complicated and risky of all. Government changes can also bring about major uncertainty particularly when it comes to disrupting a go-to solution in the marketplace.
4: Engineering
The Project: Get your Harry Potter on and design an invisible cloak
Imagine now that two engineering companies are to design the exact same product - an invisibility cloak (humour me).
Now let’s say that both products must perform the same, cost the same and fit the same audience.
Uncertainty: Although the two companies will be producing the same product, how likely is it they will follow the same process as one another? Do you think they will divulge their secrets, and exchange advice and value throughout their different product journey? Very unlikely.
This means an advance in knowledge will most likely take place, completely unique design processes and a huge amount of R&D thinking.
5: Software
Don’t think of ‘features and functions’, think more about ‘underlining architecture’.
We’ve all seen how advanced software has become in the 21st century.
As software has become a lot more accessible over the years, it is now one of the most scrutinised subjects with R&D claims. Therefore, it’s important that you know what true uncertainty looks like within IT projects.
If you want to design an app, even I know that you can go onto YouTube, watch a tutorial, and buy a software package (some are even available for free). Great - you’ve now created an app. The only uncertainty is your lack of knowledge on how to put this together, but it’s not something that hasn’t been done before - all the answers are there at the click of a fingertip. This wouldn’t be classed as R&D.
However, companies are doing some fantastic things with Augmented Reality, Artificial Intelligence and pushing boundaries in the IT programming space. These platforms cannot function without unique underlying architecture, which is where an enormous amount of doubt and experimentation comes to play.
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Not always black and white
So, when you think of R&D always think: does the outcome of my project face uncertainty and risk? If the answer is yes, then you’ve got a potential claim on your hands.
However, sometimes R&D claims can be complex and aren’t always so black and white. If you’re still unsure whether your project qualifies for R&D, contact me or via karen@innovationinsights.uk