Research & Development (R&D) Business Strategies
Research and Development is an important topic for every entrepreneur, no matter how small the business enterprise. Unfortunately, not many entrepreneurs are aware of its importance. This week we examine what is involved in R&D and how you can make use of it to grow your business. Research and Development departments are common in many larger companies, especially those working with newer products or technologies subject to important shifts. While research and development work can be instrumental in creating new products or adding features to old products, the work that the department does is more complex than simple innovation. R&D is connected to marketing, cost management and other parts of business strategy. Although what follows is common practice in bigger businesses, see if you small business can benefit from the ideas we share.
R&D is closely linked with Market participation, which refers to the ability to attract new customers and win customer interest. At its core, it is about innovation, and 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.
Research and development does not produce value directly in relation to how much funding the department receives. 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 but work to secure talented employees and proper goal orientation and still produce good results.
Research and development 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.
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 research and development 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 adaptable and profitable.
Many small and medium businesses think that research and development is not for them, but for big businesses. Obviously, this is wrong thinking. It is noteworthy that the benefits of R&D for small business range from finding hidden niches and preserving capital to building customer loyalty and identifying more business opportunities with existing customers. Below are some ideas small enterprises can learn about R&D.
They think it is costly, to begin with. Many entrepreneurs believe they cannot afford the costs of conducting market research. They should first of all learn what R&D involves in order to realize that there is a lot they can do without incurring high costs.
The entrepreneur should try both research types. Research comes in two forms: primary and secondary. Primary research is first hand knowledge you gain directly from the marketplace and often uses techniques as focus groups and surveys. Secondary research, on the other hand, is usually published studies available online or from your library providing broad knowledge about your markets. Learning about your business and industry from secondary research is a good start but primary research allows you to target your efforts and understand customers' attitudes in real time.
You are encouraged to use Web Searching: The Internet has opened up a flood of business information that was once available to big companies or those with money only. No doubt conducting secondary market research on Yahoo or Google saves time and money for small business. To save money, visit your local library, business center, or college to gain access to the quality information you need at zero cost, just as you have done by reading this article on mygweru.com
Rely on Family Focus Group may not be a bad idea. However, a common mistake of new startups is asking those close to you for feedback on your product and service. Those who know you will want to guard your feelings. Friends and family make the worst possible selection of a focus group. You need to talk to real customers about the pros and cons of your offer and use your friends and family as support not market research.
All too often business owners will downplay the importance of gaining customer insight via research and development. It's absurd how many businesses are launched without ever talking to a single potential customer. I want you to reflect on your experience, either as a customer or a business owner in Gweru. How much research and development do you think our new and established businesses do? Suppose they all had this insight about the value of R&D what impact do you think that will have on business success? Now, think about yourself as an entrepreneur. How convinced are you about the importance of R&D? Avoid the common errors and use market research wisely to position your business for success.
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