Enterprises drive competitive edge through R&D

Enterprises are discovering the benefits of R&D in building competitive advantage and differentiation in a slow economy

What made it possible for scientists to discover the Higgs Boson particle? The answer is years of research. What has made technology the way it is today? Somebody’s ideas and yes, research! What do PhD students do for years to make a discovery and obtain a doctorate?

That’s right – research.

Research is the life-blood for development and breakthroughs. In a highly competitive world people need to constantly innovate in order to stay ahead.

Many companies continue to rely on R&D to provide their competitive edge, which explains why, R&D spending in 2011 increased by 9.6% to US$603 billion—an all-time high, according to a study by Booz & Co. The report goes on to say that global R&D investment among the world’s top innovation spenders continued to grow robustly, despite a looming economic and financial crisis.

With the pressing need for faster and more efficient mechanisms that can result in market advantage, organisations are seeing the increasing need to invest in research and development.

India is fast developing as a haven for research. Over about 870 multinational companies have established R&D centres in India according to the Global R&D Summit 2013 report by FICCI. This is a sign that Indian talent is very much in demand for its skill and tenacity to help achieve enterprise goals.

According to FICCI in India, R&D expenditures by Foreign Direct Investment (FDI) companies has shown a robust increase from `286 crore in 2002-03 to `2,883 crore in 2009-10. The share of foreign companies in overall R&D has risen to around 20%, according to the most recently available estimates.

Why is India a hotbed for research, innovation?
Local talent pool: According to a report compiled by Voice and Data, India has been steadily filing over 1,200 patents per year, since 2010. The fact that global organisations are seeing potential and investing in India has caused talent to want to stay put and contribute within their own country.
Thus, more people are willing to invest, leading to a cycle of constant development.

Collaboration: Industries and academia are increasingly coming together to create tangible research results that can be made into products.

Economically feasible: The reason why India first became a destination for R&D was due to its economic feasibility. In comparison with other nations, resources are more economical in India and more readily available, too.

Potential market: People all over the world are recognising India’s potential to drive global innovations as well as a potential market for products, solutions and services. Given this, it makes business sense for companies to invest and build their R&D in India, in order to serve the domestic markets with ideal products and solutions.

Government of India: The government has been introducing several bills like The Universities for Research and Innovation Bill 2012, which was aims at establishing universities focused on innovation and research and encouraging existing universities to take up more research and industry collaboration projects.

Availability of niche senior talent: A decade ago, the role of technologists and IT architects was rarely visible in the Indian IT industry. Now however, most product engineering companies have introduced such roles and senior professionals are embracing them.

When it comes to R&D, India’s advantage lies in a majority of its population comprising of youth, the multitude of engineering and technology institutes and a developed ecosystem in high technology.

Rudramuni B
Executive director and head of Dell India R&D