What is r and d

R&D monitoring & controlling

R&D monitoring, essential to control innovations

The R&D expenditure of 8-10% of sales, which is relatively high on an international scale, justifies and demands the systematic provision and use of adequate instruments for German industrial companies. The R&D Monitoring & Controlling is to be understood as a control loop at the center of which is the transformation of the global R&D strategy into the business area-specific R&D planning. From this arise R&D roadmapswhich all market-oriented, technical and commercial objectives in the form of binding project agreements (Project Agreements) include. The task of R&D Monitoring & Controlling is now to coordinate the globally distributed project initiation, to check the targeted project implementation at regular intervals and to initiate or implement measures to achieve goals in the event of unforeseen problems and higher-level plan changes.


Figure 1: Control loop "R&D Monitoring & Controlling

R&D Monitoring & Controlling is the central instrument for planning and controlling R&D projects, with which the transparency of technical, temporal and financial opportunities and risks can be achieved when developing and introducing new solutions. The economic ones are particularly important Success of the individual project as an assessment and control parameter to be used in order to be able to ensure during the ongoing process that the technical performance potential is only exhausted to the extent that it makes economic sense.

"R&D only makes a positive contribution to the achievement of goals specific to the business area if the allocation of R&D funds is based on the possible and necessary performance improvements of the technology."

R&D studies by the TCW

Studies by the TCW show that out of 100 R&D projects, only 57 are technically successful, but only about 1/3 are launched on the market. Economically successful in the sense that the projects generate more than the return on the capital employed at market rates, are only 12% of the projects started. Therefore it is necessary clear and economic success-oriented goals for global R&D activities to be able to make clear decisions at clearly defined turning points and, if necessary, to be able to terminate a project in good time.


Figure 2: Planning and controlling R&D projects

The basis for effective planning and control of R&D projects are thus universally accepted target agreements that are documented in project agreements. The goals must be borne by engineering as well as by manufacturing and marketing & sales and must be checked and controlled together with the business people. Project agreements thus form the contractual basis on which the R&D project agreed between the client / budget provider and the contractor is planned, approved and carried out.

No R&D activities without a project agreement - no project agreement without a result control

R&D Monitoring & Controlling also coordinates the provision of the necessary resources at the right time to ensure that the technical goals can be achieved at the right time, with the right quality and without significant cost overruns. The early control and thus the possibility of making changes in short value creation intervals is together with the Use of specific monitoring tools (e.g. milestone trend analysis, capacity / status and cost monitoring, risk analysis and the increasingly important target cost calculation) associated with an increase in the planning effort, positive effects such as:

  • Increase in R&D efficiency and R&D effectiveness,
  • general shortening of development times,
  • Reduction of complexity in products and processes,
  • Improvement of product and process quality,
  • Reduction of manufacturing and maintenance costs as well as
  • Improving international cooperation

but surpass them many times over.


Figure 3: Project management through R&D monitoring & controlling measures

The reason for control measures are in principle occurred or expected deviations of the actual activities from the planned course of the project. The quality of project management through R&D monitoring & controlling measures, such as quarterly reports or comprehensive review meetings and steering boards, will be confirmed on Degree of adherence to a plan measured and is largely determined by the early detection of deviations from the plan.

"The earlier deviations from the plan are recognized and control measures are initiated, the greater the chances that these measures will take effect in good time."

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