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Section D
Project Management of Innovation

The selection of innovation projects is of great importance to a company that wants

to stay at the front of the race with its competitors. Hence the need for innovation to
be clearly defined in the company’s strategy and its role in meeting the ambitions of
the business to be understood at all levels in the organisation. At the strategic level
there needs to be a formal mechanism for identifying any gaps in the current inno-
vation requirements, required to meet the growth targets of the business. Once iden-
tified this innovation gap will need to be filled by the successful completion of ap-
propriate projects that will make up the R&D portfolio. Clearly R&D will play a cen-
tral role in integrating the idea generation innovation process with other functions
in the company; a leading one in the work on the early stages of new product inno-
vation and a supporting role in market development.
Some people assume that formal Project Management in R&D starts either when
the experimental programme has been agreed or a product has been selected for de-
velopment. This is wrong, the techniques of project management should be applied
as early as possible, at least from the time an opportunity has been identified out in
the market and preferably even before this, during the phase when opportunities for
R&D are being sought. It is in these early phases when most projects are rejected and
it is easy to dismiss an idea without giving it due consideration from a techno-com-
mercial perspective.
Poor execution of the project selection procedure will inevitably lead to a waste of
time and energy for all concerned, resulting in frustration for the research workers
and the shattering of the hopes of the sponsors of the work. There is a need to look
hard and long at what advantages a new product offers, how it can be assessed in
terms of market acceptability and financial rewards and also in carrying out the fine
tuning of the target requirements in the light of the information that is gleaned dur-
ing the exercise.
Projects are either driven by the market or by a technology. In new product research
the market nearly always dominates, you cannot sell a product nobody wants, whereas
in process development and applications research, technological changes can more
frequently drive R&D projects. Which ever type of project, a good management sys-
tem will help companies to choose the right paths for their innovations and avoid
them travelling down technical or commercial blind alleys. Many of these difficulties
can be overcome by employing, a stage-gate process for project management. In this
Research and Development Management in the Chemical and Pharmaceutical Industry:
Second, Completely Revised and Extended Edition. Peter Bamfield
© 2003 WILEY-VCH Verlag GmbH & Co. KGaA, Weinheim
ISBN 3-527-30667-6
206 Section D Project Management of Innovation

process a gate is a milestone at which a formal decision is made on whether to pro-

ceed to the next stage. Whilst this process is good at delivery it is slow, being a linear
process of around eight stages.
With the increased importance of getting new products into the market quickly,
the time-to- market issue, attempts have been made to reduce the number of deci-
sions points and stages in a streamlined process. Time equates to money, therefore
the sooner a company is able to get a product to market the sooner it can recoup its
expenditure on R&D. Guidelines for achieving this time reduction in the length of
the innovation chain will be given, with particular emphasis on the role R&D Man-
agement plays in this process.
Selecting the Project Team and Manager or Leader, ensuring that the right people
and other resources are available and assigned to the project team, are key manage-
rial tasks. Once in place, a Project Manager, with the necessary skills and training,
must have the freedom to plan, monitor and control the project and be empowered
to deliver on the company’s behalf a successful outcome.

Overview
The R&D portfolio, which forms part of the innovation strategy of the company, is
designed to fill the innovation gap. Whilst improving existing products and increas-
ing plant output is very cost efficient work for R&D, it is new product research, the
discovery phase that underpins a growth strategy. Strategic research on the other
hand generates new businesses or leads to a strategic change of direction. Success-
ful management of the innovation chain from idea to marketable product is the key
task. Full-scale manufacture of a new product is a time of high excitement, but care-
ful planning and execution are crucial. The time-to-market issue is a driving force in
new product development, but speeding up the delivery of new products to the mar-
ket involves intelligent risk and resource management. Most problems occur at in-
terfaces and are best resolved by using multi-functional project teams. The nature of
the project will define the managerial skill requirements of the leader. Planning of a
project and the allocation of resources should start only once it has been redefined
in specific terms. A formal project launch is like the opening night of a production
the successful completion of a project, and needs to be acknowledged by senior man-
agement. All projects produce new learning, which should become part of the com-
pany’s knowledge management system.