Importance of R&D for corporations

“As technology changes, people can produce more with either the same amount or fewer resources, thereby increasing productivity. As productivity grows, so does the economy.” – innovationfiles.org

Research and development (R&D) is a vital component of a company’s growth all over the world. R&D activities in the corporate world include a wide range of verticals, from product creation and growth to supply chain process refinement for increased performance. It usually entails allocating resources to the testing and production of new goods or services, as well as improved and more efficient methods of doing stuff. Companies all over the world are looking for new and more efficient ways to achieve their objectives through technological advances. R&D spending by some of the world’s most powerful corporations demonstrates this concern. For instance, the global investment in R&D by organizations worldwide has been around a staggering $2.3 trillion, which is roughly 2 percent of global GDP (McKinsey). Apart from the pharmaceutical industry, which still invests a large portion of its revenue on R&D, industries ranging from information technology to consumer goods are reinvesting more than 20% of their earnings before interest, taxes, depreciation, and amortization (EBITDA) back into R&D (McKinsey). 

Corporations now want creativity and innovation to be ingrained in their DNA because it allows them to remain ahead of the curve in terms of value addition, whether by new products or process optimization. Traditionally, large companies have their R&D departments. For corporations, this model has proven to be the most straightforward and time-tested. The Incubation model is the other big type; in this “Inside-Outside” approach, the company produces ideas and research internally but collaborates with incubators for production, testing, and, in some cases, implementation.

"R&D paves the way for businesses to thrive in the future and stay relevant in their chosen sector."
Mir Shahrukh Islam
Managing Director, Bondstein Technologies Ltd

Bondstein’s PCB manufacturing & Research and Development facility at Hi-tech Park, Gazipur

But what do businesses hope to get in return? While the answer to this question varies depending on who you ask, the bottom line is that they expect their R&D investments to yield vital technologies that they can use to create new products, services, and business models. However, technical advancement isn’t the only aspect that contributes to a company’s R&D performance. To achieve valuable results, such a department or even an organization should be aligned with the corporate strategy and mission at times. 


As compared to companies in other nations, the increase in R&D activities by a company in Bangladesh is slower. The immediate explanation for this is simple: the headquarters of large companies in our country are dependent on regional headquarters, and as a result, the majority of R&D work is performed outside of the country. However, as the country’s economy develops, local businesses are expanding and beginning to conduct research and development. Such expansion in local organizations paves the way for Bangladesh’s future in R&D.


Written by
Rahul Biswas
Executive, Social Media Marketing & Communications
Bondstein Technologies Ltd

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