How to Get the R&D Resources You Need With Growth Innovation

In German, “Ich verstehe nur Bahnhof” means “I have no idea what you’re talking about.” But translated literally, it’s “I only understand train station.” That about sums up a lot of R&D budget requests. R&D speaks fluent pipeline. Leadership’s ear is tuned for growth and ROI. Everyone nods politely, and the request never leaves the station.  

You’ve been here before. Your project needs additional funds or staff in order to meet expectations, whether that means conducting reliable research, staying on schedule, or meeting launch quotas.

And now you need to request more resources from the higher-ups.

It’s a common difficulty in enterprise R&D. Petitioning for extra resources is stressful and time-consuming. And when those requests are denied, project morale goes down with them.

However, some enterprises have found a way not only to make resource advocacy an easier ask, but also to routinely expand their R&D budgets. They’ve solved this problem by adopting an entirely new approach to innovation management, and you can too.

Wellspring commissioned a study with Forrester Consulting to explore what our most successful enterprise customers were doing differently, and what other enterprises could learn from them. What we found was an innovation management philosophy that, in addition to many other benefits, empowered R&D teams to advocate for, and receive, the resources they need from leadership. One organization realized a 40% increase in investments in its R&D operations over five years since implementing this approach to management.

Read on to see how it did this, and how your R&D shop can too.

3 Major Obstacles to R&D Resource Advocacy

Before we look at the ways enterprises have reversed this problem, let’s first examine the hurdles that currently stand in the way of most R&D advocates. These obstacles tend to be systemic: nobody wants them and nobody likes them, but traditional innovation management norms allow them to persist.

1. Unrealistic or Uninformed Expectations

This is the most obvious issue when it comes to getting the resources you need for a project. Leaders assign resources to projects without a full understanding of what they will cost, and they set expectations without a full understanding of how they tend to pan out. This leads to projects with timelines and budgets that are difficult (or impossible) to meet, which leads to petitioning for more resources. When this happens, the R&D team asking for help needs to give an account for why it’s not meeting expectations.

This happens because the people allocating resources and setting expectations rarely have any visibility when it comes to historical innovation project data. Any information regarding the time, money, labor, and contingencies involved in similar projects is either not recorded anywhere or scattered across disparate teams and systems. This means leaders can’t pull historical numbers when setting budgets and targets, so they do the next best thing: they make educated guesses.

2. Lack of Portfolio-Level Decision-Making

The innovation pipeline isn’t a vacuum: your enterprise has many innovation initiatives running at the same time. When projects share resources (teams, production facilities, approval channels, etc.), bottlenecks and contingencies can arise. This means even if your team is doing everything right with your project, it might still not be where it should be in the development process.

Ideally, leaders should make every decision in the context of the whole portfolio. They should account for the ripple effects that every “Go,” “No-go,” and “Hold” will have on the rest of the initiatives at play. This would allow them to temper expectations for all their projects and mitigate the chance of unwittingly letting projects cannibalize each other.

However, in order for leaders to make these kinds of portfolio-conscious decisions, they need to see how all their innovation projects interact with each other. That level of visibility is largely unavailable to anyone in the enterprise.

3. The R&D/Strategy Reporting Disconnect

The third big contributor to this issue we’ve found is that the business strategy is all too often divorced from how R&D reports on projects. Business leaders are responsible for setting the company’s objectives and strategy, keeping the enterprise on track, and reporting on the company’s performance to the board and shareholders.

But R&D teams are tasked with the nitty-gritty work of turning ideas into reality. Leaders live in a world of ROI and value creation, whereas R&D professionals live in the pipeline.

Because this is the case, R&D departments usually use more process-based metrics in their reporting. New product development methodology dominates the mindset when it comes to discussing project status. That’s not necessarily bad for intra-R&D conversation, but it doesn’t translate as well to advocating for more time or resources from leadership.

Ideally, the innovation shop would be familiar enough with the particulars of your enterprise’s business objectives to advocate for your project needs using the language of your leaders’ strategy. Ideally, leaders would give innovation workers a list of KPIs to report on that intuitively link a project to those overarching business objectives. And the entire innovation portfolio would be reviewed regularly enough to spot potential bottlenecks and resource shortages ahead of time and adjust expectations or budgets accordingly.

But most enterprise innovation shops don’t enjoy these ideals.

How Growth Innovation Enables Better R&D Resource Advocacy

The obstacles above are endemic to the enterprise innovation world, but over the years we’ve seen enterprises overcome them in ways that get leaders and innovation workers on the same page and empower R&D managers to advocate for the resources they need to get the job done. This turnaround is the result of implementing growth innovation methodology across the entire innovation organization.

Growth innovation is the innovation management philosophy that sets growth as the single most important innovation outcome and manages every step of the innovation process accordingly. This approach to innovation relies on every innovation stakeholder (from executives to interns) radically committing to three key underlying principles:

• Growth: Articulating measurable targets in the innovation strategy and explicitly connecting every innovation activity to at least one of those targets.
• Visibility: Centralizing all innovation management data in one place and giving every stakeholder access to the information they need.
• Orchestration: Making every decision in the context of a portfolio-level growth strategy.

When enterprises use these three principles as the core of their innovation management approach, the innovation culture shifts in a way that makes advocating for your R&D needs far more straightforward.

1. Aligning on Growth to Make the Business Case for Resources

Under growth innovation, business leaders translate the company’s overall business objectives to an innovation strategy for the enterprise. This growth innovation strategy prioritizes growth objectives and explicitly links every innovation initiative to at least one of those objectives. Resources are assigned to projects based on these priorities, and the new growth innovation strategy is socialized with the entire innovation organization.

When this is done, business leaders set specific, measurable growth targets for every innovation project. These targets include timelines, budgets, market performance, and other expectations that leaders have for each project in the innovation pipeline. The targets also specify interdependent KPIs for each project, which link a given project’s progress and performance to the growth objectives it’s supposed to support.

This establishes a common language for both R&D and executives. By circulating the growth innovation strategy across the innovation shop, everyone knows (or can easily look up) how any given R&D project connects to leadership’s objectives. And with clear targets and KPIs set, R&D managers have a clearer avenue to petition for more resources. If a project falls behind on its targets, R&D can state where the shortages are, how much additional resources are required to get back on track, and what the implications of not receiving additional resources will be.

This alignment goes a long way in growing the innovation budget over time, too. Because R&D teams have clear targets and KPIs that scaffold up to the enterprise’s overall objectives, growth innovation teams are able to more consistently increase their budget. Leaders like to invest in projects with a proven track record of success, and growth innovation R&D teams instill that confidence by demonstrating how their projects have contributed to the business strategy over time.

Or as one interviewee in the Forrester study put it:

“We’ve increased our investment through our ability to clearly illustrate our strategy, our investment, our prioritization. It builds credibility, which goes a long way for us to keep having an increased budget. In fact, [when] one of the regional presidents looked at our five-year capital-planning process (which is all done within Accolade), he said this is how everyone in the company should do it. This has helped support and endorse our budget request year over year.”

2. Setting (and Auditing) Targets Based on Historical Data

Growth innovation enterprises aggregate all their innovation data into a single innovation management system (such as Accolade). This includes historical data, both the expected numbers and the actuals. Leaders set targets and allocate budget based on how similar projects have actually progressed and performed in the past, so deadlines, resources, sales numbers, and other metrics are grounded in the organization’s demonstrated ability to meet them.

When leaders make data-informed decisions, the need for resource-adjustment conversation goes down. Targets are more grounded in reality than before, so fewer projects stray from their planned trajectories.

However, if a project does begin to perform contrary to those targets, leaders and R&D managers alike can access that historical data to see how and where the project may have gone off course. This enables leadership and R&D to collaboratively investigate ways to right the ship, or as one Forrester study interviewee shared:

“We bring all of our actual data into Accolade. […] Then you can do the root cause analysis to go back to what were your initial assumptions and actually see where, for example, you were misguided.”

3. Increasing Leadership Confidence by Increasing R&D Efficiency

A common response to requests for more resources is, “If you managed the project more efficiently, you wouldn’t need to ask for extra support.” Unless you can prove that R&D has been managing the project efficiently already, you might be told to find ways to cut costs internally instead of being given the additional help you need.

But growth innovation enterprises don’t experience this problem. Between their commitment to strategic growth-oriented spend and the labor saved by using comprehensive innovation management software, they can consistently increase R&D efficiency on their own.

The Forrester study took a weighted average of reduction in project management costs after implementing growth innovation methodology. What they found was that over the first five years, growth innovation enterprises reduce their project management costs by an average of 10%. They were able to do this because their innovation management system (their main tool for implementing the growth innovation principles of visibility and orchestration) automated mundane tasks and expedited decision-making, which empowered them to accomplish more with fewer people.

Keep in mind: they achieved these cost savings while also decreasing time to market by 15% and increasing pipeline throughput by one major net new product. These R&D departments are increasing their output while becoming more lean. One interviewee in the Forrester study explains:

“Before Accolade, we needed 20 to 50 people to plan for projects. And now I think we are down by 50% or even more. Everything is transparent, and we can communicate better than before. For roadmapping, we have 10 people.”

Plus, with the innovation management software taking care of repetitive busywork, growth innovation R&D personnel are able to upskill into more impactful capacities, thus making the innovation shop even more efficient.

Running an R&D shop this efficiently builds trust with the people you’re requesting resources from. When you make all your innovation data visible to stakeholders, it’s very easy to prove that your need for additional support isn’t rooted in your own inefficiency.

Set Your R&D Teams Up for Success With Growth Innovation

With growth innovation, R&D and leadership finally speak the same language. Next stop: approved. Growth innovation methodology has been the ticket to better R&D resource advocacy for other enterprises, and it can help you get the resources you need too. If you’d like to explore how growth innovation can expand upon your current NPD processes, download our free guide, New Product Development vs. Growth Innovation: The One Formula for the Evolution of R&D Management.

The enterprises included in the Forrester study represent some of the most successful teams using Accolade, Wellspring’s innovation management software platform. Accolade integrates with your other innovation systems to give your entire innovation organization a single data hub, which you can use to visualize data, collaborate on projects, track progress, and create custom reports. Enterprises use Accolade as their innovation central nervous system. It’s the key tool that enables them to apply the principles of growth, visibility, and orchestration to their innovation operations in entirety.

If you’d like to see what Accolade can do for your R&D shop, we’d love to show you how it works. Book an Accolade demo with us today.