The New Normal has accelerated innovation and the adoption of digital and emerging technologies. And as enterprises look to work with new goals in sustainability, it enables a system where digital research and development (R&D) will drive innovation in businesses.
In the past, organizations were focused on driving traditional operational efficiencies. Such practices appear to have run their course. Today, digital transformation determines how a business will perform. There is a more fundamental shift towards digital R&D, where organizations leverage technologies in new ways digitalizing the production and re-engineering of entire processes.
New-age technology and data driving the move toward digital R&D
The key to digital R&D is to make the best of new-age tech, especially in digitalized operations, AI and advanced analytics, cloud computing, IoT, blockchain, etc. The growth in computational power and connected products are opening up a world of possibilities, where each aspect of product engineering is going digital.
Traditionally, R&D in the engineering sector focused on making the available tools that fit the purpose. Digital R&D is driving the need to improve such applications continuously, and there are many ways it can use AI. For example, a large graphics semiconductor player has transformed itself from being a provider of graphic processors to a leader in computing for AI and autonomous driving. It now ranks in the top 10 of the most valuable companies globally.
Data-driven R&D services have transformed industries by using data and digital channels to offer more personalized services. The success of consumer product companies has always been based on a relatively simple formula: delivering the right product at the right time. A North American consumer electronics giant retailer is a case in point. The company’s customer data assets helped it break out of pure-play retail to create a health tech and services company for senior citizens.
There is intense pressure on R&D to deliver better, cheaper, faster, and less risky products and solutions in life sciences. In consumer products companies, data-driven R&D is a crucial aspect of Intelligent Industry — which is Capgemini’s cross-industry application of new technologies and services to bolster innovation through innovative and differentiated smart products, supply chain optimization and an enhanced customer experience.
Driving the sustainability paradigm with As-a-Service models
As digital services are powered to accumulate data on the use of all forms of products and services, we now have the infrastructure to offer new as-a-service, engineering models. This change has enabled manufacturers to move from selling products to services and finally to selling outcomes. A global uber automotive brand, which also manufactures aircraft engines, offers Jet-propulsion-as-a-service by using data gleaned from engines to provide propulsion on a per-flying-hour basis, which is an essential requirement for airlines.
To keep an ongoing relationship with the product, R&D will adjust to accommodate these technologies. Products can be released as base versions that can later be upgraded with new functionality. For instance, an industrial electric giant transformed itself from creating industrial electrical equipment to becoming a leader in efficiency-as-a-service, generating revenues by reducing its clients’ carbon emissions.
Top retailers have resolved to drive climate action as part of the UN’s Race to Zero program. While Danone and Walmart are embracing regenerative farming, auto manufacturers like Daimler, the original developer of the internal combustion engine, are preparing for an electric transportation future, all thanks to a continuous – and conscious – R&D program.
Companies investing in digital R&D will always enjoy the first-mover advantage in the New Normal. But simply doing things faster in the digital sphere isn’t the answer. Successful companies enable speed through better decisions and faster course corrections. What is most critical is the rapid movement of entire business processes towards sustainable growth models, improving data security, and creating a collaborative and dynamic work environment.
R&D enabling a new business culture in Industry 4.0
R&D data offers a wide range of digital opportunity, from highly personalized consumer apps to even highly personalized decision-making. It can drive digital disruption and open new revenue streams. And its progress will largely depend on factors that will influence the future of work – cybersecurity, use of advanced technologies, consumer behaviour, etc.
At one time, lean and agile methodology formed the core aspect of any business transformation. While those practices persist, the only change is that digital R&D has risen and complemented those very same practices and revolutionized the shop floor. Ultimately, businesses that are fully invested in digital R&D will use it to drive their digital manufacturing and supply chains. It is all set to become the business gamechanger of the future.
Written by
Chandra Reddy, Head of Capgemini Engineering – India, Capgemini
