The R&D project manager

JUNE 1981

Harold Kerzner

Professor of Systems Management

Baldwin-Wallace College

Berea, Ohio

One of the most difficult tasks in any organization is the management of R&D activities. These R&D activities are usually headed up by scientists, engineers, managers, employees, and even executives. All of these people, at one time or another, may act as R&D project managers. They start out with an idea and are asked to lay out a detailed schedule, cost summary, set of specifications and resource requirements such that the idea can become a reality. Unfortunately, this is easier said than done.

Project management is an attempt to obtain more efficient utilization of resources within an organization by getting work to flow horizontally as well as vertically. Furthermore, all projects must be completed within the constraints of time, cost and performance. If the project is for an outside customer, then there exists a fourth constraint, within good customer relations. Without proper training and understanding, R&D project managers might easily manage their projects within time, cost and performance, but alienate the outside customer to such a degree that follow-on (or production-type) contracts are non-existent.

R&D personnel were probably the first true project managers in the world. Unfortunately, very little training was available until the “vanguard” of modern project management occurred in the late fifties within aerospace, defense and construction companies. Even today, twenty-five years later, very little project management training is provided for R&D personnel.

R&D personnel are technically trained perfectionists who believe that cost and time are unimportant when it comes to improving the state of the art. R&D personnel would rather crawl on their hands and knees and beg for more money and time rather than admit defeat on an R&D project. The more degrees an individual has, the more reluctant he is to accept defeat.

R&D personnel have been stereotyped and placed under more criticism than any other employees, even engineers. R&D personnel are considered to be egocentric individuals sitting in small corners of laboratories, having their food fed to them under the door, being given potty seats to prevent embarrassment, and are provided with hand calculators so that they can get excited once in a while. The R&D project managers avoid people-contact whenever possible. They cannot communicate well, write reports or make presentations. They are illiterate except when it comes to complex graphs and equations. And yet they are consistently placed in charge of projects. In most project driven organizations, there is usually strong representation of former project managers in top echelons of management. How many senior corporate executives or CEOs do we have that came out of the R&D ranks? Could it be the result of this inappropriately applied stereotyping that has prevented R&D personnel from rising to the top?

The R&D Environment

Very few people in an organization truly understand the R&D environment and the problems facing the R&D project manager. We continuously ask the R&D project manager to achieve an objective which even science fiction writers haven’t thought of and which requires technology that hasn’t been discovered yet. We further ask him to lay out a detailed schedule, with established milestones and predetermined costs set forth by some executives and then inform him that he may have trouble obtaining the resources that he needs.

After he establishes his schedule, executives change the milestones because they affect their Christmas bonus. And when the project finally gets on track, marketing pushes the end milestone to the left because they wish to have earlier introduction of the project into the marketplace in order to either beat or keep up with the competition.

The project manager therefore finds that he must do his work in seclusion, avoiding meddling from executives, marketing and manufacturing. The avoidance of the manufacturing group ultimately leads to the R&D project manager’s downfall because he finds out too late that manufacturing cannot mass produce the item according to the R&D specifications. Who gets blamed? The R&D project manager, of course! He should have been communicating with everyone.

The R&D environment might very well be the most difficult and turbulent environment in which to manage a project. The remainder of this paper will describe this problem in R&D project management in hopes that the readers will obtain more appreciation for those individuals who accept R&D project management as a career.

Detail Scheduling: A Fact or Fantasy?

Scheduling activities for R&D projects is extremely difficult because of the previously mentioned problems.

Many R&D people believe that if you know how long it will take to complete the objective, you do not need R&D. Most R&D schedules are not detailed but are composed of major milestones where executives can decide whether or not additional money or resources should be committed. Some executives and R&D managers believe in the philosophy that

  • I’ll give you “so much time” to get an answer.

In R&D project management, failure is often construed as an acceptable answer.

There are two schools of thought on R&D scheduling, depending of course upon the type of project, the time duration, and resources required. The first school of thought involves the tight R&D schedule. This may occur if the project is one-person activity. R&D personnel are generally highly optimistic and believe that they can do anything. They, therefore, have the tendency to lay out rather tight, optimistic schedules. This type of optimism is actually a good trait. Where would we be without it? How many projects would be prematurely cancelled without optimistic R&D personnel?

Tight schedules occur mostly on limited resource projects. Project managers tend to avoid tight schedules if they feel that there exists a poor “window” in the functional organization for a timely commitment of resources. Another reason is that R&D personnel know that in time of crisis or firefighting on manufacturing lines, which are yielding immediate profits, they may lose their key functional project employees for perhaps an extended period of time.

The second school of thought believes that R&D project management is not mechanical as other forms of project management and, therefore, all schedules must be loose. Scientists do not like or want tight structuring because they feel that they cannot be creative without having sufficient freedom to do their job. Many good results have been obtained from spinoffs and other activities where R&D project managers have deviated from predetermined schedules. Of course, too much freedom can prove to be disastrous because the individual might try to be overly creative and “reinvent the wheel.”

This second school says that R&D project managers should not focus on limited objectives. Rather, the project manager should be able to realize that other possible objectives can be achieved with further exploration of some of the activities.

There are two special types of projects that are generally performed without any schedules. They are the “grass roots” project and the “bootleg” project. Both the grass roots and bootleg projects are simply ideas which, with one or two good data points, could become a full-blown, well-funded activity. The major difference between these two is that the grass roots project is normally funded with some sort of “seed” money whereas the bootleg project is accomplished piecemeal and on the sly. With the bootleg project, employees charge their time to other activities while performing the bootleg R&D.

Working with Executives

Executives earn high salaries for their ability to perform long-range planning and policy formulation. In general, project management executive meddling is a way of life because of conflict resolution and the need to continuously reassess the priorities of the projects. In R&D, this problem of executive meddling becomes more pronounced because, in addition to the above-mentioned reasons, the executive might still consider himself to be a technical specialist or might develop a sense of executive pride of ownership because this project was his idea. If an executive continuously provides technical advice, then it is entirely possible that an atmosphere of stifled creativity will occur. If the executive is considered to be the expert in the field, then everyone, including the R&D project manager, may let the executive do it all and both the project as well as the executive’s duties may suffer.

There is nothing wrong with an executive demonstrating pride of ownership for a project so long as he does not assert that “this project will be mine, all the way,” and continuously meddles. The R&D project manager should still be permitted to run the show with timely, structured feedback of information to the executive. If executives continuously meddle, then the R&D project manager may adopt a policy of “avoidance management” where executives are continuously avoided unless problems arise.

In general project management, executives should actively interface a project only during the conception and planning stages. The same holds true in R&D project management but with much more emphasis on the conceptual stage than the planning stage. The executive should work closely with the R&D project manager in defining the:

  • Needs
  • Requirements
  • Objectives
  • Success factors
  • Realistic end date

The executive should then step out of the way and let the R&D project manager establish his own timetable. One cannot expect executive meddling to be entirely eliminated from R&D activities because each R&D activity could easily have a direct bearing upon the strategic planning that the executive must perform as part of his daily routine.

R&D activities have a direct bearing on the organization’s strategic planning. Executives should therefore provide some sort of feedback to R&D managers. The following comments were made by an R&D project manager:

  • “I know that there is planning going on now for activities which I will be doing three months from now. How should I plan for this? I don’t have any formal or informal data on planning as yet. What should I tell my boss?”

Executives should not try to understaff the R&D function. Forcing R&D personnel and project managers to work on too many projects at once can drastically reduce creativity. This does not imply that personnel should be used on only one project at a time. Most companies do not have this luxury. However, this situation of multi-project management should be carefully monitored.

As a final note, executives must be very careful as to how they wish to maintain control over the R&D project managers. Too much control can drastically reduce bootleg research and, in the long run, the company may suffer.

Working With Marketing

In most organizations, either R&D drives marketing or marketing drives R&D. The latter is more common. Well-managed organizations maintain a proper balance between marketing and R&D. Marketing-driven organizations can create havoc especially if marketing continuously requests information faster than R&D can deliver it and if bootleg R&D is eliminated. In this case, all R&D activities must be approved by marketing. In some organizations, R&D funding comes out of the marketing budget.

In order to stimulate creativity, R&D should have control over at least a portion of its own budget. This is a necessity because not all R&D activities are designed to benefit marketing. Some activities are simply to improve technology or create a new way of doing business.

Marketing support, if needed, should be available to all R&D projects regardless of whether they originate in marketing or R&D. An R&D project manager at a major food manufacturer made the following remarks:

  • “A few years ago, one of our R&D people came up with an idea and I was assigned as the project manager. When the project was complete, we had developed a new product, ready for market introduction and testing. Unfortunately, R&D does not maintain funds for the market testing of a new product. The funds come out of marketing. Our marketing people either did not understand the product or placed it low on their priority list. We, in R&D, tried to talk to them. They were reluctant to test the new product because the project was our idea. Marketing lives in their own little world. To make a long story short, last year one of our competitors introduced the same product into the market place. Now, instead of being the leader, we are playing catch-up. I know R&D project managers are not trained in market testing, but what if marketing refuses to support R&D-conceived projects? What can we do?”

Several organizations today have R&D project managers reporting directly to a new business group, business development group or marketing. Engineering-oriented R&D project managers continuously exclaim displeasure with being evaluated for promotion by someone in marketing who really may not understand the technical difficulties in managing an R&D project. Yet, executives have valid arguments for this arrangement asserting that these high technology R&D project managers are so in love with their project that they don’t know how and when to cancel a project. Marketing executives contend that projects should be cancelled when:

  • Costs become excessive, causing product cost to be non-competitive
  • Return on Investment will occur too late
  • Competition is too stiff and not worth the risk

and other arguments. Of course, the question arises, “should marketing have a vote in the cancellation of each R&D project or only those that are marketing driven?” Some organizations cancel projects upon consensus of the project team.

Location of the R&D Function

R&D project management in small organizations is generally easier than similar functions in large organizations. In small companies, there usually exists a single R&D group responsible for all R&D activities. In large companies, each division may have its own R&D function. The giant corporations try to encourage decentralized R&D under the supervision of a central research (or corporate research) group. The following problems were identified by a central research group project manager:

  • “I have seen parallel projects going on at the same time.”
  • “We have a great duplication of effort because each division has their own R&D and Quality Control functions. We have a very poor passing of information between divisions.”
  • “Central research was originally developed to perform research functions which could not be effectively handled by the divisions. Although we are supposed to be a service group, we still bill each division for the work we do for them. Some pay us and some don’t. Last year, several divisions stopped using us because they felt that it was cheaper to do the work themselves. Now, we are funded entirely by corporate and have more work than we can handle. Everyone can think of work for us to do when it is free.”

Priority Setting

Priorities create colossal managerial headaches for the R&D project manager because R&D projects are usually prioritized on a different list than all of the other projects. Functional managers must now supply resources according to two priority lists. Unfortunately, the R&D priority list is usually not given proper attention.

As an example of this, the Director of R&D of a Fortune 25 Corporation made the following remarks:

  • “Each of our operating divisions have their own R&D projects and priorities. Last year corporate R&D had a very high R&D project geared toward cost improvement in the manufacturing areas. Our priorities were based upon the short run requirements. Unfortunately, the operating divisions that had to supply resources to our project felt that the benefits would not be received until the long run and therefore placed support for our project low on their priority list.”

Communication of priorities is often a problem in the R&D arena. Setting of priorities on the divisional level may not be passed down to the departmental level, and vice-versa. We must have early feedback of priorities so that functional managers can make their own plans.

Written Communications

R&D project managers are no different from other project managers in that they are expected to have superior writing skills but actually do not. R&D project managers quickly become prolific writers if they fee 1 that they will receive recognition through their writings.

Most R&D projects begin with a project request form which includes a feasibility study and cost benefit analysis. The report can vary from five to fifty pages. The project manager must identify benefits that the company will receive if it allocates funds to this activity. In many non-R&D activities project managers are not required to perform such feasibility studies.

Because of a lack of professional writing skills, executives should try to reduce the number of interim reports since it can seriously detract the individual from more important R&D functions. In addition, most interim reports are more marketing-oriented rather than R&D-oriented.

Many of today’s companies are having weekly or bimonthly status review meetings where each R&D manager will provide a five minute (or less) oral briefing on the status of his project, without getting involved with the technical details. Of course, at project completion or termination, a comprehensive written report will still be required.

Salaries and Performance Evaluation

R&D groups have one of the highest salary ranges in a company. R&D groups are generally the first to establish a “dual ladder” system where employees can progress on a technical payscale to high salary positions without having to accept a position in management. In the R&D environment, it is quite common for some functional employees to be at a higher salary level than the R&D project manager or even their own functional managers. This technique is necessary in order to maintain a superior technical community and to select managers based upon their managerial expertise, not technical superiority.

The R&D group of a Fortune 25 corporation recently adopted a dual ladder system and found that it had created strange problems. Several scientists began fighting over the size of their office, type of desk, and who should have their own secretaries.

The evaluation process of R&D personnel can be very difficult. R&D project managers can have either direct or indirect control over an employee’s evaluation for promotion. Generally speaking, project managers, even R&D project managers, can make only recommendations to the functional managers, who in turn assess the validity of the recommendation and make the final assessment. Obviously, not all R&D projects are going to produce fruitful results. In such a case, should the employee be graded down because the project failed? This is a major concern to managers.

Motivation

R&D project managers have no problem with self-motivation especially on one-person projects. But how does a project manager motivate project team members especially when you, the R&D project manager may have no say in the performance or evaluation? How do you get all of your employees to focus on the correct information? How do you motivate employees when their time is fragmented over several activities? How can you prevent employees from picking up bad habits which can lead to missed opportunities?

R&D project managers would rather try to motivate employees through work challenge and demonstrating their own expertise. Most R&D project managers prefer not to use formal authority. One R&D project manager summed up his problems as follows:

  • “I have only implied authority and cannot always force the project participants to perform my way. We have used task forces both effectively and ineffectively. We are always confronted with authority and priority problems when it comes to motivating people. Functional managers resent R&D project managers who continuously demonstrate their project authority. Our best results are obtained when the task force members visualize this project as part of their own goals.”

Executives must take a hard look at how they are managing their R&D projects. In general, all R&D personnel are project managers and should be trained accordingly as any other project manager would be. If executives wish to develop an organization which will retain superior personnel and stimulate creativity and freedom, then executives must recognize the need for effective organizational communications and alleviate meddling by marketing and the executive level of the organization. R&D project managers are actually the architects of the conceptual phase of the corporation’s long-range plans and their value to the organization appears to be finally being recognized by management.

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