With a new Royal Academy of Engineering report warning that business research and development (R&D) is at risk post-COVID-19, last week’s poll asked how your firm’s R&D has been affected by the crisis?
Based on research with 25 R&D-intensive firms, the report found that R&D activity in UK companies is at immediate risk as the nation comes out of lock-down and said that urgent intervention is required to give the UK the best possible chance of innovating its way out of the recession.
The Academy found that the pandemic has rapidly altered the business environment in which innovative start-ups and R&D-intensive businesses operate.
With R&D often funded through revenue, many companies experiencing cash flow difficulties are liable to halt or significantly reduce their R&D activity, including partnerships with universities and support for studentships.
A knowledge and innovation-led economy remains our best strategy for future prosperity
Professor Sir Jim McDonald – President, Royal Academy of Engineering
Projects said to be at highest risk are those in the middle of the innovation process, from proof-of-concept through to prototype and demonstration stages. These steps are costly and often face technical challenges with the need for extra time to be resolved. Cancelled projects are likely to reduce the benefits of previous R&D investments, cut competitiveness and reduce innovative outputs in the coming years as planned projects fail to reach maturity.
The Academy highlighted a number of interventions that could be used to support R&D innovation, including an expansion of the Made Smarter pilot to support SMEs; a series of financial support packages aimed at future-proofing the innovation pipeline; and a targeted use of the Industrial Strategy Challenge Fund to stimulate pre-competitive collaboration.
Commenting on the report’s findings Royal Academy president Professor Sir Jim McDonald said: “A knowledge and innovation-led economy remains our best strategy for future prosperity and we know from previous economic downturns that companies that have continued their R&D activity have been much better placed to recover afterwards. Now is the time for government to set out a powerful vision that both demonstrates its commitment to R&D and provides certainty to the businesses that will shape our economic destiny. Investing in R&D is investing in the future.”