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5.6 Research & development (HL)

5.6 Research & development (R&D) (HL Only)

Learning outcomes

"Fall seven times and stand up eight."
- Japanese proverb

"Everything that can be invented has been invented."
- Charles H. Duell, Commissioner, US Office of Patents, 1899

This topic is for HL students only

R&D is the process of creating new products (goods and services) and processes (how things are down), in order to meet market needs. R&D is likely to include the following: Investment (financial funding), Test marketing, Prototypes, and Market research.

In particular, research is concerned with the creation of new ideas and new products. It precedes development. Development is concerned with adapting existing ideas and products in order to commercialise new products in a financially feasible way. Both research and development are needed to increase an organization long-term earning potential.

Did you know...?

Whilst it is well known that Henry Ford introduced the world to mass production in the car industry, it is less well known that he also brought charcoal briquettes to the world.

Henry Ford created charcoal briquettes from the wood scraps and sawdust from his car factory. Consider that with your friends the next time you're at a BBQ!

The learning outcomes (or assessment objectives) for this section of the IB Business Management syllabus are:

  • The importance of research and development for a business (AO3)
  • The importance of developing goods and services that address customers’ unmet needs (of which the customers may or may not be aware) (AO2)
  • The following types of innovation (AO2):
    • product
    • process
    • positioning
    • paradigm
  • The difference between adaptive creativity (adapting something that exists) and innovative creativity (creating something new) (AO2)
  • How pace of change in an industry, organizational culture and ethical considerations may influence research and development practices and strategies in an organization (AO3)
ATL Activity (Thinking skills)

Watch what happens when a business, such as Blockbuster Video, fails to stay with the times - from the perspective of kids:

This video will certainly make more sense to some teachers (like me!) than others (the very young ones!) But it does highlight that what used to be normal aren't anymore (as one of the children in the video says at the end).

Just look at the expression of the children's faces when they watch the commercials - it's exactly how customers react to businesses, brands, and products that are no longer relevant to them.

InThinking Business Management resources

Click the hyperlinks below to access the InThinking resources for this particular section of the IB Business Management syllabus.

Return to the Unit 5 Operations management homepage

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