The R&D strategy almost always followed the manufacturing strategy of the company or the industry in question. In the early 20th century, manufacturing companies pursued an extreme verticalization strategy. General Motors can be cited as a good example: in addition to having several distinct vehicle brands under its umbrella, it also had a multitude of auto parts industries in its ranks. As a result, its R&D strategy was also extremely diversified and verticalized. Its scientists studied all the necessary fields to build a vehicle and the parts that compose it. It was a well-numerous team of scientists, quite diverse in their training and specialties. This type of strategy forced companies to be very large, and their maintenance costs were very high. With the advancement of science, these R&D costs became increasingly high, naturally forcing companies to change their strategy.
As we move forward a few decades, heading towards the end of the 20th century, the manufacturing company now had an extreme specialization strategy. Industries specialized in a specific field, and thus their R&D teams were also quite specific, less numerous, and all with similar backgrounds. The pharmaceutical industry of that time exemplifies this phenomenon well. With even greater advancements in science, it became difficult and costly for companies to have R&D that was fully specialized in their area of operation. A new strategy became necessary.
This new strategy came with the beginning of the 21st century, leading companies to start dividing and sharing their R&D efforts. Since it was difficult for a company to possess all the knowledge, it began to share its research with other companies, with Science and Technology Institutes, and with individual researchers, bringing the specialized knowledge of each actor together to achieve a specific end.
This has been, and will increasingly be, the strategy of future-oriented companies. It is impossible to have the knowledge and resources necessary to achieve one's R&D strategy in isolation. It is essential to utilize the expertise of various actors to collectively achieve the objectives of increasingly complex projects.
When we talk about the research of natural ingredients, this strategy makes even more sense. An isolated company, besides not having the necessary knowledge and resources to develop a new extract or a new essential oil, represents a small volume for the agricultural producer and for the industry that transforms the plant mass into a natural ingredient. If these two actors (the agricultural producer and the industrialist) could sell their products to more than one company, wouldn’t they have a more sustainable and enduring business? The obvious answer is yes, but on the other hand, the development of a new ingredient is usually commissioned by a specific company. The solution to this dilemma is to make the company demanding this new ingredient give up its exclusivity and allow the chain that generates this ingredient to sell it to other companies (even if they are competitors). Of course, the demanding company can (and should) charge some type of competitive advantage when the chain of producing companies sells the ingredient (whose R&D investment was funded by it) to other companies.
With this strategy, the entire production chain becomes more sustainable, and the demanding company also ends up having R&D revenues (from licensing) that may at some point exceed its costs, and the R&D operation itself can become a business and/or a business unit.
Co-development is a winning strategy, sustainable, and will certainly be the strategy of a growing number of companies.
