Here is a brief excerpt from an article co-authored by Barry Jaruzelski, John Loehr, and Richard Holman for strategy+business magazine, published by Booz & Company. In it, they focus on the firm’s annual study of R&D spending, one that reveals the tools that are transforming innovation—from customer insight to product launch. To read the complete article, check out other resources, obtain subscription information, learn more about the firm, and sign up for email alerts, please click here.

Illustration by Craig & Karl

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At Catalent, a U.S.-based producer of pharmaceutical products and provider of advanced drug delivery technologies and services, digital tools often support the practices of the company’s 18 research and development sites around the world. Data pours in from R&D, sales and marketing, operations, quality assurance, and regulatory affairs, as well as customers. Evjatar Cohen, vice president for global innovation and portfolio management, and his team make sense of it all with a slate of new market and customer insight enablers. “Collecting the data is just part of what we do,” he says. “It’s really about using that input to come up with market uptake estimates for each potential product and an understanding of its business value. That aids us greatly in deciding where to focus our day-to-day activities as well as planning our long-term strategy.

Catalent’s story is similar to that of other leading companies around the world. To enhance the front end of their innovation process, more and more R&D teams are using new tools such as software programs that mine and analyze “big data” and customer immersion labs that use digital reality to simulate experiences. “The earlier in the process you are,” says Cohen, “the more uncertainties and hurdles there are to manage”—and the new digital tools are ideal for confronting uncertainty and surmounting hurdles. Although they have not yet been widely adopted or tested, these tools are already enabling some companies to first gather a better and deeper understanding of customers’ needs and engage them in the design process, and then monitor their products’ use after launch to capture data that can be fed back into the innovation process.

These new digital tools are fostering change, but not in isolation; they are joining another group that has been around for years and is already well established at most companies. Productivity enablers such as computer-aided design (CAD) software used in the design and tooling stages of product development and project management tools that help track time lines, workflows, milestones, and spending have a long track record of helping companies boost the efficiency of their innovation processes—particularly at the back end when they are developing products.

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To read the complete article, please click here.

Barry Jaruzelski is a senior partner with Booz & Company in Florham Park, N.J., and the global leader of the firm’s engineered products and services practice. He created the Global Innovation 1000 study in 2005, and continues to lead the research. He works with high-tech and industrial clients on corporate and product strategy and the transformation of core innovation processes.

John Loehr is a partner with Booz & Company based in Chicago, and is the global leader of the firm’s innovation practice. He works with automotive, industrial, and technology companies to help them build competitive innovation capabilities and to resolve critical decisions in their product and market strategies.

Richard Holman is a partner with Booz & Company based in Florham Park, N.J. As a senior leader of the firm’s innovation practice, he works with clients in highly engineered products sectors such as aerospace, industrials, high tech, and healthcare on innovation capability building, new product development efficiency and effectiveness, and product management.

Also contributing to this article were s+b contributing editor Edward H. Baker and Booz & Company senior associate Stefan Luckner and senior analyst Jennifer Ding.