Terms and definitions

The term of innovation:

Implementation of a new or significantly improved product (good or service), or process, new marketing method, or new organizational method in business practices, workplace organization or external relations. (definition of the IM standard)

Before introducing the standard, it is important to clarify the concepts used in the standard. We have to differentiate between intellectual properties – as for example invention, protected intellectual property and innovation. It is important to state that innovation is not the intellectual property itself, it is a process, not a goal.

R&D activities:

„Research and experimental development (R&D) comprises creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications (as defined in the Frascati Manual). The term R&D covers three activities: basic research, applied research, and experimental development.” (OECD definition)

R&D is activities to identify scientific and/or technical uncertainties and solve them in a new way.

Deciding whether a project belongs under R&D activities or not is influenced by a widespread misinterpretation. Many people think that if something already exists somewhere, then resolving technical uncertainty to make it, or implement it cannot be a novelty. Therefore, it is considered that if a company wants to produce something, or develop a technology to which something similar is already in the world, it cannot be the subject of R&D, as it already exists in the world. In reality, however, these are only true if this product or technology are available (in books, publications, internet, etc.), so a professional with general background knowledge is able to solve uncertainties, resolve the problems. The keyword here is one (professional).


  • basic research: experimental or theoretical work carried out to get new information on observable facts in relation primarily to their fundaments without having their practical application or use in view.
  • applied research: planned research, or critical survey to get new information and knowledge in order to develop new products, technologies or services, or to significantly contribute to improve already existent products or services. It includes developing elements of complex systems - without prototypes, especially for checking generic technologies.

Experimental development:

Experimental development is systematic work, drawing on existing knowledge gained from research, and/or practical experience. This is to produce new materials, products or devices; to installing new processes, systems and services; or to improving substantially those already produced or installed.

Main differences between basic and applied research:

  • Basic research does not directly aim at practical application of the results
  • Applied research is a research with the main aim to use results in practice

Relation between Research, Development and Innovation:

Interpretation of the relation between R&D and innovation has been under constant change. There developed some well-distinguished concepts:

  1. R&D is a part of innovation (one of the first definitions).
  2. R&D activities precede innovation. Innovation is built on the results of R&D. In this context we often use the abbreviation: R&D&I.
  3. R&D are two parts of the research. The process consists of two parts: research and innovation. Therefore the most commonly used abbreviation: R&I (latest approach) in this concept means that experimental development is part of innovation.
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