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A "lift and shift" approach to R&D processes may be putting your whole operation at risk.

Published: 2020


Research and development (R&D) divisions are charged with pushing boundaries—making breakthroughs that will propel business forward. This is likely to be even more pronounced following COVID-19. However, despite well-publicized incidents around the world, many organizations fail to recognize the significant and unique operational risks associated with R&D activities.

The potential for fires and explosions, unexpected chemical reactions, asphyxiation, hazardous waste, and exposure to toxic chemical, biological or radioactive materials is inherent in R&D operations. There is also a high level of IP-related risk, as well as challenges associated with regulatory compliance, supply chain management and business continuity.

Manufacturing organizations are perceived as having reliable processes for managing operational risk across the value chain, but this does not necessarily hold true for risks associated with R&D. Rather than "lifting and shifting" a manufacturing approach for R&D, develop a custom approach to risks that are unique to the R&D process.


The impact of existing mindsets
Widespread misconceptions have caused risk related to R&D to be largely underestimated. It is generally believed that:

  • R&D labs work with small volumes of materials, so the potential for catastrophic incidents is low or nonexistent.
  • Labs are often staffed by well-qualified people with master’s degrees and PhDs, so they are insusceptible to errors and can manage risks as they arise.
  • Smaller setups and lower-capacity equipment do not present the same integrity risks as manufacturing facilities.
  • Creating and complying with risk processes could interfere with the ability to innovate and may hinder core research and development work.

  • R&D risks are unique
    While corporate leadership has a clear understanding of manufacturing processes, they may lack the experience to appropriately advise R&D on how to manage risk. What's more, low perceptions of R&D risk can lead to a lack of field implementation and hands-on support for scientific teams. R&D divisions are often left alone to determine how to comply with a variety of complex processes, from hazard identification and risk assessment to trade secret management, business continuity and security processes. R&D personnel may not have the knowledge or skills to maintain the integrity of complex equipment or even have the depth of knowledge to operate it safely.

    In addition, country-specific regulations and enforcement levels indirectly impact the operating culture and behaviors.

    As a result, R&D has received far less risk management focus than other business units. Instead, processes established for manufacturing are often overlaid onto R&D—the lift-and-shift approach—without considering whether they are relevant or effective.

    In reality, the challenges and risks faced by R&D are quite different from those in manufacturing operations. In fact, because the nature of R&D is to deal with unknowns, the potential for incidents may at times be greater than on the manufacturing floor.

    Comparing Processes and Risk
    Manufacturing R&D
    Processes are mostly fixed, with limited change management required. Management of change is frequent—even daily—as teams complete hundreds or thousands of experiments.
    Material is handled in large volumes and the materials used vary only periodically. Materials are handled in small volumes, and a wide range of regularly changing materials are used.
    Process conditions tend to be fixed. Process conditions are always changing.
    Teams are fairly qualified and risk understanding has evolved over time. Teams are highly qualified, with advanced degrees, and tend to view activities from a core R&D process perspective rather than through a safety or business risk lens.
    Equipment and facility integrity management processes are in place. Equipment integrity is addressed from a quality perspective, not a safety, perspective—often leading to high annual maintenance contracts.


    The cost of ignoring R&D risk
    The effects of an R&D incident can extend well past the lab, rippling across the whole organization. An R&D incident can happen in the form of fires, explosions, gas leaks and more, causing injuries, loss of life, asset damage and business loss.

    For instance, prior to the DSS engagement, one our clients with large R&D operations in Asia Pacific incurred a revenue loss of 3% in a financial year following an incident.

    In another case, a fire in the R&D facility of a medical equipment manufacturer in India resulted in loss of assets, including the intellectual property of the company, estimated at ~USD 20MM.

    A streamlined approach to unique risks
    Managing R&D risk cannot be the sole responsibility of those working in the lab.

    After all, R&D is a core process in the value chain. Rather than treat R&D as a discrete entity and expect scientists to understand how to manage processes, facilities and equipment, organizations must involve all corporate functions in order to coordinate as a team.

    To support this shift toward integration while assessing and mitigating unique R&D group capabilities and risks, DSS has developed an excellence model for Lab Hazard Analysis (LHA). Not only does this approach drive increased visibility and reduced risks, it contributes to lower operational costs as well.

    DSS Lab Hazard Analysis (LHA) model
    As a global consulting firm, DSS has developed extensive knowledge of R&D risk management processes and best practices through our own experience working with clients across multiple industries and geographies, as well as DuPont's 200+ year legacy of owning and operating R&D labs around the world.

    Further, in developing this R&D Risk model, multifunctional DSS teams have worked with the scientific community to better understand, appreciate and identify R&D pain points. The resulting LHA methodology has been tailored precisely for R&D needs while encompassing a holistic view of management, processes, capabilities and culture.

    LHA is unique in that it is a single, harmonized process for managing all risks, including occupational health and safety, process safety, and environmental risks, as well as business continuity and trade secret protection.

    What's more, it can be applied to R&D operations as well as pilot plants. LHA has already been successfully deployed within DuPont and numerous client operations, allowing teams to focus on their specific exposures while continuing to perform at an optimum level.

    The Lab Hazard Analysis (LHA) methodology provides:

    • An integrated solution that cuts across risk management silos and requirements, including safety, security, asset integrity, intellectual property, supply chain, product stewardship and more.
    • A strong risk management program that minimizes risks while supporting business continuity plans and the organization's reputation.
    • Elimination of duplicate processes, as documentation can be leveraged for new experiments, materials or processes.
    • A technology-guided solution with user-friendly tools that help scientists recognize and mitigate hazards and share best practices.
    • Improved productivity through enhanced equipment integrity and integration with existing processes and supports.

    • As a result, LHA helps protect people while improving operations.

      The LHA decision tree
      Implemented using a straightforward decision tree, LHA helps scientific staff identify risks and choose the appropriate hazard level, then review processes and determine resource requirements before beginning any new experiment.

      Naturally, the higher the potential risk, the more involved the process. As experiments or processes with moderate or high potential risk are evaluated, lab workers are directed to reach out for the support of line managers, safety teams, maintenance experts and facility managers. Together, these teams can review data, consider mitigation actions and agree on engineering controls, standard operating procedures, personal protective equipment and any necessary training before activities begin.

      Supportive software streamlines LHA activities
      R&D organizations can be large or lean, conducting just a few or hundreds of new experiments each day. In either case, requiring manual analysis of every procedure, material and instrument can be a burden. To make the LHA process more efficient, DSS developed a digital assessment tool that incorporates detailed risk information for common materials, equipment characteristics and system-level considerations. This allows scientists to leverage past assessments, access a library of support materials, attach data and share learning across teams quickly and easily.

      The LHA methodology and digital tool have been customized and adapted by organizations in various sectors including chemicals, biotech, performance polymers and electronics, and can be applied to virtually any industry—from oil and gas to pharmaceuticals.

      In fact, DuPont and DSS clients have already used the tool in conducting millions of hazard analyses for R&D experiments, processes and equipment. Scientists have embraced the solution because it has helped minimize their risk by guiding them toward lower-hazard materials and solutions and increasing layers of protection while improving overall productivity.

      Secure the lab and the whole organization
      While adapting mature manufacturing risk management approaches to R&D may seem like a logical solution, the nature of labs and pilot plants means that they continuously encounter diverse, unique risks as part of their primary mission. Trying to retrofit or modify existing processes can lead to costly outcomes—in dollars, injuries and reputation. Instead, LHA provides a streamlined, holistic methodology that allows scientists and technicians to assess and address risk as they plan and perform experiments, protecting the overall organization without slowing down R&D's drive toward the next innovation.

      About DuPont Sustainable Solutions
      A world-class operations management consulting firm, DSS has been in the business of saving lives and improving operational performance for our clients for more than 50 years. We enable organizations to protect their employees and assets, realize operational efficiencies, innovate more rapidly, build workforce capability and undertake cultural transformation. By leveraging the DuPont heritage, deep industry and business process expertise, and our diverse team of expert consultants, DSS helps clients turn operations management into a competitive advantage.

      With over 700 professionals in 40 countries, we are a trusted advisor to leading industrial companies around the world on operations improvements and workplace safety. DSS has been ranked as a top environment, health and safety consulting brand for the third consecutive year by the independent research and consulting firm Verdantix. We have also been named a top asset productivity and reliability consulting firm that creates impact for clients across industry sectors by the independent research firm ALM Intelligence.