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# Game mechanics - Research and development

27.01.2017

Research and development in design and technology is important way to be competitive. Each quarter, therefore, you should decide how much to spend on Research and development for each of your products.

Regardless of how much you spend, you can not assume that your efforts will be immediately successful. Each quarter, there are three possible Research and development outcomes:

1. MINOR - improvements will be automatically implemented into your products (without requiring any decision) and will give small but immediate effect on your product quality and demand.
2. MAJOR - new improvements have such a great effect on the characteristics of products that they lead to obsolescence of existing products and their destruction (sale of stock at the price of scrap). Therefore, MAJOR developments require confirmation of their implementation.
3. NONE - means that your research and development activity was not successful in previous period. Research and development is cumulative process, so this is not necessarily a bad thing, because result of activity of the research and development team may take two or even more periods.

Implementation of new developments has a positive effect on the quality of the product. Effect of implementation of new developments is to increase image of your products in the eyes of consumers and increase the assessment of the quality of your products.

Product quality is evaluated in GMC simulator by internal rating, starting from 60 points. Conversion into custom for players 5-stars rating occurs by formula (x - 60) / 20. Result is rounded up to whole number, for example:

1. (80 - 60) / 20 = 1.00 (1 star)
2. (85 - 60) / 20 = 1.25 (2 stars)
3. (115 - 60) / 20 = 2.75 (3 stars)
4. (138 - 60) / 20 = 3.90 (4 stars)
5. (182 - 60) 20 = 6.10 (7 stars)

As seen from the calculation, rating is actually not limited by 5 stars and may be equal to 6, 7 or more. When you get new R&D development, GMC simulator automatically adds 6 points to internal rating of the product for MINOR and MAJOR. With implementation of MAJOR, simulator additionally adds another 20 points to product rating. So, MINOR costs 6 points and MAJOR 26 points.

If you was not able to implement MAJOR immediately, its value remains unchanged over time, contrary to popular belief, MAJOR does not become obsolete. But product itself becomes obsolete over time, with each period product rating is reduced by a certain number of points, which depends on current product rating, for example:

1. for points from 61 to 80 (1 star) every quarter product loses 4 points;
2. for points from 81 to 100 (2 stars) every quarter product loses 5 points;
3. for points from 101 to 120 (3 stars) every quarter product loses 6 points;
4. for points from 121 to 140 (4 stars) every quarter product loses 7 points.

If you do not invest in R&D and do not get new developments, your products can lose (obsolete) up to 30 points for whole game (5 quarters) or 1.5 stars.

Increasing internal product rating by 1 point increases demand for value from 0.10% to 0.25% depending on product type (1, 2, 3), market type (EU, Nafta, Internet) and market load. So, receiving and implementing MAJOR (6 + 20 points) increases demand by 6-7%.

Now you understand the importance of choosing optimal R&D plan before game to achieve best result. When select optimal R&D plan, follow these rules:

1. MAJOR development in any case is better than MINOR. Sometimes players prefer to receive MINOR, because they are afraid to destroy large amount of products when implement MAJOR. Receiving MAJOR gives 6 points as MINOR, and implementation gives extra 20. So, MAJOR value is 26 points, and MINOR is only 6 points.
2. For each R&D plan sum total number of points, which can be received from development. Total cost for R&D plan is divided by the number of points and we calculate average cost of 1 point for selected plan. The lower cost of 1 point and the more points, the better.
3. Note the quality of each products in company's history. If product is already highly ranked by customers (5 stars), then you can choose a more conservative R&D plan aimed at retaining the achieved level of quality.
4. Priority of receiving MAJOR should focus on 1, 2 and 5 period. In 1 and 2 period, while market load is low, it will provide an opportunity to obtain additional market share. In 5 period additional development will increase goodwill.

You can purchase optimal Research and development plan for each scenario in our store.

Automatic selection of the optimal Research and development plan is built into the Calculation model, which can also be purchased in our store.