Like minds gather to share
best practice
Business Strategy Group:
Innovation Imperatives: Best Practice Showcase
Henley Management College, UK
 SCI’s
Business Strategy Group welcomed over 70 innovation practitioners
and experts to an exchange of ideas and experience at Henley
Management College in the UK last month.
Speakers from 18 innovative organisations, from Dow Corning
to 3M and Unilever to Nestlé Rowntree, shared their
views and experiences of innovation, recognising that all
players involved in all industry sectors that supply and depend
on chemicals must reinvigorate their efforts at innovation,
both to remain competitive on the global stage and to provide
credibility, confidence and value to all customers from the
supply chain through to consumers.
There was general agreement that the industry has got it
right in terms of process, but getting the right culture and
capabilities are crucial. An innovative workshop approach
to discussing the content of the papers led to conclusions
that leaders must:
- provide the direction for innovation through strategy,focus
and structure in the organisation;
- provide the capability for innovation through leadership
and organisation of the people and the process to ensure
that innovation skills are applied to the innovation process;
and
- empower the people in their organisations to put the results
into practice.
Keynote address
Keynote speaker Ray Stark of Honeywell Specialty Materials
set the ball rolling with a challenge to think differently
about our business and to focus on customer benefits, advising
that ‘innovation generally responds to unmet customer
needs’.
Roger Platt of Unilever added that innovation demands that
an organisation balances creativity, entrepreneurship, risk
and experimentation, and it is up to management to create
the right environment for innovation. Effective innovation
requires the ability to scale up quickly and to keep a clean
house, spreading winners and culling losers.
Geoff Tabbner from innovation leaders 3M told the audience:
‘3M’ers do not look any different from other people,
but we behave a little bit differently.’ He felt that
innovation feeds from the passion of individuals – to
3M it is not just about new products; it is a whole approach
to business. Sustainable innovation requires an enabling culture,
and 3M’s culture is built around a process to accelerate
commercialisation, designed to generate twice the number of
new ideas and to triple the number of commercial successes.
Keywords at 3M are vision, foresight, stretch goals, empowerment,
networking, communication and recognition – their best
new commercial ideas are built on a deep understanding of
the customer and their needs.
Bridging the gaps in innovation
Reinforcing this message, Jill Hender of Henley Management
College described some results of ongoing research, which
has identified ‘bridgers’ as the missing link enabling
the innovation gap between ‘thinkers’ and ‘operators’
to be closed. In addition to the usual project management
roles of leaders, owners and sponsors, ‘climate makers’
are needed for innovation.
David Graham of Synthomer highlighted the need for flexibility
in a successful innovation process, saying many successful
ideas have arisen thanks to a diversion from the original
idea. David again reinforced the message that innovators and
innovation teams need a deep, detailed understanding of customer
needs and perceptions of value to develop commercial successes.
Management must create the environment for the non-linear
process to exist and proceed.
Peter Machin of GlaxoSmithKline explained how GSK had successfully
managed the transformation of its innovation processes and
environment through a series of mergers and acquisitions,
which have generated a range of choices between the different
approaches to innovation of the various legacy companies,
enabling GSK to discover better ways to innovate. GSK has
added a new front and back end either side of the drug discovery
process, enabling the company to leverage its global size
and strength while remaining agile and fast in local implementation.
Mike Bushell of Syngenta reaffirmed the message that successful
innovation today demands a focus on people and their needs
for motivation, rather than technology, and that this requires
management to develop a supportive organisational culture
and leadership style. At Syngenta too, new ideas are driven
by market understanding with a knowledge-based discovery process
based on market needs.
Richard Duggan gave a very clear message to management: Innovation
is all about attitudes to risk. Embracing and then minimising
risk is central to successful entrepreneurship and innovation.
Original business ventures
Andy Goodwin of Dow Corning Plasma Solutions confirmed that
Dow Corning is not only innovative in its approach to serving
its longstanding customers, but is also innovative in implementing
and supporting original business ventures. Dow Corning adopts
a three-horizon approach: to revitalise current business;
to focus and invest in current and new business development;
and to incubate through controlled investment in new venture
businesses such as Plasma Solutions, Ireland.
Arthur Day entertained the audience with a lively display
of consumer-inspired innovation from Nestlé Rowntree
called Little Notions – a true innovation of a new consumer
product category. Robert Phaal from Cambridge University explained
the power of strategic road-mapping to support successful
innovation. Richard Fairburn of Unilever (Liptons Cold Brew)
and Morgan Johnson of MoJo HDM (Callisto, Syngenta) shared
case studies of successful innovation. Richard underlined
the importance of inter-dependence and co-operation across
the globe as a key factor in Liptons Cold Brew’s success,
while Morgan demonstrated the power of brand belief and brand
positioning as a basis for successful commercialisation. ‘A
brand is something that people believe in and trust,’
he said.
Degussa’s Ian Grayson explained his company’s new
approach to innovation, being driven by the priorities of
the business: ‘Central R&D is an expensive luxury.’
Degussa will use a more collaborative model and plans to increase
R&D spending from 3% to 4% of total sales revenues. The
new model will include a strategic R&D and a corporate
venturing approach to develop start-up projects and project
houses to incubate internal start-ups. Degussa is also linking
knowledge across the organisation with knowledge and academic
networks and a NIH (‘not invented here’) Award to
encourage the right environment for successful innovation.
Chris Forsdyke of Comstratos took the meeting to new horizons
beyond the widely used stage-gate process, encouraging the
adoption of a more entrepreneurial approach to innovation:
entrepreneurial = understanding + will. Chris reinforced the
need for more enlightened approaches to innovation, reminding
the gathered innovators that the chemical industry is the
highest value-adding of all industries, but has patently failed
to recover that value created through its poor commercialisation
record and inability to capture and sustain value pricing.‘
You have to understand the value drivers of the customer in
order to protect the price,’ he said. Chris also encouraged
the group to get the right successes to market faster and
to sell the innovations to the right people, adding that selling
innovations to purchasers can kill the value.
Patent protection
Michael Ellis from Kodak reminded all of the importance of
protecting innovations and using patents as a basis for protecting
value-creating opportunities. Michael also explored the benefits
of creating additional value by licensing ideas, reminding
everyone that IBM gets 15% of its profits from licensing technology.
Marcos Gomez explained how one of the industry’s largest
and most profitable players, BASF, takes a highly collaborative
approach to innovation as a means to improve the traditionally
poor performance (when it had needed 2000 ideas to generate
11 successful innovations). Today BASF uses different impulses
for innovation from technology push to market pull and society
demand. The new collaborative approach has brought a number
of advantages to BASF including improved creativity, insight,
valuable know-how, faster-to-market projects, shared risk
and rewards and increased flexibility. Most importantly, it
has also encouraged and engendered a much deeper understanding
of customer needs and value.
Rounding off what was described by one participant as ‘one
of the most inspired and inspiring events I have attended
in many a year’, John Irven, European Chemical News
Innovation Award Winner in 2004, demonstrated to the fascinated
and attentive audience that it is never too late to innovate.
John explained how Air Products had moved from an old and
traditional bulk product supply model to an agent/distributor
model and how it had been the stimulus for a whole series
of innovations in the bottled gas market based on a better
and closer understanding of customer needs and values, with
examples such as Integra, which integrates several functions
into the cylinder package, and Ferromaxx, which delivers a
range of benefits from environmental improvements to better
yields and lower costs.
By Phil Allen, Marketing Excellence
Practitioner and Value Creator, Marketability
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