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Business Strategy Group

Art innovates business at BSG anniversary

Celebrators of the Business Strategy Group’s first anniversary in December were treated to a mixture of serious business strategy considerations and a dose of interactive creativity at the BSG’s annual gala event at Belgrave Square.

BSG chair Marten Japenga reviewed the first year’s activity in the BSG, highlighting three key networking and learning events since the launch gala a year ago: a first project management workshop in March 2005; the creative ‘Emotional Logistics’ workshop (examining organisational behaviour and structure) and the successful ‘Innovation Imperatives’ conference at Henley in May. Japenga then welcomed Werner Kreuz of AT Kearney to address the audience on the key strategic topic: ‘What is the future of the chemical industry and will the Asian tigers and dragons beat the traditional European and American players?’

Most people are aware of the phenomenal growth of the Chinese and Indian economies in the last decade, where GDP growth has exceeded that in the UK by a factor of ten and four respectively. While China’s growth engine has been in manufacturing, India has grown most rapidly in the area of services.

By 2015, purchasing power in both countries will have boomed, most spectacularly in China. According to a survey by AT Kearney, China has been the most attractive country for foreign investment for the past three years, while India has rocketed to the number three position in the past two years. The message from Kreuz was that the poor performance of the Western chemical industry in terms of value growth and creation has resulted in a long period of cost-cutting and consolidation. During this time the Indian and Chinese chemical industries have invested and grown, leaving them in a stronger position to challenge for business, both in local and in export markets, he said. A further challenge facing the Western chemicals industry is the massive migration of the key customer industries in the direction of China and India, combined with the strong growth of home-grown producers in those downstream markets.

In conclusion, Kreuz left his audience with a very clear message: the future of the traditional European and American chemicals producers lies in innovation – not only in products, but also in services and business models. AT Kearney’s study of best innovators clearly shows a better performance of innovative companies in terms of their profitability and growth. Kreuz highlighted the key success factors for innovative performers, reinforcing some of the messages from the speakers at BSG’s ‘Innovation Imperatives’ conference earlier in the year:

• Innovation ‘top down’ driven and managed as integral part of the corporate strategy;

• Innovation strategy and search fields fixed in writing;

• Openness for ideas and innovation as part of corporate culture;

• High degree of internal and external collaboration and networking;

• Continuous improvement of idea pipeline;

• High degree of corporate-wide standardisation – re-use of process and product technologies;

• Tracking of objectives and structured learning from experiences;

• Innovation integrated in performance evaluation; and

• All processes supported by most recent web-based IT technologies.

Following Kreuz’s presentation, guests were treated to an interactive creative session led by BSG committee member Jürgen Bergmann of Transico, during which the participants created a novel work of art, representing the SCI’s ‘where science meets business’ strapline and the BSG’s ‘where business meets science’ approach. Red and blue cords were intertwined representing the arteries and veins of the organisation, with the BSG at its heart. Guests wrote their hopes and aspirations for the group on cards which were in turn intertwined with the cords, bringing the society and its endeavours together as a whole.

The creative energies were replenished and replaced with a sumptuous buffet accompanied with drinks, where the participants enjoyed yet another excellent opportunity to network and discuss what they had heard and experienced. Look out for more networking and learning opportunities from SCI’s Business Strategy Group in 2006:

• Growing opportunities for innovation in platform chemicals, Foresight Seminar 20 March, Belgrave Square, the first meeting in SCI’s Foresight programme;

• Boosting R&D productivity by structured networking, 21 March, 2 Canning House, Belgrave Square, London; and

• Track 4, ‘Where science meets business’, at SCIpharm, 17 May, Edinburgh.

Phil Allen, Business Strategy Group