- 10 ingredients for successful innovation in consumer goods industries - innovation types, strategic alignment, concept development, scorecards

1. 0
10 Ingredients for your
Innovation Recipes
Key Points for Success
Amsterdam, 10.10.2010
Strive for Success through Innovation
Mr. Jean F. Schrurs
Expert Advisory Team

2. 1
Introduction

3. 2
1. Use 4 Innovation Types
2. Align with your Strategy
3. Capitalize on Trends
4. Where to get Innovative Idea’s ?
5. Concept is not Development
6. Qualify and Quantify
7. Trust Yourselves
8. Allow for different Paces
9. Communicate and Sell
10. Just do it !
Highlights

4. 3
- practitioner’s shared experience
- no non-sense
> pragmatic recommendations
- based on :
20+ years of experience
(Coke, ABI, FMCG clients)
50+ new product launches
20+ developed technologies
50+ new concept developments
- holistic approach
- from ideation to product launch
Introduction

5. 4
- Four types
Technology widely available in the
target industry (process
improvements and material
reductions).
Non-existing technology in the
target industry : medium level of
complexity, risks and rewards.
Non-existing technology or in
embryonic stage, high level
of complexity, risks and rewards.
Existing technology in the
target industry : low levels
of complexity.
H0
Efficiency
Improvements
H1
Evolutionary
or Incremental
H2
Revolutionary
H3 : Pre-
Revolutionary
Consumer
Hint n°1 : use 4 Innovation Types !

6. 5
Key points :
- local versus global innovations
- leadership versus consulting
- documenting knowledge
(specs, procedures, results)
Background
- roles and responsibilities
- management of expectations
- observations
- most R&D functions
“technical services experts”
- technology reapplications
- innovation R&D steps
Hint n°2 : Align with your Strategy !

7. 6
technical
assistance
regional
local projects
local brands
to drive business
growth
strategic
to sustain current
business
tactical
maintain/improve the
fundamentals :
• renovation
• base business support
• low risk
Innovation as growth
and profitability driver :
• breakthrough innovation
• incremental innovation
• competency development
Objective
Focus
Scope
Method
key corporate projects
global brands
new concepts
competence
development
local project
leadership
global initiatives leadership
local project consulting
Involvement
Differentiated Innovation Mandates
HeadquarterDivision

8. 7
Hint n°3 : Capitalize on Trends !
The Siemens-Method to Plan the Future
based on the combination of
Extrapolation and Retropolation
INFLUENCING
FACTORS
Operating
Units
“Extrapolating”
over roadmaps
Products
Technologies
Customer Requirements
STRATEGIC
VISIONING
today short term medium term long term
“Retropolating”
from Scenario’s
new Markets
new Customer Requirements
new Technologies
New Business Opportunities
Time horizons are heavily dependent on strategic opportunity area
Services
Materials
Lighting
Medical
Transportation
Power
Information &
Communications
Automation
& Control
SCENARIO’s FOR
SIEMENS
STRATEGIC OPPORTUNITY AREA’S
AND
CROSS-SECTION
TECHNOLOGIES
Individual
Company
Politics
Economy
Environment
Technology
Customers
Competition
Source : Siemens

9. 8
Recommendations :
- scout your marketplace
- talk to consumers
- visit tradeshows in :
- your industry
- adjacent industries
- read, read and read more
- invest in scouting
Hint n°4 : Where to get Innovative Ideas ?

10. 9
Concept Development
“Fuzzy Front End”
Hint n°5 : Concept is not Development !
Idea
generation
and
enrichment
Concept
definition
Concept
selection
Opportunity
identification
Opportunity
analysis
Engine
1
Source : PDMA Toolbook for New Product Development
Chapter 1 : Fuzzy Front End : Effective Methods, Tools and
Techniques (P. Koen, G. Ajamian, S. Boyce, A. Clamen,
E. Fisher, S. Fountoulakis, A. Johnson, P. Puri, R. Seibert)
3
2
Start 1
Start 2
to NPD

11. 10
PHASE I :
Idea &
Concept
PHASE II :
Project &
Development
PHASE III :
Launch & Volume
Manufacturing
Ranking
H0
Efficiency
Improvements
H1
Evolutionary
Pre-
Revolutionary
H2
Revolutionary
H3
Consumer
Technical
Feasibility
Financial
Opportunity
Global
Brand
Innovative
Score
Strategic
Endorsement
Score
Time to
Market
Competitive
Insulation
Process
Mapping

12. 11
- use scorecards
to prioritize your initiatives
- map your projects and resources
against time horizons
- measure the value of your
innovation portfolio regularly
using risk-weighted project valuation
- maximize your portfolio
- ultimate Innovation KPI :
Σ (NPV)last 5 years
-------------------------
Σ (FTE)innovation and R&D
Hint n°6 : Qualify and Quantify !

13. 12
I. Technical
Feasibility
IV. Financial
Opportunity
V. Global
Brand
VI. Innovative
Score
VII. Strategic
Endorsement
TOTAL
SCORE
II. Time to
Market
9
6
3
Sure Thing
Likely
Low
3
> 3 years
6
1 < … < 3 years
9
< 1 year
III.
Competitive
Insulation
9
6
3
First to Company
First to Industry
IP Protected/Patented
9
6
3
2
1
0
3
No
Yes
3
6
9
Re-application
New to Company
New to Industry
3
0
« must do »
other
>1 M Euro
1..3 M Euro
3..5 M Euro
5 .. 15 M Euro
>15 M Euro
Scorecard

14. 13
- feed your left and right brain
- document
> get the learnings
> go to the next level
- invest in yourself
- keep track of your time
- communicate
Hint n°7 : Trust Yourselves !

15. Hint n°8 : Allow for different Paces
14
- measure your time as an accountant
Examples
- time usage ratio’s in R&D departments
- 70% project work
- 30% organization excellence
- 2/3 projects with direct impact
- 1/3 longer term projects
- use time-sheets

16. 15
Communication and Innovation
- you are in competition for
resources (M&A, …)
- give your portfolio a 6th dimension
- feed your intuition
- commercialize your innovation function
- generates idea’s > identify gaps
- ‘operationalizes’ innovation
Hint n° 9 : Communicate and Sell !

17. 16
Raw material
supply
Finished
goods
supply
Replenishment,
delivery &
merchandising
Market
channel
Petroleum
Convenience
Stores
Vending
Channel
Super
Markets
Hotels,
Cafés
Restaurants
Warehouse
Delivery
New
Channel

18. 17
- take one risk per day
- experiment, experiment, experiment
- put yourself into difficult situations
- put things in writing,
take a distance and reflect
- make assumptions, share, validate, proceed
- athletic behavior :
norm/storm/perform/transform
- build credibility using business
cases and success stories
- welcome constraints, drivers for innovation
You take big risks by not taking one !
Hint n° 10 : Just do it !

19. 18
Contact :
Jean F. Schrurs
john@capedecision.com
M +32 498 53 04 58
Key Points for Success