LANXESS board member responsible for R&D presents on innovation as a key driving force - even in a crisis

1. Innovation – a key driving force,
even in a crisis
Werner Breuers
Member of the Board of Management of LANXESS AG
American Chamber of Commerce, NY, January 2010

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3. Innovation means rethinking something you
already know
“All intelligent thoughts have
already been thought; what
is necessary is only to try to
think them again”
Johann Wolfgang
von Goethe
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4. Creativity and innovation are key to securing a
viable future – particularly in times of crisis
“There's no bad time
to innovate. You should
be doing it when times are
good and when times are
tough. […] it’s such a
deep-seated belief,
I'm not sure we have
Jeff Bezos, a choice.”
founder of Amazon.com
Source: Business Week, April 17, 2008
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5. Innovative strength does not depend on the size
of the budget
Performance Disconnect Of the 1,000 companies
with the highest R&D
budgets, less than
10% achieved
significantly better
performance per dollar
spent
on R&D than other
companies in the
same sector.
No direct correlation between R&D expenditure
and commercial success
Source: The Booz Allen Hamilton Global Innovation 1000, 2005
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6. A vibrant corporate culture drives innovation
 Pinpoint simple working principles Corporate culture and working principles
to promote a vibrant culture at LANXESS
of innovation
 Ensure these principles are
developed consistently as part
of the day-to-day working
environment
- Space for creativity Seek solutions, Take
- The courage to make decisions not problems ownership
quickly
- More individual responsibility
Keep it Think new,
simple act fast
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7. At LANXESS, we support innovation by
improving our creative culture!
 Support from top management Innovation network
 Strategy Trust
 Responsibility
Integration
 Trust
Open communication
Transparent innovation
Interdisciplinary
Innovation
approach
culture
Innovation processes
 Implementation of R&D
 Stage Gate
 Integration of business units  Project management
 Focus on market needs  Idea generation
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8. LANXESS – blazing a new trail in chemistry
History
 Independent company following
spin-off from Bayer in 2004
 Stock market listing
in January 2005
Global success
 46 sites in 23 countries
 14,400 employees
 Sales in 2008: EUR 6,576 million
Proactive crisis management
 Challenge09 and Challenge12
initiatives
 Savings of around EUR 360 million
by 2012
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9. Cost-efficiency is the decisive factor in all R&D
activities
R&D setup at LANXESS
 Central coordination department for boosting
interaction and knowledge sharing between the
business units
 First-class support departments to ensure
optimal implementation
 Industry-oriented R&D in each of the business
units for maximum customer and market
proximity
 Integration of existing development networks
 Optimized project management for maximum
added value with a reduced workload
80% of R&D projects are market-ready within
two years
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10. Targeted investment in innovation
 Further 10 % increase in R&D R&D expenditure [EUR million]
budget in 2009
 110 R&D projects implemented + 10 %
in 2008, with a further 100 projects + 10 % 97
in the pipeline 88
 Number of new patents granted
quadrupled between 2006 and
2008
 Numerous successful innovations
e.g. the high-performance rubber
additive Nanoprene®
2007 2008 2009
Sustainable program of innovation
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11. Innovation at LANXESS – Nanoprene®
Nanoprene® – a rubber additive
 Improves the properties of tires:
- Improves wet grip and abrasion resistance
- Increases service life
- Reduces rubber particle emissions
 Increases the efficiency of engines as a
component in fuel cells:
- Increases the reaction temperature
from 60 ° to 200 °C
Innovation in response to the increasing
demand for mobility
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12. Innovation at LANXESS – Baynox®
Baynox® – an additive for modern biofuels
 Prevents the formation of insoluble polymers in
biodiesel
 Stabilizes biofuels for long-term storage and
transportation
 Enables cooking oil and other spent oils to be
processed into biodiesel
incl. Baynox®
Innovation in response to the increasing
demand for energy
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13. Innovation at LANXESS – Therban AT®
High-performance elastomer Therban AT®
 More effective and efficient oil field exploitation
through optimized drilling technology :
- Improved oil and abrasion resistance of drilling
heads
- Longer service life of drilling materials through
improved adhesion to metals
Innovative contribution to efficient extraction of
energy reserves
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14. Agreement on tire labeling
Tire labeling adopted by the
European Commission
 Label clearly detailing their fuel
efficiency as of 2012
 Cut CO2 and noise emission and
protects the environment
 Positive boost to the innovative
tire industry
 Business driven by innovation
Tire labelling – Initiative
of the European Union
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15. Innovation is a key factor in achieving success
in a globalized world
 Establishment of structures and
conditions that promote innovation
 Global R&D projects to heighten
the worldwide profile further still
 Cutting-edge R&D and technology
centers in growth markets
Creativity is capital
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