Tuesday, February 9, 2010

Leadership and Innovation Strategy

By Connie Harryman, Applied Concepts Creativity
Guest Blogger IIR USA
LIVE Front End of Innovation Europe 2010

Topic: Corporate Leadership Forum on Innovation Strategy – A Two Part Presentation

Speakers: Krijn Rietveld, Senior Vice President of the Nutrition Innovation Group, Royal DSM N.V. & Patrick O’Riordan: Global Director, Insights & Innovation, Anheuser-Busch InBev

DSM has existed over 100 years. It began as a coal mining company and is now in fertilizers, petrochemicals, performance materials, etc. Global trends drive DSM’s innovation strategy. These include climate and energy, health and wellness, functionality and performance, and emerging economies.

DSM has a strategic commitment to (open) innovation and they have a top 50 project list. Their innovation scope includes fitness, wellness, obesity, diabetes, novel pharma process, eco-friendly materials, safety and protection, next generation plastics, biomedical materials, specialty packaging, etc.

Their new business development includes: biomedical, incubators, personalized nutrition, sports, specialty packaging, venturing, white biotechnology, and licensing.

They have an incubator for radical innovation to focus on new business models, etc. They are steering the innovation pipeline and have open innovation throughout the pipeline. Acquisitions boost innovation speed. They exit businesses which do not fit their strategy.

They are advocates of “proudly found elsewhere” strategy and have a regular sanity check of innovation projects.

Their key focus areas include:

1.) Boost commercialization and launch skills with a dedicated product launch support team.
2.) They have a toolkit for commercialization.
3.) They identify and spread best practices.
4.) They recruit and hire individuals from other industries to speed up commercialization.
5.) They stimulate employees to innovate by providing high level jobs and career paths in innovation. They train people and virtual teams around innovation at multiple levels and functions. This includes a business plan competition for top potentials. The teams are cross discipline, cross business entities, as well as cross countries.

Their focus is on opportunities at the intersection of life sciences and materials sciences. They are the winner of 2009 OCI Award and have had continued innovation growth despite the recession.

Core elements include: a strong strategic commitment, a tailored organizational structure, a focus on building relationships with external partners, a continuous drive to improve from good to great and creating sustainable growth for all stakeholders.

Part Two:
Speaker: Patrick O-Riordan, Global Director, Insights & Innovation, Anheuser-Busch InBev


Anheuser-Busch InBev is the leading global brewer with a ranking of the #1 or #2 positions in over 20 markets. They are a consumer-centric, sales-driven organization with 320 brands.

Every second 16’912 glasses of beer are drunk; this is 169 times the volume of the Empire State building. However the industry and world is changing. Before the majority of their consumers were in the westernized market. In the next 5-10 years there will be a consumption shift to developing nations such as Brazil, India, and China.

The most difficult and important part is to understand the consumer. They connect the brand experience in a meaningful way, while providing a balance of heritage and innovation. This is done in a responsible way.

This leads to the concepts of Renovation and Innovation. This is a modernization of a product or tactical launch of short lived products to defend share. The innovation, package can include a significant modification of the liquid delivery or the container. It could be the creation of a new liquid within the beer segment and or across categories.

The philosophy is that for brands to have maximum effect they need renovate and innovate to fulfill their promise. For R&I to have maximum effect, it needs the brand to consider provision, focus and direction.

Key learning’s are:

1.) To build the story of the brand
2.) Pathways of timed introductions
3.) Connected pipeline – collective potential of initiatives
4.) Complementary short-, mid- & long-term focus
5.) Have a framework for innovation; they have done most of their work at the front end of innovation.
6.) R&I process (WCCP). This is the where, what, and how.

Their common strategy and process is:
1.) Secure and protect the core.
2.) Drive share & volume.
3.) Expand category share at expense of SOT. They are now in ten global markets.

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