Innovating from the Outside In

Wednesday, December 16, 2009 7:26 pm EST

Swiffer Duster. Olay Regenerist. Pringles Stixx. Mr. Clean Eraser. The Pulsonic Toothbrush. What does such a diverse group of brands have in common? Market success, absolutely. But, also, each is a P&G product grown out of a partnership with someone outside the Company.

Seem odd? Perhaps at first. But a closer look shows an innovative strategy on how to approach innovation.

A strategy focused on delivering more superior products, faster. And with maximum chances for success and optimal use of key resources. We call it Connect+Develop. The objective is to discover key innovations outside the Company and bring them inside—to either advance, enhance or expand current projects and strategies.

It works by building the kinds of partnerships that enable good innovation to flourish.

Years ago, P&G focused on everything being homegrown, home developed. But with information and technology sharing happening at unmatched speeds, the race to market with exciting ideas and superior products continues to be increasingly more competitive. Thus, P&G, aiming to remain on the edge and in the lead, made a daring culture shift about 10 years ago from "P&G made" to "P&G made or discovered."

"We don't corner the market on good ideas and every good idea doesn't have to be ours," said Vice President of Business Development, Jeff Weedman. "The goal is to identify and collaborate with innovators who can help us consistently improve existing brands and create new products that delight the world's consumers."

Connect+Develop began with just one-on-one connections and word of mouth suggestions. Today, the C+D global Web site receives about 300 idea submissions a month from all over the world. P&G teams go through them all, looking for an idea, a technology or a product that fits in with the Company's business goals and strategies.

When they think they have a match, they start a thorough, deliberate, confidential process of connecting with the owners of the ideas to learn even more. Then, if it is indeed a fit, they begin working through arrangements that will build win-win partnerships between P&G and the innovator.

To build the kinds of partnerships that might lead to a success story such as Mr. Clean Eraser, P&G devotes up front to every potential project, both extensive innovative resources and innovation discipline.

To date, P&G has 1,000 active partnerships; many have already resulted in real success stories:

  • Pringles Stixx extended our Pringles line with a complementary, already developed product that we now market globally.
  • Pulsonic leveraged the R&D technology of an external partner, advancing our existing toothbrush technology and cutting a good five years off our own development process.
  • Regenerist includes a peptide technology developed by a French technology company and was turned into a global success by partnering with P&G.

"P&G is connecting with the most innovative minds in the world to develop products that improve consumers' lives. We want to be the company innovators most want to work with because they know a partnership with P&G will be more rewarding than any other option available to them," said P&G Chairman of the Board, A.G. Lafley.

"Our vision is simple: We want to be known as the company that collaborates—inside and out— than any other company in the world," he added.

Collaborations to date have lead to innovation in nearly every area: products, formula ingredients, packaging and manufacturing.

And the results have proven to be three-way wins. Swiffer Duster was designed by a company in Japan that produced and sold the hand-held dusting tool—but only in Japan. The company did not have the manufacturing, distribution or marketing might to take their product into any other markets.

P&G engineers had simultaneously been working on a dusting tool of their own to expand the Swiffer mop line. But they liked the sleekness and user-ease of the Japanese product—as did consumers in market testing. So Connect+Develop built a partnership that enabled P&G to take the Japanese firm's innovation, global. The Japanese firm benefited from the global expansion. P&G delivered on its vision, with superior design and innovation. And, consumers globally have a tool that enables efficient and effective cleaning with a swipe. Swiffer Duster now is sold in 15 global markets.

"Win, win, win," Weedman said, "that's the model we're working against. Win for the partner, win for P&G, and most importantly, win for the consumer."

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