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By Peter Longini
The core business of Bayer MaterialScience – the materials side of the German-based firm whose pharmaceuticals and crop science products have made the company a household name for generations – is high-quality plastics. But plastics, like the products they go into, have life cycles that begin with breakthrough innovation and end as low-margin commodities. As a result Bayer, which has been a leader in its chosen markets, is constantly looking for new ways to leverage its formidable technical, production, and market strengths toward innovation. And it has worked on institutionalizing that search process.
Brian Long, a chemist by training, is one of a handful of people that the company has designated as Innovation Managers at its New Business Creative Center outside of Pittsburgh. His job is not to shake up Bayer’s traditional research and development patterns, but rather to gradually introduce new ones into a firm which has enjoyed considerable success. And he avoids being dogmatic about how it’s done.
“We’re moving into slightly different places in the value chain,” Long acknowledged. “We’re focusing on strategic growth areas that we haven’t looked at as closely in previous decades. And one of them is moving a little further downstream. We’re a raw material supplier. But as we see technology trends and business model trends moving in a certain direction, we realize that if we leverage it properly, we have a lot of expertise in things that can be moved downstream in the supply chain.”
Connect and Develop
However, the process through which those technology trends are identified, and the development of product ideas that follow, has undergone radical change in the last few years. It’s called Open Innovation. “As a conservative company your philosophy tends to be: put your head down in a lab and emerge five years later with something that may or may not be relevant to a market,” Long said. “The idea was fix, fix, fix, fix, and then ship it. But in the last few years, the message getting across to us loud and clear is that we need to have a methodology of: build something and then ship it, and don’t be worried that it’s not complete. Because chances are if you do all that work yourself, it won’t be the right kind of solution anyway.
“You need that input from the market, you need that input from the key players. You need that input from thought leaders,” he said. “So the philosophy now is: fix-ship, fix-ship – however many iterations it takes to get to something that’s going to be a viable product.”
That represents a major shift in the emphasis, sequence, and focus of the company’s development efforts. It also means looking at customers as more than just customers, but rather as co-developers. “The idea now is ‘connect and develop’,” he said. “In this day and age, you’re not going to get the right answer all by yourself. That was even rare 20 years ago when you had the mad scientist with his head down, working for years on something he eventually emerged with. Now it’s much more collaborative. You can see it even in the tools that are being developed: your Wikis, your crowd-sourcing tools – those types of things.”
Validate
Ideas come from everywhere. “They all have a different genesis,” Long acknowledged. “Some of them came from a technology push. Some came from a societal demand. Some came from trend-watching, some came from market pull. We’re not so concerned with how we got the idea, but what we do with it once we get it.
“We look across and say: what kind of technology can we develop to meet those needs in 5 or 10 or 15 years? And if we see enough business coming out of that, or if it’s in our strategic portfolio, we start developing it. We employ different tactics at that stage to validate our assumptions: Do some feasibility studies. Do a trial run with a customer. Do something else that gets us more information.”
For mobile robotics – a particular area of interest for Long – getting more information includes meeting informally with people in the robotics community at universities, startups, and technical consortia; attending professional conferences, giving out samples of materials that the company is working on in order to secure feedback. “If we talk to people that are outside the realm of what we think of as customers, we’re going to get at needs that are unmet or unarticulated,” he said. “If we can approach them intelligently and lay the foundation for a relationship with that particular company or industry, we’ll have a first mover advantage.”
Leveraging Networks
One of the most important strategies comes through leveraging networks of people outside the organization. “I’m not expected to do everything and figure it all out myself,” Long said. “So among other things, I’m in charge of establishing industrial designer networks here. Industrial design is a hot topic, a way to get pictures of the future. The designer’s way of thinking is almost diametrically opposed to the engineer’s type of thinking. And that sort of creative friction opens up our eyes to realities of the marketplace, because designers are very well trained in user-based research or user-centric design. Those are the types of concepts we are trying to embed in our culture.”
Another form of network leverage for product ideas is one that’s more common in Europe than here, at least for now. It has formed itself as a “future_bizz” network. This platform is a complementary network of industry partners and experts with the charter: explore and develop the future. “We find and recruit like-minded companies who are usually on a similar innovation path as Bayer. We approach them and say, for example: ‘We’ve been looking at future logistics and we think there’s some opportunity there.’ And they say, ‘yeah, we’ve been looking at that kind of area too.’
“Then we create working groups with clear future relevant topics, share experiences and build knowledge about trends and scenarios and roadmaps – whatever we happen to have. And we create new minds around that area from the perspectives of the different companies,” he said.
The network bundles the resources and competencies of companies and speeds up innovation processes for the exploration of new business ideas. Changes in the value-added chains can be detected early and shaped accordingly.
“We’re not coming together because we’re all in the same region or because we all have the same culture or whatever,” Long noted. “It’s really about strategic interests. So the topic could be future of security. It could be the future of mass transit. Or whatever it happens to be that is strategically aligned to these recruited companies. You can drop in or out. Maybe a company says there’s really not a whole lot here for us, we’re going to pass this round. Then the rest of them get together and fund a project to create a designer portfolio of future application opportunities.”
Idea Hot House
One more strategy for idea generation grows out of training that all the New Business Creative Center staff members have taken. “All of us here have been trained at the Creative Problem Solving Group in Buffalo, New York with the traditional Alex Osborn-type of brainstorming process. So we’re also for hire internally to get at new ideas,” Long said.
“In addition, we use idea management tools to build upon, categorize and store the ideas of our employees. With these, we can run short ideation sessions or longer-term, suggestion box-type events. We know our employees at all levels have ideas worth pursuing if only given an outlet to express them. Currently, for example, we’re running sessions asking our employees to contribute technical solutions in an open innovation pilot.”
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