Point: Capture, share and reuse knowledge to make R&D engineers more productive

Story:

At Power to Innovate 2009, Boston Scientific’s Randy Schiestl (VP of R&D) and Jude Currier (Cardiovascular Knowledge Management & Innovation Practices Lead) described how Boston Scientific is redesigning its innovation processes. The goal: to accelerate time to market, increase the productivity of innovators, and reduce costs and risks.

Boston Scientific is an $8 billion company committed to delivering innovative medical technologies that improve the quality of patient care as well as healthcare productivity. The company has a broad portfolio of 13,000 products. The new products in its pipeline include drug coated stents, bare metal stents, catheter and bio-absorbable technology.

In the past, Boston Scientific drove innovation from business strategy to technology development to product development. In this staged approach, engineers created technology-driven products that were then shown to business units and customers at the prototype stage. The trouble with this process was that the later groups often found gaps or risks in the proposed product late in the product development process. As a result, the company had to spend more money than expected putting out fires while trying to hold to a launch schedule.  Boston Scientific decided to change its innovation process to bring more knowledge and resources into the earlier stages of innovation.

As part of the new innovation process, Boston Scientific began bringing in key “voices” into the innovation process earlier. By getting these voices — the voice of the customer, the voice of the business unit, and the voice of regulatory bodies — earlier, the company uncovered its knowledge gaps and risks much sooner. The second part of Boston Scientific’s innovation process redesign gave employees access and pointers to relevant information, whether that information resided in a document or in the tacit knowledge of an expert. The goal here was to reduce the amount of time engineers spend looking for knowledge. Schiestl said engineers spend 30% of their time looking for relavant knowledge. To improve upon that, Boston Scientific used Goldfire (innovation software from Invention Machine) to capture, share and reuse knowledge.  Goldfire’s semantic technology automatically categorizes concepts can and ties relevant intelligence to specific innovation initiatives. For example, engineers used Goldfire to identify past research and then validate whether that research could be repurposed. The result: Boston Scientific engineers who used Goldfire spent only 10 percent of their time researching intelligence, compared to 20-30 percent by non-Goldfire users.

Boston Scientific’s new innovation process illustrates what Mark Atkins, CEO of Invention Machine, called an innovation intelligence ecosystem.  This ecosystem represents the aggregate of information, communities, and processes that collectively contribute to innovation. Here’s how it works: using innovation software like Invention Machine’s Goldfire, companies capture and reuse information and intellectual capital created by employees as well as by external sources. Goldfire further enables collaboration by accurately reconstructing a user’s past thinking and research process, making it visible and explicit to other users. Employees avoid reinventing or duplicating research already done, thus saving time and improving innovation productivity.

Boston Scientific shared two examples of its success using Goldfire and the company’s new innovation processes. First, the company improved the design of cardiac stents to reduce a patient’s injury-response to the device. By combining knowledge from across the innovation ecosystem, the company mapped key clinical knowledge about heart disease and how different heart artery conditions affect the patient outcomes with different stent designs.

In the second example, Boston Scientific used Goldfire to solve a technical problem in manufacturing that was reducing product yields.  Using Goldfire, Boston Scientific found that previously undocumented thermocapillary effects were leading to clogged spray nozzles. By understanding the physics of the cause, Boston Scientific was able to make a simple change to the manufacturing line to eliminate the clogging and thereby improve yields.

Action:

• Uncover all the “voices” that have a say in the success of innovations (the voice of the customer, voice of technologists, voice of manufacturing, voice of regulatory compliance, etc.).  Connect key people and communities in a more collaborative, sharing-oriented environment
• Identify, organize, and access information (internal and external) needed by these communities to do their innovation-related work.
• Develop knowledge and innovation processes that find and resolve knowledge gaps or risks early in the innovation process.

Point: Open innovation can accelerate new product development

Story: When Irene Rosenfeld took over as CEO of Kraft, she saw an anemic innovation pipeline. The company had 2000 corporate R&D staff — scientists, engineers and chemists — but new products weren’t flowing rapidly enough.   Her solution to encourage innovation?  To get everyone to “Think of Kraft as a $40 billion start-up,” she said at the World Business Forum on October 7, 2009.  One way to emulate start-up thinking is to be open to new ideas from anywhere and quickly turn them into something valuable. Kraft reached out beyond its corporate R&D to enlist the help of employees across the whole company, as well as suppliers and partners, to spur innovation.

For example, Kraft runs an online “Innovate with Kraft” program whereby anyone can submit product ideas.  Although skeptics call such programs gimmicks or fads, Rosenfeld maintains that they’re not gimmicks if the programs and the ideas generated from them are being used.

Kraft’s recent new product introduction, Bagel-fuls (frozen bagels pre-filled with Philadelphia brand Cream Cheese), for example, came from an unsolicited idea from a third-generation bagel maker in a niche market. The idea was a win-win for both companies: it solved some technical challenges that Kraft had faced in delivering a bagel and cheese combo, and it expanded the bagel-makers product beyond his niche.

Rosenfeld also mentioned the value of platform-based innovation (ideas that span multiple brands and geographies) in the innovation process.  Now, “Our innovation pipeline is quite full,” Rosenfeld remarked, with new products coming out in four core areas: Snacking, Quick Meals, Premium and Health & Wellness.

Action

• Look for ideas in the corners: reach out to employees and suppliers, especially niche people, to uncover obscure ideas that merit more widespread use
• Celebrate the use of submitted ideas to show the value of participation in innovation submission programs.

For more information:
Irene Rosenfeld at the World Business Forum on Oct 6, 2009 #wbf09

http://www.usatoday.com/money/companies/management/profile/2008-12-10-ceo-forum-kraft-irene-rosenfeld_N.htm

Staggs, Sandy. Foster Innovation at Kraft Foods, Oct 27, 2008.

New York Times, Sept. 9, 2009

Point: Tough economic times call for different brand messaging

Story: We’re in a time of new frugality, said Kevin Roberts, CEO of Saachi & Saachi, at a recent HSM webinar. People are evaluating their purchases more closely. They’re comparing more products and contemplating switching brands more often. They will still buy luxuries, but they’ll buy fewer luxuries; and, they’re redefining what luxuries are. They’re separating true value from false economies. Roberts suggested three strategies that companies can use to keep their products and services on a customer’s “buy” list in an era of less buying.

First, companies can reframe the competition and the category.  In the era of new frugality, many people are eating out at restaurants less and eating at home instead.  Some companies see parallels in this inside/outside phenomenon to redefine their place in the market.  For example, P&G compares its premium-priced Tide Total Care with the cost of dry-cleaning, not with other cheaper detergents. P&G is reframing the category, positioning its detergent as a frugal way to achieve clean clothes in the home without the high-cost of dry-cleaning outside the home.

Second, companies can help consumers use products in a more cost-effective way.  For example, in a similar spirit of saving its customers money, Tylenol’s new ad campaign offers advice that helps customers ease the pain of a headache — without taking a Tylenol product.  Tylenol suggests that if you have a headache, drink a glass of water and wait 20 minutes. If you still have a headache, then take Tylenol.  Although the campaign may lose Tylenol some sales, the ultimate goal is to side with the customer and win in the long run. Empathsizing with the need to save money, Tylenol suggests a solution that can save customers money while remaining the brand of choice for tougher headaches.

Third, be honest and highlight the value if you can’t decrease the cost. If your product truly is a premium-priced luxury, don’t pretend that it’s a cut-rate necessity. Be honest. Customers still want joy in their lives, and they’ll still treat themselves to an occasional luxury. Rather then make a luxury seem cheap, highlight what makes it more special and more meaningful. The product may not cost less, but the emotional bonus makes it more valuable.

Action

1. Reframe your product’s category (e.g., detergents competing with dry cleaners)
2. Offer useful advice on cost-effective use of your product
3. Enhance the emotional value of your product

For More Information:

Kevin Roberts will be presenting at the World Business Forum in New York City on October 6-7, 2009.

Kevin Roberts is the author of Lovemarks: The Future Beyond Brands
and The Lovemarks Effect: Winning in the Consumer Revolution