Open Innovation and Technology Scouting

Roger Leech

OI Portfolio & Scouting Director

21st Oct 2010

Agenda

•Introduction to Unilever

•Open Innovation approach with a focus on scouting new opportunities

•Case studies

•Conclusions

13 > € 1 Billion global brands

€40b turnover (2009)

Western Europe 30%

The Americas 32%

AACEE 37%

6 Global R&D Centres6 Global R&D Centres

TrumbullUSA

Port SunlightUK

ColworthUK

ShanghaiChina

VlaardingenNetherlands

BangaloreIndia

Open Innovation - What and Why?Bigger, Better, Faster Through Partnership

Bigger Better Faster

Pepsi – Lipton JVCreated a new

category

Pepsi – Lipton JVCreated a new

category

Partners allow us to access to growth

markets we could never access alone

Partner to harness new capabilities to deliver

better outcomes

Great ice cream textureMartek create route to

sourcing

The right partners can drive speed

Investing in capability build externally reducesTime to discover x 10

Unilever’s approach to open innovation

mindset

organisation capabilities

OrganisationA Critical Capability In Unilever

BreakthroughsFrom

Discover

Fast,Large Scale Deploy

BrillianceIn Product Design

Prioritise in Define

Differentiating and Transforming Critical Functional Capabilities

Open Innovation, Patents, Safety & Environment, Regulatory, Clinicals, Information Management for R&D

Capabilities aligned to Open Innovation process

Manage Manage delivery incl. relationship.Project management

WantDefining the targets.Which capabilities do we need to deliver the innovations ?

FindIdeas Management in relation to defined needsScouting for capability providers

GetDefine business goals of alliance and likely alliance type. Approach & build deal quickly or separate

Scouting

Deal Architecture

Technology Licensing

Define for OI

Alliance Management

Excellence

Underpinned by……

Open Innovation Training, Open Innovation Communication, IT for Open Innovation

FIND – Who scouts?

•Project scouts – provide input into projects deliverables with external science and technology

•OI Scouts – help projects to find companies, academic centres, consultants and solutions

Want Summit

10

Stretching the ambition and prioritising the Wants…• Scheduled event to provoke, prioritise and review the Wants• Wants are owned by the Programme• Maintain running list of all Wants and associated activities• Improve the Want definition through best practise• Confirm commitment to the selected Strategic OI Wants

Category VPCategory Discover

Leader

Project Leader

Project Leader

Project Leader

IAD

OI Scout

EVP Discover PlatformsDiscover Platform

Leader

Genesis Leader

What makes a good scout?

• Entrepreneurial • Creative• Good experience of science and technology• ‘Extrovert’• Organised• Contract understanding• Global mindset• ‘Janus’ approach

Scouting across the programme

ProgrammeProgrammePlatformDiscover

GenesisFields

CategoryDiscover

CategoryDesign

Access to ScienceAccess to Science Access to TechnologyAccess to Technology Access to InnovationAccess to Innovation

‘Baked’ 5% 40-50% 80%

OIWANTS

OIWANTS

OIWANTS

OIWANTS

OIWANTS

OIWANTS

OIWANTS

OIWANTS

OI LEADS

Risk Investment

How to measure scouting success?

Delivery

New Products New Processes New Strategy

Unilever – 2010 OI Scouting Facts

• ~ 50 scouting activities done with external partners

• to date ~14 activities have resulted in contract action from the internal project team

• current portfolio of ~500 OI activities (excluding CDAs)

MindsetWith a wide spectrum of partners and open innovation models

University/ Contract Research

Supplier Networks

JV’s Alliances

Science Parks

Entrepreneurs

Scouting Networks

Unilever Corporate Ventures

NGO’s

Pyramid Teabags Accessing capabilities beyond our industry and orchestrating multiple partners

What makes a collaboration successful? Case Studies

Framingham New service based approach from external data

Case Study: Pyramid Fruit TeabagObjective

•To delight our consumers with a transformed product that touches multiple sensory cues

–great new flavours, –large pieces of fruit and tea,–new look packaging–a novel transparent teabag

•While maintaining the fastest line speeds in the industry and product integrity

Pyramid Tea Bags Case Study

Accessing and orchestrating new capabilities from an ecosystem of partners to deliver what we couldn’t do alone

New blending and handling systems

New suppliers of transparent materials

New ultrasonic sealing technology

Tea suppliers Flavour houses

Pyramid Teabag Case StudyBigger better outcomes

•Marketplace–Successfully launched in 44 countries–Major growth driver for Tea Category

•Partnerships–Lasting partnerships that have formed the basis of new strategic alliances–Commercial success

Framingham Heart Study

“The FraminghamHeart Study”• Established 1948

• 5000+ individuals• Established risk factors for

heart disease• Ongoing study today

“The FraminghamOffspring Study”• Started 1971• Recruited the children of

original cohort and their partners

• Demonstrated family history important

• Ongoing study today

“The Framingham Third Generation”

• Started 2003• Recruited children of

offspring and their partners

• Ongoing study today

Summary

• A business as big and complex as Unilever draws on a wide range of open innovation models - There is no one best practice

• Different situations will see us draw on different models – we want and need a wide palette

• We are continually learning and looking for repeatable models

• Who is working for you to develop/market your products or services?

• Construct your own approach to suit your capabilities, strategic intent

THANK YOU