I came across a summary of a speech Helmut Traitler, Vice President for Innovation Partnerships at Nestle gave at an Open Innovation Forum in Cambridge. It is a beautiful example of a company purposely innovating and I have nothing to add to Saul Kaplan’s account of the presentation.
“Embracing open innovation and new business models Nestle clearly recognizes that to achieve its growth objective it must extend its internal capabilities to establish a large number of strategic partnering relationships. It has embraced open innovation and works aggressively with strategic partners to co-create significant new market and product opportunities. Worldwide, Nestle employs approximate 5000 people in 24 R&D centers and over 250 application groups. It extends its reach by tapping into the technologies and expertise of more than a million researchers around the world.
Importance of strategic focus within target benefit areas Nestle has a very clear framework to screen new opportunities. It has identified target benefit areas that relate to nutrition, compliance and quality, and taste. In order for any idea to be pursued it must be strategically aligned with one of the identified target benefit areas.
Building partnerships based on trust and goodwill Nestle has developed an internal culture based on a “sharing is winning” philosophy and recognizes that big growth opportunities can only be co-created with partners if the relationship is based on a strong foundation of trust and goodwill.
Upfront clarity on how IP is handled Nestle recognizes that how IP is shared is often a key determinant in moving innovation partnership discussions forward. The company makes its framework for sharing IP very clear early in the conversation so there is no expectations gap. While there may be exceptional cases the norm is that every physical solution, such as ingredients or technologies, is owned by the competency providing organization. In turn, the smart applications of a new solution are owned by Nestle for the period specified in the individual agreement. Partners know Nestle’s expectations right up front which enables a more efficient partnership evaluation process.
Importance of program management and discipline Just the raw number of discussions at various stages in the partnership life cycle to drive the growth Nestle is trying to achieve is only possible with strong program management capabilities and rigorous discipline build into the decision making process.”
