Connect and Develop: Inside Procter & Gamble’s New Model for Innovation
Learning Objective:
To see how Procter & Gamble sources ideas for new or refined products from outside the company and then applies specific principles–such as leveraging proprietary and open networks–to develop those ideas into profitable innovations
Description:
For generations, Procter & Gamble generated most of its phenomenal growth by innovating from within–building global research facilities and hiring the best talent in the world. Back when companies were smaller and the world was less competitive, that model worked just fine. But in 2000, newly appointed CEO A.G. Lafley saw that P&G couldn’t meet its growth objectives by spending greater and greater amounts on R&D for smaller and smaller payoffs. So he dispensed with the company’s age-old “invent it ourselves” approach to innovation and instead embraced a “connect and develop” model. By identifying promising ideas throughout the world and applying its own capabilities to them, P&G realized it could create better and cheaper products, faster. Now, the company collaborates with suppliers, competitors, scientists, entrepreneurs, and others (that’s the connect part), systematically scouring the world for proven technologies, packages, and products that P&G can improve, scale up, and market (in other words, develop), either on its own or in partnership with other companies. Thanks partly to this connect-and-develop approach, R&D productivity at Procter & Gamble has increased by nearly 60%. In the past two years, P&G launched more than 100 new products for which some aspect of development came from outside the company. Among P&G’s most successful connect-and-develop products to hit the market are Olay Regenerist, Swiffer Dusters, the Crest SpinBrush, and the Mr. Clean Magic Eraser. Most companies are still clinging to a bricks-and-mortar R&D infrastructure and to the idea that their innovation must principally reside within their own four walls. Until they realize that the innovation landscape has changed and acknowledge that their current model is unsustainable, top-line growth will elude them.
Managing Middlescence
Learning Objective:
To appreciate the dangers in ignoring mid-career employees’ disaffection and restlessness and discover strategies for renewing these employees’ commitment and productivity as well as reducing turnover in their ranks.
Description:
They make up more than half your workforce. They work longer hours than anyone else in your company. From their ranks come most of your top managers. They’re your mid-career employees, the solid citizens between the ages of 35 and 55 whom you bank on for their loyalty and commitment. And they’re not happy. In fact, they’re burned out, bored, and bottlenecked, new research reveals. Only 33% of the 7,700 workers the authors surveyed feel energized by their work; 36% say they’re in dead-end jobs. One in three is not satisfied with his or her job. One in five is looking for another. Welcome to middlescence. Like adolescence, it can be a time of frustration, confusion, and alienation. But it can also be a time of self-discovery, new direction, and fresh beginnings. Today, millions of mid-career men and women are wrestling with middlescence–looking for ways to balance work, family, and leisure while hoping to find new meaning in their jobs. The question is: Will they find it in your organization or elsewhere? Companies are ill-prepared to manage middlescence because it is so pervasive, largely invisible, and culturally uncharted. That neglect is bad for business: Many companies risk losing some of their best people or–even worse–ending up with an army of disaffected people who stay. The best way to engage middlescents is to tap into their hunger for renewal and help them launch into more meaningful roles. Perhaps managers can’t grant a promotion to everyone who merits one in today’s flat organizations, but you may be able to offer new training, fresh assignments, mentoring opportunities, even sabbaticals or entirely new career paths within your own company. Millions of mid-career men and women would like nothing better than to convert their restlessness into fresh energy. They just need the occasion–and perhaps a little assistance–to unleash and channel all that potential.
For generations, Procter & Gamble generated most of its phenomenal growth by innovating from within–building global research facilities and hiring the best talent in the world. Back when companies were smaller and the world was less competitive, that model worked just fine. But in 2000, newly appointed CEO A.G. Lafley saw that P&G couldn’t meet its growth objectives by spending greater and greater amounts on R&D for smaller and smaller payoffs. So he dispensed with the company’s age-old “invent it ourselves” approach to innovation and instead embraced a “connect and develop” model. By identifying promising ideas throughout the world and applying its own capabilities to them, P&G realized it could create better and cheaper products, faster. Now, the company collaborates with suppliers, competitors, scientists, entrepreneurs, and others (that’s the connect part), systematically scouring the world for proven technologies, packages, and products that P&G can improve, scale up, and market (in other words, develop), either on its own or in partnership with other companies. Thanks partly to this connect-and-develop approach, R&D productivity at Procter & Gamble has increased by nearly 60%. In the past two years, P&G launched more than 100 new products for which some aspect of development came from outside the company. Among P&G’s most successful connect-and-develop products to hit the market are Olay Regenerist, Swiffer Dusters, the Crest SpinBrush, and the Mr. Clean Magic Eraser. Most companies are still clinging to a bricks-and-mortar R&D infrastructure and to the idea that their innovation must principally reside within their own four walls. Until they realize that the innovation landscape has changed and acknowledge that their current model is unsustainable, top-line growth will elude them.
Managing Middlescence
Learning Objective:
To appreciate the dangers in ignoring mid-career employees’ disaffection and restlessness and discover strategies for renewing these employees’ commitment and productivity as well as reducing turnover in their ranks.
Description:
They make up more than half your workforce. They work longer hours than anyone else in your company. From their ranks come most of your top managers. They’re your mid-career employees, the solid citizens between the ages of 35 and 55 whom you bank on for their loyalty and commitment. And they’re not happy. In fact, they’re burned out, bored, and bottlenecked, new research reveals. Only 33% of the 7,700 workers the authors surveyed feel energized by their work; 36% say they’re in dead-end jobs. One in three is not satisfied with his or her job. One in five is looking for another. Welcome to middlescence. Like adolescence, it can be a time of frustration, confusion, and alienation. But it can also be a time of self-discovery, new direction, and fresh beginnings. Today, millions of mid-career men and women are wrestling with middlescence–looking for ways to balance work, family, and leisure while hoping to find new meaning in their jobs. The question is: Will they find it in your organization or elsewhere? Companies are ill-prepared to manage middlescence because it is so pervasive, largely invisible, and culturally uncharted. That neglect is bad for business: Many companies risk losing some of their best people or–even worse–ending up with an army of disaffected people who stay. The best way to engage middlescents is to tap into their hunger for renewal and help them launch into more meaningful roles. Perhaps managers can’t grant a promotion to everyone who merits one in today’s flat organizations, but you may be able to offer new training, fresh assignments, mentoring opportunities, even sabbaticals or entirely new career paths within your own company. Millions of mid-career men and women would like nothing better than to convert their restlessness into fresh energy. They just need the occasion–and perhaps a little assistance–to unleash and channel all that potential.
