Article Review on “how P&g Tripled Its Innovation Success Rate”
Article Review on “How P&G Tripled Its Innovation Success Rate”
The purpose of this article was to discuss the efforts of Procter & Gamble to increase the success rate of their innovations. The article began by mentioning how innovation was the “backbone of P&G’s growth”, but at the start of the 2000’s, only 15% of P&G’s innovations actually met expectations (Brown & Anthony, 2011). P&G created the “Connect and Develop” program which allowed people from outside the company to give their own ideas to the company, but the first major step in creating successful innovations was to hire two P&G veterans to build a “growth factory” (Brown & Anthony, 2011). The two leaders in the innovation process, Leikhim and Goulait, worked with other P&G leaders on certain key elements to build a successful growth factory (Brown & Anthony, 2011). One of the key strategies was to create small teams that focused on specific markets and innovation strategies (Brown & Anthony, 2011). P&G explored many different directions in creating innovations; they list 4 types of innovations as sustaining, commercial, transformational-sustaining, and disruptive innovation styles (Brown & Anthony, 2011). Finally, the article offers “six lessons” from P&G to teach leaders on how to create successful new growth factories (Brown & Anthony, 2011).
List of Key Points
“Closely coordinate the factory and the core business” (Brown & Anthony, 2011).
“Promote a portfolio mind-set” (Brown & Anthony, 2011).
“Encourage intersections” (Brown & Anthony, 2011).
“Create new tools for gauging new businesses” (Brown & Anthony, 2011).
“Make sure you have the right people doing the right work” (Brown & Anthony, 2011).
Discussion of Key Points
Brown & Anthony (2011) mention that a healthy core business is vital for successful new-growth (p. 70). Innovation projects need funding, and a successful core business provides the necessary cash flows for investment into new projects. Also, with a successful core, less attention is needed on the core business, so more resources may be used for innovations (Brown & Anthony, 2011).
Creating a portfolio allows P&G to keep a close track of all their innovations. This allows a company to see the types of innovations, their progress, and allows for the company to distinguish between the most promising and least promising innovations (Brown & Anthony, 2011). Having this “portfolio mind-set” is important because a company may more accurately estimate the successfulness of an innovation. This information