P&G: A System for Bringing Successful Innovations to Market

Summary

The video discusses the concept of a 'growth factory' as essential for innovation across various scales, from individuals to large corporations. Highlighting Procter & Gamble's history of innovation, it reflects on past challenges, particularly the stagnation in 2000, when many projects failed to meet growth goals. By adopting external ideas and categorizing innovations into distinct types, P&G improved its success rate from 15% to over 50%. The narrative emphasizes the importance of systematic approaches to foster growth and meet ambitious targets, showcasing successful innovations like probiotic products and enhanced consumer experiences.

Takeaways

• 🚀 The concept of a growth factory is essential for innovation and can be applied by individuals, companies, or even countries.
• 📜 P&G has a rich history of innovation, having created significant products like disposable diapers and fluoride toothpaste.
• 📉 In 2000, P&G faced significant challenges, leading to stalled growth and a loss of focus on innovation.
• 🔍 An internal analysis revealed that 85% of P&G's projects were failing to meet growth goals, indicating a need for change.
• 📚 The company drew inspiration from Clay Christensen's 'Innovator's Dilemma' to understand the threat of disruption.
• 🔗 P&G's 'Connect and Develop' initiative emphasized leveraging external ideas to enhance innovation.
• 🔬 P&G categorizes innovation into sustaining, disruptive, transformative, and commercial types to streamline their approach.
• 🥗 The successful introduction of probiotics into products showcased the importance of market experimentation.
• 🧑‍🤝‍🧑 Engaging directly with consumers and observing their behaviors is crucial for understanding their needs.
• 📈 P&G's innovation success rate improved from 15% to over 50%, demonstrating the effectiveness of their systematic approach.

Q & A

What is the concept of a growth factory?

A growth factory refers to a systematic approach to innovation that enables organizations, regardless of size, to replicate successful growth strategies and create new products or services.

How has Procter & Gamble (P&G) historically approached innovation?

P&G has a rich history of innovation, being the first to launch several notable products, including commercial disposable diapers and fluoride toothpaste. However, they faced challenges in the year 2000 that led to a stall in growth.

What issues did P&G identify with their innovation projects in the early 2000s?

An internal analysis revealed that only 15% of P&G's innovation projects were meeting their growth goals, indicating that 85% were failing to achieve desired outcomes.

What role did Innovate play in P&G's turnaround?

P&G turned to Innovate to bring a scientific approach to disruptive market innovation, helping to systematize and spread innovative practices throughout the organization.

What is the 'Connect and Develop' initiative?

The 'Connect and Develop' initiative is an effort by P&G to seek ideas and solutions from outside the company, recognizing that many valuable insights exist beyond its internal walls.

What categories of innovation does P&G now recognize?

P&G categorizes innovation into four types: sustaining innovation, disruptive innovation, transformative innovation, and commercial innovation, facilitating clearer communication about needs in different contexts.

How did P&G use consumer insights in their innovation process?

P&G applied the 'jobs to be done' framework, which emphasizes the importance of observing consumer behavior and understanding their unmet needs rather than just relying on direct consumer feedback.

What experimental approach did P&G take to improve their understanding of consumer needs?

P&G opened dry cleaning services to learn about customer experiences firsthand, which helped them to innovate and transform the dry cleaning process with their Tide brand.

What results did P&G achieve by implementing these changes?

P&G significantly improved its innovation success rate, increasing it from around 15% to over 50%, and restored confidence in their growth strategies.

What is the long-term outlook for P&G's innovation strategy?

P&G believes that the systematic approach enabled by Innovate will continue to drive their growth factory and help meet future goals for many years to come.