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Robert Kirschbaum (DSM) - The balancing act between radical and incremental innovation (and the role of intrapreneurs)
Royal DSM is a global life sciences and materials sciences company focused on innovation in health, nutrition, and materials, with a strong emphasis on open innovation and venturing to drive growth. The company invests in research and development, emphasizing sustainability and creating solutions across various markets such as biomedical and bio-based products. Their strategy includes collaboration with external partners and fostering intrapreneurship to keep pace with market complexities and enhance their product portfolio.
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Robert Kirschbaum (DSM) - The balancing act between radical and incremental innovation (and the role of intrapreneurs)
- 1. “Intrapreneuring” at RoyalDSM Robert Kirschbaum, VP Open Innovation Eindhoven: December 11th , 2014
- 2. Introduction toRoyal DSM Innovation Page - DSM Innovation Center - Open (Chesbrough) Model - Venturing - Stage Gate examples Emerging Business Area’s - Bio Medical Materials - Bio Based Products & Services - Advanced Surfaces Learnings
- 3. Page DSM –understands change Coal Mining Commodity Chemicals Specialty Chemicals Life Sciences & Materials Sciences 2
- 4. DSM at aglance* Page 3 Sales ~€10 billion EBITDA ~€1.3 billion Global presence ~24,500 employees worldwide Listed at Euronext NYSE Share price quintupled in 25 years • DSM is a global Life Sciences and Materials Sciences company active in health, nutrition and materials • DSM delivers innovative solutions that nourish, protect and improve performance in global markets such as food and dietary supplements, personal care, feed, medical devices, automotive, paints, electrical and electronics, life protection, alternative energy and bio-based materials • 5% of Turnover and 10% of our people in R&D. Sustainability leader Top ranking Dow Jones Sustainability Index * 2013 numbers total DSM
- 5. DSM’s organization DPxPharma POET-DSM Page 4 Supervisory Board Managing Board Functional Excellence Shared Services Associates DSM Sinochem Pharma Nutrition DSM Food Specialties DSM Nutritional Products Performance Materials DSM Dyneema DSM Resins & Functional Materials DSM Engineering Plastics Corporate Staffs Polymer Intermediates DSM Fiber Intermediates DSM Innovation Center DSM Bio-based Products & Services DSM Biomedical DSM Advanced Surfaces LIFE SCIENCES & MATERIAL SCIENCES
- 6. Mission • Ourpurpose is to create brighter lives for Page people today and generations to come • We connect our unique competences in Life Sciences and Materials Sciences to create solutions that nourish, protect and improve performance
- 7. DSM in motion:driving focused growth People - Planet - Profit: creating value along three dimensions Page
- 8. Page DSM InnovationCenter New Business Development EBA Biomedical EBA Bio-based Products & Services EBA Advanced Surfaces Business Incubator Enablers / Accelerators Excellence in Innovation CTO Office Licensing Venturing 8
- 9.
- 10. Building an intrinsicallyinnovative company 20% Innovation Sales 2015 @ ~5% higher Gross Margins Top Quartile McKinsey Innovation Benchmark 2012 €1B Disruptive Platforms, 2020 Page 10
- 11. FOR INTERNAL USEONLY Page 12
- 12. FOR INTERNAL USEONLY Breakthroughs can be “Proudly Found Elsewhere”
- 13. Breakthrough versus IncrementalInnovation The Balancing Act Innovation Center Business Groups Long term Vision Intrapreneurship Agility Medium term Vision Operational Excellence Lower risk Pilot plants Scaling-up Breakthrough Innovation Sustainable, Profitable Innovations Page 14
- 14. Managing the Portfolioacross Levels Page 15 Product new to DSM Market new to DSM “Adjacent Business” New to The World Emerging Growth Mature Decline Market life cycle Improved Product Disruptiveness 1~1.5 yr Established Products and Business Lines 1.5 – 3 yr 3 - 5 yr 5 - 9 yr New Platforms Break-Away New Applications and Adjacencies
- 15. BioBased: EcoPaXX® Enginecover Trends Reducing carbon footprint Metal replacement Bright Science 70% bio-based engineering plastic Superb surface appearance High thermal resistance up to 250 C Brighter Living Reduction of 40% of the CO2 emissions compared to conventional polyamides Mercedes A class © 2014 DSM. All rights reserved
- 16. Innovation successes aren’tjust luck…
- 17. Standardized work processfor project execution: the ‘Project Management Process’ Decision to Scale-up Phase 3 Phase 4 Phase 5 Final Review Transfer to Running Business phase (Commissioning, Market launch and Full Scale Production) Idea Generation phase Decision 1 Decision 2 Decision 3 Decision 4 Business Feasibility phase (Market demand /opportunity) Development phase (Market and Technology development) Scale-up and Validation phase (Engineering, Procure-ment and Construction; Validation) Initial Screening Decision to Develop Decision to Launch Decision 5 Phase 1 Phase 2
- 18. FOR INTERNAL USEONLY Why do we need Open Innovation? DSM 99.9996% of world population outside DSM! Networks needed!
- 19. FOR INTERNAL USEONLY
- 20. FOR INTERNAL USEONLY Networks make Open Innovation work Fuzzy Front End Interaction / Synthesis Market Scouting / Business Intelligence Licensing In Venturing Spin in Joint Business Developments Intellectual Asset Management Acquisitions Licensing Out Spin out/off Divestments R&D services (Chemelot) Competence Development, Technology Intelligence
- 21. Innovation is likea parachute… ‘Chemistry connects People’
- 22. Innovation is likea parachute… It works much better when Open! ‘Chemistry connects People’
- 23. Open Innovation atChemelot Page Start up SME Knowledge sources
- 24. Page Isolation isa not-winning option
- 25. Page Stating theobvious: just bigger is not enough !
- 26. The game isgetting more and more complex Page
- 27. Alliances, M&A, JV,Venturing, JDA …. Page We need to add new dimensions to game. We need to experiment. And learn from a few mistakes.
- 28. DSM Venturing :How to mitigate risks?
- 29. FOR INTERNAL USEONLY Corporate Venturing A win-win situation is the objective 34
- 30. DSM Venturing –Corporate VC of DSM DSM Venturing - Mission DSM´s competence center for external (VC) participations aimed at boosting innovation & growth Window to the world Explore new emerging markets, technologies and products in order to enhance DSM´s product portfolio, technology toolbox and business model's Strategic value Add value internally and externally through facilitating strategic co-operations with start-ups Financial return Create value by investing in and divesting start-up companies
- 31. When to investin the startup life cycle? High High Low Low Emerging Technology Proof of principle Commercialization Expansion Time Venture Capital Public/PE Grants "Angels" Sales Investment & Risk Financing gap Risk Investment amounts Sales DSM Venturing
- 32. Portfolio snapshot May2014 Nutrition (Bio)medical BioBased Other
- 33. Page Gate 1:New Business Creation Fuzzy Front End Licensing In Venturing Spin in Gate 1 Joint Business Developments Acquisitions Licensing Out Spin out/off Divestments R&D services (Chemelot) Gate 2
- 34. 1981: We need€’s for a strong fiber “lab-line” ! Page
- 35. FOR INTERNAL USEONLY Dyneema contributes to Sustainability Page 41
- 36. Gate 2: NewBusiness Planning Page Fuzzy Front End Licensing In Venturing Spin in Gate 1 Joint Business Developments Acquisitions Licensing Out Spin out/off Divestments R&D services (Chemelot) Gate 2
- 37. 1991: We needtrue commitment for survival ! Page
- 38. Stanyl contributes toSustainability Page Stanyl (polyamide 46) turned out to be the best value-proposition as high temperature resistant LED-Lamp holder LED technology will use only 10% electricity
- 39. The Intrapreneur’s “10commandments” 1. Come to work each day willing to be fired 2. Recruit a strong team 3. Ask for advice before resources 4. Forget pride of authorship, spread credit widely 5. When you ‘bend the rules’, keep the best interest of the company and its customers in mind 6. Honour your sponsors 7. Underpromise and overdeliver 8. Be true to your goals, but realistic about ways to achieve them 9. Remember, it is easier to ask for forgiveness than for permission 10. Do any job needed to make your project work, regardless of your job description Page
- 40. Intrapreneurs play towin ! Page Play to win means: • Start small, but think big • Develop what is needed • Address new customers • Optimizing reward vs. risk • Place the eggs in many baskets • Fail often to succeed sooner • Long term gains • Effectiveness • The Exploratory “WoW” Poker game
- 41. Top managers tendto… play “not to lose” Page Play not to lose means: • Big volume markets • Develop what you can • Serve current customers • Minimizing risk • All eggs in one basket • Right first time, never fail • Short term gains • Efficiency • The Exploiting “WoW” Chess game Play to win means: • Start small, but think big • Develop what is needed • Address new customers • Optimizing reward vs. risk • Place the eggs in many baskets • Fail often to succeed sooner • Long term gains • Effectiveness • The Exploratory “WoW” Poker game
- 42. Introduction toRoyal DSM Innovation Page - DSM Innovation Center - Open (Chesbrough) Model - Venturing - Stage Gate examples Emerging Business Area’s - Bio Medical Materials - Bio Based Products & Services - Advanced Surfaces Learnings
- 43. DSM Biomedical Page Page 49
- 44. Open Innovation inpractice Page Internal Innovation Licensing R&D Alliances & Cooperations Scientific Advisory Board & other Consultants Mergers & Acquisitions (Joint) Venturing
- 45. Page 52 DSMBio-based Products & Services Eco+
- 46. Biomass as asource of fermentable sugars Plant cells Lignin Cellulose Hemi-cellulose Glucose Xylose Arabinose Glucose Galactose Mannose Biomass © 2014 DSM. All rights reserved
- 47. Inspired by Nature– Xylose Isomerase • C5 Yeast • Conversion of Xylose and Arabinose • Increased yield of EtOH
- 48. Corn Stover Feedstock PAGE 57 Page
- 49.
- 50. Current major BiomassVentures • Cellulosic bio-ethanol • Renewable diesel + • Bio-Succinic
- 51. DSM Advanced Surfaces Confidential
- 52. Anti Reflective Coatings Market • Demand for anti-reflective (AR) coated solar cover glass is growing strong • AR coatings are expected to become standard Value proposition • KhepriCoat® AR coating provides an improvement of PV module efficiency of up to up to 4% due to reduction of reflection of the sunlight on the solar cover glass Glass substrate Coating (approx 100 nm) air glass KhepriCoat®
- 53. Same sun, morepower KhepriCoat® anti-reflective (AR) coating technology for solar glass • Rooftop Project at DSM with 365 modules coated with Khepricoat® • 1MWp project in India start of construction Q3/13 • 4,75MWp project in Belvedere New Jersey
- 54. FOR INTERNAL USEONLY Key Take Aways • Venturing improves the power to select options • Open Innovation : A tool to rejuvenate your business • Partnerships mitigate innovation risks • Partner with an open mind; dare to share • Construct Alliances based on complementarity • Focus on the Grand Challenges Page 65
- 55. FOR INTERNAL USEONLY Velox speed record attempt
- 56. FOR INTERNAL USEONLY Questions ? 133.8 Km/Hour !
- 57. Slide 68 BRIGHTSCIENCE. BRIGHTER LIVING