Reflections on Kraft’s Systematic Open Innovation Webinar

Nannette Stangle-Castor

Yesterday I had the pleasure to sitting in on a webinar called “Systematic Open Innovation: Screening and Scouting Technology Landscapes.”

Featuring Linda Perucca, section manager of RD&Q Intellectual Property Strategy at Kraft Foods, and their open innovation consultant Barry Brager, founder and managing partner of Perception Partners^®, the webinar provided insights into Kraft’s systematic approach to open innovation.

With $48 billion in revenue, Kraft is the #1 food company in North America and #2 in the world. So, one might ask: Why does Kraft need open innovation? Perucca put it well in one of her slides:

Kraft may be in a leadership position, but we own only 2% of food-related intellectual property. In order for Kraft to reach 5% annual growth, we need to look outside.

There were many excellent points made during the webinar, too many to fully cover here in this blog. But several really resonated with what we at Fuentek have found in providing open innovation services to various clients. (BTW, you can read more about how we approach this work in the Symbiotic Innovation section of our blog.)

Here are just a few of the webinar’s highlights:

• “Always look internally first.” One of the key questions we ask our clients up front is: What are your internal capabilities and resources in the challenge/need area? Kraft has an internal Web site for finding internal expertise that may be needed—that’s great! (Some suggestions for connecting your internal needs with your technology portfolio are in my “Understand-Address-Present” paper.)
  
  
• “You need rigor around building the brief.” Without a clear picture of what you are looking for, you cannot find a solution. Indeed! Defining the need is the most critical step in open innovation.
  
  
• “Keep a keen eye on the literature.” It was rightly noted that literature studies may reveal good partnership opportunities. You might find recent studies that have furthered technology beyond what you’d find in a published patent application, which by definition is at least 18 months old. (Check out Laura Schoppe’s paper “Investigate before Investing: Using Technology Transfer Principles to Guide R&D” and her blog post on using market research to find the tech-need intersection.)
  
  
• “Look for partners in other industries.” Why? They are not direct competitors. It makes sense for Kraft to partner with, say, a pharmaceutical company, which would bring scientific studies and data/testing expertise to the partnership. (You can read a step-by-step process for finding and evaluating new partners in other industries here.)
  
  
• “Culture and behavior change is the #1 priority.” Addressing employee concerns with future outsourcing, etc. is crucial. A blog from Todd Boone on 15inno recently discussed the people aspect of open innovation. You also might appreciate this blog post about building strong relationships with your internal “customers” of open innovation.
  
  
• “You have to water the plants to get a pretty flower.” Kraft tells the successes of open innovation because, as Perucca put it, “Provide the water, and the support for open innovation within your company will grow.” Fuentek’s experience has been that people want to be involved in successful endeavors—it’s human nature. Promoting success is a winning strategy across the board, spanning all technology transfer activities.
  

One can find many analysis, opinions, and debates on open innovation; however, the takeaways listed above seem very universal to success. Do you concur? What fundamental themes do you think can be applied across the various implementations of open innovation?

Thanks to both presenters and The Management Roundtable and the Product Development and Management Association for an insightful webinar!

–By Nannette Stangle-Castor