Nearly a decade ago, the $17.8 billion food giant General Mills started down what was a radical path for the era: Open innovation. A common strategy today, the move was intended to leverage experts outside the company to drive fundamental innovations. And it worked.
We recently sat down with Mike Helser, senior manager of the General Mills Worldwide Innovation Network, known as “G-WIN,” to glean some of those lessons, and to see how applicable the model is to other companies.
Q. Let’s talk motivation. General Mills created its “Worldwide Innovation Network” to team up with innovators outside the company. Why?
A. We launched the General Mills Worldwide Innovation Network (G-WIN) because we believe there are innovation partners outside our walls who have the expertise and capabilities to help us more effectively meet the needs of our consumers. Simply put, open innovation helps us deliver bigger innovations to the marketplace more quickly.
Q. Walk us through a quick history…
A. Our open innovation journey began in 2005. Peter Erickson, our senior vice president of Innovation, Technology and Quality, sensed a benefit in having General Mills more effectively connect with outside partners. To build our open innovation strategy, we looked to other companies who had already done so and learned from them. We sought insight from organizations both outside the consumer goods industry as well as from our peers. We talked to many best-in-class open innovation practitioners, from Henry Chesbrough to Proctor & Gamble, and the learning we gathered from them helped us jump start our program. In 2007, we officially launched G-WIN.
Q. You know, a lot of companies, like Apple, prefer to keep their doors closed when it comes to innovation, secretively protecting R&D. General Mills went the opposite direction here. G-WIN is a truly open model, and you’ve been surprisingly public about it … there’s even a pubic website that lists “innovation opportunities,” and a slick system where innovators can register to improve everything from packaging to ingredients.
A. Prior to the launch of G-WIN, we too were close to the vest about our future plans and projects. As we launched G-WIN, we needed to ignite a cultural shift to transform from an internally-focused to externally-focused organization.
Q. I want to ask about igniting that shift in a second, but how hard was it to get buy-in from management for the open G-WIN strategy?
A. We found management support and involvement to be critical to moving our connected innovation program forward aggressively. When launching an open innovation strategy, it’s tremendously exciting as you discover new technologies and partners that can drive your business forward. It’s equally challenging as you push against a culture that was built doing things internally.
The cultural shift is really about encouraging, supporting and rewarding our teams to become more connected, both internally and externally. That’s something that can only be accomplished with the support and persistence of those in upper management positions, such as Peter Erickson in our case.
Q. Okay, so how’d you make the “cultural shift,” and are there any lessons you could impart here?
A. What worked for us was creating a dedicated team, which we named “The X Squad,” to facilitate in finding and tapping into external innovation. The X Squad is a full-time team charged to catalyze this new thinking; to help people think differently about their overall skill sets. Their philosophy is to think big, start small, experiment often and scale fast on successes. The X Squad travels around the globe looking for potential partners that have a product or technology solution that would fit within our existing businesses.
In 2008, we expanded the G-WIN team to include Innovation Entrepreneurs who work with each of our businesses to identify and prioritize the solutions and capabilities that are the most important to the business. Recently, we’ve evolved this approach to have Innovation Entrepreneurs who are responsible for product categories across the globe, such as cereal or dairy, rather than focusing on one individual business.
Today, the X Squad continues to lead in creating new capabilities, networks, processes and tools for General Mills to leverage connected innovation and to continue driving the culture change from internal to external.
Q. Is the G-WIN model portable? I mean, could a pharmaceutical or aerospace company replicate a system like G-WIN?
A. Absolutely. After all, no one company has a monopoly on all the talent in the world, and any sized company can be more effective at innovation if they leverage great minds outside their company.
We believe open innovation is critical to keeping pace with today’s ever-changing world. From a business performance standpoint, companies will only succeed if they’re responsive to change – and are able to respond quickly. Open innovation can help maintain the competitive edge and assure survival, especially when companies tap external partnerships to launch new products, solve complex technical problems and pioneer new business models.
Q. If you were advising our readers — most of whom are innovation executives — to build a similar system, what are the steps you’d have them take?
A. Well, Jeff Bellairs, who led G-WIN from its inception until last fall, contributed a great article to Industry Week that contained some key steps to success, but generally speaking we found the following five steps to be critical to the success of G-WIN:
- Benchmark Others – Follow the lead of companies who have already realized open innovation success.
- Start at the Top – Early support from upper management is critical.
- Tailor to Your Existing Culture – Adapt your program to what works for your company and your employees.
- Go Where You’re Wanted – Certain groups and certain leaders will be more enthusiastic about open innovation than others. Start by helping those who want your help.
- Appreciate and Communicate Early Wins – Share your early successes to help build your case for open innovation.
And regarding recommendations for entrepreneurs, Peter Erickson shared his “9 Tips for Entrepreneurs” on our blog a few years ago.
A. If you had to do it again, what pitfalls would you avoid?
A. One thing we’ve realized since launching G-WIN is that it’s important to be specific and transparent about the challenges you’re looking to solve in order to identify the right partner for the project.
For example, it’s one thing to say that you’re seeking “packaging solutions” – as we may have done early on in our efforts – and another to say that you’re looking for ways “to use renewable content in flexible packaging films and rigid containers.”
Q. So, greater clarity…
A. Absolutely. And a mechanism for that communication. In the fall of 2009, we launched the G-WIN online portal, through which we publish our clearly articulated technical challenges and invite visitors to create and submit non-confidential proposals. During the first year of launching this more robust and clearly articulated site, we connected with more than 1,000 inventors from around the world and received more than 500 proposals.
Q. What else?
Consider face-to-face opportunities. For example, we recognized early on that there was a huge opportunity to better connect with the suppliers with whom we are already working. As I mentioned earlier, we used to keep our future plans and projects close to the vest, even with our existing suppliers. Upon adopting our open innovation strategy, we realized the tremendous value existing suppliers can have at the front end of innovation. So we’ve since held three Supplier Summits to bring together our top suppliers to network, hear about the company’s business strategies and learn about specific partnership opportunities.
Q. Was there any cultural backlash? I mean, didn’t the Summits and open innovation threaten your internal R&D folks?
A. Well, one obstacle that comes along with the shift from internal to external is the great pride that inventors take in inventing. When we asked our scientists, who were always our inventors, to leave the lab in search of outside ideas, it’s not surprising that there was some reluctance on their part.
In the years since, however, we have observed a significant change in the mindset of many of our scientists as they have engaged external experts. By working with these external experts, who have world-class facilities and technology, and whose entire academic or professional careers have been dedicated to a narrowly focused science discipline, our scientists now realize the unique opportunity that open innovation presents. We can actually participate in, and guide, basic research efforts that will be needed to unlock some of the very complex scientific challenges that face our business – challenges that we could not possibly solve ourselves.
Q. Let’s talk about outcome. What has been the result of the program, specifically as it pertains to ingredients, packaging, or other business efforts?
A. General Mills is growing its business through open innovation. Since launching G-WIN, many of our most successful new product launches have incorporated open innovation, such as Fiber One 90-Calorie Brownies, Yoplait Greek 100, Progresso Light soups and Nature Valley Protein bars, which were named the ‘Most Innovative Product of 2013’ by Consumer Goods Technology magazine.
Nature Valley Protein Bars were developed in partnership with several outside partners. For instance, one external partner helped incorporate high levels of great tasting protein in the bars. Another partner company developed the “crisps” used in the bars specifically for General Mills. Nature Valley Protein Bars were named the No. 8 item on Symphony I.R.I’s 2012 New Product Pacesetters list, which recognizes the top 100 CPG product launches each year. Below is an image of some of our successes:
We also recently published a case study on another innovation created with Hearthside Food Solutions.
Q. Were there any other tangential, ancillary benefits from developing G-WIN?
A. We’re particularly proud of the benefits that our partners realize because of our commitment to being more externally-focused. The open innovation partners we work with at General Mills represent a broad spectrum – from large corporations to small businesses to individual inventors. Since launching G-WIN, we’ve made new connections and built lasting relationships with thousands of companies and individuals across the globe. We’ve actually covered some of those successes in our blog, including one with a young inventor named Mark King (whom The New York Times just profiled) and another with an existing supplier, Shearer’s Foods.
Q. Alright, last question: Metrics. A lot of our readers struggle with measuring success, or even identifying the innovation metrics to track. How do you think about measuring the success of G-WIN?
A. One key metric we track is the percentage of our new product launches that encompass a significant amount of open innovation. Prior to launching G-WIN in 2007, less than 10 percent of our new product launches were externally enabled. Today, around 35 percent of our innovation projects at General Mills are externally enabled.
Additionally, we have expanded our innovation capacity by nearly 40 percent through additional headcount from external sources collaborating on our projects. Another benefit we’ve realized is that our new product launches with a significant external component had 2.2 times higher Year-One sales than those developed internally.