Why P&G No Longer Leads Open Innovation


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Several people mentioned that P&G and their Connect+Develop program should have been on my Top 5 Companies for Open Innovation list.

Well, I really like P&G and their past efforts, but I don’t think P&G has developed or delivered recently and in this post, I share my arguments why I don’t think P&G leads open innovation anymore. I look forward to a good discussion.

Corporate turmoil:

It is no secret that P&G is struggling in many ways. Such corporate turmoil is poison for the implementation of open innovation and even though P&G is one of the companies in which the organization has embraced open innovation the most, they still have lots of work to do.

Solution: No clear answer on this. Big challenge…

Losing good people: As a result of the corporate turmoil, P&G is losing good people. Some left for other companies while others have retired. It is difficult to put a value on the experience and insights of those leaving the company, but it is definitely significant.

Solution: The could put more focus on internal training to upgrade people. They need to give their people time to develop relationships. They could also activate their alumni network. The latter could be one of the best resources of open innovation knowledge in the world. Should it stay untapped?

No progress: When I look at the open innovation efforts of P&G in the last couple of years, I wonder where the drive, the vision and the progress has gone. The last time P&G prompted me to give a nod of approval was in 2010 when they launched several language versions including Chinese and Portugese for the Connect+Develop site. This was a great move as you need to adapt to local markets, but not much has happened since then.

Solution: Ok, the Connect+Develop site got an overhaul not so long ago, but why not take it even further (see below).

Too much focus on P&G: Open innovation is moving towards communities and they will not only be physical. They will also be virtually. I have heard that P&G acknowledges that the Internet and social media will be key drivers for open innovation. In my world, this translates to better use of social media and the development of virtual communities.

Why has P&G not picked up on this yet? They have hundreds of thousands of people in their systems. Why not bring them together and thus focus on the needs of stakeholders in those ecosystems rather than just on the needs (and assets) of P&G?

Solution: Get a better understanding of social media and communities and activate their own networks.

Competitors are catching up:

P&G has a strong reputation for their open innovation efforts. Such a position can serve a company well for many years, but it can also be dangerous. You can get complacent or you might start protecting your position too much. The latter could result in a behavior that is too defensive, which could lead to not investing enough in staying ahead of the competition. To some extent, this is what P&G is experiencing right now and to make things worse, the competition is learning fast and they are catching up on P&G.

Solution: P&G need to take more chances again and when they are back on the right track again, they should make full use of their communication platform. Did you know they have dedicated PR/marketing people for the Connect+Develop platform? This is much better than having to rely on the corporate communication team.

Final remarks

They have great people at P&G and they have a strong foundation for open innovation. However, they need to be careful. Open innovation is very much about perception and if people start to doubt the open innovation capabilities of P&G, it will only intensify the competition for the best innovation partners and thus erode the lead that P&G still holds within their business areas.

I think P&G can turn this around and get back on top. They kind of deserve this as they have lead the way for so many years, but you cannot dwell on the past. It will be interesting to see what happens in the coming years.

Republished with author's permission from original post.

Stefan Lindegaard
Stefan is an author, speaker, facilitator and consultant focusing on open innovation, social media tools and intrapreneurship.


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