2. Different stages in a new product launch

Business environment is changing at an ever-increasing speed. To survive, companies have to find ways of doing things differently. They have to innovate. So these days companies often have large R&D department. It’s team of people who are constantly innovating and perfecting designs.

Innovation process starts with a problem or goal which needs to be formulated into an innovation challenge. Once this is done, the challenge is presented to the problem solving group. This may be done in the form of a brainstorming event, ideas campaign or other activity.

Then they build a prototype or working model. Sometimes during testing there is a setback when it becomes clear the design has a fault. At this point maybe it is time to start again or go back to the drawing board. More work is done and there is a breakthrough – a solution is found. The product can be retested and then, hopefully, manufactured. The company will apply for a patent for a design so that others cannot copy it and steal the idea.

After some time, when ideas have been implemented, they need to be reviewed, probably against an ongoing series of milestones. If an implementation does not achieve a milestone, it needs to modified or killed. Moreover, even the most spectacularly effective and profitable breakthrough innovations need to be improved on a regular basis.

3. Innovation at p&g

Business environment is changing at an ever-increasing speed. To survive, companies have to find ways of doing things differently. They have to innovate.

And P&G is company, which could create strong innovation machine. During the past two years, P&G has raised its new-product hit rate from 70% to 90%. That’s terrific in an industry where half of new product fail within 12 months.

This incredible growth is possible through the actions of Lefley, the CEO of P&G. He has bought a lot of creativity and rigor to innovation process. Lefley’s innovation model is unusual in some aspects.

Firstly, P&G’s marketers don’t spend time with focus group. They go to consumer’s homes, watch the ways they wear their clothes, clean their floors and ask them about their habits and frustrations.

Secondly, the company encourages employees to post problems on an internal website. Lefley evaluates the ideas that have been shared between employees.

Also they are trying to find external sources of invention. Today they have near 35% of innovations, which were not created in P&G’s labs.

Moreover, they cut new product testing time, because it takes time – luxury that P&G executives increasingly don’t have. They don’t put out product without test-marketing, but P&G reduced product launch time from lab to roll-out from 3 years to 18 months company-wide.

To sum up I’d like to say, that a lot of companies offer fat bonuses for innovation or hire staff from outside in an attempt to encourage growth, but P&G has not done either if those things. They choose another way of innovation with great payoffs.