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Open Innovation at Nestle

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Innovation
Management

Open innovation now approaches business cliché status, but that doesn’t mean it doesn’t matter. I went today to listen to Helmut Traitler, Nestle's vice president of innovation partnerships, a job that Nestle created just two years ago to pursue ideas from outside the company. Last year, open innovation created $200 million in new business for Nestle, about 10 percent of its overall growth from what he calls innovation/renovation. Granted, $200 million isn't much for a company Nestle's size (about $100 billion in sales). But it shows the promise of drawing ideas from outside the organization, in Nestle's case, from universities, startups and suppliers. Traitler said the concept of open innovation, speeds development of products. Instead of needing three years, things get developed in 18 months. Researchers are spending less time juggling projects, too. In addition, open innovation presents less risk to Nestle, since development costs come after an idea is proven. Traitler seems confident that Nestle will continue to refine its innovation partnerships strategy. For an in-depth look at how Nestle shifted from 140 years of 'not-invented-here' to an open innovation culture, see this Nestle site and publication.

posted by Michael Fitzgerald
April 30, 2009 @ 2:43 pm

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