Innoboard: There is no generally accepted definition of innovation. Every industry and every department perceive it differently. How do you define innovation?
Dr. Weber: Technically, the definition of innovation is clear. It is something new which provides added value for the customer which can then be translated into monetary gain. There are also business model innovations or process innovations that result in financial benefit by competitive advantage.
And if no money is paid?
Then that would not be considered successful innovation at an industrial company which must ultimately make money from innovation. That being said, it certainly could be something for which one could get honored by other means, such as patents, publications, or awards.
Additionally, today’s industrial companies have a social responsibility. An innovation should fit the social environment and, thus, also create a specific value in said environment. This is something that is not directly reflected in monetary matters but builds a certain reputation in the market in the long term.
Also important, is that an innovation, in any case, must be sustainable. It should not compromise our responsibility to the earth.
How do you generate ideas at BASF? Which roles do the customers, suppliers, and other external partners play?
Many companies believe that idea generation is the task of the R&D departments. At BASF, all employees are invited to introduce ideas.
Ideas have to be differentiate between technology push and market pull. Technology push is mainly driven internally by experts and their specific know-how. They need to look for new and technologically driven solutions. Market pull deals with the basic questions of what customers will want in the future and what trends will determine their behavior. Each department has a different function. For example, the marketing department can generate ideas and make decisions based on trends, the purchasing department can evaluate the capabilities of suppliers, and product development can consider direct customer needs. Subsequently, you must merge the results and look at the overlap of technical opportunities and the requirements of the market.
Which department has the greatest potential?
In the chemical industry, the marketing and sales departments have the greatest potential for idea generation because they are very close to the end users. They either set trends themselves or are forced to find solutions for them.
Close follower should be the R&D departments. Only based on their creativity and knowledge about new scientific results new or even breakthrough solutions are possible.
The process in the early stages should be controlled as little as possible to avoid preventing creativity. On the other hand it should be as structured as possible in order to ensure effective control. How do you find a balance?
I think that in the early phase there should be as little process orientation as possible. That being said, some conditions are important: First, you must set a very precise goal, so that an innovation can occur that is aligned with the strategy of the company. Second, certain criteria must be considered when evaluating the idea, such as: feasibility, novelty, and impact. Up to this point, creativity should run its course and free space must be created for it.
Subsequently, the process should be structured well, because the idea will evolve into a project. In project management, structured work is crucial in order to prevent spending money unnecessarily and losing time in the cooperation with various parties. Time is the critical factor in order to avoid being left behind by the competition.
What are the three most important factors of success for innovation?
The number one factor is competent and enthusiastic employees.
The second factor is innovative capacity. It is a compilation of investment in research (input) and output. This factor is determined by an effective and efficient product portfolio.
These have been the two decisive factors for success in the past, but I am convinced that in the future, another factor will be of more significance: The factor of cooperation.
If you ask me, true innovation, which not only represents marginal improvements to a current portfolio, can only be enabled by cooperation with external partners. This means that we must open our innovation environments and networks.
What trends and disruptive technologies will have a significant impact on the chemical industry in the future? What changes will result in the industry? What opportunities do you see for BASF?
The trends and technologies of the future are all derived from one topic: that we will have between nine and ten billion people on earth by 2050. Additional competencies in the field of energy, food, and resources will have to be developed. These are all areas in which chemistry plays a major role- from the very beginning of the value chain all the way to the end user or application.
About the Author:
Dr. Thomas Weber studied chemistry at the Universities in Siegen and Osnabrueck. After completing his PhD in 1988, he startet his career at BASF in R&D, technical service and general management of the business unit High Performance Composites. After three years of internal consulting, he moved to the business unit Dispersions with responsibilities in strategic and investment planning. Subsequently, he was responsible for the global marketing of acrylic polymers and the business unit Coating Basic Materials. In 2001 he became Head of Solution Polymers, and in 2007 he became Managing Director at BASF Future Business GmbH. Since 2012 Dr. Weber is Senior Vice President, Innovation Management at BASF SE.