Whirlpool Global Strategy

Topics: Innovation, Innovation system, Technological innovation system Pages: 13 (3008 words) Published: February 5, 2014
Case
Open innovation helps Whirlpool
Corporation discover new market
opportunities
Amy Muller and Nate Hutchins

pen innovation – the practice of sourcing ideas and expertise from outside a company to stimulate or supplement internal initiatives – can promote new business opportunities when applied at all stages of the innovation process – idea generation, idea development and commercialization.[1] To manage the process effectively, each company needs to learn to understand which stages of the innovation pipeline will benefit the most from recruiting outside perspectives and expertise. By selectively applying open innovation, companies can enrich their stock of valuable ideas, effectively manage product development and upgrade their emerging businesses without wholesale changes to their innovation initiative.

Amy Muller is a Director and
Nate Hutchins is a Principal
with Strategos, a global
strategy and innovation
consulting firm (www.
strategos.com) and the
Strategic Services division
of Innovaro.

O

Whirlpool Corporation (Whirlpool), a successful innovator that is embracing open innovation, offers a case study of an innovation journey in progress. Its new line of consumer products, affreshw appliance cleaners, is an example of open innovation in action. Since its successful launch in 2007, affresh has grown into a family of related cleaners and products and has opened doors to further success for Whirlpool in the consumer goods space.

Open innovation at Whirlpool Corp: a set of principles and tools Whirlpool began its innovation initiative in 2000 with the objective of establishing innovation as a core competency. Today, its innovation process is deeply embedded throughout the company.[2,3] In 2010, Whirlpool reported revenues from innovation of $3.6B, approximately 20 percent of its total 2010 revenue.[4] In 2010, Whirlpool was named one of the ten most innovative companies in consumer products by Fast Company magazine.[5] Recently, Whirlpool reported that potential products in its innovation pipeline number about 1000.[6] Innovation has enabled the company to successfully venture into adjacent consumer product businesses beyond its traditional core – including garage organization, countertop appliances and water filtration.

Whirlpool Corp’s ‘‘Triple Diamond’’ innovation process. Whirlpool’s approach to innovation is a series of three diverge-converge cycles that explore new perspectives and alternatives (see Exhibit 1). At the end of each cycle stage – Discovery, Develop Opportunities and Experiment, Deliver and Grow – the team synthesizes a new point of view or proposed direction.

All references to the company
in this article are to the
Whirlpool Corporation and all
references to its innovative line
of cleaning products are to the
affreshw brand.

The first cycle, ‘‘Discovery’’ is focused on generating new insights about Whirlpool’s customers, competitors, macro-trends, and corporate capabilities to fuel innovation. Ideas are generated at the intersection of the insights in ‘‘ideation’’ sessions. The second cycle, ‘‘Develop Opportunities and Experiment’’ focuses on screening ideas and assembling them into larger product groups that provide a common customer benefit and an aspirational view

The authors thank
Moises Norena, Michael Colston
and Jim Bartley of Whirlpool
Corp. for valuable discussions
on open innovation.

PAGE 36

j

STRATEGY & LEADERSHIP

j

VOL. 40 NO. 4 2012, pp. 36-42, Q Emerald Group Publishing Limited, ISSN 1087-8572

DOI 10.1108/10878571211242939

Exhibit 1 Whirlpool Corp’s Triple Diamond process

of the future. Contained within each product group are multiple related product ideas that could be developed over time. The most promising ideas are selected for further development and elaboration. The objective of the third cycle, ‘‘Commercialization,’’ is to maximize the value of innovations in the market place through iterative, market-based...
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