unit

4 Great ideas

partnerships in innovation
Before you read
Where do companies usually get their ideas from?

Reading
Read this article from the Financial Times by Jonathan Birchall and
answer the questions.

level of difficulty

Innovation brings growth

By Jonathan Birchall
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Procter & Gamble, the world’s P&G. “We want you to come to Glad brand plastic bags. Its most
largest consumer goods company, us with your big ideas first.” unexpected government research
is a global industry leader in new External co-operation has partner may be the Los Alamos
consumer product innovation. delivered a stream of successful National Lab, the US defence
5 According to data from IRI, 25 “big idea” products. Last year, 45 technology research centre. Los
the market research firm, it IRI’s list included Tide Total Alamos initially helped P&G to
produced five of the top 10 US Care, a premium version of its produce one of the chemicals
non-food product launches last Tide detergent. This product used in babies’ nappies, using
year. Its goal is to add another was number two by sales on data analysis systems developed
10 1bn customers to the estimated 30 IRI’s top 10 list of non-food 50 for weapons technology.
4bn it already reaches. Bob products. It was developed with One of the programme’s early
McDonald, its chief executive, external research from Sweden’s success stories was its Olay
says that the road to more University of Lund and from two Regenerist anti-ageing creams,
innovation should increasingly small chemical companies. which was built around a chemical
15 include other people’s good ideas. 35 P&G’s list of partners includes 55 process developed by Sederma,
“We need bigger innovations other large corporations, such as a French company. “As a small
that create more value,” Mr food groups ConAgra and General company, we had little chance of
McDonald told this year’s annual Mills, and rivals, including getting in there until P&G changed
awards event for companies and Clorox. P&G is developing a joint its policy,” says Karl Lintner,
20 research centres that work with 40 venture with Clorox to produce 60 who headed Sederma at the time.

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1 Look through the whole article to find the 5 Choose the best summary for the whole
names of: article.
a) a consumer goods company. Procter and Gamble …
b) its CEO. a) has always welcomed co-operation with other
c) a market research organisation. companies to develop new products.
d) a Scandinavian university. b) only works with American companies to develop
e) two big food companies. new products.
f) a competitor of the company in item a) above. c) has realised the importance of working with
other organisations, not only companies, on new
g) a military research laboratory.
products.
h) a French company.

Over to you 1
2 Now look through the whole article again to
What are the risks of working on new products with
find the products developed in partnership
competitors in joint ventures?
with the organisations in items d), f ), g) and
h) in Exercise 1 above.
Over to you 2
Is there co-operation in your country between
3 Find expressions in paragraph 1 with the
businesses and universities to develop new products
number of words shown in brackets that and services? If there is, give some examples. If not, try
mean the following. to explain why.
a) the biggest organisation anywhere in the world
that makes products for the general public (6)
b) the biggest and best company of its kind
anywhere in the world (3)

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c) developing new products for the general public
(3)
d) an occasion every year where prizes are given (3)

4 Read paragraphs 3 and 4 and decide if these

statements about expressions are true or
false.
a) External co-operation (line 23) is when a company
develops a new product by itself.
b) The word stream (line 24) is used here to refer to
water.
c) A premium version (line 27) of a product is less
good and costs less than the ordinary version.
d) The word chemical is used in line 34 as an
adjective and in line 47 as a noun.
e) A corporation (line 36) is usually a small
business.
f) A joint venture (lines 39–40) is when two
companies work together on a particular project.
g) The word data (line 49) refers to information,
especially information analysed on computers.

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 unit
4 Great ideas

accepting new ideas

Before you read
The expression ‘Not invented here’ is used by someone to say that an
idea or new product did not start in their department or company.
Why is it difficult for organisations to accept ideas that are ‘Not
invented here’?

Reading
Read this article from the Financial Times by Stefan Stern and answer
the questions.

level of difficulty

Open your mind to the idea of innovation

TEXT BANK

By Stefan Stern

The three most dangerous words been rejected as part of a review 35 retailer. He told a story of how his
in management? “Not invented process, 10 had gone on to become company had in the past 20 years
here”. As Henry Chesbrough, 20 highly successful businesses. brought in new ways of doing
executive director of the Indeed, the combined value of things again and again.
5 Center for Open Innovation at these 10 new projects was twice Whether it was ending
the University of California, that of Xerox itself. He calls these 40 commissions for sales staff,
Berkeley, has pointed out, senior rejections “false negatives”: the starting to sell on the Internet, or
management teams can fail 25 innovations had looked bad, but renewing the company’s approach
to spot important innovations that was because senior managers to customers, or expanding
10 because the new ways of doing did not recognise their benefits. abroad: each time, Best Buy’s
business do not easily fit in with Prof Chesbrough was one 45 leadership did not make the
the way they are doing things of the speakers at last week’s decisions easily. Each time, there
now. 30 Financial Times innovation were smart people at the top who
Researching the performance conference in London. The resisted change, he said. Necessary
15 of Xerox, the copier and printer conference also heard from innovations are hard to introduce
company, Prof Chesbrough found Brian Dunn, chief executive of 50 when, as in Best Buy’s case, the
that, out of 35 projects that had Best Buy, the electrical goods business seems to be doing fine.

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1 Put the paragraph headings in the correct d) What does Best Buy do?
order. i) It’s a wholesaler of electrical goods.
ii) It’s a retailer of electrical goods.
a) Best Buy’s difficult innovation decisions iii) It makes electrical goods.
b) Company managers can fail to see new ideas e) Why is Best Buy mentioned?
c) The innovation process at Xerox i) Because it is similar to Xerox in its approach
d) Regular innovations at Best Buy to innovation.
ii) Because it did not innovate at all.
2 Read paragraphs 1 and 2 and decide if these iii) Because it does accept new ideas, but only
after a lot of disagreement and discussion.
statements about expressions and related
expressions are true or false. f) Why was it particularly difficult to introduce new
ways of doing things at Best Buy?
a) An innovation (line 9) is a new idea, product, etc. i) Because it was already a successful company.
Innovation (line 5) is new ideas, products, etc. in ii) Because most of its senior managers resisted
general. them.
b) If you point something out (line 7), you don’t talk iii) Because it did not need them.
about it.
c) If you spot something (line 9), you don’t see it. 5 Choose the best summary for the whole
d) If something fits in (line 11) with something else, article.
it’s acceptable. Companies …
e) If something is rejected (line 18), it is accepted. a) do not find it easy to accept new ideas.
f) In a review process (lines 18–19) things, ideas, b) do not accept new ideas because many managers
etc. are judged. are stupid.
c) accept and develop new ideas easily.
3 Find expressions in paragraphs 3 and 4 with
the number of letters shown in brackets that

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mean the following.
Over to you 1
What does your own school or organisation do to keep
a) boss (5, 9) itself open to new ideas?
b) introduced (7, 2)
c) repeatedly (5, 3, 5) Over to you 2
d) payments in addition to salary (11) What do you do to keep yourself open to new ideas?
e) senior managers considered as a group (10)
f) fought (8)
g) needed (9)

4 Read paragraphs 2, 3 and 4 and choose the

correct answer.
a) How many of the new business projects rejected
in Xerox’s review process went on to become
successful businesses?
i) most of them
ii) more than half of them
iii) nearly a third of them
b) How much were the businesses worth in relation
to the value of Xerox?
i) twice as much
ii) the same
iii) half as much
c) Why had Xerox managers rejected the new
business ideas?
i) Because the ideas were not explained
properly.
ii) Because the managers couldn’t see their
value.
iii) Because the managers didn’t understand the
ideas.

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