Finding a Home for Misfit Innovations
Posted by mdf4u on December 19, 2009
Once upon a time, a global consumer packaged goods consumables giant received an unsolicited external innovation submission from the CEO of a medical device company who was seeking a buyer for his FDA-approved, clinically proven and commercially available product. The CPG giant examined the submission and decided that while it was somewhat related to one of their branded businesses, the fit was not sufficiently close to merit their consideration. So, they declined the submission. And the medical device company’s CEO was sad.
However, all was not lost. The CPG giant suggested to the CEO that someone they knew and respected might be able to help him to achieve his dream of finding a home for his technology. The CPG giant was progressive to recognize that even if it wouldn’t adopt the innovation, that it could add value by helping to steer him to someone qualified to help him find others who might be willing to do so.
So, one day in 2007 my phone rang…it was the CEO! I listened carefully to his story and in partnership with a colleague, arranged to introduce the CEO to senior executives at a consumer durable products company that we felt was a better fit for the innovation. Unlike the CPG, the company was pursuing a strategic initiative in which this medical device would be an excellent candidate. Well…I suppose you can guess at the rest of the story.
The consumer durables company acquired the medical device company earlier this year. And they all lived happily ever after. The lessons from this story should be pretty obvious:
- an unsolicited innovation submission that isn’t right for your firm may be very valuable to another. It need not represent a competitive threat to your business.
- referring declined innovation submissions to a 3rd party who can facilitate new introductions is a great way to build your reputation as a partner-of-choice.
- the more companies that put dismissed opportunities back in play, the better the odds that these will find their way to your company.
Obviously, I’m not talking about companies seeking to create compelling business opportunities for their direct competitors. I don’t think I’d want to be the one to have to explain to P&G CEO Bob McDonald why the diaper concept my company declined somehow ended up as a Huggies product. There are simple guardrails that can be built into these types of referrals to prevent such occurences and to prescribe which types of companies are in or out-of-bounds.