Haier s Open Innovation Practices. Tao Ninesigma Innovation Leadership Summit April 27, 2016
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1 Haier s Open Innovation Practices Tao Ninesigma Innovation Leadership Summit April 27, 2016
2 About Haier Revenues of $34 billion in 2014 Ranked No.1 among world's large appliance brands in the past seven consecutive years Global market share of white goods 10.2% in retail 2
3 OI is Central to Haier s Business Strategy Major Driving Forces: User Personalization: In the age of Internet, there is an ever growing requirement for personalized products that make consumers feel understood, valued, and connected. Therefore, in order to meet user s personalized demands, Haier has to change the traditional innovation method and co-innovate with users. Product Innovation Acceleration: As stated in Big Band Disruption, the exponential development of technology and the rapid iteration of products have transformed the previous innovation method. Innovative products mushroom extremely fast, urging Haier to shorten R&D cycle, iterate products and improve user experience, which is possible only by gathering the smartest minds in the world. Industry Disruption: The 3rd Platform of computing (cloud, big data, social, mobility) is transforming not just the IT industry, but disrupting every industry doing business with the platform. Only by building open platforms and innovation ecosystems can Haier continue to innovate and get a new life. 3
4 Some Major Challenges Judge if a submitted technology is going to resonate with users Internal people s supplier/buyer mentality remains unchanged Confidentiality and IP issues arise with open innovation partners Perfect matching solution to a fuzzy customer need does not exist Ideas/concepts require assessment on a timely manner 4
5 Haier Open Partnership Ecosystem (HOPE): 5
6 The Culture of Everyone Becomes an Entrepreneur According to CEO Mr. Zhang Ruimin, Haier will dismantle traditional structures in favor of open platforms where people can bring in their own ideas and resources to develop new products and services. Traditional business units have given way to selfmanaged micro-enterprises. Their sustainability depends on their innovative performance, their ability to generate profits and to attract external partners and funding, thereby expanding Haier s ecosystem of resources. In sum, the company has become a giant business incubator. By introducing market mechanisms into its R&D processes, Haier is able to develop a flow of disruptive technologies and convert them into commercial products. 6
7 Transformation of Haier s Innovation User Company Partners Fresh Air Wate r Users and partners join forces with Haier to deliver disruptive user experiences through direct interaction with each other 7
8 HOPE s Vision An interactive platform to provide value-added services to all players involved in the whole innovation process, from consumer pain point analysis to new product development. HOPE Co-Creation Resource Crowdsourcing New Product Users 8
9 Online User Community Groups Hot Topics Personal Blogs 9
10 User Insight Analysis To conduct in-depth insight analysis based on the leading professional users, and other online communities with consumer feedback. Journal method ( Write your intimate contact with the product in the diary) Ideas and Concepts analysis Interview method (Let s talk) Focus group (share experience) Card sorting ( Home-made cards to play cards ) Empirical evaluation ( Standards, principles and experience ) Customer service feedback analysis (Receive users complain) Qualitative Methods On-site Observation (understand the feelings of users) Background query ( Combination of observation and inquiry ) Remote usability testing (Coordination working at different locations) Usability testing ( You do, I watch) Eye movement experiment ( Your eyes "betrayed" your heart ) Product and Prototype Testing Analysis of Blog ( Touch pitch, and you will be defiled ) Questionnaire investigation ( My questions, Your mark) Quantitative Methods 10
11 New Idea Generation Develop ideal solutions that could solve the problem, even if the solutions are not practical. OFFLINE WORKSHOPS (when there are unmet customer needs identified) ONLINE DESIGNER ENGAGEMENT (when there are technology solutions available) 11
12 Global Innovation Monitoring Dynamic access to global scientific and technological innovation information Research institutes Science and technology publications Patents Competitor landscape Industrial associations Technology programs Crowdsourcing websites "HOPE science and Technology Information Daily" "Technical monitoring weekly" "Index science and technology trends" "Competitor dynamics" "Special report" 12
13 Global Resource Integration 13
14 The World is Our R&D Center Global R&D centers serve as resource integration networks and technology scouts distributed across the world while continuing to perform traditional R&D function. 北欧 ( 芬兰 ) SBM 纽约中心 英国 鲁汶 US R&D Center HAP European R&D Center 以色列 Japan R&D Center Function & positioning for 5 R&D centers China R&D Center University High-tech company Research institute Industry association 1. Information hub for interaction with local market 2. R&D resource hub for parallel development 3. Incubation hub for disruptive product concepts Incubator Professional society New Zealand R&D Center 14
15 HOPE s Core Capabilities To trace the latest technology trend of industry To build interactive ecosystems for chosen topics To constantly generate and incubate disruptive ideas To rapidly and accurately find matching resources To support idea transformation 15
16 Success Stories Recycled Water Double Drum Dry/Moist Food Storage New Material CO-free Air-Mixing Air Magnetic Comfort Cooling 16
17 The best way to predict the future is to invent it. -Alan Kay Let s co-invent it. Question? Please contact: Dr. Tao Xie Managing Director Haier America Innovation Partnership Program txie@haieramerica.com
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