Innovation in Cosmetic Industry

ABSTRACT conclude is one of the beloved grave issues in wrinkle enquiry today. It has been studied in many another(prenominal) independent enquiry traditions. Our pinch and study of intention can benefit from an integrative retread of these inquiry traditions. In so doing, miscellaneous topics of calcu deeplyation choose been place and studied.Consumer response to macrocosm, Organizations and figure, which argon more than and more important as convergence victimisation becomes more complicated and tools more effective precisely demanding techniques for crossroad culture lodge ones, which scram been trans stressed through global pressures, increasingly accurate node input. intention is the core job organisation competency of the 2 beginning(a) century. In outrank to not only compete and grow but to survive in a global economy, channeles must(prenominal) innovate.To check intent has been approached in a piecemeal fashion often linked solely to the tonic proceeds developing (NPD) surgical action. T here(predicate) has been a remarkable increase in R&D investment by industries at global transfer over a tot of days. The argona of R&D in pains with the highest rate of growth over the olden six years has been in directed brokerary research. Innovation and the effective counselling of engine room bring become a top priority for nations as well as companies, to stimu parvenue-fangled economic development and streng so their competitiveness.Allocation of R&D for the development of refreshed crinklees is seen as a report growth dodging by firms in most separate of the world. in the raw harvestings atomic number 18 engines to growth and prosperity for every(prenominal) companies in the manufacturing sector or the service sector. In this denomination, an attempt has been made to explore the drivers of tonic increase performance, with a particular focalization on enhancive attention. P&G is considered to be one of the companies counting with nonfunctionals with the best construct strategies, and hence it has been optn as an example for the study.The Innovation baseball field is introduced by P&G as an integrative and guiding model to dish up prudence focus on whats important to success alteration dodge, a unbendable conception-to- dump change, portfolio management and the right climate and loss leadership. (Keywords Innovation, R&D, ornamental industry, P&G, success, harvest-feast Development. ) INTRODUCTION Innovation, the process of saving impertinently intersection points and services to foodstuff, is one of the most important issues in occupation research today.Innovation is answerable for raising the quality and lowering the prices of returns and services that have salientally modifyd consumers lives. By finding bracing solutions to problems, trigger destroys active markets, transforms old ones, or give rises unseasoned ones. It can bring down giant incumbents fleck propelling small outsiders into dominant positions. Without psychiatric hospital, incumbents slowly lose both gross r planeue and profitability as rivals innovate past them. Innovation pop the questions an important basis by which world economies compete in the global marketplace.Innovation is a broad topic, and a variety of disciplines address various aspects of innovation, including marketing, quality management, operations management, technology management, organisational demeanor, crossing development, strategic management, and economics. Research on innovation has proceeded in many academic fields with neither links across those fields. For example, research on market pioneering typically does not connect with that on diffusion of innovations or the creative design of stark naked intersections.Overall, marketing is well positioned to participate in the beneathstanding and management of innovation within firms and markets, because a primary goal of innovation is to develop invigorated or special enhances for enhanced profitability. A necessary component of profitability is revenue, and revenue depends on settle withing customer require collapse (or more in force(p)ly) than competitors can satisfy those need. Research in marketing is intrinsically customer and competitor focused, and and so well situated to study how a firm capability improve get out innovation to meet its profitability goals boomingly.To encourage and allay further research on innovation in marketing, we desire to collect, explore, and evaluate research on innovation. Key goals of this paper depart be to provide a building for thinking about innovation across the fields, highlight important streams of research on innovation, suggest interrelationships, and provide taxonomy of related topics. Successful innovation rests on first of all understanding customer needs and then develop growths that meet those needs. Our review of the literatu re, therefore, starts with our understanding of customers and their response to and acceptance of innovation.Because we ar interested in how firms profit from innovation, the article will then review organizational issues associated with successfully innovating and with how organizations adopt innovations. Customer understanding and the organizational linguistic context atomic number 18 underpinnings to innovating successfully. They must be in place ahead proceeding. Then the flow of innovation will be discussed. SUCCESS FACTORS IN AN ORGANISATION Success factors for an organisation predominantly identified in the research papers are crop innovation R&D investment Leadership commission, Clear understanding of the social clubs capabilities, Strong connection to the customer and a deep understanding of major customer problems, Willingness to take full-size but well-understood risks. PRODUCT DEVELOPMENT Once consumer needs are understood and organizations for innovating a nd strategies are in place, then begins the execution part of innovationmoving from having a strategy to conceiving a design to delivering against that strategy, to designing the final yield and its manufacturing process, to finally having a (hopefully successful) commercial product.This section examines research that has sought to improve this process of product development (PD), which is predominantly prescriptive in nature. We begin with a brief review of product development processes, then will discuss about the research applicable to to each one of various stages of product development. PRODUCT DEVELOPMENT PROCESSES The emerging view in industry is of product development as an end-to-end process that draws on marketing, engineering, manufacturing, and organizational development. The core of this process is the product development funnel of opportunity identification, design and engineering, testing, and first appearance.Previous researches recognizes that, for a single su ccessful product dive, failures will be many, although some may be recycled, reworked, and improve to become successful products. rase when a product has been in the marketplace, innovation continues as the firm continually searches for new opportunities and ideas. Researches in any case recognize the genuine hypothesis that firms are most successful if they have multiple product impressions in the pipeline at any given conviction, forming a portfolio of excogitates.These parturiencys might relate to independent products but increasingly are based on coordinated platforms to take favour of common components and/or economies of scope. Risk is inherent in product development hardly a(prenominal) of the many concepts in a portfolio are likely to be successful. Information to evaluate alternative concepts is often imperfect, difficult to obtain, and tight to integrate into the organization. For each success, the process begins with 6 to 10 concepts that are evaluated and ei ther rejected or meliorate as they move from opportunity identification to launch.RESEARCH CHALLENGES PD processes are only as levelheaded as the bulk who use them. Structured processes force evaluation, but evaluation imposes both monetary and time costs. Teams can be tempted to skip evaluations or, worse, solelyify advancement with faulty or incomplete data. There are substantial research opportunities to understand the optimal trade-offs among evaluation costs, the motivations of team ups for accuracy, and the motivations of teams for career advancement. For example, advancing a concept to the contiguous stage in either a sequential or spiral process requires a hand-off.New team members must have sufficient data to accept the hand-off. In some instances, the old team members are right a right smart required to witness for new projectsa disincentive to advancing a concept through the introduction. grocerying, with its tradition of research on people, whether they are cu stomers or product developers, have many research streams that can inform and advance the theory and practice of PD processes. Despite this, we have seen little prescribed investigation of the link betwixt marketing capabilities and PD processes.The most critical research challenges in this empyrean acknowledge, Improving the effectiveness of non sequential PD processes Understanding which process is best in which situations Understanding when it is purloin to modify processes Linking marketing capabilities and PD processes Understanding the explicit and implicit rewards and incentives that encourage PD teams to either affirm by or circumvent formal processes. Both market orientation and innovation have been identified as crucial success factors in companies.A positive impact of market orientation and innovation on company performance has been found in many industries and under a wide go of market characteristics. Research on market orientation is focused in particular on vo luminous companies. How eer, market orientation is expected to be important for small companies as well as large-scale companies. Research in this field for small firms is relevant because small companies are widely represented in important industries like retailing, services and agriculture.Research has shown the importance of market orientation for the success of product innovations. A market orientation may stimulate innovations and increase the performance of innovations. In this paper we will focus on innovations in small independent companies that do not have the capacity for R&D as opposed to innovations in medium sized and large companies. Various models about the relationship between market orientation and innovation have been proposed examined the impact of market orientation on innovation characteristics employ measure for market orientation. many an(prenominal) studies that focus on factors discriminating between successful and unsuccessful innovations decide that mar ket orientation is one of the main contributing factors to innovation success. INNOVATION Innovation is the reality of bettor or more effective products, processes, services, technologies, or ideas that are accepted by markets, governments, and society. Innovation differs from invention in that innovation refers to the use of a new idea or method, whereas invention refers more immediately to the creation of the idea or method itself.The word innovation derives from the Latin word innovatus, which is the noun form of innovare to renew or change, stemming from ininto + novusnew. Diffusion of innovation research was first started in 1903 by seminal tec Gabriel Tarde, who first plotted the S- cause diffusion curve. Tarde (1903) be the innovation-decision process as a series of footprints that includes archetypical knowledge, Forming an attitude, A decision to adopt or reject, Implementation and use, Confirmation of the decision, Innovation.Innovation is the process by which an id ea or invention is translated into a good or service for which people will pay, or something that results from this process. To be called an innovation, an idea must be replicable at an economical cost and must satisfy a limited need. Innovation involves deliberate covering of information, imagination, and initiative in deriving great(p)er or varied hold dear from imaginativenesss, and encompasses all processes by which new ideas are startd and converted into useful products.In parentage, innovation often results from the industry of a scientific or technical idea in decreasing the gap between the needs or expectations of the customers and the performance of a companys products. In a social context, innovation is equally important in devising new collaborative methods such as alliance creation, joint venturing, flexible working hours, and in creating demoraliseers purchasing power through methods such as layaway plans. INNOVATIONS ARE DIVIDED INTO TWO BROAD CATEGORIES (1) evolutionary innovations are brought about by numerous incremental advances in technology or processes and are of twain types a) Continuous evolutionary innovations result in an alteration in product characteristics instead of in a new product, and do not require any user-learning or changes in his or her routine. Examples are the multiblade sliver razor, fluoride toothpaste, and laptop computers. (b) Dynamic continuous evolutionary innovations require some user-learning but do not disrupts his or her routine. Examples are fax machines, instant photography, and handheld computers. (2) Revolutionary innovations ( too called discontinuous innovations) require a good deal of user-learning, often disrupt his or her routine, and may even require new behaviour patterns.Examples are photocopier (xerography) machines, private computers, and the Internet. Innovation is synonymous with risk-taking and organizations that introduce revolutionary products or technologies take on the greatest risk because they have to create new markets. A little risky innovation strategy is that of the imitator who starts with a new product (usually created by a revolutionary-innovator) having a large and growing demand. The imitator then proceeds to satisfy that demand go bad with a more effective approach.Examples are IBM with its PC against Apple Computer, Compaq with its cheaper PCs against IBM, and Dell with its still-cheaper clones (sold directly to the customer) against Compaq. Although many innovations are created from inventions, it is possible to innovate without inventing, and to invent without innovating. NECESSITY FOR INNOVATION Innovation will be the necessity for social and economical growth of the nation in future. We live and die through relation subscribe innovation. The world has changed because of innovation only. Science is responsible for all the innovations we feel around, remarked Srinivasan K.Swamy, President, All India wariness Association (AIMA), New Del hi A light bulb overhead may signal a bright idea in cartoons and comic books, but in todays commercial readprise world companies cant sit around waiting for creative bolts of inspiration. durable success requires a process of innovation that is predictable and consistent. Today innovation is necessary to survive. The global market has become so competitive that innovation is now as valuable an investment as gross revenue and marketing. Markets are becoming more global, not less, so the value of innovation will continue to increase.Heres why a) The best ideas and technologies spread rapidly around the world now. A company with a new product may deem a one-time splash, but before long bothone else will have adopted it. A consistent, predictable innovation process enables companies to overcome this. b) Brands arent as powerful as they used to be. Experience is now more important than tag name as the basis for a persons purchasing decision. The Internet allows people to share exp eriences about a company with millions of some others. People now choose the products that give them the highest value, not clean the best-known brands.Relying on a strong brand name is no longer enough. Consistent, predictable innovation is the answer. The Society of Management Accountants calls innovationfundamental to the quest for profitable, sustainable growth. 3 Peter Drucker, probably the most insightful management guru ever, deems it the one business competence needed for the future. Fortune magazines advice to companies who take to be named to its Most Admired List? Innovate, innovate, innovate. Innovation currently accounts for more than half of all growth. And it is tremendously profitable.A study done on the rate of return for 17 successful innovations showed a fuddled return of 56% compared with an average ROI of 16%. Companies are catching on to this sea change. In an Ernst & modern study, European and North American companies called innovation the most important criterion for success in the future. Even technology firms who presumably are leading this charge consider making innovation happen the industrys single biggest problem. nonfunctional INDUSTRY Indian ornamentals industry has witnessed strong growth during the past few years and has emerged as one of the industries holding immense future growth potential.The enhancives industry registered impressive sales worth Rs 288. 7 Billion (US$ 5. 8 Billion) in 2010. The sector has principally been driven by modify purchasing power and rising fashion consciousness of the Indian population. Moreover, the industry players are readily consumption on the promotional activities to increase consumer awareness. According to our new research report Indian Cosmetic domain Analysis (2009-2012), Indian nonfunctionals sector is expected to witness noteworthy growth rate in near future, owing to the rising beauty concerns of both men and women.The industry holds promising growth prospects for both existing and new players. The baseline for the optimistic future out construe of the Indian cosmetics industry is that, there has been a break in variety of products poke outed by the industry players. Moreover, the companies have started opting for online retailing and are offering specialized products to generate revenue from all the corners. Rising usage of Cosmeceuticals and Nutricosmetics by the Indian consumers will likewise pave way for the Indian cosmetics market during the forecast period.Our research report incorporates an innovation of the cosmetics industry in India. It provides segment level analysis of the industry along with the emerging trends and innovation that happened in the previous years. INNOVATION IN COSMETIC INDUSTRY The cosmetics industry is a lucrative, forward-looking, and fast-paced industry. It is also a make market segment in the retail industry. In it they highlight the next products as examples of what cosmetic companies are doing to create inn ovative products. 1. flog from a lingerie company 2. Mens cologne in a bottle shaped like a 1 3.Nanotechnology shin care cream 4. 3D anti-ageing skin mask. The only product that could have some techno system of logical innovation is the one based on nanotechnology. Unfortunately, there are no claims given and you could easily make the product by creating a standard skin lotion with added, non-functional nanotechnology. If cosmetic companies really wanted to set their products apart from the competition, they need to create formulas that solve consumer problems in some maestro way. Consumers dont care about how their products work (say nanotechnology), they care about the end results.The major sections of cosmetics in this industry are sun care, skin care, pig care, body care and perfumes and decorative cosmetics. SUN apportion The World Health Organisation (WHO) recommends regular sun screen use to help protect skin against UV radiation Significant industry investment has help ed develop increasingly effective and appealing sunscreens that allow for broad UV (both UVA and UVB) protection Contain a combination of nano-sized mineraln (e. g. titanium dioxide) and organic UV filters to offer high levels of protection Have applications that suit all lifestyles and consumer needsSKIN CARE Skin fear is important because skin is the largest organ in the body, serving as a vital defence barrier. This also makes it particularly vulnerable to damage . Regular cleansing and caring improves hygiene, prevents pores from becoming clogged, removes dead skin cells and protects against orthogonal elements Dermatological research continually leads to more effective and gentle applications that address antithetical skin types such as dry or aged skin. downslope 30, 2011 Euromonitor Reports Growth in Skin billing Market in Africa & the Middle East Between 2005 & 2010.As new opportunities for skin care in key developed markets slowly dry up, oftentimes stronger gr owth forecasts for the category in many markets in Africa Dec 28, 2011 R Highlight Angle-dependent Interference Pigments Multilayer pigments alternately coated with layers having high and low refractive index are known in the art. The optical effect of the pigments Dec 14, 2011 Editorial Future-Touch Translates Future Trends into Innovation Dec 14, 2011 bind UK spa company Elemis has established itself as a leading professional spa company as well as a strong contender in the retail cosmetics market.HAIR CARE products Shampoos, conditioners, hair colourizeants, texturisers, serums, hair sprays, growth stimulators, anti-dandruff shampoos, lotions. Improved own(prenominal) hygiene via treatment of dandruff, itchy scalp, greasiness Enables self-expression, helping consumers have confidence in their appearance and greater self-esteem Meeting specific consumer needs such as crackling fly-away hair, taming unruly hair with relaxants, adding texture to limp hair, repairing damaged hair and restoring colour to aged hair BODY CARE Products Soaps, antiperspirants, deodorants, body washes, shower gels, body lotions, scrubs, oils. Benefits Soap represents a strong historical popular health advance, helping break down grease and dirt Antiperspirants and deodorants enhance comfort and hygiene by helping avoid excessive perspiration and resulting body odour Non-soap detergent bars enable small cleansing for consumers with skin conditions (eczema, rosacea, mild atopic dermatitis, etc. ) PERFUME Products Perfumes, colognes, salves, scented oils BenefitsFragrances play a significant consumption in enhancing personal well-being Aromatherapy research reveals that smells influence our emotions, inspire creativity and are the fastest repositing triggers The sense of smell is proven to be an important factor in the process through which we form relationships. DECORATIVE COSMETICS Products Foundations, blushes, powders, eye Benefits Make-up enables self-expres sion, helping consumers have confidence in their appearance and greater selfesteem clinical research confirms that the ability to take care of your appearance during illness increases confidence and can aid the heal processScience is at the heart of every cosmetic product. R programmes generate new patents every year and in 2009, over 2600 (an estimated 10% of all patents granted in the EU) were awarded to the cosmetics industry. Scientists from a wide honk of disciplines such as physics, microbiology, biology, toxicology, rheology, analytical chemistry and genetics apply their skills in the European cosmetics industry. In total, the European cosmetics industry employs approximately 17,000 scientists.R programmes investigate consumer behaviour and beauty aspirations, the biology of skin and hair, new innovative technologies and sustainable development this helps to take in the best ingredients which are the most respectful of human health and the environment, and to create new fo rmulations which respond to both expectations and challenges Innovation is vital for the European cosmetics and personal care products industry. It can take over 5 years of innovative research and formulation to bring a new product to the market Every year, a quarter of all cosmetic products on the market are improved or are completely new.Europe is the flagship producer and mass consumer market of cosmetics and personal care products in the world. Ongoing changes in the environment and in consumer lifestyles require new innovations that meet increasing needs, such as caring for and protecting skin from sun and weather damage SUSTAINABILITY The cosmetics industry is committed to sustainability and aims to Reduce the environmental impact of the sector and its supply chain, from ingredient sourcing through to packaging. Ensure a balance between the economic, environmental and social pillars of sustainabilityWHY INNOVATION IS REQUIRED IN COSMETIC INDUSTRY Cosmetic products are importa nt consumer products with an essential role in everyones life apart from traditional cosmetic products, such as physical composition and perfumes, it also includes products for personal hygiene, for example tooth-care products, shampoos and soaps. Todays cosmetic market is driven by innovation including new colour pallets, treatments targeted to specific skin types and unique formulas concentrating on different needs. Most cosmetics products have a lifespan of less than five years and manufacturers reformulate 25% of their products every year.They need to improve products ever in order to stay ahead in a highly competitive market where more choice and ever greater efficacy are expected by the consumer. The European cosmetics industry is a world leader and dominant cosmetics exporter, a highly innovative sector and a significant employer in Europe. The EUs involvement concerns mainly the regulatory framework for market access, international trade relations and regulatory convergenc e, all aiming to ensure the highest level of consumer safety duration promoting the innovation and the competitiveness of this sector.Innovation is important for any business but for cosmetic industry it is a necessity. Recently Several hundreds of key representatives from the European cosmetics industry have gathered in Brussels to discuss the importance of industry on the European economy and how it can build for a sustainable future. Discussion at the General Assembly focused on Science, Beauty and disturbance Innovating for a Sustainable Future. Fabio Franchina, President of Colipa mentioned Todays cosmetic industry, is more dynamic and innovative than ever, and we are committed to ensuring that we contribute fully to a truly sustainable uture. He also mentioned that innovation is the life-blood of the cosmetic industry This product innovation strategy guides the businesss New Product Development stress and helps to steer pick allocation and project selection. In the mid-1 990s, P&Gs Cosmetics business lacked a business and product innovation strategy, the result being that Product Development efforts were scattered many different initiatives were launched in many different product categories and segments in a futile attempt to win. There was no focus. The first element was a product innovation strategy.Indeed, the real breakthrough occurred in the Cosmetics business flip-flop when the business leadership team began a rigorous business planning process leading to all the way defined objectives, goals, strategies, and measures. A such(prenominal) more concentrated innovation strategy was elected, focusing on lips, brass section and eyes, alternatively than the entire body. Next important facet of strategy meant getting the supply chain under control end-to-end supply network management. Management streamlined the supply network so that action and shipments were secure to market demand.As a result, they were able to reduce the time in the supply network, thereby eliminating much of the product obsolescence generated with each new product launch. By focusing first on an innovation strategy for the business, the stage was set for effective Product Development. The message is that if your business lacks a product innovation and technology strategy, you are missing a key element of successful product innovation. This strategy should include the goals for the businesss product innovation effort and how these goals tie into the broader business goals.This strategy is more than just a list of this years development projects. It has a much longer-term commitment. The innovation strategy also includes delimitate strategic arenas or areas of focus, much like the Cosmetics business did. That is, you need to define the product, market, and technology areas in which the business will focus its Product Development efforts. The key here is focus. Innovation is important on different levels and is also important for different reasons. Inn ovation is an important driver of Economic growth and improvement. For Cosmetic Industry it is for Survival Growth Shareholder return Individual perspective every industry constantly needs to innovate. Industry changes their route to work to become more efficient. They change how they do something (process innovation). They train to hold out their skills (to gain competitive advantage). Virtually all of the economic growth that has occurred since the eighteenth century is ultimately due to innovation. The Economist Intelligence Unit undertook a survey in 2007 which noted that long? run economic growth depends on the creation and fostering of an environment that encourages innovation.Innovation is considered an important driver of long-term productiveness and economic growth. Innovation is required to raise productivity, meet the challenges of globalization and to live within our environmental and demographic limits. Some major reasons for innovation are ? To survive adverse ch anges in operating circumstances ? To make life easier for the customers ? To gain competitive advantages ? To protect market share ? To reposition an organization and raise its visibleness ? To lead the market and reinforce a reputation as market leader ?To open new horizons so as to get out of a rut or avenues with limited potential ? To draw out extra funding ? To raise margins and profitability ? To drive total shareholder returns. FACTORS FOR DEVELOPING AN R&D COSMETIC STRATEGY In this weeks cosmetics and skin care industry stick on, the New logic portfolio team write about six factors to consider when developing your R&D cosmetics strategy. To research the post we reviewed our cosmetics posts over the last few months, and conducted ancillary research. 1. The Combination of Groundbreaking Formula and User-friendly PackagingIn the cosmetics and personal care industry, breakthrough innovations on formulas and packaging are still keys to success as they directly relate to produ ct performance. Cosmetic and skin care chemists search for the ingredients and technology to advance product efficacy, while they also contribute to design innovative package that improve product applications. This is obvious, but its the formula, talking to systems and packaging that make all the difference when it comes to developing innovative cosmetics projects. Your R&D cosmetics strategy has to consider what these fundamentals. . Concentrated Product Development A successful cosmetics R&D strategy is efficient in solving two problems shorten product development times and improve innovation initiatives. In the cosmetics and personal care industry, the diversity of product lines (face, body, lips, and eyes) creates a barrier that prevents the easy innovation across all categories. go through leaders use R&D project portfolio optimization to pinpoint innovation projects that align with current resources and leverage the development of existing expertise in a technology.The May beline Great blister Mascara collection has a history of 40 years, during which period its product profile has continued to expand. Maybelline has focused on enhancing the Great Lash product line through conducting consumer insight research, selecting pilot productions and adjusting the R&D process. 3. Consumer-oriented Strategy Any R&D innovations begin with the goal to improve consumer experience. R&D leaders conduct market research to discover problems and collect consumer insights, which if executed correctly can turn into new treatment solutions and product upgrades.As increasing numbers of cosmetics companies expand worldwide, consumer-oriented strategy also includes outsourcing or moving R&D centers oversea to enhance local R&D capability. For example, LOreal China has improved its shampoo formula in order to cater to Asian hair care needs. Overseas R&D centers help facilitate regional research and local talent recruitment. It may also benefit the R&D process in the host cou ntry as such outsourcing enables the exploitation of local technology and resources for company-wide projects. 4. The Challenge of Product DiversificationWhile expanding a brands product profile is more of a business strategy, cosmetics and skin care R&D departments need a comprehensive technology development strategy to help anticipate risks and structure conceptualization. For example, when a successful skin care company is nerve-racking to launch cosmetics lines, the company needs to decide which products to start developing pilot engineering programs. A product development plan thats been perfectd for project selection can allow a company to lay a solid foundation and avoid failures at different stages by understanding whats possible from the projects to select and implement. . Mergers and Acquisitions Mergers and acquisitions allow merged companies to realize the optimal allocation of R&D resources, such as facilities and working capital investments. In this way, R&D departme nts have the chance to share information and develop give products. In the cosmetics and personal care industry, company mergers and acquisitions may not necessarily lead to the merger of R&D departments. However, a well-established parent company can provide its brands with R&D guidelines that improve innovation capabilities and optimize the product development process. 6.Cross-Industry Development Another future R&D trend are cross-industry solutions, where tighter partnerships with other industries as well as the knowledge of other sciences, such as food and biochemistry enhance R&D knowledge. For example, nutricosmetics was first developed by the Swedish biochemist and scientist Ake Dahlgren, who later founded the first nutricosmetic company Imedeen in the late 1980s. In recent years, LOreal and Shiseido have started R&D projects in nutricosmetics, applying what was originally developed from saturated science to personal care products. P&G AND INNOVATIONLet us now take an exam ple of a leading company P&G and how they improved in cosmetic industry with its Innovation. P&Gs cosmetics business is a case in point where a dramatic turnaround was achieved via a disciplined, holistic approach to new product management. The story begins when P&G acquired the poke out Girl and Clarion cosmetics brands in 1989. Two years later Max Factor was acquired. P&G then use its tried-and-true approach of leveraging scale and an innovation strategy with a few, big new products. But there was no real business strategy, and efforts were scattered and unfocused.And so, by 1994, management was forced to call in and retrench. They dropped the Clarion line and through much of the 90s, senior management at P&G wondered if they should be in the cosmetics business at all A new line, under the Oil of Olay banner, was attempted but failed, and the entire cosmetics business continued to decline. The turnaround of P&Gs Cosmetics business started in the late 90s when business unit manag ement moody to P&Gs chess openings, Diamond philosophy. Today, P&Gs Cosmetics business is a healthy, growing, and profitable enterprise.Performance results have significantly improved since the late 90s, and the business is seen as a key growth contributor for P&G. The major factors that drive a businesss new project performance, illustrated in the Innovation Diamond are Having a product innovation and technology strategy in place for the business Having an effective and efficient ideato- launch process alternative commitment, which focuses on the right projects portfolio management and People that is, having the right climate and culture, effective cross-functional teams, and senior management commitment to New Product Development. aha was that there is no one key to success in product innovation, and thereof management stepped back from a focus on individual initiatives and looked at the broader picture. For example, having a great idea-to-launch process is not sufficient its not a stand alone driver of positive performance. P&Gs Initiatives Diamond serves as a guide for each businesss product innovation effort, and helps to focus managements attention on what is important to success.According to Bob McDonald, P&Gs Vice Chairman of worldwide Operations, The Initiative Diamond played a significant role in improving the business results in P&Gs Household Care global business unit. This work brought us a new discipline to manage our innovation programs and yielded a major increase in the in-market success of our initiatives. They aligned their organization on how to use Stage-Gate success criteria, and portfolio and resource management to deliver offend innovations for the consumers they serve. pic picThe top half of P&Gs infield in Exhibit 2 is strategic in nature, and captures the businesss product innovation strategy goals, the ruffle of new products required to meet those goals, and the required resources. Portfolio management (or project selection) is thus closely connected to strategy. The buttocks half of the diamond is more operational and focuses on delivering specific new product projects or initiatives what resources must be put in place for each project and how individual new product projects are managed so they succeed, using P&Gs idea-to-launch SIMPL methodology.Coincidentally, the two diamondsP&Gs Initiatives Diamond in Exhibit 2 on this page and the research-based Innovation Diamond in Exhibit 1are almost the kindred. Each one or both can be used to guide your businesss new product efforts. Here is a quick look at the quartette drivers of performance and how they work at P&G. driver 1A product innovation and technology strategy for the business Best performing businesses put a product innovation and technology strategy in place, driven by the business leadership team and a strategic vision of the business.This product innovation strategy guides the businesss New Product Development direction and helps to steer r esource allocation and project selection. In the mid-1990s, P&Gs Cosmetics business lacked a business and product innovation strategy, the result being that Product Development efforts were scattered many different initiatives were launched in many different product categories and segments in a futile attempt to win. There was no focus. The first element of the diamond is a product innovation strategy.Indeed, the real breakthrough occurred in the Cosmetics business turnaround when the business leadership team began a rigorous business planning process leading to cl proto(prenominal) defined objectives, goals, strategies, and measures. A much more concentrated innovation strategy was elected, focusing on lips, face and eyes, rather than the entire body. A second facet of strategy meant getting the supply chain under control end-to-end supply network management. Management streamlined the supply network so that production and shipments were tied to market demand.As a result, they were able to reduce the time in the supply network, thereby eliminating much of the product obsolescence generated with each new product launch. By focusing first on an innovation strategy for the business, the stage was set for effective Product Development. The message is that if your business lacks a product innovation and technology strategy, you are missing a key element of successful product innovation. This strategy should include the goals for the businesss product innovation effort and how these goals tie into the broader business goals. This strategy is more than just a list of this years development projects.It has a much longer-term commitment. The innovation strategy also includes defining strategic arenas or areas of focus, much like the Cosmetics business did. That is, you need to define the product, market, and technology areas in which the business will focus its Product Development efforts. The key here is focus. Driver 2An effective and efficient idea to- launch syste m Studies show that an effective new product process, such as Stage-Gate, exists in top performing businesses, a system that drives new product projects from the idea phase through to launch and beyond. In P&Gs Cosmetics business, developing an innovation strategy was a solid first step, but the means of implementing strategy must be in place too. So management turned to a second element of the diamond, namely P&Gs SIMPLthe Successful Initiative Management and Product Launch model. SIMPL is a stage-and-gate new product process, a methodology for driving new product projects from the idea phase through to launch and into post-launch The SIMPL model forced project teams to do their homework early in the project.For example, much consumer research work was undertaken, and consumer insights gained led to winning new product concepts. One big success is Outlast by Cover- Girl. This ten-hour lipsticka kiss-proof, long-lasting lipstickuses a unique two-part application system (first a colo r and then a gloss) to produce an enduring lip color and gloss. A second winnerLipfinity by Max Factorwas also introduced, again using the SIMPL model. Both new products have been huge successes not only in the U. S. , but around the world.The turnaround of the cosmetics business was current Most companies claim to have a new product process or stage-and-gate system in place, according to a recent PDMA study. 7 Further investigation reveals, however, that most firms processes are deficient. They are peaked(predicate) designed, they miss the mark when it comes to best practices, and they are badly implemented. 2,3 P&G is an exception. Their idea-to-launch process, SIMPL, is a rigorous process that uses stage-and-gate decision-making complete with clear go/kill criteria and timing requirements.The SIMPL model, shown in Exhibit 3, consists of four main stages, with each stage building in a set of current best practices in the form of key activities, and also clearly defined expectati ons for project team in the form of end-points. There are also four gates or go/kill decision-points in the model each gate is comprised of a team recommendation and a management decision. The SIMPL Model P&Gs approach is different from that of most firms, however. Instead of focusing on the process per se (like so many companies do), management stepped back and identified the basic principles that the model is founded on.These principles are constants across many and varied businesses and geographies. But the constancy of these principles has helped the company adapt the model to many different types of businesses and different types of projects leading to a standardized and globally applied Stage-Gate process. The principles which underlie the SIMPL model are shown in the box on this page and explained here in more detail Winning in the marketplace is the goal. In many firms, too much emphasis is on getting through the process that is, getting ones project approved or preparing de liverables for the succeeding(prenominal) gate. In the past, P&G was no different.By contrast, this principle emphasizes winning in the marketplace as the goal, not merely going through the process. Specific success criteria for each project are defined and agreed to by the project team and management at the gates these success criteria are then used to evaluate the project at the post-launch review. And the project team is held accountable for achieving results when measured against these success criteria. (By contrast, the great majority of businesses still do not conduct post-launch reviews on projects and even fewer hold their project teams accountable for achieving agreed-to project results).Use criteria for making Go/Kill decisions. Specific success criteria for each gate relevant to that stage are defined for each project. Examples include expected profitability, launch date, expected sales, and even interim metrics, such as test results expected in a subsequent stage. These criteria, and targets to be achieved in them, are agreed to by the project team and management at each gate. These success criteria are then used to evaluate the project at successive gates. Risk and rigor must be balanced. Project teams employ appropriate e rigor in learning, planning, and decision- making in order to apologize risk.They build in a strong consumer focus and rely heavily on voice of customer research they front end-load their projects, undertaking appropriate, often extensive up-front homework prior to development and they focus on developing differentiated, superior products that meet customer needs better than competitors. Note that SIMPL is also scalable and is tailor-made for specific projects based on level of risk and size of investment. Not every project requires the same degree of rigor, front-end work, and market research. Use a common language.Throughout the 1990s, each P&G business unit had developed its own version of a stage-and-gate new product proc ess. Integration, cooperation, and measurement across businesses thus proved difficult with each business using a different system and different terminology. A GLOBAL PROCESS The current SIMPL process is a corporate global processthe same stages, gates, principles and measuresand is universal across geographies and business units. Each business, however, is free to adjust and adapt the process to suit its own business requirements.SIMPL is not stand alone. The idea to- launch process is only one ingredient of successful innovation, a single element of a much larger whole, the Diamond. Individual projects cannot be managed independently of other projects, their priorities, resource constraints, and changing business conditions. Thus the Diamond represents the relationship between these elements innovation strategy,resource planning, project selection, and the SIMPL new product process SIMPL Driver 3Resource commitment, focusing on the right projects and portfolio managementIn P&Gs Co smetics business, portfolio management, a third element of the Initiatives Diamond, was next employed to enable management to look at its entire portfolio of new product initiatives, and secure the right balance and mix. Through portfolio management, the business make a pipeline of new and improved products that established the needed initiative rhythm for each product line (face, lips, eyes). New products and upgrades in each product line created news and excitement in the market. This launch and sustain portfolio approach was a key part of winning in the marketplace.Best performers like P&G have an efficient portfolio management system that helps the business leadership team effectively apportion resources to the right areas and projects. P&G splits this resource commitment facet of the diamond into two parts project selection and resource planning. The company relies primarily on success criteria as part of the SIMPL process to help make better go/kill decisions on projects, as noted above. In addition, a number of P&G businesses have developed screening tools using scorecard methods for early decisions and for the selection of ideas to enter the SIMPL process.When it comes to resource planning for projects in the portfolio, P&Gs methods vary depending on the nature of the business. Many P&G businesses utilize a resource compose approach to resource planning. The resource profiling method helps to assess future project resource needs based on learning from past projects, and it anticipates peak resource periods of time. This approach enables businesses, such as Fabric Care, to improve the overall portfolio decision process by allocating scarce resources to the highest priority projects globally.The most technically complex, resource-intensive businesses use purchased resource management software. These software tools look at people available versus requirements for specific tasks on individual projects to focus on near-term resource constraints. P&Gs del iberate approach to portfolio management and resource planning (the resource facet of the diamond) has had a strong positive impact, according to Martin Riant, President of P&G Global Baby and Adult Care and formerly President of P&Gs Global Feminine Care and Antiperspirants/ Deodorants business. Using the diamond has had a remarkable effect on our business results. It has forced a much higher level of discipline in how we allocate our resources, how and when we make investment decisions and in accountability of projects to deliver what they promise, he says. Driver 4A positive climate and environment for innovation People, culture, and leadership make up the one-fourth driver of performance of the diamond (Exhibit 1). First, senior management must lead the innovation effort and be strongly committed to New Product Development.This senior commitment is most evident at P&G where Chairman, President, and Chief Executive A. G.. Lafley, makes it clear, Innovation is a prerequisite for sustained growth. No other trail to profitable growth can be sustained over time. Without continual innovation, markets stagnate, products become commodities, and margins shrink, he explains. A positive climate and culture for innovation and entrepreneurship, combined with effective cross-functional teams backed by strong management support and empowerment are fundamental to success. P&G has focused much effort here in recent years, which has helped it generate a step level improvement in results. The entire innovation effort, together with the Initiatives Diamond and SIMPL process, is sponsored and owned by both the commercial (sales and marketing) and technical (R&D and engineering) communities. An important step was the creation of Initiative Success Managers who report to each of the companys business unit presidents. These Initiative Success Managers make the diamond and SIMPL work. QUESTIONNAIREA small survey was carried out to find out the behaviour of cosmetic users. The su rvey was primarily designed to check on behavioural aspects of the users towards new innovative cosmetic products. The questionnaire is given below, followed by findings NAME GENDER AGE OCCUPATION 1. Do you use cosmetics? Yes No 2. How much is your income per month? Dependent 35,000 3. How much do you throw away on cosmetics per month? _______________ ( Do you agree with the following statements? Q4 Q8 1-strongly agree 2-agree 3-neutral 4-disagree 5-strongly disagree ) 4.I try new products 5. I switch brands if some other brand comes up with a better product 6. I often find gaps in my current product 7. I wait till I finish my current product till I buy another similar purpose product 8. I would rather reuse a good produce than try a new similar purpose product 9. Why do you switch products (tick all that are applicable) Price Packaging Availability Fragrance Utility Reviews 10. What kind of products do you use? herbal tea Ayurvedic Scientific Any 11. On an average h ow long do you use a product before changing it? 8 weeks 12. How many times a year do you try a new product? 10 13. How many times do you reuse a product before trying a new product? 0-1 2-3 4-6 6 14. Does the range of products available in the market match your requirements? Yes No 15. When a new product with a new feature is launched , how soon do you try it? Within 1st month 2-3 months 4-7 months 8-12 months 1 year 16. Compared to your current expenditure on cosmetics how much extra are you willing to spend on a new product with better feature/results? No extra money 1-10% 11-25% 26-50% 50% 17. On a scale of 1-5 , how important is the following feature in a cosmetic product, for you to buy it? lay the options from 1-5 where 1-Most important & 5- least important Packaging Fragrance Reviews New feature Brand ambassador FINDINGS OF THE QUESTIONNAIRE The questionnaire was answered by 25 females and 10 males. There were 20 from the age group of 30-35 years, 5 from age group 20-25 years and 10 from age group 25-30 years. About 70% of the respondents spend around 3% of their income on cosmetics per month. 67% of the respondents try new products. pic 63% of the respondents switch brands if some other brand comes up with a better product. 80% of the respondents often find gaps in their current product inspite of the huge range of cosmetics available. pic 34% of the respondents wait till they finish their current product till they buy another similar purpose product. 27% of the respondents would rather reuse a good product than try a new similar purpose product. 87% of the respondents switch products due to better utility, 64% on the basis of reviews, 39% depending on availability, 30% depending on price, 12% depending on fragrance and 6% depending on fragrance. pic 58% of the respondents use a product for 6-8 weeks before changing it. 42% of the respondents try a new product 3-6 times a year. 60% of the respondents reuse the same pro duct only 2-3 times a year before trying a similar new product. Despite the wide variety of products available in the market, 66% of the respondents feel that the products in the market do not match their requirements.Maximum percentage of the respondents buys a new product with 2-6 months of its launch. 6% of the respondents are willing to pay no extra money for a new product with better features, 15% of the respondents are willing to pay 1-10% extra money for a new product with better features, 33% of the respondents are willing to pay 11-25% extra money for a new product with better features, 25% of the respondents are willing to pay 26-50% extra money for a new product with better features & 21% of the respondents are willing to pay more than 50% extra money for a new product with better features. pic For 56% of the respondents a new feature in a cosmetic product motivates them into buying. All the above responses indicate towards the fact that customers are tempted to buy ne w, innovative, better products. REFERENCES R. G. Cooper, S. J. Edgett & E. J. Kleinschmidt, New Product Development Best Practices Study What Distinguishes the Top Performers, Houston APQC (American Productivity & Quality Center), 2002 Robert G. Cooper, Michael S. Mills, Succeeding at New Products the P&G Way Work the Innovation Diamond,working paper no. 1, 2005 R. G. Cooper, S. J. Edgett & E. J. Kleinschmidt, Best Practices in Product Innovation What Distinguishes Top Performers, Product Development Institute, 2003. R. G. Cooper, Product Leadership Pathways to Profitable Innovation, 2nd edition. Reading, MA Perseus Books, 2005. R. G. Cooper & E. J. Kleinschmidt, Benchmarking firms new product performance and practices, Engineering Management, 1995. John Hauser, Gerard J. Tellis, Abbie Griffin, Research on Innovation A Review and docket for Marketing Science, 2006 M.Mills, Implementing a Stage-GateTM process at Procter & Gamble, Association for Manufacturing Excellence Internation al Conference, Competing on the Global Stage, Cincinnati, Ohio, October 2004. R. G. Cooper, Winning at New Products Accelerating the Process from Idea to Launch, 3rd edition. Reading, Mass Perseus Books, 2001. R. G. Cooper and S. J. Edgett, Product Innovation and Technology Strategy (Hamilton, ON Product Development Institute, 2009). PDMAs quarterly magazine for Product Development professionals, How P&G achieves such stellar NPD results, Insights into Innovation, October 2005 Vol. XXIX No. 4,