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Soak, wash, rinse, spin: Whirlpool's four-phase approach to innovation

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People tend to associate innovation with high-tech startups. But chances are you may see more innovation per square foot at some traditional product-...

People tend to associate innovation with high-tech startups. But chances are you may see more innovation per square foot at some traditional product-line manufacturers than in the loft-based headquarters of the next budding social media company.

This is particularly the case with Whirlpool Corporation, a name more closely associated with washing machines than virtual machines.  A recent report by Jessie Scanlon in BusinessWeek looks at the innovation culture Whirlpool has created, and how it is driving new business -- lots of new business.

It took a push from the top to get things moving in this direction -- ten years ago, Whirlpool's
then-Chief Executive David R. Whitwam set the wheels in motion. Today, Whirlpool introduces about 100 new products a year (it has a total of 1,000 products), according to Moises Norena, director of global innovation.

Here's the four-phase process Whirlpool undertakes to evaluate and bring new ideas to the surface:

1) Innovation is promoted throughout the organization by "i-mentors," or employees trained in innovation who have been deployed throughout the organization to identify promising ideas.

2) Ideas that meet Whirlpool's three criteria for innovation are then slated for further study: The new idea must meet a consumer need in a fresh way; it must have the breadth to become a platform for related products; and it must lift earnings.

3) Research findings are written up an "opportunity brief" which is then reviewed by the "i-panel," a 15-member panel of innovation experts and regional managers from across the organization, including marketing, sales, customer service, and engineering. The i-panel measures the idea against the "i-box," a three-page scorecard that forces innovation teams to be very concrete about expected factors such as revenues, technical feasibility, relevance to the brand, and market trends.

4) If the innovation meets the i-box criteria and paases muster with the i-panel, it is then funded and put into the product development pipeline.

By actively encouraging and embedding an innovation culture into its operations, Whirlpool sees an estimated 20% of its revenues each year coming from new product launches. In the most recent fiscal year, this equated to approximately $4 billion of a total of $19 billion in sales coming from new products, Norena estimates.

Promoting an innovation culture is smart business because it leads to creative new product ideas that increase the revenue stream. But just as importantly, an innovation culture also encourages employees to generate fresh new thinking and approaches to processes that can improve the operations behind the product offerings.

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Joe McKendrick

Contributing Editor

Joe McKendrick is an independent analyst who tracks the impact of information technology on management and markets. He is a co-author of the SOA Manifesto and has written for Forbes, ZDNet and Database Trends & Applications. He holds a degree from Temple University. He is based in Pennsylvania. Follow him on Twitter. Disclosure