1. Sustainable Value Cycle Solutions
Ellen MacArthur Foundation webinar 24 April 2012
“Innovation and Value Creation”

2. Invention or Innovation ?
Invention:
The creation of an idea or a method
Innovation:
The use of a new idea or method

3. Where does innovation take place?
Technical environment
Jet engine, Digital revolution, nuclear fusion, synthetic fibre (Nylon)
Business Model
Amazon, MacDonalds, Zara, EasyJet, Dell
System Level
Harley Davidson, Facebook, Google, Ford

5. Where does innovation take place?
Technical environment
Jet engine, Digital revolution, nuclear fusion, synthetic fibre (Nylon)
Business Model
Amazon, MacDonalds, Zara, EasyJet, Dell
System Level
Harley Davidson, Facebook, Google, Ford

6. Henry Ford’s real legacy
Ford’s vision was a car for every home….
"I will build a car for the great multitude. It will be large
enough for the family, but small enough for the individual to
run and care for. It will be constructed of the best materials, by
the best men to be hired, after the simplest designs that
modern engineering can devise. But it will be so low in price
that no man making a good salary will be unable to own one –
and enjoy with his family the blessing of hours of pleasure in
God's great open spaces”
Personal mobility

7. Innovation Business
?
Revenue and
Value
Innovation business
Creation growth
"Companies cannot grow through cost reduction and re-engineering
alone... Innovation is the key element in providing aggressive top-line
growth, and for increasing bottom-line results."
Davila et al. ”Making Innovation Work” (2006)

8. Drivers for Innovation
Resources
Social
Consumer/Market
Technology
• Historical issue • 1950-70s • 1980-00s • 2005+
• Materials • Mass • Marketing/Brand • People/network
• Labour production and driven driven
• Water manufacturing • Experience • Transformation
• Fuel • Consumption • Consumer • Co-creation and
• Crisis/war • Push to Insights content
consumer
• “company is • “customer is • “Customer is my
King” King” best friend”

9. ..but something else is changing
“..Traditional approaches to business will collapse, and companies
will have to develop innovative solutions. That will happen only when
executives recognize a simple truth: Sustainability = Innovation..”
Source: HBR, Sept 2009
“It is more intriguing that outperformance on revenue
growth is correlated with superior creation of stakeholder value”
Source: “The granularity of growth”, McKinsey Quarterly, 2007

10. The additional drivers for innovation
Traditional
Cost
Technology
Consumer needs
Stakeholder Revenue and
Drivers Innovation value business
creation growth
Resources/waste
Social
Environmental
Holistic
…a formula for business success

11. Current economy
Resources

12. “We can't solve problems by
using the same kind of
thinking we used when we
created them”
– Albert Einstein –

13. Albert Einstein Gene Simmons - KISS

14. Circular Economy

15. Stakeholder Revenue and
Design for
Innovation value business
Value
creation growth
The only sustainability strategy that should be considered is one that is
integral with the business and does not compromise it; a systems approach.
..a cyclic process of innovation, value creation and value recovery.
.. a "Value Cycle"

16. From concept to reality
1. Communicate the concept simply
2. Design “value”products for the system
3. Use “Trustful and Recoverable” materials
4. Consumer is my best friend

17. 1. Value Cycle concept
Design
injection Create
point
Collect
Source
Recover

18. 2. Design “value” products for the system
Great product Added value

19. • Deliver on brand promise
• Designed for recycling & value recovery
• Defined periods of use

20. 3. Use trustful and recoverable materials
  
Source Content Usage
  
Source Content Usage
€

21. • Managed/renewable source
• 100% known & evaluated content
• Known use scenario
• Technically recylable
• Commercially recoverable
• Second life target product
• Safe end of life
Select and retain materials value

22. 4. Consumer is my best friend
Your design
Health and happiness
Do more good, not less bad

23. The result
• Great products
• Delighted consumers
• Lower costs through better design
• Return on materials investment
• Eimination of toxins and waste
• Materials and chemicals (risk) management
• Brand image enhancement
• Improved employee engagement
Multi stakeholder value creation

24. Maximising Value
Value Cycle design
Brand • Brand promise
• Social & Ethical position
• Primary function
Product • Primary proposition
Product • Additional value
discriminators • Supporting argument

25. Case study… Desso AirMaster
Brand •Brand promise: “Creativity, Ambition, Flexibility, Cradle to Cradle”
•Social & Ethical position: Cradle to Cradle company & products
•Primary function: floor covering
Product •Primary proposition: high quality, durable, trending designs
Product •Additional value: improves indoor air quality
Discriminator •Supporting argument: C2C certified, take back & recycling

26. Not just a one off
More Innovation..
• Light reflecting carpets
• Aviation carpeting
Desso profitability (EBIT)
9%
60% accousitc damping
4.5%
+10dB sound reduction
<1%
2006 2008 2010

27. The Value
Internal value
• New consumer value spaces/ideas
• Innovative and critical designs
• Materials risk and flow management
• Reduced data set of materials
• Reduced BoM
• ROI from materials recovery
• Employee engagement
External value
• Brand enhancement
• Superior primary function
• Additional functionality (descriminator)
• Supported sustainability program
• Option to certify or label
• Delighted consumers
• Market and business growth

28. Sustainable Value Cycle Solutions
“Value creation in sustainability”
Staff training Strategic advice Interim expert management
• Workshops • Materials development • Specialist competences
• Coaching • Supply chain development • Partner selection & engagement
• Ideation for innovation

29. Corporate Sustainability office CL Board of management
Andy Hall
Consumer Lifestyle -C2C and resource effectiveness team Sustainability
Innovation Manager
Preferred
Materials
Program