Norbert Majerus

Goodyear

12/5/2012 2

• 1,500+ new (innovative, high value added) SKU’s every year globally

• 1,000+ projects at any time

• 4,000 learning cycles/year

• $450 Mi/yr

Why do great companies fail at Innovation?

Companies do not fail because they fail to build a product

Companies fail because they fail to build what customers want*

*Diana Kander, All In Startup, Wiley, 2014

What IS Innovation

• Creativity?

• Taking an IDEA and turning it into a profitable PRODUCT, SERVICE, PROCESS, Computer Program, Building …

• It is when you do not have a future state*

10/22/2016 4

*John Shook – GBMP, 2016 Worcester

0

50

100

150

200

250

300

350

400

450

500

2007 2008 2009 2010 2011 2012 2013 2014

R&D Spending

0

20

40

60

80

100

120

1988 1991 1994 1997 2000 2003 2006 2009 2012 2015

Product Life Cycles

2016 Global Innovation

0

50

100

150

200

250

300

350

400

450

500

1988 1993 1998 2003 2008 2013

Complexity Index

Goodyear data and estimates

6

Global Competition

Phase CProof ofConcept

Phase BConceptScoping

Phase DDetailed

Assessment

GateB

GateC

GateD

GateA

Transition Phase

Goodyear’s Case for Change

10/22/2016 8

Lean Operation

Goodyear Lean R&D Transformation

10/22/2016 9

Goodyear Innovation Today

10/22/2016 10

Learnings from the Goodyear Journey

• The shadows of Innovation

• YES, Innovation can have a process

• Collaboration through the value stream

• Visual Management

• Innovation speed

• The fashion model

• Quick learning cycles

• Minimum Viable Prototypes

• Respect for People

• Managing innovation talent

Focus on Customer VALUE, not cost

Apply lean to the Shadows

Winning With Innovation

10/22/2016 14

Agility to deliver to the customer (business) what is needed and when it is needed*

* In addition to products meeting Goodyear safety and quality standards

Manufacturing Shadow????What creates more revenue/profit for a company?

10/22/2016 16

Use lean manufacturing to reduce COST?

Use Lean Principles to have the right (high value) product at the right place at the right time?

TCP : Technology Creation Process

Phase CProof ofConcept

Phase BConceptScoping

Phase DDetailed

Assessment

GateB

GateC

GateD

GateA

ICP: Innovation Creation Process (Global)

(Global)

(Regional)

Product Leadership Strategy

TSRD SSRD > Quad TOOS Full Stage TOOS SOL Extended SMO PCI

Current Eagle GT

Future Eagle GT successor 20% NA = = = = 5% = = =

Current GY Wrangler SA

Future GY Wrangler SA A/T 2013 Pmet 20% NA 20% 10% 10% 20% = = = =

Current GY Wrangler SA

Future GY Wrangler SA A/T 2013 LTmet = NA = = 10% = = = = =

Current GY Assurance Fuel Max

Future GY Fuel Max Succ 2014 20% NA 5% = = = = or 10% 10% = 100%

Current GY Wrangler SRA

Future GY Wrangler SRA Succ 2014 10% NA 10% 10% = = = = = =

Current GY Wrangler Duratrac

Future GT Wrangler Duratrac Pmet 2015 = NA = = = = = = = =

Current GY Assur CS Fuel Max

Future GY Assur CS Fuel Max Succ 2015 20% NA 5% = = = = 10% = =

Current GY Assur ComforTred Tour

Future GY Assur CTT Succ 2016 20% NA = = = = = = = =

Current DU Sport Signature

Future DU Sport Signature Succ 2014 20% NA = = = = 5% = = =

Current DU Signature CS

Future DU Signature CS Succ 2014 20% NA 5% = = = = = = =

Current KY Safari Signature

Future KY Safari Signature Succ 2014 = NA = = = = = = = =

Manufacturing Quantifiable ImplicationsMixing Extruding Tire Assembly Curing

2

3

5

6

4

1

10

11

9

8

7

Corporate R vs Cc

Transition Phase

17

Need a Process to learn and continuously improve

PCP Roadmap

17

Goodyear Innovation Process

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InnovationExcellence

“Great products meeting consumer

needs”

Sales & MktgExcellence

“Consumer-centricdriven pull”

Operational Excellence

“Right tires, rightplace, right value”

Win at the Intersection

Collaborate and align to win at the intersection

Highest Level, End to End

10/22/2016 19

Value Stream Collaboration

• Targets set JOINTLY – but they evolve

• Targets reflect value for customer and company growth

• CONCURRENT development

• Functional and personal agenda take a back seat to the value for the customer and the growth of the company

10/22/2016 20

There is more value created with value stream alignment than functional (departmental, individual…) excellence- Don Reinertsen

Tetris Principle

Short Cycles - Are easier to schedule- Allow better risk management- Create knowledge faster

Visual Planning

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Scania Planning Process

1,500+ new SKU’s globally every year1,000+ Projects at one time4,000 learning cycles/year30 min business meeting every 2 weeks

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Heijunka Box – Assign Work

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31

• Show deviation from standard – 10 sec rule

• QUICKLY activate standard problem solving process

– One time deviation

– Systemic problem

• Verify solution

• Make new standard

Visual Management

Leaders will have to find better things to do …

If I had only one thing to focus on, it would be SPEED

Competitive advantage

Faster Learning, better risk

management

Better cash flow

Collaterals of efficiency

Among Many Lean Opportunities …

TCP : Technology Creation Process

Phase CProof ofConcept

Phase BConceptScoping

Phase DDetailed

Assessment

GateB

GateC

GateD

GateA

ICP: Innovation Creation Process (Global)

(Global)

(Regional)

Product Leadership Strategy

Transition Phase

33

PCP Roadmap

Goodyear TWO Processes

Lean Innovation – The Fuzzy Front End

Lean does not have a good reputation for supporting (disruptive) innovation

35

Connecting Lean and Innovation

The Fashion Model

Generic Product Innovation Process

37

$$$$$

The Reversed Funnel

10/22/2016 38

Discovery

10/22/2016 39

ED GREVI

Sorting Out Ideas

10/22/2016 40

C GONV E R EED GREVI

Entrepreneurs are Luck Makers, not Risk Takers (Diana Kander, all in startup, Wiley, 2014)

My agile, quick learning, scrum, rapid deployment, design thinking, … cycle

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TEST

LEARN

BUILD

Innovation Cycle

10/22/2016 43

DIVERGE CONVERGE

TEST

LEARN

BUILD

Minimum Viable Products

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Name functionor work to do

TO DO IN PROGRESS DONE

Time Period

Goal, deliverable ….

Quick Learning Cycles - SCRUM• Easier to schedule - Use time limit if no logical break

• Team/customer/stakeholders set/reset goals for every cycle

• Easier to manage risk – allocate money in small batches

• Faster learning

• Frequent pivot/reflection and decision points

• Follow go/no go schedule

• Teams self organizing, sometimes self directing

45

Google Venture

Transforming From The Inside Out

A lean transformation is a major change in a companyChange is all about PEOPLEMore companies are challenged with the people part than the lean principles piece

(my) Desired State

10/22/2016 47

FOUNDATION

DESTINATION

CO

NTI

NO

US

IMP

RO

VEM

ENT

RES

PEC

T FO

R P

EOP

LE

Current State

10/22/2016 48

FOUNDATION

CO

NTI

NO

US

IMP

RO

VEM

ENT

RES

PEC

T FO

R P

EOP

LE

Average of 70% of people are not

engaged*

*Jerry Solomon - Lean Frontiers conference, San Antonio 2016

Inside Out Transformation

• Learn the principles

• Teach the principles to the people who do the work

• Engage the people and coach them through the transformation

• Help sustain the gains

Why Engage the People

• They know the process

• You cannot just replace them

• They can improve the work

• THEY sustain the change

• Engagement motivates people

10/22/2016 50

HOW to Engage the People

• Simplify work and reduce stress

• Communicate, teach (WHY)

• Listen to the concerns

• Focus on the influencers first

• Go see – build trust - help and support

• Thank and reward

• Show respect

Respect

• People come to work to do a good job• If they cannot, look at process, training, qualification,

equipment …• They ARE the best people to do the work - appreciate

them – help them be successful - set stretch goals• People deserve a safe work environment• Remove waste from their work • Ask questions, do not give answers• Learn to manage the round peg in the square hole -

google

10/22/2016 52

Innovative Talent

Managing Innovative Talent

• Lack of talent management is one of the 8 key wastes in lean

• Benchmark google, 3M …

• Learn to manage the square peg in the round hole

• Empowered serial innovators may be more about what you can tolerate than what you manage

• Seed some money – have fun

• Respect them and let innovators have a career at innovating

10/22/2016 54

Not managing innovative talent is a large WASTE

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Session No: WP/22

Lean-driven innovation

Norbert Majerus

Goodyear

norbert.majerus@goodyear.com