Featured case:
Samsung’s European Innovation Team

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The case

Who – the protagonist

Luke MansfieldLuke Mansfield, leader of Samsung’s European Product Innovation Team (EU PIT) and team members, Jerome Wouters and Ran Merkazy.

What

The team’s mandate was to bring the European consumer into Samsung’s innovation processes by developing market insights and suggesting new features, products and services for the company’s various business lines.

Why

EU PIT was set up to fuel consumer-driven innovation (as opposed to technology-driven innovation). This was prompted by the huge success of Samsung’s ‘fast follower’ strategy. Having become a market leader, who could it now follow? The company realised it needed to adapt and learn new competencies. The aim was to introduce genuine new-to-the-world products that would meet latent consumer needs.

When

Lee Byung-chulSamsung was founded as a trading company in 1938 by Lee Byung-chul. Over the next thirty years it entered a diverse range of markets, including electronics, retail and insurance. By the 1970s it was active in shipbuilding and construction. Mobile phones and semiconductors are now its principal source of income.

The European Product Innovation Team was set up in 2010.

Where

seoulSamsung’s worldwide headquarters are in Seoul, South Korea. The European Product Innovation Team is based in London’s Holborn area, reporting into the European Headquarters’ Marketing Division.

Key quote

When you look for a new idea, it is crucial to first focus on the relevance to the user. Lots of people start with differences; they first look for ideas that will stand out and THEN they take that idea and try to make it relevant. That’s fatal. We call that ‘putting lipstick on the gorilla.’ – Jerome Wouters

What next?

The team is successful in developing a new function for video camcorders, an app for transferring data to Samsung phones, and a revolutionary new type of refrigerator.

Says Luke Mansfield: ‘Whatever metrics you look at, I think it’s clear that we’ve been successful…I’m not sure what the future will bring, however. I get the feeling that we need to change the PIT radically…’

Where can Luke’s team go from here?

The authors

Paddy Miller and Thomas Wedell-Wedellsborg

Paddy Miller and Thomas Wedell-WedellsborgPaddy and Thomas explain why they were so impressed by the EU PIT team and discuss how it became so successful.

Amazing results

What really caught our attention was the EU PIT team's results: after 3½ years, they had delivered 700 million dollars profit to Samsung. Pretty remarkable for a 12-man team located half a globe away from the corporate headquarters.

Successful leaders

bookThrough our research, discussed in our book, Innovation as Usual (Harvard Business Review Press), we found that successful innovation leaders tend to possess two traits. One is, of course, a hands-on understanding of innovation in practice (having been part of driving a startup or launching a new initiative). But equally important is ‘organisational competence’. The innovation unit needs a leader who can influence and engage a lot of people in the main organisation – and that requires a much more tactical, politically attuned mindset.

It can also be a huge advantage if someone on the team has an existing network inside the organisation. We have written more about this in our Harvard Business Review article, The Case for Stealth Innovation, which we often use as a supplementary reading for the case.

Leaders or followers?

bookBeing an innovation follower is typically both safer and cheaper in the short term, but it exposes you to a larger risk of being disrupted over time. Being an innovation leader, on the other hand, is more risky in the short term. A great read on this topic is Constantinos Markides’ book Game-Changing Strategies and of course his classic Fast Second.

Teaching objectives

We like to focus the case on three core questions:

  • How do you succeed with an innovation unit?
  • How can you use customer insights to drive growth?
  • How do you sell ideas to the organisation?

Unpacking the one-liners

When being interviewed, many executives are good at distilling their experience into core principles – ‘embrace failure’ is a classic. Your job as a case writer is to dig deeper and unpack those one-liners. With Samsung, we took the time to explore in-depth both the success stories and the failures – and it’s through those stories that you can really see HOW the team’s approach came to life.

The authors

Paddy Miller, Professor of Managing People in Organizations, IESE Business School
e PMiller@iese.edu

Thomas Wedell-Wedellsborg, Partner, The Innovation Architects
e thomas.wedell@gmail.com 
tw @thomaswedell

 
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Samsung’s European Innovation Team
Ref DPO-0307-E
Teaching note
Ref DPOT-0068-E

 

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