How Whirlpool Puts New Ideas Through the Wringer

The appliance maker has formalized the process of evaluating and testing the thousands of notions that bubble up

By Jessie Scanlon

In 1999, Whirlpool's (WHR) then-Chief Executive David R. Whitwam set a goal: He wanted the leading maker of big-ticket appliances to be No. 1 in innovation as well. Whitwam's pronouncement kicked off a flurry of ideas. Not all of them were sensible. "There were some wacky ones—bicycles, tennis shoes," recalls Moises Norena, director of global innovation. Whirlpool needed a system to evaluate and screen ideas, advancing promising concepts and culling out those that were better forgotten.

Today, the maker of such brands as Whirlpool, Maytag, and KitchenAid has formalized a process to sort through the thousands of ideas that, at any one time, are percolating up from product groups, new business development teams, and i-mentors—employees trained in innovation who have been deployed throughout the organization to identify promising ideas. From that first grab-bag of concepts, managers green-light several hundred for study, giving each a slice of an innovation budget that Norena ballparks at "several million dollars for North America" this year.

Ultimately, almost half of those flow into its innovation pipeline, which currently numbers close to 1,000 products. On average, 100 are introduced to the marketplace. "Every month we report pipeline size measured by estimated sales, and our goal this year is $4 billion," says Norena. With Whirlpool's 2008 revenue totalling $18.9 billion, that would mean roughly 20% of sales would be from new products.

Beginning Affresh

The process has helped Whirlpool find such innovations as Affresh, a hockey puck-shaped tablet that consumers can toss into front-loading washers for a cleaning cycle. In less than two years, Affresh, which works with any brand of appliance, has grown into a line of four products that Whirlpool expects to be an $80 million to 100 million business by 2015. Taking Affresh as a guide, here's a look at how the Benton Harbor (Mich.) appliance maker evaluates new ideas.

Affresh came out of regular consumer research a few years ago: Water and chemical residues caught in the seal of the door of front-load washing machines, customers told Whirlpool researchers, were causing odor problems. (Not all of Whirlpool's concepts emerge from customer research; Gladiator GarageWorks—a line of storage containers and appliances for garages and workshops—was conceived in a sales and marketing brainstorm about how Whirlpool might develop products for rooms beyond the kitchen and laundry room.)

For an idea to be considered for development, it has to meet Whirlpool's three-pronged definition of innovation: It 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. (Add-on innovations are expected to deliver results within months, while new-to-the-world ones are given three to five years.)

Charles Martin, director of strategy and marketing for new business development, who led the Affresh development, already knew there was a consumer need. Four to six weeks of research and concept development convinced him he could clear the second hurdle too, by expanding into kitchen appliances too. And Whirlpool had good reason to expect profits. Sales of front-loaders are on the rise—1.91 million will be sold this year, according to IBIS World—and the machines are expected to eclipse top-loaders in three to five years.

Clearing the Hurdles

Research findings are written up in a document Whirlpool calls an "opportunity brief." The brief is reviewed by a 15-member panel of innovation experts and regional managers from across the organization, including marketing, sales, customer service, and engineering.

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