How Whirlpool Puts New Ideas Through the Wringer

(page 2 of 2)

This i-board meets monthly to review potential projects, and allocate funding. Martin's team was granted several thousand dollars to continue development of the Affresh idea.

Roughly 40% of ideas that make it to this stage end up in the innovation pipeline. Those that don't get tripped up by the next hurdle: 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. "The i-box needs to make the case that there is a consumer need, that the concept meets it, that it does it better than existing products, and so on," says Norena.

The i-panel then reviews the i-box, with each member scoring how well the concept meets each criterion on a scale of 1 to 5, with 5 being the strongest. The averaged scores determine whether a concept will be funded (at which point it officially enters the pipeline) or shelved. "Everything checked off," says Martin of the Affresh i-box.

Whirlpool currently has some 1,500 projects shelved for a variety of reasons. An idea to create an "on the move" appliance for campers, for instance, was held because it strayed too far outside of Whirlpool's home-focused comfort zone.

Thumbs-Down on a Steam Dryer

Ideas can also be held simply because of overall resources and priorities. Every year, Whirlpool sets a goal for innovation-related revenue for each product team. "We might say we want 80% of new revenues to come from innovations to core products, 15% from innovations that leverage or expand the core, and 5% from totally new innovations," says Norena.

A concept for a dryer with a steam function, proposed in 2004, ended on up the shelf because it didn't match up with that year's priorities. Three years later, when the fabric care team began working on a relaunch of Whirlpool's Duet line, the innovation manager for the laundry team reviewed the shelved concepts for features to include in the new machines. Duet dryers came to market in 2008 with the steam function. (Concepts can also be resurrected by the i-board, which reviews all active innovation projects and shelved ideas during an annual pipeline cleanup.)

Once Affresh and other new concepts officially enter the innovation pipeline, they go through Whirlpool's standard stage-gate process. Affresh's development differed only in that it was developed in partnership with an outside partner, a chemical company that Whirlpool won't identify, one of Whirlpool's first open innovation projects.

The first Affresh product—a three-pack of tablets for cleaning front-load washers—showed up in appliance stores in September 2007 at a suggested retail price of $6.99. Whirlpool won't reveal specific numbers, but says that first-year sales exceeded Martin's estimates by 200% and were robust enough for the company to expand distribution to national grocery chains such as Kroger (KR) and Publix Super Markets. Building on that, Whirlpool developed a more efficient product for service technicians and, coming next month, an Affresh-branded dishwasher and disposal cleaner.

What can executives learn from Whirlpool's approach to screening ideas?

• Define Innovation A brief, concrete definition of innovation will help employees evaluate new concepts at the front end, screening out those that just don't fit. As a concept progresses, keep returning to the definition to make sure that the idea still clears the bar.

• Never Kill Good Ideas A concept that might not be worth pursuing today—because of limited resources, for instance, or the lack of a partner—might be next year's innovation. Don't kill projects. Shelve them, and annually review all concepts for possible resurrection.

• Adjust Your Criteria Early in the process Whirlpool concepts are required to meet the basic definition of innovation. As projects progress, the evaluation criteria become more rigorous. Begin with easier requirements to avoid killing off concepts before they can be developed.

• Link Idea Screening with Strategy A concept might be innovative but still not smart for a company to develop because it would take the company too far afield. Make sure that the people evaluating ideas do so in the context of the company's strategic goals.

Jessie Scanlon is the senior writer for Innovation & Design at BusinessWeek, where she covers the intersection of design and business.

Business Exchange

Track and share business topics across the Web.