Resear China 中 国 研 究 所

1. AmCham Shanghai Science and Technology Committee Event Best Practice: Co-funded Corporate-Government R&D centers Dr Ya Cai Director Unilever Research China ya.cai@unilever.com ResearChina 中 国研 究 所

2. 和路雪 Unilever (联合利华) - Home & Personal Care and Foods - Sales $48.3 billion - 70th (Fortune 2004) - 400 brands - 150 countries

3. Unilever Global R&D Network - R&D is an integrated part of Global Business - Annual budget - 2.5% of NPS, totaling $1.25 billion (2004) - 6,500 staff - 6 Global R&D Labs (UK x2, USA, NL, India, China) - Global / Regional Technology Centres (category based) - Local Product Development Centres (category based)

4. - New Materials - New Processing Business Impact - Formulations - Packaging Large - New Products - Adaption - Launch Medium Small 2 3 4 5 6 7 8 1 Time - Years R&D Roles and Business Impact Global R & D Laboratories Global Technology Centre Regional Technology Centre Local Development

5. Unilever in China 1923 - Soap factory in Shanghai 1986 - Returned 1st JV 1996 - 14 JVs 1999 - 3 Acquisitions 2001 - 4 Business units, 100% owned 2005 - Reorganised

6. 3 Stages of R&D Evolution in China Stage 1 - Basic formulation skills - Support manufacturing Stage 2 - Product Development - Gain competitiveness Stage 3 - R&D Capabilities - Drive new business opportunities

7. We Must Succeed in China - One of the largest consumer markets - Economy is growing fast - Market size is enlarging rapidly - Purchasing power is rising - 2nd largest economy by 2015

8. We Must Grow Faster Bigger Volume Higher Margin Brand differentiated Product differentiated Benefit differentiated Technology differentiated

9. Successful Business Model in China Outstanding Branding Breakthrough Innovation Fast Sustainable Growth + =

10. 700 Multinational Companies Have Set up R&D in China An Incomplete List of Multinational Companies ABB, Accenture, Ajinomoto, Amway, Alcatel, AVL List GmbH, BASF, BEA Systems, Bearingpoint Inc, Calsonic Kansei, Cisco, Coca-cole, Danone, Degussa, Dell, Delphi Corp, Dow International, DSM, DuPont, eBay, Ericsson, Firmenich, France Telecom, GE, GlaxoSmithKline, Hitachi, Honda, Honeywell, HP, Hyundai, IBM, Intel, Kao, Keihin Corporation, Kodak, LG, L’Oreal, Lucent, Matsushita, Microsoft, Motorola, NEC, Nestle, Nifco Inc, Nissan Motor, Nissin Kogyo, Nokia, Nortel Networks, Novo Nordisk, Novozymes, Oracle, Panasonic, Pepsi, Philips, Procter & Gamble, Roche, Rohm and Haas, Samsung, SAP, Schindler, Shell, Siemens, Sony, Synopsys, Teling Manufacturing, Tetrapak, Toray, Toyo Ink, Trelleborg AB, Unilever, Valeo Group, Volkswagen GE - A global lab of 2,000 FTEs opened in Shanghai Philips - A global R&D Campus planned in Shanghai

11. Do World Class R&D in China We Must - Most competitive market - Fast changing life style - Unique culture and social value - Huge variations across the country - A technology - oriented society - Competitors apply the best innovations

12. We Can - Good tradition of education / Esteem of science - Governments strong support and commitment - Abundant R&D resources - 590 universities - 300 institutes - 3 million undergraduates - 0.5 million postgraduates - 150k overseas well-trained scientists - Well established academia - Leading capabilities in a wide range of science fields - Excellent infrastructure - Strong manufacturing and supplying

13. Our Vision - Best Materials Research Lab in the World - Traditional Medicine and Natural Actives - Nano Technologies - Synthetic Materials - Most Competitive Innovation Centre - Develop and deliver big, bold innovations with quality, speed and cost efficiency

14. 4 Keys to Successful Innovations - Governmental support - People - Organization - External Resources

15. Key 1 - Governmental support - Commitment - Policies - Incentives - Joint R&D Efforts

16. Key 2 - People - Selection - Appraisal - Career path - Development - Retention

17. Our Goal - The World Class Team - Young and enthusiastic - Persistent - Diligent and dedicated - Entrepreneurial - Confident and proactive - Creative - Genuine teaming spirit - ‘Internationalised’ - Open, trusted partner

18. Selection - Comptency and skills - A wide range of sources - General and specific targets - Comprehensive assessment - Overseas experience

19. Appraisal - Personal target - ‘SAMRT’ - 3600 feedback - Overall ranking - Bottom tier move-out

20. Career Path - Career most important - Managerial vs. expert - Define as early as possible - Wider range of experience - Create larger space - Regularly review promotion

21. Development - Focus on competency - Training course - On-job training - Overseas secondment - Coaching

22. Retention Not a problem !

23. Key 3 - Organization - A culture of delivery - A highly motivating environment - Harmonised teams - Open and transparent - Fair, just and trusted - Diverse and individual value - Proactive engagement - Risk taking - Feel like at home

24. An Efficient Innovation Process - Professional project management - Integrated project team of multi-functions - Highly flexible and pragmatic - Action-oriented - Simple - Capability-driven vs. Project-driven

25. Key 4 - External Resources - Right partners - IPR Management - Keep on track - Joint R&D fund

26. A Break-through MAKER Excellence in Globe An Indispensable THINKER Created in China A contracted Labourer Made in China Three Steps towards Success

27. We will be most competitive - Noveler - Better - Speedier - Cheaper

28. Thank You Dr Ya Cai ya.cai@unilever.com