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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. Resear China 中 国 研 究 所. 和路雪. Unilever ( 联合利华). - Home & Personal Care and Foods - Sales $48.3 billion

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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


和路雪

Unilever (联合利华)

- Home & Personal Care and Foods

- Sales $48.3 billion

- 70th (Fortune 2004)

- 400 brands

- 150 countries


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)


- 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


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


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


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


We Must Grow Faster

Bigger Volume

Higher Margin

Brand differentiated

Product differentiated

Benefit differentiated

Technology differentiated


Successful Business Model in China

Outstanding

Branding

Breakthrough

Innovation

Fast

Sustainable

Growth

+

=


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


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


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


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


4 Keys to Successful Innovations

- Governmental support

- People

- Organization

- External Resources


Key 1 - Governmental support

- Commitment

-Policies

- Incentives

-Joint R&D Efforts


Key 2 - People

- Selection

- Appraisal

- Career path

- Development

- Retention


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


Selection

- Comptency and skills

- A wide range of sources

- General and specific targets

- Comprehensive assessment

- Overseas experience


Appraisal

- Personal target - ‘SAMRT’

- 3600 feedback

- Overall ranking

- Bottom tier move-out


Career Path

- Career most important

- Managerial vs. expert

- Define as early as possible

- Wider range of experience

- Create larger space

- Regularly review promotion


Development - Focus on competency

- Training course

- On-job training

- Overseas secondment

- Coaching


Retention

Not a problem !


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


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


Key 4 - External Resources

- Right partners

- IPR Management

- Keep on track

- Joint R&D fund


A Break-through

MAKER

Excellence in Globe

An Indispensable

THINKER

Created in China

A contracted

Labourer

Made in China

Three Steps towards Success


We will be most competitive

- Noveler

- Better

- Speedier

- Cheaper


Thank You

Dr Ya Cai

ya.cai@unilever.com


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