Kidit Afable Business Model Innovation | Go-to-Market Strategies [email protected]
1 Source: The New York Times 2 3 The innovation of speed Usain Bolt versus 116 years of Olympic medalists
1. Performance generally improves Today’s winner is over time tomorrow’s 2nd place
Francis Lane in 1896 23m behind (12.6s)
Usain Bolt in 2012 9.63s
Source: The New York Times 4 The innovation of speed Usain Bolt versus 116 years of Olympic medalists
1. Performance generally improves Today’s winner is over time tomorrow’s 2nd place
2. Innovation is seldom linear, and incremental It takes more to improvements are constantly diminishing win each time
1896 – 1906 10 years, 0.8 seconds
1932 – 1960 28 years, 0.1 seconds
Source: The New York Times 5 The innovation of speed Usain Bolt versus 116 years of Olympic medalists
1. Performance generally improves Today’s winner is over time tomorrow’s 2nd place
2. Innovation is seldom linear, and incremental It takes more to improvements are constantly diminishing win each time
3. Jumps in innovation are always Winners eliminate or triggered by one improve everyone else
1924: Jesse Owens 10.3 seconds 1964: Jim Hines 9.95 seconds 2012: Usain Bolt 9.63 seconds
Source: The New York Times 6 The innovation of speed Usain Bolt versus 116 years of Olympic medalists
1. Performance generally improves Today’s winner is over time tomorrow’s 2nd place
2. Innovation is seldom linear, and incremental It takes more to improvements are constantly diminishing win each time
3. Jumps in innovation are always Winners eliminate or triggered by one improve everyone else
4. The margin of winners From 0.1s to continues to decrease 0.01s
Bronze in 1968 was Bronze in 2012 was Bronze in 1906 is 0.7s 0.23s faster than gold in 0.17s faster than gold in faster than gold in 1896 1948 1992
Source: The New York Times 7 Average company lifespan on S&P 500 Half the S&P 500 likely to be replaced over the next 10 years
33 20 18 14 years years years years
1965 1990 2012 2026
Source: Innosight 8 STAYING RELEVANT: A 130 YEAR OLD JOURNEY (sustainable innovation)
9 10 Johnson & Johnson Largest and Most Diversified Health Care Company in the World
31 53 ~70% of 10 year Free Consecutive Consecutive Cash Flow years of years of returned to adjusted dividend shareholders earnings increases** increases* ~70% ~25% of sales from of sales from #1 or #2 global products launched AAA RATED market share in past 5 years position
* Non-GAAP measure; excludes special items ** Inclusive of the April 2015 dividend declaration *** Non-GAAP measure; Cash Flow from Operations less Capital Expenditures
11 Our Company The Johnson & Johnson Family of Companies is organized into three franchises that collectively touch over a billion lives everyday!
Medical Devices & Pharmaceutical Consumer Diagnostics
12 is a
130+ YEARS OLD COMPANY
13 HOW CAN become a
130+ YEARS OLD START-UP?
14 Our formula for re-invention and innovation:
1 Super charge the CORE
2 Be CUSTOMER-obsessed
3 Render yourself OBSOLETE
4 Embrace COLLABORATION and the long-game
5 Let YOUR PEOPLE lead
15 1 Super charge the CORE Optimizing the portfolio mix whilst owning more of the customer experience
Medical Devices & Pharmaceutical Consumer Diagnostics 47% 35% 18%
16 1 Super charge the CORE Make big bets and focused investments on high unmet needs – for us this equates to transformational medical innovation
17 2 Be CUSTOMER-obsessed There are a number of areas where we can drive innovation…
What we offer How we create value How we capture value Offering Configuration Experience
Product Product Profit Customer Networks Structure Process Service Channel Brand features performance model engagement
CUSTOMER SEGMENTS WHO WE SERVE
Source: Deloitte-Monitor Ten Types of Innovation 18 2 Be CUSTOMER-obsessed …yet innovation efforts are typically focused too narrowly – need to expand beyond comfort zone
Most companies focus here
What we offer How we create value How we capture value Offering Configuration Experience
Product Product Profit Networks Structure Process Service Channel Brand Customer features performance model engagement
CUSTOMER SEGMENTS WHO WE SERVE
Source: Deloitte-Monitor Ten Types of Innovation 19 2 Be CUSTOMER-obsessed Leverage convergence to create better customer experiences
DIGITAL HEALTH INSURANCE FINANCE MOBILITY TECHNOLOGY
Consumer Patient Screening and Disease Wellness and Access and early disease management and lifestyle affordability of care interception outcomes
20 3 Render yourself OBSOLETE
21 3 Render yourself OBSOLETE
“Our goal is to make significant progress toward a “World Without Disease” by 2030“
Dr. Bill Hait, Global Head, Research Development
22 3 Render yourself OBSOLETE Need for new business models that expand you reach throughout the consumer value chain
FROM HEALTHCARE to HEALTH: Shift from medication to disease interception to prevention
23 3 Render yourself OBSOLETE Disruption will come from the outside
24 4 Embrace COLLABORATION and the long-game
25 4 Embrace COLLABORATION and the long-game Advancing new healthcare solutions through collaboration
Incubation Acceleration Strategic Late stage investments and go-to- market
26 4 Embrace COLLABORATION and the long-game
Innovation Centers
Janssen Labs
JJDC (30+ years of VC Innovation Centers Janssen Labs investing) (Incubators) • $1B+ invested since inception • 4 global Innovation Centers • 4 sites across the U.S. • 43 investments and ~$200M • ~200 alliances in last 2 • 70 companies in invested in 2014 years residence
27 4 Embrace COLLABORATION and the long game Create separation and comfort on failure but ensure adequate linkage back to the business
28 5 Let YOUR PEOPLE lead In-source innovation
29 5 Let YOUR PEOPLE lead Do (and innovate) what is right…commercial success follows
30 Our formula for re-invention and innovation:
1 Super charge the CORE
2 Be CUSTOMER-obsessed
3 Render yourself OBSOLETE
4 Embrace COLLABORATION and the long-game
5 Let YOUR PEOPLE lead
31 Q&A
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