Issue link: http://www.e-digitaleditions.com/i/111663
INNOVATION Honoree Award at AACSB International���s conference and annual meeting in April in Chicago, Illinois. Here, we ask McDonald about his role at the company, his approach to mentoring, and his perspective on innovation. You became P&G���s CEO after serving in the military, earning your MBA, and then moving up within the ranks of the company. Which of these experiences have been most valuable in developing yourself as a leader? They were all valuable, but often I did not recognize at the time just how valuable they were going to become. For example, when I joined the company, most of our business was in North America, and almost every senior leader was based in Cincinnati. When I was asked to move to Canada and then later to Asia, my ���rst reaction was that I had done something wrong! My managers recognized how important Asia would become for P&G, and they wanted to ensure that future managers like me had ���rsthand experience of these dynamic markets. You succeeded A.G. La���ey in 2009. Did you feel more pressure to carry on his legacy or to follow your own brand of leadership? My most important consideration is to ensure that the organization is stronger after my tenure than it was before I accepted this role. That has been the duty of every CEO in our company���including great leaders like John Smale, John Pepper, and A.G. La���ey. They understood the fundamental importance of listening and constantly asking ���why?��� until they uncovered the essential insights they were looking for. P&G is known for its approach to innovation. How do you structure operations to ensure that P&G���s employees stay innovative, particularly during ���nancial downturns like the one we just experienced? Innovation has always been a critical driver of the company���s growth. Many of our innovations have been what we call ���discontinuous������in other words, totally new to the world. Despite these successes, we recognized in the early 2000s that only 15 percent of the company���s innovations were meeting their expected revenue and pro���t targets. We recognized that we needed to create a structure that systematized innovation and enabled us to produce a reliable, repeatable stream of breakthrough or discontinuous innovation. One part of that strategy is P&G���s Connect + Develop initiative, which invites people inside and outside the company to submit their best ideas. P&G started its Connect + Develop open innovation program more than a decade ago, when we saw that collaboration outside our company would enable us to accelerate our innovation and deliver breakthroughs. At the same time, we knew that some of our innovations might reach more consumers if we shared them with partners who were better suited to maximize the bene���t of what we���d developed. We set a company goal���to have at least 50 percent of our innovations come, in a key way, from external collaboration. That goal helped drive our internal culture from one of ���invented here��� to one of broadscale collaboration. Today, more than 50 percent of our innovations are done with partners from all over the world, from academia, research facilities, SMEs, other global companies, individual entrepreneurs, and even some competitors. How do you manage this initiative? We manage the C+D program on three key fronts. First, we have a Web site that accepts innovation submissions from anyone, anywhere. All submissions are reviewed by a team of experts. Second, we have an internal C+D team that works hand-in-hand with the company���s top leadership to understand what each business requires to meet existing or emerging consumer needs. That C+D team then works with established global networks���including BizEd March/April 2013 37