An Empirical Research Into The C & D Innovation Model By P&G

With the rapid development of the economy, there is fierce competition in fast moving consumer goods (FMCG) industry. In China, MNCs such as P&G, Coca-Cola, L'Oréal have occupied middle and high end market, while a great number of Chinese firms are only capable of competing with these MNCs in low end market. Domestic products are single, similar in functions, overproduced and sold off at greatly reduced prices, and which leads to that many firms suffered huge losses. Nowadays, independent innovation has been greatly promoted everywhere. Therefore, product innovation has become the focus of study in Chinese firms. However, Chinese firms have not had experience of successes of product innovation in FMCG industry, so the dissertation studies P&G which is a famous Multinational Corporation, and sums up an effective product innovation model for FMCG firms though analyzing P&G's development and innovation model, in order to offer a new experience for Chinese firms in practice and a new idea for study in theory.In doing so, the author sums up the traditional theories on FMCG's product innovation, and finds out that competition is so fierce that product innovation itself should also innovate, and the theory of open innovation is produced necessary. The dissertation analyzes in great detail product innovation model in P&G, Connect and develop innovation model (C&D innovation model), which is focus on the idea of open innovation. Analyzing intently the model, the study reveals initially the four-stage management process: P&G "discovers" technologies and products they want and need through extensive global networks, and "evaluates" these technologies and products on internal network, and then new products are "launched" in several different markets, meanwhile P&G and collaborators "cocreate" in shared labs to improve the products.Studying P&G's product innovation model and FMCG industry, the author supports that C&D innovation model is an important means for FMCG firms for developing, so Chinese firms should learn from the idea of open innovation. Moreover, after the study of industries' characteristics, the author also thinks that open innovation applies not only to high-tech firms and FMCG firms, but also to firms in the industries which are characterized by fierce competition, short product life cycle and fast changes in technologies.