A.G. LAFLEY’S LEGACY
INNOVATION’S GREATEST GURU DOESN’T WEAR BLACK TURTLENECKS: A.G. LAFLEY’S LEGACY
by Mark Payne, President & Head of Innovation, Fahrenheit 212
After such a sterling run, CEO A.G. Lafley’s departure from P&G stirs an amalgam of feelings — gratitude ringing the loudest.
Over the past decade, A.G. did more to shape the innovation business than anyone else on earth — including innovation’s Mystic-in-Chief Steve Jobs. A.G. hasn’t just worked his magic behind the curtain. He’s been innovation’s most public Pied Piper.
He showed what was possible, proved it and invited us all on the journey.
His proof lay in a torture test demonstration: Taking the staid-and-stumbling P&G he inherited, and making it dance to innovation’s drumbeat in a way that most businesses could only envy.
Signs of A.G.’s innovation-centric mindset were apparent when I first met him in the mid-nineties. A.G. was in Japan to sign-off new product plans for Olay. But A.G. wasn’t just interested in whether all the P&G process boxes were ticked; he went deep on the ideas and what they meant to the consumers he considered his boss.
If that sounds normal now, it wasn’t at all in that moment in P&G history.
During the Ed Arzt era, the company’s global edict was Search & Reapply. This mandate to replicate rather than invent treated globalization not as a source of much-needed fresh perspectives, but as an institutional wet blanket.
Later, under Durk Jager, the highly caffeinated talk was about the hunt for the big breakthrough. But the walk often wasn’t.
While Jager’s right hand explored bold forays into pharmaceuticals, his left crusaded to put all of P&G’s beauty brands in identical bottles to save a penny a pack. The unsubtle philosophy: Grow margin through standardization rather than imagining new, premium-priced consumer experiences.
A.G. had a different vision, and he wasted little time showing it.
Soon after becoming CEO, A.G. came to New York for a symposium on everything from Latino marketing to new digital research techniques.
I’d been given a half-hour on the dais to share a new innovation model built to create bigger ideas and drive them faster to market. Intrigued, A.G. focused his remaining comments on what that model could do.
His endorsement inspired me co-found Fahrenheit 212 with P&G as our flagship client.
In the ensuing year, A.G. grew increasingly public about his belief that becoming world-class at innovation was pivotal to P&G’s future.
He foresaw the two greatest threats any branded FMCG player would face: Domineering retailers and insurgent private labels. Innovation was the only way to future-proof P&G’s core - upping differentiation to insulate his growing stable of billion-dollar brands.
Innovation could no longer be thought of as a mere activity stream of random hits and misses. It was now a mission-critical strategy to be delivered and monetized.
To jumpstart the change, he fired a shot heard around the innovation world.
He told P&G’s brilliant scientists and marketers to abandon their famously insular ways and look outside for catalytic perspectives, ideas and solutions.
Connect and Develop became the new paradigm. Its metric? Half of P&G’s new offerings would come from outsiders, up from 10 percent. As with nearly every other ambition, A.G. surpassed that 50 percent goal with room to spare.
A.G. spawned a new best practice and a new industry: The outsourcing of innovation. But he didn’t stop there. He hard-wired innovation into every aspect of P&G’s business:
· HR had to find a way to single out and cultivate P&G’s catalytic innovation leaders.
· Finance had to make innovation a strategic line item in every business unit’s P&L.
· Design had to become a new company competency.
· Business unit leaders had to learn to balance their innovation portfolios -with both low-risk iterations and bolder, game-changing bets - and to prove that their budgets could deliver a potent, long-term pipeline.
At the heart of this was and is perhaps A.G’s greatest legacy: Appreciating innovation not simply as a game of test tubes, theories and org charts, but of people and ideas.
A special breed of people with innate restlessness, a gift for synthesizing connections others don’t see and for developing transformational ideas that change lives and businesses.
A.G. showed how this power could be tapped, harnessed and leveraged - giving the world an innovation roadmap.
His principles are by now more than proven. As are the formidable talents of Bob McDonald, who steps into big shoes, but will find them more than comfortable.
As fans, disciples and beneficiaries of A.G.’s indelible stamp on the business of innovation, we say: Thanks, A.G.
We’ll keep the torch hot.