Syngenta-INSEAD MaSE Academy

INSEAD Fontainebleau
August 2012

Prof. Prashant Malaviya &

Markus Christen

Solution Innovation:
The Journey from
Products to Solutions

What is the difference between a product

and a solution?
•  Solving a customer problem that limits revenues, drives up
costs, causes excessive risk, and/or keeps customer awake
at night—not just providing an input or supplies into
customer production process
•  More value and less complexity through integration of
product and service components—not just packing more
functionality into a product or offering clever bundles

Good Not good

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 A few examples of solution innovations

•  Hilti: Fleet management instead of just power tools

•  Rolls Royce: TotalCare instead of jet engines
•  IBM: Solutions for a smarter planet instead of hardware
•  Air Liquide: Individual Quick Freezing instead of gases
•  Alstom: Available train capacity instead of equipment
•  Lantal: Cabin design for airlines instead of fabrics
•  Syngenta: Planted rice fields instead of seeds and CP

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Explore the customer’s business:

BOA: ‘Before-On-After’ Farm

Potential Syngenta Offers &

Solutions

Before On After
the Farm the Farm the Farm

Areas that influence what a Areas that impact how much

Crop
farmer is trying to do Production a farmer gets for his crop

Environment Crop Farm Crop Processing

Marketing Activities Planning
Raw
Materials Crop
Monitoring Distribution

Agronomy

Crop Agronomics

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 Explore the customer’s mind:
ODE: Occurs-Decided-Experienced

Rational Issues: Business Dimension

Before On After

What
Personal Dimension
Emotional Issues:

Occurs?
Traditional
What is Research
Decided?

What is
Experienced?

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What does a customer want?

•  Integration to improve
•  Activities
–  Combine/eliminate activities
–  Fewer activities
–  Outsource activities
–  Less arduous activities
–  Mechanize activities
•  Decisions
•  Integration to improve
–  Fewer decisions
–  Advice, better information
–  Simpler decisions
–  Better communication of offer
–  Clearer choices
•  Integration to improve
•  Experiences
–  Guarantees, control, access
–  No negative experiences
–  More profit, predictability, time
–  More positive experiences
–  Peace of mind, status

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 Customer Value = Total monetary gains
and overall satisfaction (RCRS)

Risk
Reduction Qualitative or
(e.g., lower variance, psychological value
Quantitative or better predictability, etc.)

economic value
Satisfaction
(e.g., pride, status,
peace of mind, Cost
Revenue etc.)
Savings
Gains (e.g., no labor costs,
(e.g., higher yield, lower insurance
better price, etc.) costs, etc.)

Always relative to the next best alternative

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©Prof. Malaviya & Christen, INSEAD

Two directions to move

from products to solutions
Coordinated Chain Market Solution
System

Focus on developing optimized production system (e.g., Focus on grower’s business objectives to deliver
environmentally sustainable golf course management, desired returns through optimized production system
Integrating Steps

value chain access, residue management program) and customized business decisions

 Higher, more predictable quality  Higher profits for given risk

 Higher revenues, lower costs  Different focus for grower’s resources

Focus on best product to address specific problem at Focus on delivering best operational outcomes through
Portfolio

specific stage of growing system (e.g., weed control, optimized products and services and their application
seed varieties) (e.g., no insects, planted field)

 Better performing seeds and chemicals  Lower total cost

 Timely delivery and proper application  Better yield

Product Customized Program

Application Outcomes
Doing Individual Steps

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©Prof. Malaviya & Christen, INSEAD
 Integrating elements
to keep solution together
System Coordinated Chain Market Solution
Integrating Steps

Insurance, Guarantee,
Profit Sharing

Information, Support,
Consulting
Portfolio

Convenience,
Price, Quality

Product Customized Program

Application Outcomes
Doing Individual Steps

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Key resource
to enable successful solution innovation
Coordinated Chain Market Solution
System

Value chain Two-sided platform

Integrating Steps

influence control
Portfolio

Product knowledge Customer-specific

Operations knowledge data

Product Customized Program

Application Outcomes
Doing Individual Steps

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 Solution Innovation:
Moving beyond products and services
•  Innovation is more than just new products and technology
–  Find new ways to deliver better customer value through higher
revenues, lower costs, better risk-return, more pleasure (RCRS)

•  Solutions start with identifying and understanding customer

problems—which should involve everybody
–  BOA: Expand perspective beyond your products, your industry to
customer’s business
–  ODE: Expand understanding beyond customer activities to decisions
and experiences

•  Solutions are not just bundles of products and services

–  Create value with customized programs or coordinated value chain

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Implications for Valuland

•  Analyze grower business and value chain to understand

customer problems (pain points)
•  Evaluate current market offers and their key strategic
attributes (value ‘as is’)
•  Identify satisfied, under-served and un-served customers
•  Develop new offers to solve a problem for target customers
by exploring customized programs and coordinated systems
and applying ERRC
•  Assess revenue, cost, risk, and satisfaction impact (RCRS)
to determine new value (value ‘to be’)
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