Recipe for Growth

How does Whirlpool cook up great ideas to get back on the fast track? By turning people loose on the challenge of innovation, and then turning up the heat on their best ideas.

The smell of gently sautéed garlic, the whir of a pepper mill, the clang of a paella pan. Around Whirlpool Corp., the world's largest manufacturer of home appliances (annual sales: more than $10 billion), these sounds and smells are signs of a promising new business growing inside a slow-growing giant -- and of a whole new way of thinking about innovation.

The new business, Inspired Chef, is a stretch for Whirlpool. For more than 90 years, the Benton Harbor, Michigan-based company has made its fortune by making refrigerators, washing machines, and ovens. Inspired Chef is a direct-to-consumer business that marries an old-fashioned culinary school with a next-generation Tupperware party. It is also one of the first major initiatives to come out of the company's Innovation Team, a new approach to generating business ideas. "We had this internal market of people we weren't tapping into," explains Nancy Snyder, corporate vice president of strategic competency creation. "We wanted to get rid of the 'great man' theory that only one person -- the CEO or people close to him -- is responsible for innovation."

It was an old-fashioned strategic business dilemma that inspired this new-wave approach about 18 months ago. Growth was slowing, profits were falling, and Whirlpool was headed right for another cyclical downturn. Some cost-cutting steps were taken, including the decision to trim 10% of the company's 60,000 workers by the middle of 2002. But leaders at Whirlpool knew that no company can downsize its way to excellence.

Enter the Innovation Team. The 75-member group -- an international cross section of employees from the factory floor to the corner office -- was charged with scouring the organization for ideas that could generate material business growth. No boundaries would be set. No proposals would be rejected out of hand.

But the new ideas did have to survive rigorous evaluation sessions centered on how customers would react to them, with Whirlpool employees sometimes replacing outside focus groups. Ideas that made the cut got funding to go to the next level.

Inspired Chef was one of the ideas that survived the gauntlet. It was the brainchild of KitchenAid executive Josh Gitlin, who'd been pushing to get this Whirlpool division involved with a phenomenon called "extreme nesting," where people spend a lot of time at home decorating, cooking, and entertaining. "I wanted to sell the culinary passion that goes along with owning all of these complex kitchen tools," Gitlin says.

It works like this: Inspired Chef contracts with chefs and culinary-school grads to throw cooking class -- dinner parties in customers' homes, and then to sell them the tools it took to make the meal. The chef brings all the food, the cookware, and, most importantly, a catalog chock-full of KitchenAid goods like cutting boards and knives. Whirlpool gets a new distribution channel for its appliances and a cut of the tuition. Classes start at around $29 for a Spanish dinner-party class, where you learn to cook paella and, ideally, buy a paella pan.

By August 2000, the Innovation Team had moved Gitlin's idea into the experimental stage, which meant getting real money and a staff. And since it was Gitlin's project, he became founder and president of the new unit. A year later, Inspired Chef has a full-time staff of seven people and nearly 60 instructors teaching classes in six states. A national rollout is now under way.

Whirlpool executives are hoping that Inspired Chef will be an inspired business. It's already an example of how to spark creativity inside of a big organization. "There's always a fear that innovation will end once a business has been created," says Nancy Snyder. "But this time, it feels like innovation has become a part of us, that it's bigger than specific projects."

Learn more about Inspired Chef on the Web (www.inspiredchef.com).

Sidebar: Ideas Inc.

How do you innovate from the inside out? J.D. Rapp, a leader of Whirlpool's Innovation Team, has come up with his own formula.

Forget skunk works. That phrase gives off the odor of a secret project, which runs counter to the notion that everyone can have great ideas. Creativity doesn't happen behind closed doors.

Embrace obstacles. If there's nothing in the way of a new idea, chances are you're making the evaluation process too easy. And that could mean your ideas aren't groundbreaking enough to energize the whole organization.

Create your own evaluation tools. Use simple tools -- like the list of nine questions that Rapp and his team ask -- to vet ideas. Doing this lets everyone get in on the action, and it also helps keep evaluation costs down. The burn rate on ideas can be high; Rapp estimates that for every 10 or 12 ideas his team puts to the test, only 1 or 2 survive.

Nurture volunteers. People are often willing to give up some of their time for great ideas. Companies need to think of ways to compensate volunteerism. Sometimes that means putting volunteers in charge of a project; other times, it just means freeing up their time so they can help out a team that could use their expertise.

Make innovation permanent. With the constant pressure to innovate and change, creative ideas can end up being one-hit wonders. Use tools like an intranet -- Whirlpool has one called the Innovation Pipeline -- to keep people current on what's new and exciting.

Contact J.D. Rapp by email (john_d_rapp@email.whirlpool.com).

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