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DuPont launches with a new take on innovation

Solo again, the company is spending big on a decentralized, customer-focused research model

by Alexander H. Tullo
June 9, 2019 | APPEARED IN VOLUME 97, ISSUE 23

 

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Credit: DuPont
Alexa Dembek, Dupont's chief technology and sustainability officer, oversees the company's innovation strategy.

Last year, DuPont opened the refurbished Building E353 at its 115-year-old Experimental Station in Wilmington, Delaware.

The building serves as the global headquarters of the firm’s industrial bioscience division. The top floor houses executives and other business personnel. Scientists working on enzymes and probiotics occupy the three newly equipped levels below.

A high-throughput screening laboratory allows DuPont researchers to rapidly evaluate new enzymes for applications such as laundry detergents. The scientists swap out amino acids in the proteins one by one and set up large arrays to see if they work under the temperature and pH conditions of washing machines.

Another lab is equipped with a fluorescence-activated cell sorter for probiotic work and an Illumina DNA sequencer for enzyme and probiotic science. The building has an enormous anaerobic chamber, allowing scientists to study probiotic bacteria without exposing them to oxygen.

In another room, scientists examine chicken gizzards brought in from large farms. They are developing probiotic formulas that will allow farmers to forgo antibiotics.

Down in the basement, twenty-four 1 L fermenters create enzymes and probiotics. Tubing from each vessel runs along the ceiling to a mass spectrometer, enabling workers to monitor off-gases from the fermentation.

Building E353 is not just a gleaming new lab; it is part of a broader remodeling of innovation at DuPont that began in 2015 and continued during the nearly 2 years the company was part of DowDuPont. The commingling of scientists with businesspeople, and even customers, in the building is a theme for the entire firm, which reemerged on its own on June 3.

Research at DuPont was historically more cloistered. The company had perhaps the most fabled central research organization in all of corporate chemistry.

Shutting down DuPont Central R&D was among the first orders of business for Edward Breen when he took over as CEO in 2015. He thought the more than $200 million that DuPont put into Central R&D annually was wasteful. Breen repeatedly bemoaned “moonshot” projects with few prospects for payback, like a $200 million cellulosic ethanol plant in Nevada, Iowa, that he ended up closing.

Instead, Breen wanted to redeploy that R&D money into innovation that DuPont undertook for—and in collaboration with—customers. Science & Innovation, the successor to Central R&D, is a purely service organization now. It offers business development expertise and provides scientists from the firm’s businesses with access to expensive equipment such as transmission electron microscopes. It has no R&D projects of its own.

Breen, now DuPont’s executive chairman, is hardly against R&D. DuPont will spend about $900 million on R&D annually, about 4% of sales. The company has also launched a $350 million program at the Experimental Station to build physical infrastructure to match the company’s decentralized and customer-focused innovation strategy. The industrial bioscience building is one of the key projects.

Alexa Dembek, DuPont’s chief technology and sustainability officer, presides over this R&D budget and the new innovation strategy. She joined the company 28 years ago after completing a PhD in chemistry from Pennsylvania State University.

During her career, Dembek worked with the late Owen Webster, inventor of group transfer polymerization, used to make block copolymers for the ink in inkjet printers. She also held business leadership roles in performance polymers, advanced fibers, and building innovations.

“I can speak with great authority around what it means to be in a laboratory with awesome scientists, but I also know what it means to make money,” she says.

DuPont is well positioned with the portfolio that it has, Dembek says. Through the process of merging with Dow Chemical and then decoupling, DuPont executives engineered four new business segments that they say are honed for long-term growth.

Transportation & Advanced Polymers brings together DuPont’s engineering polymer unit and Dow’s automotive materials businesses such as adhesives. Electronics & Imaging marries businesses from both companies.

Safety & Construction brings together DuPont staples such as Kevlar, Nomex, and Tyvek with Dow franchises like Filmtec reverse-osmosis membranes and Styrofoam insulation. The Nutrition & Biosciences business combines the businesses that DuPont got when it bought Danisco in 2011 with those it acquired from FMC more recently.

“The power of this new portfolio is that it allows us to be deep, to be broad, and most importantly, to be relevant to customers,” Dembek says.

Innovation is not a department. Innovation is what we do as a company.
Alexa Dembek, chief technology and sustainability officer, DuPont

For example, as the world’s leading supplier of probiotics, the Nutrition & Biosciences business is well situated for the explosion of interest in the microbiome as a key to both human and animal health. “This is where I believe the technology is changing the most,” Dembek says. “It is a place where our competitive advantage and the market attractiveness are both quite clear.”

Likewise, DuPont’s three other business segments will be able to develop materials for emerging technologies such as artificial intelligence, the internet of things, 5G wireless networks, and autonomous vehicles.

Given this slate of opportunities, Dembek says, the most important part of her job is choosing the right ones. This requires intimacy with the customer to “understand the important and valuable end-user challenges in the key industries that we serve,” she says. “ ‘Important and valuable’—that is critical to me. I contrast that with a different approach, which would be ‘Here are our products. Where can we go sell them?’ ”

To help establish this intimacy, customers will get real estate right in the heart of the Experimental Station. As part of the remodeling, DuPont is converting a vestige of the old DuPont, the former Lavoisier Library in Building 301, into a more-than-900 m2 customer innovation center.

When it opens this fall, the building will be a venue for DuPont executives and scientists to collaborate with customers. The Lavoisier reading room will be an assembly space for up to 150 people. Another room, called the “wormhole,” will have full-length wall displays so people can virtually visit similar rooms at 10 other DuPont innovation centers around the world.

In the same vein, Dembek aims to tear down barriers between people within DuPont. One way, as seen in the new bioscience headquarters, is making sure executives and scientists are well acquainted. Indeed, all the business segments will have offices at the Experimental Station. “We want strategic marketing teams and scientists working side by side,” she says. “That’s where we get the speed.”

Dembek wants to get DuPont’s four business segments working collaboratively, too. Last September, DuPont launched an initiative called AHEAD, which stands for Accelerating Hybrid-Electric Autonomous Driving. Led by Transportation & Advanced Polymers, it also involves DuPont’s Electronics & Imaging and Safety & Construction businesses.

Electric and autonomous vehicles will need new materials for signal electronics, thermal management and insulation, and charging-station housing—which are all within DuPont’s wheelhouse. At the Battery Show in Stuttgart, Germany, last month, the company showed off battery-pack assemblies as well as components for sensors, electric motors, and other parts.

“It is pretty special for our portfolio to have this large presence in electronics and automotive,” Dembek says.

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Credit: DuPont
Tanja Gruber, the functional leader for biochemistry at DuPont Nutrition & Biosciences, shows off the fermentation lab in Wilmington, Delaware.

Gary Pisano, an innovation expert at Harvard Business School, agrees that cultivating a culture in which employees work across businesses is important for DuPont. “Sometimes companies have all the building blocks, and yet they’re isolated in different business units,” he says. “That’s a danger. They can wind up with balkanized knowledge bases.”

Pisano suggests that managers like Dembek monitor where ideas are coming from. “If I were the leadership of DuPont, I would be worried if all the projects that they were getting proposed were all within business units, because then the idea that they were going to collaborate across business units is not working.” On the other hand, it would be a very good sign if the company racks up early innovation wins involving multiple businesses.

Dembek wants the latter and is instilling a set of rules to help her get it. “No silos” is one. “No civil wars” is another.

She is also trying to change DuPont’s culture around killing projects that are not working out, a delicate task for any big R&D organization. She hosts what she calls “Failure Fridays,” where people talk about efforts that fell short. “We are not celebrating failure,” she says. “What we are doing is proudly saying what did we learn, how do we pivot, and how do we move on to the next best opportunity.”

Dembek jokes that she also wants to make T-shirts that say “Fall in love with growth, not projects”—a slogan that shows up frequently in her PowerPoint slides.

DuPont might be without Central R&D, but Dembek wants to create an environment where innovation is central to all of DuPont. “Innovation is not R&D,” she says. “Innovation is not a department. Innovation is what we do as a company. It is the culture of the company.”

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