How a 100,000-strong company is relearning how to innovate

Innovation in painkillers, polyurethanes, selective herbicides, antibiotics and anticoagulants are among a long list credited to pharma giant Bayer over its 150-year history. It still employs 14,000 people in research and development alone.

However, management has recognised that while this commitment to scientific progress remains essential, it is not enough. The world of life sciences is changing even more rapidly today than in previous generations. Innovation isn’t just about new technologies and new products – it also means developing new services, new business models and entirely new ways of working. Bayer used to see the other big pharma and crop science companies as competitors; now it is Silicon Valley start-ups like Verily and 23&me that are threatening market disruption.

Bayer’s reinvention began five-years-ago, it looked at how to problem solve, how to come up with new ideas and how to drive them forward into services and products. It has rethought and expanded innovation – so that people across the company, in whatever function, can identify and act on opportunities to do things differently. Bayer needed to operate in a more agile way. The pace of change inside the company needs to match the pace of change outside.

Choosing the right innovation model

Delivering an innovation agenda is challenging, more so in company of 100,000 individuals, and the closer executives looked at models, which had worked elsewhere, the more challenging it looked. 

From the start Kemal Malik, Member of the Board of Management with responsibility for innovation, knew the company could not simply replicate a proven solution: “We cannot be like Google, but neither do we want to be. We need to plot our own path.” 

Inspired by John Kotter’s dual-operating structure model, an agile network was developed, a volunteer group of many hundred people, still working primarily in their day jobs within the established hierarchy, but with between 5% and 10% of their time devoted to innovation.

A network working on fast-cycle, informal project cutting across the silo-based structure. The agile network has become a spine of innovation ambassadors and coaches running through the entire company, taking on collective responsibility for innovation and transmitting new innovation culture.