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Thursday, May 17, 2012

Proctor and Gamble loves Israel

It is not only high-tech companies like Google and Intel who invest heavily in Israel. Proctor and Gamble, the consumer products and pharmaceutical powerhouse, also looks to Israel for innovation. From Forbes:
I visited P&G office in Tel Aviv. Lital Asher-Dotan, who established Procter & Gamble first R&D hub in Israel called “P&G Israel House of Innovation”, explained why P&G calls Israel a “startup nation.”
 Procter & Gamble has promised to deliver 3-6 % of growth per year. How? Open innovation. P&G Office in Tel Aviv. Image by Shannon Reaudeau
 Image of P&G office in Tel Aviv by Shannon Reaudeau
In the entry lobby of P&G office, which is 20 minutes away from Google’s office in Tel Aviv, there are a few samples of different products sold by P&G in Israel. Among the usual health and beauty brands (Head & Shoulders, Pantene, Oral B, Gillette, Tampax, Pampers …) and brands of household cleaners (Ariel, Lenor, Swiffer, Tide …) there were also different prizes and trophies P&G Israel has received for the development of innovative products. However, what surprised me the most was that besides all these products and prizes there was a copy of the acclaimed book Startup nation by Dan Senor and Saul Singer.
Procter & Gamble takes Research and Development  seriously: it invests $2.8 Billion annually and has 9,300 employees in R&D worldwide. The Israel House of Innovation (IHI) was created five years ago by CEO Bob McDonaldand one of the key goals is to create alliances between P&G and Israeli innovators.
Procter & Gamble’s Israel House of Innovation collaborates with Teva Pharmaceutical Industries Ltd. (NASDAQ: TEVA; TASE: TEVA), the largest generic drug manufacturer in the world; the Hebrew University of Jerusalem, which carries out more than 1/3 of all academic scientific research in Israel;Powermat, which has only 70 employees and is developing wireless battery rechargers. By the way, Jay-Z participates in the JV with Powermat and P&G  not only as a spokesperson but also as an investment partner.  P&G  has also signed on bilateral agreement with Israeli Chief Scientist providing Israeli start ups that collaborate with P&G favorable access to governmental funding.
Present in over 180 countries and with total revenues of about $80 Billion, P&G is the world’s largest Multinational consumer goods company. Procter & Gamble has promised to deliver 3-6 % of growth per year or about extra $5billion in annual revenue. Open innovation is the key to this growth: the giant established in 1837 aims to have 50% of all innovation (not only on new products but also on internal systems) having elements from outside of the company. Jeff Weedman, P&G Vice President, External BD:

            Our JV with TEVA represents the lessons learned that we need better access to Innovation and global abilities while we can provide the in-depth consumer knowhow.”
Read the whole thing.