TEAMS FUEL GLOBAL INNOVATION AT WHIRLPOOL
Whirlpool Corporation is a leading global manufacturer and marketer of innovative home appliances.89 Based in Benton Harbor, Michigan, Whirlpool has 70,000 employees and 67 production and research centers around the world.90 Typically, one would not think of a manufacturer of refrigerators, dishwashers, and washers and dryers as a global innovator, but Whirlpool is just that. While a strong commitment to innovation pervades the company and its culture, so too does the realization that cross-functional global teams that bring together diverse perspectives and areas of expertise are central to innovation.91 Bringing together different areas of expertise in cross-functional teams was central to Charles L. Jones’s approach when he was hired by Whirlpool to build the Global Consumer Design division, of which he was vice president until 2010 when he joined Masco Corporation as Chief Design Officer.92 In the past, the actual design of appliances was more of an afterthought rather than an integral part of new product development. As a consequence, Whirlpool would churn out appliances that were high quality yet very similar to those of key competitors and competition was based on price; thus the Whirlpool appliance prices were falling by around 3 percent a year though demand kept pace. At that point, top management realized that innovation was the key to the company’s future.93 When Jones came on board, he created cross-functional teams composed of engineers, graphic artists, usability researchers, human factors experts, marketers, and industrial designers to develop new products. The top-selling and awardwinning Whirlpool brand Duet® Fabric Care System (also referred to as the Dreamspace® Fabric Care System in Europe), a high-end matching washer and dryer set with a novel, attractive design, was the result of the efforts of a global cross-functional team.94 The Duet® features a front-loading washer with a porthole and can be raised off the ground on a pedestal so consumers don’t have to stoop as much as they ordinarily would to load and unload clothes from a front-loading washer. It also has a large cleaning and drying capacity, and is efficient in terms of saving on water and energy usage. In designing the Duet system, the interests and desires of consumers in both the United States and Europe were taken into account, as were the perspectives of industrial design, usability, human factors, visual appeal, marketing, and engineering; hence, the need for a truly global cross-functional team. The Duet® dryers are manufactured in Ohio, while the washers are produced in Germany. Thus, much coordination was required between both locations to ensure that materials and colors matched perfectly.95 As Ruben Castano, an employee in the Whirlpool Global Consumer Design division in Cassinetta, Italy, indicated, “It was just a matter of small adjustments in terms of colors, graphics and labeling of programs in order to make the product fit perfectly in each market… the core processes and work methods inside Whirlpool are truly global. This makes it very easy to create teams with members from all over the world.”96 Cross-functional teams at Whirlpool learn a lot by actually observing consumers interacting with products. Thus, it is not uncommon to see team members huddled behind two-way mirrors in specially designed rooms watching volunteer consumers trying out the products.97 This is in contrast to the traditional focus-group approach to product development where consumers are brought together in a group and asked questions about their needs and reactions to products. By actually watching consumers, team members can gauge how useable their products are and how they will actually be used (something consumers might not be able to articulate themselves).98 Groups are used in other ways at Whirlpool to spark innovation. For example, employees in the Global Consumer Design division can devote about 20 percent of their time to developing new ideas, which are then presented to a group of about 8 or 10 employees in studio critique fashion.99 The division is organized around brands rather than products and often employees working on one brand will critique a new idea that employees working on another brand came up with to get a diversity of perspectives with the overall objective of giving those with new ideas honest and helpful feedback.100 Using teams and groups to spark innovation has paid off handsomely for Whirlpool.101 And in 2010, Fast Company magazine ranked Whirlpool 5th on its list of the “World’s Most Innovative Companies” in the Consumer Products category.102
Questions for Discussion
1. Why did Charles Jones form cross-functional teams at Whirlpool?
2. What are the benefits of using cross-functional teams for innovation?
3. What are the challenges in managing global crossfunctional teams?
4. Why might observing consumers interacting with products contribute to the efficacy of new product development teams at Whirlpool?