Procter & Gamble, the $51 billion multinational that uses cutting edge technology across its products and services, entered into a tie-up with India's Council of Scientific and Industrial Research in August. The collaborative research tie-up will use the varied expertise of both organizations for mutual benefit.
P&G says it believes India's intellectual capital, technical and scientific expertise, and its world class centers of excellence create a unique opportunity for the company to accelerate P&G's innovation capability.
CSIR, India's largest network of government research laboratories, has 38 laboratories across the country and over 6,000 scientists working in fields like chemistry, biochemistry, space, pharmaceuticals, physics, botanicals, toxicology and microbiology.
Dr Shekhar Mitra, Vice-President (Global Research and Development) P&G, who traveled to New Delhi last month to sign a 'historic' letter of intent with CSIR, spoke to India Abroad News Editor Suman Guha Mozumder in New York on his return on what prompted the partnership and its implications for the company.
This interview first appeared in India Abroad, the oldest and largest circulated Indian-American newspaper, owned by rediff.com
What was the idea behind the P&G and CSIR partnership?
P&G is over 150 years old. We started as a candle-making operation and through superior innovation from day one, we have come a long way, branching off into various areas of expertise serving the needs of global consumers in a superior way.
Innovation has been the lifeblood of our success. The consumer is boss. That is why we listen to consumers and use our core competencies and sophisticated research and development to meet up to their needs and demands.
Consumers are demanding innovations that improve lives, but they should be cheaper, better and faster. We have been relying on our core competencies in polymer science and new chemicals to fuel businesses.
But we realised we can change the model of innovation by having flexible platforms, the importance of connecting and developing internally and externally -- going out and connecting and developing with superb suppliers and institutes that offer problem-solving capability.
That is the thrust of our 'connect and develop strategy,' which not only connects and develops internally to take advantage of our core competencies, but also goes out and complements work with capable suppliers and institutions where they have the ability to help us bring better, faster and superior innovations. Thus this partnership.
How 'strategic' is the tie-up?
It is strategic as it aims at taking uniquely the strengths of our company's ability to understand consumer needs in a superior way and our ability to create core competencies in certain chemistry and bio-chemistry areas. The tie-up complements areas where institutes and suppliers provide new ingredients and new problem-solving skills faster.
Can't you develop that in-house?
If we develop skills, we have to start from scratch although we have our core competence. We want to keep being the best in developing things like polymers, keep being the best in developing benefiting ingredients for skincare and healthcare.
We do not want to dilute our focus, but strategically we know in which areas we need complementary skills. That is why this tie-up is strategic in the areas of, for instance, new molecules, new manufacturing processes and new natural ingredients that are cheaper and better.
That is what we mean by strategic. We are trying to marry the core competencies of P&G's superior R&D skills with core competencies and expertise of some of our new suppliers and institutions.
Is it the first time you are having such a partnership in India?
Yes, on this scale. CSIR has 38 laboratories all over India. Even though companies like GE have collaborated with some CSIR laboratories like the National Chemical Laboratory, we are not restricting ourselves in our collaboration with one laboratory. P&G spans a variety of products -- from skincare that may need botanicals to chemicals that come from synthetic sources.
Which means you will use all CSIR laboratories?
We will identify areas where we need to complement our skills to bring innovations to global consumers faster and cheaper. Once we identify the areas, we will ask CSIR which four or five of its labs are best suited for this.
A classic example is the area of 'naturals,' for which there are five laboratories. Similarly, in molecular biology and life sciences, there are three. The letter of agreement is for collaborating with any that will meet our needs across the country. We will choose.
P&G has global presence. Why did you choose India to leverage scientific skills?
India has a long history of driving focus on science and technology. It started with Pandit Jawaharlal Nehru, the first prime minister. Indian leaders and people have driven sciences, education and engineering in a big way over the years.
We have found India has varied expertise in multiple fields that complement the expertise a superior consumer company needs. Life sciences capabilities, because we are in health and beauty science; and toxicology capabilities, as we assess the safety of our products.
We are into pharmaceuticals, we have one of the best osteoporosis drugs. India has a central drug research institute. We are very interested in how natural products can work and how they can provide superior anti-aging benefits, skins benefits, and health benefits for gastrointestinal tracts. India has that expertise.
India has the emphasis, the infrastructure We have found that not only are the Indian engineers and scientists terrific, they are very willing to collaborate with us to solve real life problems. India can provide expertise in all the areas.
The best thing is that CSIR is in every one of these areas. I can go to India and one of the CSIR laboratories and source a variety of technologies and people who can help me in problem-solving to complement and supplement our capacity and capability. There are top notch scientists and engineers trained in different fields in India.
So what is the idea?
Skills part is very important. We have the skills to understand consumers in various categories. We have skills in core competence. If we can combine that with the problem-solving abilities of top notch scientists and engineers, it will be a perfect match.
It sounds like the trend with IT-related companies in the US which are outsourcing work to India. Is that the objective?
As far as we are concerned, consumers are demanding better, superior and cheaper innovations. If this is the driving force and P&G has core competencies, we have to think how we can speed up innovation and bring problem-solving capabilities to collaborate with us. That is the kind of driving force or the objective for us.
P&G is said to be setting up a 'connect and develop' hub in Bangalore. Does it involve investment on your part?
Yes. We will invest initially and hire people to help us coordinate and run some programs in CSIR laboratories across India. We will determine which areas are top priority. The programs will have to be managed by scientists and engineers in Bangalore. They will coordinate with engineers and scientists at our Cincinnati headquarters.
We will initially hire 10 to 15 such people. We will expand slowly as the program rolls. But these people are just leaders and programs managers. CSIR scientists will work in the laboratories for the programs.
Any ballpark estimate as to how much financial investment your company will make?
I cannot give you figures now. I will not like to discuss it at this stage. But our investments will be consistent with the work we are looking forward to. Perhaps it will be in the region of a couple of million dollars in the first few years.
When will the partnership take off?
By the fall of the year, around October/November. Our first projects will start in three or four laboratories in India. This will be a very long-term collaboration. We will be involved in setting up such collaborations in India.
Image: Uday Kuckian
