Innovation Lessons From 9 Leading Ceos

Turkcell, Arçelik, Akbank, Yaşar Holding, Petrol Ofisi, Garanti Bankası, Fortis, Goldaş and Ülker… The common feature of these companies is that they were listed among the top 15 in Capital magazine’s survey of CEOs to discover the ‘leaders in innovation in Turkey’… The CEOs of these giant companies from different sectors came together for a round table meeting and shared their strategies and applications in the field of innovation.

At Arçelik Innovation Was Born During A Crisis!
Arçelik CEO Gündüz Özdemir says: “Arçelik is the patent champion of Turkey. We single-handedly account for one quarter of all the patents in the country.” He notes that the reason for this is the company’s very advanced R & D laboratories.

Özdemir explains the innovation process as follows:
“In 1996-1997 in Turkey there was incredible demand in our sector. We had great difficulty keeping pace with this boom in demand with the products that we were able to produce for the market given our capabilities at the time, We were extremely focused on quality. It was that period which laid the foundation for the quality provided by Arçelik today.”

“Later the 2001 crisis forced us to focus on what we were going to do, how we were going to compete and how we were going to increase productivity. We succeeded in developing Arçelik from how it was then to the situation in which it finds itself today. In those days we said that the slogan which would save us was ‘Arçelik means innovation’ and we have seen that we have succeeded in making this a reality.”

Garanti Looks To Listen To The Customer
Garanti Bankası CEO Ergun Özen defines innovation as ‘creating change and developing everything produced by change”. But he notes that the dimensions of development are important. Özen summarizes his views on innovation and the strategy followed at Garanti Bankası as follows.

‘We think we understand the customers but their needs continue to change. For this reason, price and quality aren’t sufficient on their own. Instead, one needs to create a difference in terms of creativity and imagination.”

“This is where innovation comes onto the agenda. I think that the innovation process starts with understanding and following the customer. There is an important factor here which needs to be borne in mind. Now almost everybody has begun to understand the customer. For this now we need to go further. I believe that the solution lies in ‘understanding the customers’ dreams and becoming part of their dreams’. This is the approach we adopt when managing innovation at Garanti Bankası.”

The Growth Effect Has Begun At Yaşar
Yaşar Holding CEO Hasan Denizkurdu says: “There is an important difference in innovation between the USA and Europe. Europe is unable to translate theoretical innovations into practical inventions. There is no such problem in the USA. Turkish companies can also do this.” He says that this is the spirit which they have adopted in the innovations they have realized at Yaşar Holding.

“We now have three nano paint products on the market. One of these is a paint which cleans itself with heat. Moreover, we have now signed an agreement with Belgium. We shall sell to Europe. We are acquiring the patent. It is an invention on a global scale. At the moment nano products account for around 10 percent of our sales and 16 percent of our turnover. It is a product with high added value.”

“There is more. We have produced another product for furniture. The most important problem with furniture is that it gets scratched. But when this paint is used it doesn’t get scratched. Another nano paint is for buildings. You know that the biggest fear when it comes to buildings is fire. It is paint that burns the most. Our new paint doesn’t burn. This is truly an invention on a global scale. Offers are coming from America and we are already starting exports to Europe.”

What Is Goldaş’s Strategy?
Sedat Yalınkaya, the CEO of Goldaş, which heads the list of companies which have made a difference in the jewelry sector, says: “When you look at it, the essence of the business is that we are engaged in one of the oldest professions in the world. In our business it really is very difficult to innovate and find new products. We are continually looking for innovations.” Yalınkaya explains the success of the innovations created by the company as follows:

“We began by establishing and opening stores. We were the first in the sector to put prices on our products. We opened our first store in 1999 as an experiment. A few months later it was New Year. When I called the store to see how business was going, they told me that there were 17 people waiting in line. This was a big surprise. Because in our sector no one will go and wait at the cash desk. Then we prepared a special packet design and we received a patent for it. We applied the same concept to Cumhuriyet gold coins. I mean, in essence what we are doing is this: We are repacking the old and selling it.”

Ülker Reads Customers Minds!
Mehmet Tutuncu, the chairman of the foodstuffs group at the Ülker Group, says: “The group’s success is based on innovation.” He continues: “We have a large R & D team. We have a lot of products which can be described as being innovative. The most recent is the ‘three in one’ product. This really is a significant innovation. It really caused a stir in the coffee sector, which is the product with the highest sales after petroleum products. Within one year we had secured a market share of 20-25 percent. Moreover, we achieved this against companies which we all know to be the leaders in the sector. I believe that behind innovation lies a culture, an outlook and an atmosphere. At Ülker we describe innovation as ‘identifying the customers’ needs before they have even formed in their heads, developing them and offering them on the market’.”

Three Factors In Innovation At Turkcell
Turkcell Assistant General manager Cenk Serdar explains the company’s approach to innovation as follows. “The pace of change in the sector in which we are active is very fast, which means that you can really live very fast. Let me explain it like this, approximately 700 new platforms are launched within the space of a single year. This is how innovative the environment is. I shall summarize it very briefly. We launched the this new generation of infrastructure. Then something happened which considerably exceeded our expectations. For the first time we provided wapsal features, which are very similar to a webpage. At the moment, this traffic already has increased six fold and our sales rapidly grown 4.5 fold. One million people have begun to use the lines. We have a mechanism. We use developmental, creative, effective teamwork. This year our investments reached US$350 million. Next year they will probably be around US$400-450. More than half of this goes to R & D.”

Innovation At Akbank Has Been Reflected In The Statistics
Akbank CEO Zafer Kurtul says: “When we initiated the process of change in 2001 our goal was to ensure that Akbank continued to grow in the future.” He notes that growth was dependent on innovation and makes the following evaluation. “To a certain extent, this is the reason we initiated the New Horizons Project in 2001. When we launched the project we first determined the bank’s priorities. First we invested in human resources. Then we focused on our brand and our communications. Later we turned to strengthening our distribution network. For innovation we decided to be close to the customer. For that reason we transformed our organization into one which was customer-focused.”

“Of course these developments have been reflected in our statistics. We can see that, in addition to profitability, we secured a rapid increase in our market share. We increased credit cards from 5 percent to 14 percent. In investment funds we went from 3 percent to 14 percent. Last year Akbank grew by 70 percent compared with a rate of 50 percent in the sector as a whole. I mean, we grew much more than the rest of the sector.”

What Is Happening At Petrol Ofisi?
Petrol Ofisi Jan Nahum explains the process of innovation and change at the company as follows. “Focusing on the customer is an important part of innovation. Using this as a starting point, we developed a new model. We decided to create sub-brands within our main brand. At the moment, urban customers are looking for speed. We established what we call ‘blue stations’ for them. Our intercity customers have no need of speed. They need more to rest. For this reason this time we created the ‘Petrol Ofisi Park’ brand. We tried something different for rural areas. We created a fuel system which had three sub-brands under a main brand. But we had a problem with the board of directors. The concept was created from nothing. There wasn’t without anything comparable. They were wondering, “Will it catch on?” and asking, “Why didn’t Shell or BP do this?”

Fortis’s Approach To Innovation
Fortis Turkey Board Chairman Yvan De Cock thinks that SMSEs are the power which really drives innovations and says that Fortis aims to provide them with support. Cock explains the innovation strategy followed by Fortis, what they have done in this context and the results they have obtained as follows:

“At the beginning of the 21st century, as it began the transition process to retail banking, Fortis launched a series of initiatives in this regard. I want to look at these initiatives in three ways. The first comprises Fortis’s innovative initiatives related to its own business processes. The second is the social responsibility initiatives in Turkey towards the development of information management, quality and an innovation culture. The third comprises financial service products and the special credits to help develop SMSEs.

IBM Turk General Manager
The Human Dimension Is Important At Ibm
For our work on innovation at IBM we consult with our solution partners. We announced that we would invest US$ 100 million over a period of two years in the ideas that had been appeared during InnovationJam, the innovation and concept development meeting we held on the Internet. 150,00 people participated in this project and 10 new ideas were selected for implementation.

InnovationJam resulted in the submission of a total of 46,000 business ideas within a period of 72 hours and most of those which were eventually selected were related to health, the environment, the Internet and the financial sector. Of course, the innovation model based on such cooperation depends on confidence in the creativity of the workforce, business partners and customers. The decision to share our accumulated knowledge with thousands of people meant that we received, and shall continue to receive, ideas that will be more useful to society and the business world.