Presentation on theme: "Innovation in Thermo Fisher Scientific, a Core Value of the Company"— Presentation transcript:
1Innovation in Thermo Fisher Scientific, a Core Value of the Company Mitchell KennedyVice President & General Manager Molecular Biology Business UnitMay 8th, 2014
2Outline of Presentation About Thermo Fisher ScientificInnovation in Product DevelopmentApplying Innovation across the CompanyCommunity Involvement and InnovationSummary
3The World Leader in Serving Science Global Scale50,000 employees in 50 countries$17 billion in annual revenuesUnparalleled commercial reach10,000 employees working with customers every dayIn Thermo Fisher, we’ve created the clear industry leader – the world leader in serving science. And we continue to build on our leading position.With the acquisition of Life Technologies, we’re now a $17 billion company, with almost 50,000 employees around the world.With our leadership position comes the advantages of scale and depth of capabilities, which differentiates us in the marketplace. There really is no other company that has the range of customer touch points we have – technologically, geographically or commercially.We now have four premier brands that we can leverage to create the most value for our customers: Life Technologies, Thermo Scientific, Fisher Scientific and the new Unity Lab Services brand. I’ll highlight the capabilities that these brands represent later in my remarks.Our scale and depth give us deep applications expertise, and we use that expertise to help our customers solve complex challenges whether they’re in life sciences, healthcare, environmental or industrial markets.Unmatched DepthInnovative technologiesApplications expertiseLab productivity partnerPremier Brands33
4Our Scale and Depth of Capabilities Portfolio**ProductsGeographiesROW 4%Life Sciences Solutions26%Services 13%Asia-Pacific 18%Lab Products & Services 37%Instruments & Equipment 26%NorthAmerica 51%Consumables 61%Analytical Instruments 18%Europe 27%Specialty Diagnostics 19%If you look at our company by revenue, you’ll see that our profile is quite balanced.We have 4 business segments that serve customers working in virtually any laboratory, in the clinic, as well as the production line and out in the field. With the capabilities we have today, we are in the best position to help our customers have a profound impact on the future of healthcare, as well as applied markets, such as environmental quality and food safety.From a product standpoint, we have a mix of consumables, instruments and services. This allows us to offer holistic solutions to the challenges our customers face, and be a true partner in meeting their needs.Geographically, nearly 20% of our business is in APAC and emerging markets. Our significant investments here in the past few years in manufacturing, R&D and commercial capabilities given us the ability to support our customers these fast-growing regions.Please note:These numbers are estimates based on FY 2013 revenues for both companies;The LIFE numbers have not been audited or verified by us,This includes certain estimates for intercompany eliminations and other accounting policy adjustments, which are not finalPro forma revenues: $16.8B** Estimates based on unaudited FY 2013 revenues of both companies**Percentages calculated are based on estimates for intercompany eliminations and other accounting policy adjustments
5Vilnius Biosciences Center of Excellence Part of Thermo Fisher since 2010Molecular and Protein Biology products for life science research and diagnostics430 employees80% with university degree, 10% Ph.D.R&D Center: 90 dedicated researchersAll products are manufactured in Class D clean-room facilitiesISO 9001, ISO 14001, ISO 13485
6Focused on What’s Most Important We will meet our 2014 goals by staying focused on the four essential elements that have led to our success and will position us for an even stronger future: our Vision, Mission, PPI Business System and 4i Values.Our Vision is about growth and strengthening Thermo Fisher’s long-term competitive position.Our Mission to enable our customers to make the world, healthier, cleaner and safer is our purpose.Our PPI Business System is our operational discipline, which helps us continuously improve the way we work so we can deliver quality products and services to our customers in the most efficient manner.Our 4i Values are the foundation of our culture, and guide our interactions with each other and with all of our key stakeholders.
7A Mission We’re Proud Of We serve a broad range of customers but if you step back and look at our customers’ goals, what most have in common is that they want to increase innovation and productivity. We are proud to be able to combine our capabilities to fulfill our mission: to enable our customers to make the world healthier, cleaner and safer.In a complex world, our mission is simple, but powerful. And it reminds our 50,000 colleagues every day that what we do as a company is vital:Getting clinical trial drugs to patients on timeMonitoring air quality in the world’s largest citiesEnsuring that our food supplies are safeWe help our customers achieve their goals, and make a difference in people’s lives.We enable our customers to make the worldhealthier, cleaner and safer
8Together We are Fulfilling Our Mission Improving breast cancer diagnosticsScreening for E.ColiHelping to reduce air pollutionIdentifying peanut allergiesEnsuring our drinking water is cleanWe have many examples of how our customers are using our technologies and expertise to meet their own goals and make the world a better place, whether they’re discovering a cure for cancer, protecting the environment or making sure our food is safe. Adding Life Technologies’ capabilities creates new opportunities for us to fulfill our mission, and gives us even more reason to take pride in working for an unrivaled industry leader.Screening for E.ColiOur whole genome sequencing technology was used to develop a qPCR assay to screen food samples for E. coli which is a deadly disease.Improving Breast Cancer DiagnosticsOur DNA sequencing products are helping to unlock the genetic code behind breast cancer with the discovery of the genetic mutation XRCC2, potentially improving breast cancer diagnostics and adding years to the lives of those with the disease.Stopping counterfeit drugsOur TruScan device is being used to help identify and seize counterfeit pharmaceuticals being sold as authentic drugs to the unsuspecting public.Ensuring our drinking water is cleanOur ICS-4000 provides customers with sensitive detection of a wide variety of contaminants in water, as well as toxic substances, in order to keep drinking water safe.Keeping the Public Safe from Radioactive materialsOur RadEye personal radiation detector is helping to keep the public safe by identifying radioactive materialIdentifying Peanut AllergiesOur uKnow peanut test is helping parents and kids know whether they’re allergic to peanuts and how severe their allergy isHelping to cut air pollutionOur Continuous Particulate Monitor collects air samples and provides real-time measurement of ambient particulate concentration to help cut air pollution – especially in ChinaAdvancing Justice through Forensic ScienceThe best forensic laboratories in the world rely on our human identification technology to accurately genotype human DNA samples everyday. Our complete, validated workflow systems are accepted as the global industry standard for forensic casework samples, establishing convicted offender and population databases, and parentage testing.Stopping counterfeit drugsKeeping the public safe from radioactivityAdvancing justice through forensic science
9Accelerating Customer Results Solving Analytical ChallengesIncreasing Lab ProductivityImproving Patient DiagnosticsOur Thermo Scientific brand offers innovative analytical instruments, lab equipment and specialty diagnostics for customers in research, clinical and applied markets.Many customers know us for our industry-leading mass spectrometry and chromatography platforms for the life sciences research market, but our reach extends far beyond that.Our instruments play a major role in monitoring industrial processes, analyzing food to ensure its safety and quality, and tracking air and water quality.Our specialty diagnostics offerings range from anatomical pathology equipment and microbiological agars to sophisticated transplant diagnostics, clinical assays and immunodiagnostics.Complementing and supporting these instruments is a broad array of consumables, equipment and software that help the consumer achieve rapid and accurate results.Scientific instruments and equipmentLIMS and laboratory softwareProcess monitoring and industrial instrumentsEnvironmental monitoring and safetyTransplant diagnosticsClinical assaysImmunodiagnosticsMicrobiologyAnatomical pathology00Laboratory equipmentLaboratory plasticware glassware and supplies
10Leading Life Sciences Technologies Our new Life Technologies brand offers some of the most cited life sciences reagents and instruments, optimized to work together to help customers in research science, medical sciences, and applied sciences accelerate discovery and enable breakthroughs.Life Technologies’ current bands – Ambion, Invitrogen, Applied Biosystems, Gibco, Molecular Probes, Novex and Ion Torrent – will become product names under the Life Technologies premier brand.Accelerating Scientific DiscoveryApplying Biology Beyond ResearchAdvancingPersonalized MedicineMolecular biologyCell biologyProtein analysisGenetic analysisMolecular diagnosticsGenomic medicineRegenerative medicineHuman identificationSynthetic biologyFood safetyAnimal healthBioproduction
11The World’s First Miniature NMR Spectrometer Portable, Affordable and Easy to UseAccessible to chemistry students and technicians with limited NMR experienceMobility – shareable across multiple laboratoriesLow cost (at least 10X less expensive than high-field NMR)Shoe-box size and 10lbs/5KgsThe latest addition to our spectroscopy portfolio is the Thermo Scientific picoSpin-45 NMR spectrometer which reflects a longstanding commitment to innovation. The world’s first fully featured bench-top NMR spectrometer brings the power of NMR to laboratories previously limited by the high cost and impractical size of traditional instruments.picoSpin is highly complementary to our existing molecular instruments and opens new NMR markets for Thermo Fisher Scientific. picoSpin spectrometers have a big role to play in chemical education because now every chemistry student can experience NMR first-hand and learn why it is such a powerful analytical method. And while it is accessible to undergraduate and graduate chemistry laboratories, it’s also robust enough to meet the standards of industrial quality control and organic chemistry laboratories.Thermo ScientificpicoSpin 45
12Q Exactive Advancing Life Science Research Microorganism IDProtein IDLC-MS/MSBacteria populationPrepData…using the new methodology with the Q Exactive, we are already seeing that within an hour or so, instead of several days, we can start getting a full spectrum. This will have amajor impact on disease…Professor Haroun N. Shah UK Health Protection Agency”“But let me give you an example of how our Orbitrap technology is helping scientists make the world healthier by helping them understand microbiological outbreaks faster than ever before. An E. coli outbreak beginning in Germany in 2011 ultimately affected 4000 people and led to 50 fatalities. This particular outbreak strain was difficult to positively ID, which hampered treatment. While a series of tests helped ultimately shift focus from O157 to O104, a bottoms-up proteomics experiment was conducted by the UK Health Protection Agency. This work confirmed the revised pathogen ID and provided new characterization information previously unknown about the strain.Here is a quote from Professor Shah at HPA
13Unrivaled Industry Leadership Committed to InnovationCommitted to Industry LeadershipOrbitrap Fusion Tribrid Mass Spectrometer Proteomics marketIon Proton sequencer Genomics marketNX70 Cryostar (cryotomy applications) Cancer DiagnosticsSureTect PCR Food TestingWith $17 billion in revenue – and a research and development spend that exceeds $700 million, we have committed to a future of innovation. We’ve continued to bring incredibly innovative products to market, and our investment means that we will continue to do so. We are the clear industry leader, and have outpaced our competition in investments in new technology… more than 40 percent than our next-closest peer. As an unrivaled leader, we’d like to think this puts us in very good company. We have a little ways to go to become a household name, but we are clearly poised to set the tone for our entire industry.R&D spend equals ~6.5% of manufacturing revenue, >$700M
14Our PPI Business System is Our Discipline QualityConsistently deliver world-class products and servicesProductivityImprove operating and process efficiency to strengthen our competitive advantageCustomer AllegianceExceed expectations to maximize customer successOur PPI Business System is our disciplineTo achieve our Vision for 2020, we make continuous improvements to better serve our customers.Our PPI Business System links Customer Allegiance, Quality and Productivity to drive continuous improvement and profitable growth.It enables employees to solve real business problems, improve our processes, remove inefficiencies, and provide our customers with the highest-quality products and services.
15March Global Kaizen Week Summary of Events & ResultsNumber of Events Conducted25Participants215Sites14Customer Allegiance: Reduction in # of Complaints109Lead Time Reductions (specific sites)72-99%Footprint / Space created for growth1,366 sq. tQuality: Warranty/Scrap Reductions (annualized)$125,000Efficiency Savings (annualized)$475,000Total Hard Savings (Quality+ Efficiency)$600,000
18Live Our 4i Values Every Day Honor commitments, communicate openly and demonstrate the highest ethical standardsCreate value by transforming knowledge and ideas into differentiated products and services for our customersIntegrityInnovationBe determined to deliver results with speed, excellence and a passion to succeedMake connections to work as one global team, embracing unique perspectives and treating others with dignity and respectIntensityInvolvementAs you know, Thermo Fisher’s 4i Values of Integrity, Intensity, Innovation and Involvement form the foundation of our culture and guide our employees’ interactions – with our customers, suppliers and partners, and with each other. These four values are fundamental to our continued growth.Integrity: We work with Integrity by honoring commitments, communicating openly and demonstrating the highest ethical standards. Every employee at Thermo Fisher plays an important role in shaping our company’s success.Innovation: For Thermo Fisher, Innovation is about creating value by transforming knowledge and ideas into differentiated products and services for our customers. Our company’s distinguished track record of Innovation is rooted in our passion to help our customers achieve goals they never dreamed possible.Intensity: We are determined to deliver results with speed, excellence and a passion to succeed. We are committed to helping you achieve your career goals by offering a range of training and development opportunities.Involvement: We encourage Involvement by asking our employees to make connections to work as one global team, embracing unique perspectives and treating others with dignity and respect. We believe that encouraging employees to contribute ideas and opinions strengthens the company and contributes to growth.
19Thermo Fisher Foundation for Science As the world leader in serving science, Thermo Fisher Scientific has both an interest in, and a responsibility for, inspiring tomorrow's scientists and engineers. The Thermo Fisher Foundation for Science was created to give back to our global community by supporting science students and broadening interest in the STEM subjects: science, technology, engineering and math.
20Community Involvement and Innovation: Globally Employees went to Yinjing, delivered donation valued >54k Yuan to 86 students in the "Thermo Fisher 1 on 1 program" and affected by Ya'an earthquake 2013Students and teachers conduct novel research while enjoying wonders of weightlessness as part of NASA-HUNCH programIn the spirit of our mission and 4-I values, Thermo Fisher Scientific believes in contributing time and support to the communities where we work and live. In 2010, we refined our volunteering program to support greater employee leadership, engagement and choice.We now have employee-led Community Action Councils (CACs) around the world organizing hands-on volunteering in local communities where we have major facilities, with plans to expand in future years. The CACs provide a framework for ongoing employee involvement and opportunities for leadership development. Our employees have contributed thousands of hours annually to support a wide range of charitable causes including health, science education and community development.Employees are granted 8 hours of paid time off to participate in company sponsored volunteer activities. In 2011, our CACs alone logged more than 9,000 volunteer hours.20 science teachers attended a workshop offered by Fisher Science Education, where they tested and analyzed water samples from the Ohio River in Pittsburgh2020
21Community Involvement and Innovation: Lithuania Collaboration with universitiesParticipation in development of study programsInternship program: 33 scholarships for students doing their final thesis in company’s labsEmployees as part time lecturers40% employees volunteered in 2013Over 3,000 hours volunteered28 social projects conductedMobile Bioclass, the first country traveling biosciences labPromoting science among high school students100 schools visited in 70 locations2,500 schoolchildren and 150 teachers participated
22Summary Innovation can be cultivated within an organization through: Funding projects and training to drive actionManagerial support to emphasize value and importanceReward novelty and originalityAvoid excessive criticism of unsuccessful effortsTools such as PPI/Lean (or other disciplines) for a frameworkGoals and objectives which require creativityPositive change management imperative for successOrganization must be willing to adapt and evolveStatus quo cannot be acceptedPreconceptions decrease creativity