Innovation factory challenges Scania's business model
With Innovation Factory, Scania addresses the disruptive changes in the ecosystem of transport and logistics and stimulates new innovations outside of Scania’s core business.
Scania’s Innovation Factory is about creativity with an entrepreneurial approach. The initiative aims to channel ideas of employees and give them hands-on experience of releasing a new product or service to the market. While innovation takes place in many parts of Scania, not the least the R&D unit of 4,500 employees, this programme also brings an entrepreneurial perspective, complementing the company’s large-scale industrial initiatives.
Innovation Factory is a necessary and vital initiative for Scania. The world around us is changing - and so is our company. We now speak about the ecosystem of transport and logistics and no longer in terms of heavy transport, with its traditional flow and supply chain. We think more in terms of a holistic system where everything is evolving.
“With Innovation Factory we want to challenge the whole business model. We hope to develop people in a new way of thinking. We need talent and people that think outside the box, to add a dimension where our staff can challenge the business model. It’s no longer enough just to develop the best truck; we need to combine that with innovative business models,” explains Scania’s CEO Henrik Henriksson.
Preparing Scania for the future transport industry
Innovation Factory aims to respond to the questions that we must answer if Scania is to succeed in the future transport system: Who will be Scania’s customers tomorrow? Where are the profit pools? Who will be Scania’s new competitors?
“Our purpose is to drive the shift to a sustainable transport system. On a higher plane: we want to leave behind us a planet that is better than the one we inherited, which also includes the social aspects. I feel that we have that in our DNA, in our blood,” says Henriksson.
Innovation Factory is one way for Scania to achieve this transformation and it can also make the company a more attractive employer. Scania employees, individually or in teams, are invited to submit viable new business ideas. These ideas are assessed and if they sound promising, the participants will have the opportunity to develop their thinking over several months.
The project selection process
In 2019, close to 60 projects were submitted for consideration to the Innovation Factory. The four teams selected through this 'Dragon’s Den'-type process were given leave from their regular duties to drive the projects over six months as part of their employment at Scania. The company contributed seed money of SEK 500,000 to each project.
The concept has evolved over the past few years. In 2019, a collaboration with Swedish tech community SUP46 strengthened the project's reputation and reach when the teams were moved into this entrepreneurial tech environment.