IPEX – Client Interview

Director of Innovation

IPEX’s Director of Innovation shares insights and advice on Stage-Gate portfolio management.  Challenges include: balancing customer requests for incremental product improvements versus big, leading-edge market-oriented innovations; and tackling uncertainty.

Operationalizing and Executing Portfolio Management to Support a Customer Intimate Business Strategy?
Richard St-Aubin, P.Eng., Director of Innovation at IPEX Inc interviewed by Stage-Gate International

Richard St-Aubin is the Director of Innovation at IPEX Inc, one of the largest manufacturers of thermoplastic piping systems in North America. Richard is a Professional Engineer, having completed a Bachelor’s Degree in Civil Engineering at Carleton University in 1992.  Prior to attending University Richard served for three years in the Canadian Armed Forces as an Artilleryman.

SGI: Let’s start by telling our readers a little about yourself and your company.

RS: Hi, my name is Richard St-Aubin and I am the Director of Innovation at IPEX. IPEX is one of the largest manufacturers of thermoplastic piping systems in North America. We have been in business as IPEX for over 20 years now and we have the widest range of plastic piping products and systems in the market today. We began life as Scepter Plastics in 1954 making hula hoops. Since then, we have developed into one of the largest global corporations making plastic piping systems for a lot of different market sectors. Although you might not have heard of IPEX, you probably have one of our products under your sink or under the road in front of your house. Our products are found everywhere and as a result, new product development and innovation is definitely an important element to IPEX.

SGI: What is your favorite new product out right now and why?

RS: We just had a major product launch, our next generation electrical junction boxes. We participate in a lot of different market sectors, including the electrical cable protection market. We have been making junction boxes for many years, but the design has not changed since the 1970s; this is true for our competitors as well. The reason this is my favorite product is because it incorporates a unique industrial design, clever engineering and really cutting-edge manufacturing to produce a product that is head and shoulders better than its rivals. This market has not seen this type of innovation in a really long time and we are extremely proud of its success. There are tremendous opportunities for product improvements and innovation, especially in the piping industry. Our ‘j-box’ generated a lot of buzz in the marketplace and it really is innovative and demonstrates what can be done in terms of innovation.

SGI: In your opinion, what is the single biggest portfolio management challenge that organizations face today?

RS:  There are two really big challenges that our organization faces. One of them is the 50,000-foot view of connecting portfolio management with the company strategy. Our company strategy is very customer-focused and intimate. We work with our customers very closely and truly worry about their business success just as much as we worry about ours. As a result, it often becomes difficult to align portfolio management with our corporate strategy – often our customers are looking for incremental product improvement while we believe it is important to focus on big, leading-edge innovations.  The tension between these two forces is the challenge of portfolio management at IPEX.

The other big challenge is more operational – how do we tackle uncertainty? When looking at projects we try to compare them on an apples-to-apples basis. When two projects require the same amount of resources and have the same financial payback, which project do you pick? Determining uncertainty within project selection continues to be a challenge: which project will be more successful; which one will have a higher ROI; which one will have those intangibles that we expect? Taking all the different criteria into consideration and then analyzing in some sort of model to compare projects continues to be our biggest operational challenge. I think this is especially true for small to medium-sized corporations like ours and/or for companies that are just starting for formalize a portfolio management system.

SGI: What advice would you give to others on how to tackle this challenge?

RS:  I believe every company needs to have a corporate strategy regardless of how well it is articulated. The company strategy usually has to do with what the company does or develops and for us it is driven by a vision to develop products that will help our customers sell to their markets and be successful. A strategy needs to guide you on what projects should be done, but perhaps more importantly, what projects should be killed. If your company strategy is not defined enough to give you this guidance, then more work is needed on it.

In terms of dealing with uncertainty, there are a lot of different tools and simulations that can help manage financial issues and provide risk analysis on the various projects being considered. My advice would be to seek help from someone that specializes in this field. There are a lot of different companies that have expertise in this field and that understand all the different approaches that could be used. I don’t always think that a ‘do it yourself’ mindset and approach are best for achieving the desired business results. Focus on what you are good at and don’t be afraid to ask for help.

SGI: What do you think Summit attendees were most interested to learn in your presentation?

RS: I have spent 17 years with IPEX, so I often wonder how other companies are doing things. I suspect there are a lot of people in product development who are in a similar position where you need/want to find out how other people are tackling similar challenges. I think delegates were interested to see how we look at strategy and how we pick projects. Attendees were also interested in why our strategy and approach are so different from that of other companies, how this impacts our customers and perhaps depending upon the nature and maturity of their markets why taking a similar approach might prove beneficial to their efforts. For companies that have a similar strategy and approach, they already know how hard it is to decide on the direction the company should take so learning about our successes and challenges might facilitate the work they are doing currently in this regard.

SGI: Looking into your crystal ball what do you think will be the greatest challenge facing product portfolio managers 10 years down the road?:

RS: It’s always difficult to predict the future, but I am confident that the challenges 10 years from now will be similar to the challenges we face today. I don’t think we will be ever able to get away from more projects than resources, different views within the company that pull you in different directions, limited people and limited funding. That is really the challenge of portfolio management. We are comfortable and efficient with using our Stage-Gate process, so we know that we are ‘doing the projects right’, but we are still working on ‘doing the right projects.’ A lot of the time this is not clear cut and I don’t see how that will change; if anything it will become more challenging with all of the technology changes.