Beyond Boundaries: Expanding Kimberly-Clark Professional's Horizons from Products to Services and Beyond

Situation: Kimberly-Clark Professional (KCP) sold many of the products it is most known for – toilet paper, tissues, paper towels – to one of the biggest users of those products – commercial real estate buildings. The problem was KCP and its competitors were easily replaced each year by one another.  One year, KCP would be in the building with its products. The next year it would be Georgia-Pacific. This allowed for little to no new growth around a limited set of items and clients.

Bryan Semkuley, and his innovation team, went to work looking for other value propositions to increase and retain market share with this set of customers. Their research included shadowing janitorial staff people and observing the behavior of paper products and soap replenishment in the washrooms. They found that as the janitorial staff made their rounds, they replaced partially used rolls of paper with fresh ones, throwing the old ones away. This practice saved them time from having to come back when they received a report of an outage in a washroom.

Washroom cleanliness and ample consumable supplies ranked in the top 2 of tenant concerns, so keeping consumable supplies at the ready was imperative. However, there was a great cost to the current practice. And it made no difference which company’s paper products were being prematurely tossed.

From these insights, the team derived a business case for a value-added approach to their products business.  They proposed adding a service, enabled a sensor technology that could be attached to every dispenser in every washroom.  When supplies ran low or jammed, the sensor would signal the janitorial team to replace supplies or fix the problem. No outages, but also not wasting time or product. Savings were associated with the cost of consumables and the time savings of the staff in the buildings. Additional revenue and longer relationship trajectories were proposed to KCP executives as part of the solution benefits.

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The Catch: Despite the logical, numerically backed business case, the idea was initially met with caution from KCP executives. Sensor technology seemed out of their line of business, and the benefit to the customer just did not seem compelling enough.

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Innovation Actions:  Bryan and the team gathered and agreed they had to be missing something. Bryan had an insight when he remembered the market research he had done during his previous career working for major beer breweries. Emotions matter. 

This time the team got permission to interview building tenants and learned that the washrooms, especially for women, were more than places of practical functioning. For some, they were the “sanctuary” to get away from the stresses of the office.

Also, having deeper dive conversations with the building managers (and influencers of the buying process), they learned that these folks had a lot of things to worry about and that keeping washrooms supplied properly seemed like low value use of their time. If KCP could help them find a way to make that easier and smoother, without wasting time and product, they would be all in.

So, Bryan and team constructed some pilots with their friendliest customers and proved the concept and the multiple forms of value – time, money, trust from tenants and building managers. However, they also took it a step further and built a pilot in KCP headquarters, giving executives and their own janitorial folks a chance to experience the benefit. The positive experience, coupled with the positive support from customers voiced directly to the executives, helped sell the idea.

One further innovation action that turned the idea into an executable action was Bryan learning from other companies that had gone from selling products only to also selling services. He brought in their selling model and techniques to KCP, so more customers would see the value, buy it, and send KCP into a growth mode within this part of its business.

From those set of actions, Onvation (the name of the service) came to life.

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Growth and Value: Growth for KCP was generated through longer retention of existing and new clients, additional SKU placements in the buildings, and revenue from the service and reporting component to the clients.

Value to the clients came in the form of consumable and labor savings, an increase in tenant satisfaction and retention, as well as allowing the building managers to spend more time proactively managing higher value issues versus fighting ‘washroom fires’.

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Mini-Lessons: Logic, numbers, financial predictions are necessary but not always sufficient motivators for taking on something new, especially if the new thing seems foreign to the business.

Even around commodity products like beer and functional places like washrooms, people have strong emotional affiliations that need to be understood, respected, and addressed.

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