Innovation is central to DSM’s culture,vision and strategy with a special emphasis on ‘open innovation’ both spinning in early stage business opportunities and spinning out others that are in a position to bring significant financial return. The company claims an ‘unlimited passion’ to innovate and an equal commitment to developing ever better products and services. It is living up to these aspirations through its attention to detail and the platforms it has developed in health and nutrition as a response to the growing trend for healthy diets. As a result of both the rising costs of oil-based feedstock and its acknowledged attention to sustainability, the company has increased investment in alternative sources. DSM is showing greater awareness of what’s going on in the outside world and is keen to learn from the experiences of others – be they consumers, customers, competitors, suppliers or through participation in VC funds. The strategic innovation effort is targeted to deliver €1bn new revenue by 2010, providing a clear focus for everyone in the company.

In 2005 DSM opened a new R&D Centre in China to increase its foothold in the region, better establish connections with universities and local industry as well as identify emerging trends in those markets. The company continues to dominate the supply of polyethylene fibre and has made several announcements for additional investments to further expansion of production in the US in support of demand for high strength fibres. Alongside strong internal R&D activities, DSM is demonstrating impact from its open innovation strategy: Through an investment in LTP of Sweden, it has launched Fabuless, a food ingredient that triggers the natural appetite control system to suppress hunger signals and consequently reduces appetite. Other recent investments include one in ORYXE Energy international, a producer of additives for cleaner burning diesel fossil fuels that reduce toxic emissions. In 2004 the company acquired NeoResins, a technology leader in specialty water-based acrylic and polyurethane resins for use in paints, coatings, adhesives and inks and, in 2005, it added Syntech, a Chinese resins manufacturer, to its growing portfolio. This combination of growth in developed economies through innovation, developing new markets in emerging economies and simultaneous emphasis on cost control and operational excellence is expected to bring more strong financial returns in 2006.

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