New Architecture for New Innovation - A warm, open building with an inviting aura as a home to R&D laboratories for the chemical industry - visitors strolling through any given industrial site aren't likely to happen upon such juxtaposition. That is, unless, we find ourselves in Industriepark Höchst in Frankfurt, Germany, at the end of 2012. That's when Clariant's new innovation center will officially open, making it the home of the Swiss-based company's global chemical R&D activities.

The 23,000 m² center, which represents an investment of more than €50 million, will cooperate closely with the company's R&D satellite sites in Gendorf, Germany; Lamotte, France; and Suzano, Brazil as well as 40 application centers around the world. Five R&D centers will call Frankfurt home - colorants; surfactants and alkoxylates; effect chemicals and intermediates; specialty polymers; and formulation technologies.

The center's open architectural office and laboratory concept intends to combine chemical research and development activities, which belong to the company's Group Technology Services group; and application-oriented laboratories and technical marketing functions, which belong to several of Clariant's 10 business units. The new building will also become home to New Business Development, Intellectual Property Management and the company's Patent department. The company said that combining different disciplines will allow it to further expand its R&D pipeline and strengthen its innovation power.

Innovation Hub
"We have an enormous synergy potential within Clariant," said Martin Vollmer, chief technology officer and head of Group Technology Services. Vollmer said that by creating a centralized R&D hub, the business units can work better together on innovative projects and inadvertent competition between the 10 units can be avoided.

Clariant has developed what it calls an "Innovation Chain," which it says links the "technology push" with the "market pull." At the group level, chemical R&D; process R&D and pilot plants; and new business development will all be brought together within the new center in Frankfurt. Application development and technical service as well as production will still take place at the business unit level.

Innovation is big on the company's agenda. Following the conclusion of its Project GANO - Clariant's wide-reaching restructuring program that began in 2008 - CEO Hariolf Kottmann is clear on his vision for the company's future.

"Innovation in combination with an increased strategic focus on profitable growth will be a key cornerstone for our company," he said at the unveiling of the R&D center design in December. "The goal is to establish Clariant as an innovation leader in the field of specialty chemicals within the next few years."

The company invested about 130 million Swiss Francs (approx. €100 million) in R&D in 2010, or about 2% of sales, which, while it is the industry average, could be considered low for a company with such high ambitions.

"This is merely our starting point coming out of restructuring," Vollmer said. "We are currently in the process of defining our future product portfolio. If we see sales potential in a particular area, we will of course selectively increase our R&D resources. However, we haven't yet defined a target for 2011; this will be clearly driven by our initiatives which are our technology platforms and new joint R&D projects with our customers."

Looking ahead to projected R&D spending in the years leading up to the completion of the R&D hub in Frankfurt and beyond, Vollmer said it was difficult to put an exact price tag on it.

"This is really a selective approach, looking at our new setup of our R&D centers and the projects we agree upon with our business units," he said.

Sales of New Products and Role of Renewables
If the company's sales generated by products five years and younger are any indication, then it will be likely that R&D spending will increase over the coming years. Currently, the 22% of the company's sales come from such new products, and Vollmer said he expects this percentage to increase through the company's definition of its future innovations programs.

"We have clear targets in terms of profitable growth, and this growth will be driven in part by new innovation projects," he said. "In the long run, we will not only see growth through the sales of existing products and regional expansion, rather also real innovation will also contribute to profitable growth."

Vollmer said he believes biggest challenge is to understand the market needs around the world and to turn these market needs into the right chemistry.

"We have to translate the needs into the right R&D projects," he said.

The company said it is looking toward megatrends to drive its product innovations. Renewable energies, energy efficiency and renewable resources are just three areas expected to open new business markets for Clariant beyond its current ones. However, Vollmer emphasized that these are not completely new areas for the company.

"Renewables already play a very important role in the current Clariant portfolio," he said. "In the business unit Industrial and Consumer Specialties, more than 20% of the product portfolio is based on renewables. Sustainability is part of our corporate strategy."


The Design
The new innovation center was designed by HPP Architekten of Düsseldorf, Germany. The company was chosen from a pool of competitors, which was overseen by Bäumle Architekten/Stadtplaner.