Innovative Cosmetics Industry through Science, Technology and Collaboration dr. Sari Chairunnisa, Sp. KK, FINSDV | VP Research and Development Paragon Technology and Innovation Education : ● ● ● ● ● ● Safety Assessment Course, Pharmacology FKUI - 2020 Clinical Trial for Cosmetics Course, Pharmacology FKUI - 2015 Dermatology Residency Program – FKUIRSCM (2010- 2014) Doctor of Medicine FKUI (2002-2008) Research Grant World Congress Dermatology, Vancouver - 2015 Fellow of the Indonesian Society of Dermatology and Venereology - 2022 dr. Sari Chairunnisa, Sp.KK, FINSDV VP Research & Development Paragon Technology and Innovation Table of contents 01 02 03 Paragon Introduction Innovation Challenge & Strategy Paragon journey and culture Why Innovation is so important in Paragon? In preparing and projecting future cosmetic trends 04 05 Innovation Ecosystem Implementation Building the ecosystem for sustainable innovation When science, technology and collaboration bring the dream alive 01 Paragon Introduction Paragon journey and culture Paragon is a Corporate StartUp Company because it is marked by the collaboration of Founders as entrepreneurs, young people who are dynamic and agile in moving and experienced employees with a corporate mindset — The combination of these three strengths has brought the Paragon brand into a local brand with global standard. Established in 1985, Paragon is growing fast to become the No.1 Beauty Company in Indonesia Paragon has the strongest muscles in beauty assets, resource & operation throughout Indonesia to keep doing good for the greater good 11 >10.000 BEAUTY & PC BRANDS PARAGONIAN ALL OVER INDONESIA >1.600 41 ACTIVE SKU's DISTRIBUTION CENTER LARGEST RESEARCH CENTER & INNOVATION >85% IN INDONESIA WOMEN PARAGONIAN 21 Ha >80% PLANT AREA UNDER 35 y.o Factory & Office The first son (Harman) joins the company Wardah direct fires Relaunching selling and Syariah MLM sales down to supply Syariah MLM 1995 1985 2003 1998 2004 2005 1996 1990 PT Pusaka Tradisi Ibu changed name toi PT Paragon Technology and Innovation 50% per year 2010 2009 2002 Economic Crisis 2011 The second son (Salman) joins the company born as a pioneer lahir Supply MLM Sophie Martin of halal cosmetics in Indonesia PT Pusaka Tradisi Ibu established as the first brand, haircare products for professional salon Shampoo Launching 2014 Launching Launching Paragon’s Journey of 37 Years 2017 2020 2022 Launching 2021 Launching 2018 2019 2014 Launching Launching Third child (dr. Sari) joins the company KAHF Face Wash BASES Breakthrough Winner in Southeast Asia (Nielsen SEA 2022) 02 Innovation Why Innovation is so important in Paragon Innovation Defined Broadly Innovation is the implementation of a new significantly improved product (good or service), or process, a new marketing method, or a new organizational method in business practices, workplace organization or external relation (Oslo Manual, OECD and Eurostat, 2005) Broad definition: an innovation can be new to the firm/farm, new to the market or new to the world Innovation is more than R&D, but R&D is important All type of innovation – products, process, marketing and organizational innovation – along the supply chain. THERE IS NO INNOVATION AND CREATIVITY WITHOUT FAILURE. Brene Brown PERIOD. In this lab, MISTAKES are : EXPECTED, RESPECTED, INSPECTED, CORRECTED Understanding Human Desirability: Key Emerging Values Amongst Indonesia Younger Generation 1. Authenticity Gen-Z loves connecting with brands that align with their values. For them, what makes a company stands out is what they bring to the table with their product, how they're treating the people working for them, and what they're doing for the world around them Langkah Baikmu Berarti 2. Diversity & Innovation 3. Transparency & Connection Gen Z is the most racially and ethnically diverse generation yet. Because of this, Gen Z expects to see this level of diversity reflected in the beauty industry through innovation that makes them Looking Good, Feeling Good & Doing Good Gen-Z look for transparency in brand's marketing, behind-the-scenes of creating a product, ability to learn from mistakes and admit when brand has messed up KOL visit to Paragon Lab The above mentioned values are also values that is championed by some remarkable person from previous generation like Martin Luther King (Equality – Diversity), Ozzy Osbourne (personifies authenticity in marketing) and some more. Today, those values has been emerging and becoming popular values amongst younger generation along with the better education supported by internet penetration From 6 to 11 brands within 3 years (2020 – 2022) All Women – Salon treatment All Women with Halal Lifestyle All Women – Prefoessional MakeUp Teen & First User Male First Jobber & Beyond, Halal Lifestyle All Women, Make Up for Halal & Glam Lifestyle Women >25 y.o, Skincare for Halal & Glam Lifestyle All Women with Sensitive Skin Moms with Kids Teen with Advance Knowledge about Skincare All Women – Clinic-like treatment PARAGON SUCCESSFULLY LAUNCH INNOVATIVE BRANDS TO FILL IN HYPERSEGMENTED CONSUMERS, ACROSS AGE (Gen-X to Gen-Z) as the Result of Innovation & Collaboration by the youth with experienced & expertise in Paragon 03 Challenge & Strategy In preparing and projecting future cosmetics trends New Product Development Business Process Challenges in product development to become a trendsetter 01 02 Compete with indie brand products that have unique and disruptive marketing communication techniques (both in terms of packaging, communication media, and claims). The technical challenges of developing new products: new technologies and new product forms take a longer time to create, especially many technologies patented by competitors. 03 Fear of making products with new formats or concepts that are not familiar to consumers. Sometimes need unique concept to build brand image. 0 4 The product cycle is very fast, with a high number of active users of the virtual world, the impact on product style and consumption is also changing more quickly, while the business process for product development is quite long. Challenges in product development to become a trendsetter (Cont’) 05 06 07 Innovation is still focused on products, even though there are still 8/10 other types of innovation that need to be addressed Products that are designed not in accordance with the growing trend and mistakes in determining which trends will last long and which are only short term External factor: shortage of raw materials globally, there is a problem with the delivery of raw materials for the trial testing institutions have limited capacity, etc Strategy in preparing and projecting future cosmetic trends 01 Collaboration of the R&D team with the marketing team to understand consumers closely (ex: consumer connection) → Exploring the habits, needs, and aspirations of consumers for each brand 02 03 Strengthening innovation insight, which captures all data related to trends (domestic and global) that we have to find potential new opportunities in Indonesia Create a data analytics function, which processes internal product sales data, monitors the echo of PTI's products on social media, public / consumer opinion, to find different new potentials 04 Strengthening relationships with suppliers, principals, experts, Key Opinion Leaders, shop owners and the community to get fresh insights. Strategy in preparing and projecting future cosmetic trends (cont’) 05 06 There is a dedicated team for technology development both from raw materials and formulations that work outside of regular projects such as NPD (New Product Development). 07 Improve lab capabilities, both for the formulation trial lab and for the efficacy test lab, so that it can increase research output to support product quality 08 Optimizing the squad team function --> accelerating the product development process with a more agile, adaptive and flexible way of working to support a cohesive work ecosystem Join the cosmetics scientist community who can improve R&D skills and capabilities and will be exposed to the latest scientific technology 04 Innovation Ecosystem Building the ecosystem for sustainable innovation Paragon Key Success, 5 Core Values & 7 Basic Identity This core values & basic identity enable Paragon to keep on growing, sustainable and bring the greater good for the society. 1 Ketuhanan (Faith in God) 2 Kepedulian (Care) Ways of Feeling Niat Baik Identity Intrapreneurship Ways of Thinking Respek pada Sesama 5 Core Value 3 Kerendahan hati (Humility) Paragon Gotong Royong Ways of Action Perbaikan Berkelanjutan 4 5 Ketangguhan (Grit) Inovasi (Innovation) 7 Basic Pembelajar Fokus pada Pelanggan Our Innovation is Based on Our Core Values Innovation is about speed. How do we catch the issues and how quickly we act on them. Innovation is about Care. How we care about our customer’s pain, and how we resolve their problems Innovation is about keeping it true to our values. Our Innovation mindset: from Paragonian for Consumer For Paragon, every small action that aims to make a change for the better is an innovation, because every small step will make a big change if it is done consistently. Innovation starts from a mindset that is translated to action and will provide a greater good for our surrounding. Engaging Paragonian in doing innovation Engage Consumer through Our Innovation Paragon Innovation Challenge (2019-now) Engaging Paragonian in Doing Innovation BUILD SAFE ENVIRONMENT TO MAKE A MISTAKE & LEARN FROM IT Paragon Innovation Challenge (PIC) was held by Paragon as a forum for all Paragonian to make continuous improvement in their areas of expertise. The spirit of innovation is shown by the enthusiasm of thousands Paragonian. Start from BA to managerial level, start from small things to big things. More than 1000 ideas have been submitted at Innovation Mayday from Paragonian consisted of new Business Model, Business Process, Brand and Product Management, Customer Engagement Way, Sales and Product Delivery, and Ways of Working improvement in early COVID-19 pandemic. The COVID-19 pandemic accelerated agility and digital transformation of the company. Paragon Innovation Summit (2018 & 2021) Paragon Innovation Summit is the trademark event of the collaboration from PT Paragon Technology and Innovation, Students, Campuses, and Communities. We’re willing to spread the innovation culture through this innovative event and collaborate together to bring changes for Indonesia. Innovation Mayday! (2020) Coaching Culture as Enabler for Empowerment Coaching Culture: Why coaching? Align with Paragon Value Humility & Care Humility and Care can show us how we collaboration in each other and empathy to others Develop form Within Coaching help Paragonian to maximize their potential, and Paragon have so many talent instead, we can make innovation through coaching also Promote Equity In Coaching Session, Client is at the center of the conversation, because everyone is okay and so resourceful. There’s no barrier between superior and their team Non Judgmental Coaching is focus on the goals instead of the problems 1. Coaching as a development tool → Unleash team’s potential. Paragonian will capitalize their potency to the optimum level. 2. Coaching as communication tools → Improve communication and feedback mechanism, that less judgemental, since everyone is ok 3. Coaching as leadership style → Embrace intellectual humility, everyone could learn from anyone since everyone is resourceful... no matter the level is. Learning without teaching is endorsed. Empowerment Coaching is all about Listening, Mindfulness, and Resourcefulness.. Open Research and Innovation Joining the Global Societies to Learn and Connect IFSCC (International Federation of Scientist and Cosmetic Chemists) Conference 2022, London Become the only Indonesia cosmetics company, with 5 young researchers delegates Bring 10 research poster to the community who represents >80 countries from all around the world Some of Our Research on IFSCC Congress 2022, London We collaborate with Indonesia University & Global Expert in doing our research Indonesia’s potential of Natural Emulsifier from Coconut Protein Extraction in Skincare Lotion Application Study of Antibacterial Body Wash Against Pathogenic Bacteria, Fungi, and Covid-19 (SAR-Cov-2) and It’s Efficacy to Protect Skin from Pathogenic Bacteria Tengkawang (Borneo Illipe) Butter Optimization Study as a CostEffective Substitution of Cocoa Butter in Body Lotion Formula A New Protocol to Evaluate Superior-Resistant Attributes of Liquid Foundation for Javanese-Indonesian Bride Keep on Building Our Innovation Ecosystem 05 Implementation When science, technology and collaboration bring the dream alive INTEGRATED HALAL ASSURANCE SYSTEM Sebagai The No.1 Halal Beauty Brand in Indonesia*, Wardah berkomitmen untuk mendorong industri halal global melalui inovasi-inovasi yang dapat mewujudkan integrated halal assurance system GLOBAL EXPERT COLLABORATION ● ● Wardah Skin Innovation telah berkolaborasi dengan 300++ ahli di 25 negara di dunia 200++ inovator muda Paragonian siap mewujudkan >300 produk baru setiap tahunnya GLOBAL HALAL RAW MATERIAL ● Bekerjasama dengan penyedia bahan baku bersertifikat Halal terbaik dari seluruh dunia ● Hanya berkolaborasi dengan principle bahan baku bersertifikat Halal HALAL PRODUCTION PROCESS ● Hanya memproses bahan baku bersertifikat Halal ● Bebas dari partikel non-Halal dalam proses produksi ● Post production dengan proses yang bersih (terbebas dari kontaminasi) Sustainable Halal Green Beauty Products *Source : Nielsen Retail Audit period ending Sep 2021 LOCAL - GLOBAL EXPERT COLLABORATION Biggest Cosmetics R&D Center in Indonesia UK Face Color Pigment USA Eye Color Pigment Granactive Retinoid Belgium Lip color pigment Netherlands Avalanche Rose Oil Korea Tranexamic Acid Hyaluronic Acid Spain Gold Peptide Japan 7 White Active Face color pigment Switzerland Edelweiss Extract Advanced Niacinamide France Avalanche Rose Petal Vitamin C Indonesia Empower local ingredients Green Tea Extract Aloe Vera Extract Germany Ectoin Bisabolol KEEP ON INNOVATING - STRONGER FOR GREATER GOOD INDONESIA 2022 WARDAH BEAUTY MOVES YOU Technology usage for Immersive Experience The Journey was Appreciated MMA (Mobile Marketing Association) Global Indonesia Award 2022 1. Category Experimental /Innovation Technology Gold Winner for Wardah - Advance Beauty Tech (Virtual Try On) 2. Category Brand Purpose Silver Winner Wardah Festive Campaign "Bergerak Hidupkan Harapan" 3. Category Spatial Technology Bronze Winner- Emina Cosmetics AR Boosts Awareness and Makes Shopping for Emina Poppin' Matte Loads More Fun 4. Category Integrated E-commerce Innovation Silver Winner - Emina AR Boost Awareness and Makes Shopping for Emina Poppin' Matte Loads More The Journey was Appreciated IHYA AWARD 2021 JUDGING PROCESS INDONESIA HALAL INDUSTRY AWARD (IHYA 2021) BEST OF THE BEST & BEST OF CORPORATE SOCIAL IMPACT INITIATIVES Make everything as simple as possible, but not simpler Albert Einstein Keep company insurgency and your leadership authenticity, we never know what's ahead us Salman Subakat