A core element of BASF’s success has been its ability to identify key market requirements early on, recognise a core need and then develop an extraordinary range of products to address it. Allied to this, the company also understands and exploits diversification. For example, BASF was one of the first organisations to recognise the need to shift from bulk chemicals to higher value consumer focused products such as coatings, vitamins and magnetic tape for audio and video cassettes. Some see that it is this willingness to adapt which has ensured the company has remained ahead of its peers.

BASF’s quest for innovation has always been along a path of complementary spaces: The company has grown in areas associated with its core markets, moving into animal nutrition as a result of its work in agricultural products and into petrochemicals because of its involvement in supporting exploration for oil and gas. BASF’s core innovation model, or ‘verbund’, is one of several ingredients of sustained growth. It combines product, process, technology and business models. For instance, the ‘production verbund’ links manufacturing plants to create value-added chains of production where by-products and waste from one plant serves as the raw materials in others. Today, the verbund has become a cornerstone of the company’s strategy and now extends outside the organisation to include BASF’s business partners, customers and the communities in which the company operates.

The strategy is producing commercial results and industry recognition: In 2007, BASF was awarded the prestigious Design Plus award by the German Design Council for Ultrason, a high-temperature-resistant, transparent plastic now used in induction water boilers. In addition Toyota chose another plastic, Basotect, for its Lexus car hoods because it is lightweight, helps to reduce CO2 emissions and absorbs sound - thereby increasing driver comfort. BASF has also been making its own contribution to the sustainability agenda by producing plastics made from renewable sources and ionic liquids to improve solar cell performance. BASF is also changing its organisational structures to reinforce the search for innovation across different dimensions: in June of 2007, it restructured its business to be more aligned with customer-driven markets including the automotive and construction industries and created a broader ‘BASF Care’ group that encompasses health, personal care and nutrition. The strong performance over the years, stable investment in R&D and drive for looking beyond its current horizon should allow BASF to to look at innovation on multiple fronts to deliver further growth successfully in the years ahead.

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