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3M: Profile of an innovating

Company
By -
FMG 27 B
Group 2
Ankit Gupta (271066)
Navdeep Goel (271089)
RajKunwar Singh Saluja( 271100)
Sanchit Agarwal (271107)
Somya Jain (271114)
Himanshi Sharma (271186)
Brief Introduction
● 3M is considered as the world’s most consistently innovative company and
was part of “The Ten Most Admired Companies”.
● Established in 1902 as a mineral deposit firm, but later switched to
manufacturing of sandpaper.
● Have a portfolio of over 100 core technologies and some 60,000 products in
200 counties, over 88,000 employees
● Technology driven culture has deep roots in each and every employee of the
firm.
● 3M leveraged its capabilities of solid operations and have gained cost
leadership by exploiting the resources.
● At the same time allowed its employees to look for innovation, making them
The Ambidextrous Organization.
Company’s CEO
● Ray Herzong - Charismatic motivating style

● Lou Lehr (1980-1985) - Ability to bring out best in employee

● Jake Jacobson (1986-1991) - Discipline, focus and objectivity

● Livio DeSimone (1992) - Attributes of all the three CEOs


Challenges
Internal
Growing portfolio of products and technologies.

Not fully developed manufacturing competencies

External

Economic slowdown

Foreign competition
High valuation of Dollar
Organizational Structure
Organic Mechanistic

● Exploration Strategy, Focus on Innovation ● More standardized structure & centralized


and R&D power with expansion & diversification.
● Allows all researchers to spend 15% of ● Exploitation strategy with each division
time on R&D. expected to contribute to financial
● Genesis program to provide seed money performance targets & International
to support further research & boost expansion
individual recognition ● Grow & divide policy with decentralized
● Encourage employees to develop sales, production & development to the
products even when no large market operating level
potential was evident
Exploration vs Exploitation
High Low
E
E X
X P
P L
L O
O I
R T
A A
T T
I I
O O
N N

Low High
Innovation, Intrapreneurship and Creativity
Types of innovation:

● Quantum innovations: Products or operating systems that refers to a


fundamental shift in technology that revolutionize products or the way in which
they are produced

○ 3M had its root in quantum innovation from its initiation from


○ products like waterproof sandpaper-”wetordry” to “post-it” notes that created a separate
divisions within 3M and had a fundamental shift in technology
contd…..
● Incremental innovations: Products or services that refers to the
improvements that are continuously made to particular technologies over time

○ First 3M develops new products/technologies


○ It then apply incremental innovations to those technologies
○ Such as the development of coating process technologies led to research on heat sensitive
paper, which in turn got the company involved in duplicating technologies.
Innovation as a Cross-Functional Team
McKnight constituted these 3 structure for cross-functional technology transfer
● Technical Council - Heads to meet on a regular basis Promoted cross-unit
technology transfer
● Technical Forum - Grassroots scientific communication across horizontal and
vertical organization boundaries
● Formal Channels - Annual technology fairs

Lou Lehr constituted the following teams


● Sales club - allow specialists to meet over lunch on a monthly basis
● Trade fairs and Trade shows - collaboration of multiple divisions and joint sales
calls

Jake constituted the following team


● Action teams - Composed of technology, production and marketing specialists with
the responsibility of developing and delivering new products.
Stage-Gate Model
contd.
● During McKnight time as CEO the funding and selections of
processes/product development proposals were not controlled strictly.
● During Jacobson time as CEO a stage gate funnel approached was
established.
● A division’s selection of projects was controlled and refined by a technical
audit process managed by the Corporate Technical Planning and
Coordination group.
Concept of Intrapreneurship
Intrapreneurs are leaders of innovation and new product development in
established organizations
i.e. employees who notices opportunities for either quantum or incremental
product improvements and are responsible for managing the product development
process to obtain them.
● 3M is one of the biggest advocate of this concept
● It provides full support and motivation to their employees by providing them
with time and resources to develop new product.
● Setting of new R&D centers
● Divisional teams dedicated to develop and commercialize their products
with autonomy
Culture of open innovation
● The culture of 3M as described by an employee “ a climate that simulates
ordinary people to produce extraordinary performances”
● Bottom up approach is followed i.e. senior management listens to the ideas
of the researchers, engineers and technologists without any biases
● Employee freedom to innovate
● Extrinsic and Intrinsic Motivation: i.e. achievements are not only rewarded
by promotion but also by recognition
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