...by Eric von Hippel, Stefan Thomke and Mary Sonnack Eric von Hippel is a professor at the Massachusetts Institute of Technology’s Sloan School of Management in Cambridge. Stefan Thomke is an assistant professor at Harvard Business School in Boston. Mary Sonnack is a Division Scientist at 3M Corporation. Sonnack and von Hippel and Joan Churchill are coauthors of a handbook on the lead user process to be published in 2000 by Oxford University Press. When senior managers think of product development, they all dream of the same thing: a steady stream of breakthrough products—the kind that will allow their companies to grow rapidly and maintain high margins. And they set ambitious goals to that end, demanding, for example, that a high percentage of sales come from products that did not exist a few years ago. Unfortunately, the development groups of many companies don’t deliver the goods. Instead of breakthroughs, they produce mainly line extensions and incremental improvements to existing products and services. And given the pace of change in today’s markets, that’s a recipe for decline, not growth. Given the imperative to grow, why can’t product developers come up with breakthroughs more regularly? They fail primarily for two reasons. First, companies face strong incentives to focus on the short term. To put it simply: although very new products and services may be essential to future growth and profit, companies must first survive to get to the future. That necessity tends...
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...Insights on Innovation – A primer from 3M 3M is widely recognized as a model of innovation. From an abrasives company, 3M has grown to generate $4 billion in net income on nearly $27billion in sales with 30% of sales consistently generated from products made in the last 5 years. 3M has nearly 60 business units grouped into six segments ranging from consumer and office to industrial and transportation. 3M does not make a secret of its success. Here are their steps to drive new products to market: 1. As a science based company they have a culture formed from a history of innovation and risk taking. Risk taking is encouraged and failure is seen as a natural part of creating new products. In fact, sandpaper without the abrasives led to adhesive tapes—consumer, medical, electrical and eventually audio and video tapes. 2. Management is focused on customers and their problems. They seek to truly understand what customers want. In some cases customers cannot explain their needs well so deep understanding on 3M’s part is what delivers a meaningful new product or improvement. Adhesives on the upper quarter of the back of small squares of paper? Yes, Post-It Notes. 3. Managers set stretch goals that require creation of new products at a rate that represents 30-40% of sales within a 4 year period. With a focus on new products in plans, the organization is driven to think and act in a new products direction. 4. Employees are given great freedom to pursue...
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...Q1. How has 3M’s innovation process evolved since the company was founded? Why, if at all, does 3M, known as the “hothouse” of innovation, need to regain historic closeness to the customer? Ans1. 3M Corporation has small laboratory or research and development section with some technicians and doing experiments on sandpaper and developed some core technology at that time for 3M like masking tapes. After such core technologies development 3M achieved global reputation and become “hothouse” of innovation. However the process grows slowly and allows 3M to recognize user needs because 3M researchers contact different employees in factories. In 1990’s 3M have 30 key technologies and get much market growth and for more development and product 3M employing more engineers and scientists. 3M corporation goes high in innovation but they are not able to found what customer need is because of least interaction and closeness with customers and users. This is because 3M need some marketing research and identifies customer needs rather focusing on products and technical stuff. Q2. How does the Lead User research process differ from and complement other traditional market research methods? Ans2. Lead user research is the process in which products may be innovate and developed products on the basis of the information and data collect by customers or user and with respect to the need of users. By the help of lead user research organizations are able to identify the client...
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...Question 1: How has 3M’s innovation process evolved since the foundation of the company? Why, if at all, does 3M, known as a ‘hothouse’ of innovation, need to regain its historic closeness to the customer? - The big winners are those who match new, marketable ideas with customers before anyone else can. It takes flexibility and creativity and willingness to risk. - In 1902, 3M was founded as Minnesota Mining and Manufacturing by five northern Minnesota entrepreneurs. - Their idea was to extract a mineral from shores of Lake Superior. The partners believed the mineral was corundum, an ideal substitute for garnet, the mineral abrasive found in grinding wheels used by furniture makers. - Each partner put in $1000 and started their venture in Two Harbours hoping to find the mineral and possibly gold. - The initial idea of incorporated first, investigated later. The company sold shares and made plans to start mining before they were even certain they had customers. - When Hermon Cable travelled to Chicago and Deitroit to get the mineral tested with potential customers to find a “fairy satisfactory” results. However, he encouraged the other four partners to go on with the project. - Two years after the founding of the company, 3M sold the first batch of minerals. The product was not corundum but anorthosite, a soft mineral that is inferior to garnet. - Everything was tumbling down from here: the suppliers wanted their money back, the company could not sell shares to...
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...“3M: A Culture Made For Innovation” Introduction 3M stands for Minnesota Mining and Manufacturing Co. It was founded by five businessmen in 1902 at the town of Two Harbors, Minn (3M, 2012). They originally financed the company to mine the mineral cornundum for grinding wheel abrasives but the investment became a failure because it turned out that the mineral was actually low-grade anorthosite (Goetz, 2011). After being done with mining, the founders bought a sand paper company but struggled on how to run it. Eventually, Lucius Ordway moved the company to St. Paul where 3M created some successful new inventions such as masking tape and cellophane tape (Goetz, 2011). 3M is known to have one of the most innovative work cultures. Over the years it has developed values and norms that are geared toward innovation. 3M believes its innovative work culture is a huge factor in its success. 3M Values To promote creativity and innovation, 3M has developed cultural values and norms that allow for employees to feel empowered, to experiment, and to take risks in order to come up with new products. Values are standards or guidelines that people use to figure out which types of behaviors, events, situations and outcomes are desirable or undesirable (George & Jones, 2012). Values can be divided into two categories: terminal and instrumental (George & Jones, 2012). A terminal value is defined as a desired end state or outcome that people seek to achieve (George & Jones...
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...This case describes how 3M Corp. introduces and learns a new and innovative methodology titled Lead User research to understand future customer and market needs. A team from 3M's Medical-Surgical Markets Division applies the Lead User Methodology to the field of surgical infection control and discovers that there exist new product concepts together with a new business strategy. The problem here is 3M should decide whether this new strategy will be a tool for 3M 's strategy towards corporate expansion and innovation. In the mid 90s, 3M realized the symptoms in its innovation approach that only incremental development is involved in its current product range instead of breakthrough ones. This approach limited the company’s competitiveness and financial performance and growing the business required to prepare the environment capable of delivering “breakthrough innovations“. Therefore, 3M’s management set a new goal: 30% of sales should be driven by new products. The new strategy focuses on understanding the real market needs to create possible developments and enhancements for a particular product which can eventually lead to a breakthrough in product offering that ultimately results in a competitive advantage. In this case, the suggested approach, Lead User Method, enables 3M to satisfy an important need (not spreading infections during surgery) by developing a specific new product or service. If there is not a new approach, the innovations that 3M makes will only be a "solution...
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...For the exclusive use of Q. WEI2015. 9-699-012 REV: JULY 23, 2002 STEFAN THOMKE Innovation at 3M Corporation (A) On the evening of October 23, 1997, Rita Shor, senior product specialist at 3M, looked across the conference room at her team from the Medical-Surgical Markets Division. She wondered when to draw to close the intense ongoing debate on the nature of the team’s recommendations to the Health Care Unit’s senior management. A hand-picked group of talented individuals, the team had embarked on a new method for understanding customer needs called “Lead User Research.” But this initiative to introduce leading-edge market research methods into 3M’s legendary innovation process had now grown into a revolutionary series of recommendations that threatened to rip apart the division. While senior management wanted the “Lead User” team to execute a manageable project involving surgical draping material to protect surgery patients from infections, the team now wanted to rewrite the entire business unit’s strategy statement to also include more pro-active products or services that would permit the upstream containment of infectious agents such as germs. This went against the incrementalist approach that for so long had pervaded 3M. After all, as Mary Sonnack, division scientist and an internal 3M consultant on the new Lead User methodology, noted “3M gets so much revenue from incremental products . . . like a blue Post-it note instead of just a yellow one.” ...
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...Q1. How has 3M’s innovation process evolved since the foundation of the company? Why, if at all, does 3M known as a “hothouse” of innovation, need to regain its historic closeness to the customer? The hard start of 3M’s in 1902 with digging for corundum then discovering it is low-grade and worthless, moving to sandpaper business and discovering that the abrasives they import to use refuse to stick to the paper pushed the company early to the research road trying to fix the problems they are facing, one of the young technician figured out the problem and fixed the sandpaper and created the waterproof sandpaper for first time in the world that has a big meaning to 3M’s which leaded the company to be one of the biggest global innovation companies in the world. The company used the innovation since then by old research and development traditional method by identify the problem through visit or questionnaire to the clients and research the solution for the problem under vision of engineering to ensure the project efficiently made, not facing any risk if the product failed and also provide a feedback, The product developers used to visit the factories and workplaces to talk to the workers to get ideas for products it start as in 1920 when one of 3M’s lab visited a car body shop and discovered a problem while removing newspapers glued to the car body and start a research ended by creating a masking tab to the world. After all the success through R&D, 3M allowed the staff to spend...
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...Innovation at 3M Corporation INNOVATION AND KNOWLEDGE ECONOMY - GROUP C 1 Contents 1 1 2 3 4 Background Source of Innovation Innovative Culture Lead User Research 5 Impact of Lead User Method 6 2 Click to add title in here Companies in Indonesia Background of “ Lead User Innovation” “ Traditional strategic planning does not leave enough room for innovation “ understand leading _edge customer needs to change the basis of Competition working closely with customer & understanding market need LEAD USER INNOVATION Definition of lead users Lead users refers to users who are ahead of the majority of the market on a major market trend, and who also have a high incentive to innovate. Producers seeking user innovations to manufacture try to source innovations from lead users - because these will be most profitable to manufacture 3 Milestone of 3M in Innovation 1902 The Minnesota Mining and Manufacturing Company (3M) founded The company has a long and famous history of innovation. They are known for such products as the Post-it which revolutionized the way individuals communicate, masking tape, and waterproof sandpaper. 1961 Medical Products Division, the first 3M division dedicated solely to health care, founded. The Health Care Unit was an important component of 3M’s business model, contributing a large percentage to the company’s revenue streams The unit had failed to introduce a successful product in almost a decade 3M is third in...
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...Innovation Organisations: The 3M Way Damian Gordon Recommended Reading 3M formerly known as the Minnesota Mining and Manufacturing Company Founded on the North Shore of Lake Superior at Two Harbors, Minnesota in 1902 With over 76,000 employees they produce over 55,000 products, including: adhesives, abrasives, laminates, passive fire protection, dental products, electrical materials, electronic circuits and optical films Richard Drew June 22, 1899 – December 14, 1980 American inventor who worked for 3M in St. Paul, Minnesota, where he invented; – – – Masking tape, Cellophane tape, and Duct tape. Masking Tape In 1923 3M employee Richard Drew visited an autorepair shop in St. Paul, Minnesota. 3M produced and sold sandpaper and Drew was in the shop to test out a new batch. Masking Tape When he entered the shop employees were expressing disappointment at a failed attempt to paint a car in the two-tone style that was becoming popular at the time. Masking Tape Typically how the effect was achieved was by painting part of the car in one colour while covering the other parts with butcher paper The butcher paper was usually held in place with a heavy adhesive tape. Unfortunately, removing the adhesive tape peeled away part of the paint job. THE IMPORTANT BIT: Rather than just sympathise with his customers and move on, Drew decided to do something about it. Masking Tape His company 3M had a lot of know-how in creating adhesives...
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...full of examples that said you can't do this.” - Spencer Silver on the work that led to the unique adhesives for 3-M Post-It Notepads. Innovation has been described by The Oxford Dictionary as the introduction of new things, ideas or ways of doing something. The Post-it Note is a product so conceptually simple, that in the technologically advanced time we live in, we have been almost desensitised to its brilliant innovation. The innovation of the Post It Note went through a number of distinct stages and processes. In this assignment I will attempt to give a clear and cohesive analysis starting from the earliest ideas of the Post It right through to the products available today. 3M The physical invention of the post it spanned over a period of 10 years, however, I believe the earliest derivation of the modern day Post It Note can be traced back to the very establishment of the 3M Company itself. In 1902 the business got off to a rather bad start when a group of investors by mistake bought a mountain containing worthless mineral to start a business to mine corundum to manufacture sand paper). Unsurprisingly the company did not generate profit for 14 years. Seemingly spurred on by their less than successful origins, 3m have since always strived to create a working environment in which innovation can flourish. Brand (1998) on the topic of 3m states that “to guarantee such conditions are in place and sustained over time, requires a long term commitment from top management, the...
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...3M in 2006 Prior to reading the 3M case, I was unaware of this historic corporation that dominates a wide range of markets today. I have heard and purchased products such as Post-it Note, Scotch Tape, and Scotch-Brite; however, I did not know all these products and many more belong to 3M Company. 3M was initiated in 1902 by five businessmen in Minnesota and its first product was the development of sandpaper. William McKnight was the leading figure and CEO of 3M who revolutionized the company and led it to its initial success. He and other prominent figures at that time evolved the company culture into a unique innovative organization. 3M was the first company to utilize various strategies that differentiated them from other organizations at the time. For instance, they applied product diversification, which was done by creating brand extensions, production modifications, or creating brand new products. A large number of ground-breaking products were created by, “leveraging existing technology and applying it to new areas”. (p. C437) This strategy was not common in other industries during that time period. This unique culture assisted 3M by allowing the company to reach out to markets their competitors could not have access too. This advantage gave 3M the opportunity to acquire a wide range of new consumers across different market sectors. It placed them as the top dog in supplying daily essentials for individuals, families, manufacturers, and suppliers. Another strategy...
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...Introduction The Minnesota Mining and Manufacturing company, or more commonly known and abbreviated as 3M, was found in 1902 in Two Harbors, US. The company started out by mining corundum which was to be used to make sandpaper and grinding wheels but soon seized operations when artificial replacements made the mineral worthless. 3M then turned to producing grinding wheels and sandpaper themselves, and only then were things were then looking up. Having difficulty with quality and marketing its products, the management supported its workers to innovate and develop new products which became its core business. Over the years, 3M and its division have produced many unique and inventive products for households and production alike. Popular Innovations from 3M: Waterproof sandpaper Post-it notes Scotch tape – Masking tape Imation Corporation Nowadays, with the vision of “the ability to not only develop unique products, but also to manufacture them efficiently and consistently around the world”, 3M operates with over 80,000 employees in more than 60 countries producing in access of 55,000 different products. 3M Business Unit: Abrasive Systems Division 3M Abrasive Systems is the core business that the company started with over 100 years ago. Part of the Industrial and Transportation business, today, it produces a complete line of coated abrasives, abrasives, microfinishing and microreplicated abrasives, plus hardware accessories which are available in sheets, rolls...
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...Abstract . 3M Corporation History of the 3M Corporation What started off as a small company in the Lake Superior Town of Two Harbors, Minnesota in the year 1902 – 3M has grown into a worldwide corporation with companies in over 60 countries. Things seemed bright in June 1902, when Two Harbors attorney John Dwan drew up articles of incorporation and added his $1,000 to that of other charter board members, meat market owner Hermon Cable, Dr. J. Danley Budd, the city’s leading physician, and Duluth and Iron Range Railroad executives William McGonagle and Henry Bryan (3M Corporation, 2015). The five men set out looking for the next new product. They wanted to mine a certain type of mineral deposit (Corundum) to use as an adhesive for grinding-wheels. Corundum was in demand as the premier abrasive for grinding wheels, sandpaper and other items to polish, shape, sharpen and decorate items produced by America’s increasingly industrialized economy. This new source of corundum was greeted jubilantly; the only other North American source was in Ontario. The problem – one that surfaced after the company had incurred a large start-up debt – was that the corundum was not there on Lake Superior’s Minnesota north shore. What was there was anorthosite, which is useless as an abrasive (Bishop, 2005). So within a couple of years of its founding, 3M had tons of mineral for sale, no customers and was all but bankrupt. When mining turned out to be of little use and a failed attempt with mineral...
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...------------------------------------------------- 3M Environmental ANALYSIS and report Project Report 3M COMPANY Environmental & SWOT Analysis of 3M Strategy | AN AMERICAN MULTINATIONAL CONGLOMERATE TABLE OF CONTENT 1. Introduction/Executive Summary………………….. 2. Industry Environment Analysis&External Audit……………………………………......... 3.1. Demographic Environment………………… 3.2. Economic Environment………………… ………… 3.3. Political and legal environment…………………………………. 3.4. Technical environment………………………………………………….. 3.5. Social environment………………………………………………………….. 3.6. Global environment………………………………………………………………. 3.7. Industry environment…………………………………………………………….. 3.8. Competitive landscape………………………………………………………. 3. Internal Environment Audit &Analysisof 3M company ……………………. 4. SWOT Analysis……………………………………………………….. 5. Risk factors & future interpretation………………. 6. Conclusions&Interpretation........................................................................ 7. References 1. Company Profile Introduction 3M is an American multinational, multi industry, diversified conglomerate company incorporated in 1929as per laws of State of Delaware, in order to continue operations of Minnesota Mining and Manufacturing that began in 1902.It is headquartered in St. Paul suburb of Maplewood ,Minnesota in United States. It...
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