3m “Profile of an Innovating Company free essay sample

3M â€Å"Profile of an Innovating Company† The 3M case traces the history of this Minnesota-based company from its inception in 1902 through 1992. By looking at the tenure of three CEOs, the case examines how 3M worked to maintain a culture of innovation while continuing to grow into an international multibillion dollar organization. While the organization’s values are critical to the success of 3M, internal and external forces also forced 3M to adjust their business model. William McKnight, the founding CEO, embedded a strong organizational culture into 3M. He instilled the values of entrepreneurship, research and experimentation into every employee. His goal was to create a climate that â€Å"stimulates ordinary people to do great things. † As 3M grew into a billion dollar business they continued to maintain their core values of innovation, marketplace responsiveness and entrepreneurship. Employees at 3M were encouraged to work on their own projects with a corporate-wide policy that promoted work on personal projects for up to 15% of a researcher’s time. We will write a custom essay sample on 3m â€Å"Profile of an Innovating Company or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Individual persistence was recognized and people were encouraged to pursue their own ideas and to take risks. Management supported â€Å"unintentioned failure† and was known to support projects that did not necessarily show market viability. Often times, these projects found future niche markets or applications that were never thought of by the inventor. 3M was a â€Å"market-oriented technology based company. † It was built around the idea of adapting current technology platforms to meet the different needs of consumers. 3M looked both externally at niche market needs and internally at ways to apply new market opportunities to existing technology. They capitalized on their technology through informal and formal knowledge sharing processes. They held technology conferences, organized technology boards and promoted sharing through other communities of practice. It was the norm to ask for scientists to discuss their work and ask for advice or suggestions. The organizational structure under McKnight was a â€Å"grow and divide† concept, where management expected units to grow organically. Successful products were continually made into new divisions, which in turn became new groups. In 1977 McKnight passed away and his successor Lou Leher took over. Internal and external changes forced management to look at how 3M could continue to be profitable in the future. The growth and spin off process left by McKnight made it challenging for 3M to control their businesses. As a result of entrepreneurship and diversification, business spin-offs had created a fragmented organization. Leher created a new business structure that promoted the consolidation of divisions to share resources and integrate processes. He also standardized the strategic planning and funding process. Used to an informal planning process based on perception and measured against their own metrics,† a formal planning system was a shock to the organization. RD funding, which was typically allocated at the discretion of the manager, was now more formalized. Although funding was more focused, they still provided an opportunity for funding additional products. Lehr began to formalize the processes of 3 M. The organization, valuing entrepreneurship and innovation, became hard to control and was leading to decreased profitability of the company. The final tenure followed is that of Jake Jacobson, a bottom line CEO who came in to cut costs and increase profitability. He changed the focus of 3M from niche premium markets to low cost markets. His changes promoted the use of cross functional teams and quicker time to market. To move products more quickly to market, the company adopted a more disciplined approach to selecting projects. Projects that did not show promise up front would not be funded, as typically done in the past. Managers began to feel that innovation was being stifled and the balance between entrepreneurial spirit and team work was lost.