3 M Company Case Study

3MGroup 2: Nguyễn Thị Hiên Đặng Thị Liên Lại Thanh Trang Lê Phương Thảo Nguyễn Thị Thảo Ly Nguyễn Như Thế Anh Đỗ Như Chinh

We make innovation everywhere

Outline

• Introduction

• Innovation in 3M • Conclusion

3M

• Formerly known as the Minnesota Mining and Manufacturing Company

• 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 (chất kết dính, chất mài mòn, cán mỏng, phòng cháy chữa cháy thụ động, sản phẩm nha khoa, vật liệu điện, mạch điện tử và phim quang học)

3M: A brief history• Established in 1902, producing abrasives and adhesives products.

– Benefited from product innovation in the early days– The culture of “individual entrepreneurship”

• The McKnight era, 1929-1966– Organizational design for continuous changes

• The Lou Lehr era, 1980-1985– Reorganization and reorientation

• The “Jake” Jacobson era: 1986-1991– The orientation to competition in existing markets

• Main characteristics:– Changes and evolution in adaptation to environments– Changes in organizational attributes for innovation

3M: The Permanently Changing Organizations

• One of “the ten most admired corporations” — Fortune annual poll of American CEOs.

• The 3M model:– Continuous technological innovation – Institutionalized “individual entrepreneurship”– Market responsiveness

• How is this possible—what are the challenges?• Institutionalized “individual entrepreneurship”?• Growth versus decentralization?• Balance between structure, culture, versus change?

Innovative Culture in 3M

• 3M’s culture fosters an environment of innovation

Innovation of culture in 3M: - Give people time to follow their dream. - Make it a part of the expert’s job to share their knowledge. - Result must be measured. - Be honest and know when to say no. - Promote a career not a job. - Internationalize your management team. - Keep spending on research and development.

• Vietnamese Honda motor company Respect the ideas of the employers as well as

employees Create a friendly and active working environment

INNOVATION MANAGEMENT

Building a innovative organization

• Recognition & reward• Reinforcement of core values• Sustaining “circulation”• Allocating slack” & permission to play• Patience• Acceptance of mistakes & encouragement of risk-taking• Encourage “bootlegging”• Policy of hiring innovators

Recognition & reward

• Schemes to acknowledge innovative activities• Recognizes effort > achievements

Reinforcement of core values

“Innovation is respected”

Sustaining “circulation”

• Different people + Different perspectives = creative combinations

Allocating “slack” & permission to play

• Curiosity-driven activities

Patience

• Acceptance of the need for ‘stumbling in motion’ as innovative ideas evolve and take shape.

Acceptance of mistakes & encouragement of risk-taking• ‘Mistakes will be made, but if a person is essentially right,

the mistakes he or she makes are not as serious, in the long run, as the mistakes management will make if it’s dictatorial and undertakes to tell those under its authority exactly how

they must do their job…”

Encourage “bootlegging”

Giving employees a sense of empowerment and turning a blind eye to creative ways

=> get around the system acts

Policy of hiring innovators

looking for people with innovator tendencies and characteristics

• An opportunistic mindset• Formal education or training• Proactivity and a high degree of persistence• A healthy dose of prudence• Social capital

May Saigon 2 Company

VNU-UEB

Eurowindow

Innovation in organization structure

3M used to be organic structure, which links people in different functions into a coherent.

3M divided most employees network into at least five levels: department, division, group, sector and company

What is organic structure? Its advantage & disadvantage?

What is organic structure

the organization has characteristic:

Flatness: communication & interaction are horizontal

Low specialization: knowledge resides  wherever it is most useful

Decentralization: great deal of formal and informal participation in decision making

• They have a flexible approach to the continually changing financial and customer environment.

• They can be very responsive and quick to make changes• Staff structures are also very fluid, with wide ranging job

descriptions• They cope better with unstable environments• The employees are very much involved in decision

making and problem solving; this enhances motivation, commitment and gives a variety of perspectives

• The ease of ability or change enables organic organizations to be more creative and imaginative

Disadvantage

• No Boundaries• Unproductive Directives: • Ineffective Leadership• Communication Barriers

Case in Viet nam

Process*Develop:- Structure - Policies

Þ Guide innovative activity: picking up signals through implementation

*Parallel routes through their system Þ Innovations can come from many ways:

- Market interactions - Deep technology research - collaboration - unexpected discovery *Association skill: Technical knowledge ∞ awareness of real / latent market needs

=> creative combination

• System for innovation & extensions: *1st : formal stage-gate (a trial by fire), based on

established products Þ Well-known but need encouraging innovation

champions to take non-linear ideas *2nd : incubator stage:

o ideas are encouraged & development funds are available

o reject loose targets o strict business plan appraisal for projects

=> funnels and clear gateway

Honda Viet Nam

• Manufacturing Process: 2nd system - Event / Competition:

o employees speak out their ideas at any timeo prize for the valuable contribution.

- The good idea will apply to the process - Implementing R&D from fortunate discovery by

their staff

Innovation Strategy and Leadership

- CEOs have been strongly associated with enacting and supporting the innovation culture which characterizes the firm

- The overall innovation strategy is focused on two core themes – deep technological competence and strong product development capabilities

Innovation Strategy

• Setting stretch targets, a focus for the whole Organization.• Allocating space and time for staff to explore ideas.• Encouragement employees working on innovation

projects in their own time and often accessing resources in a non-formal way

• Encourages ‘intrapreneurship’ (internal entrepreneurial behaviour) rather than people feeling they have to leave the firm to take their good ideas forward.

Innovation Strategy and Leadership in Vietnam

• CEOs should take time to understand the potential of their employees and the prospect of their organization.

• Encourage and incentive with new ideas which have good outcome or improvement.