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3M Optical Systems: Managing Corporate Entrepreneurship Christopher A. Bartlett and Afroze Mohammed From Burgelman et al, Strategic Management of Technology Innovation. Rev: Aug, 2012 POSTECH Strategic Management of Information and Technology Laboratory

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3M Optical Systems:Managing Corporate Entrepreneurship

  • Christopher A. Bartlett and Afroze Mohammed
  • From Burgelman et al, Strategic Management of Technology Innovation

Rev: Aug, 2012

POSTECH Strategic Management of Information and Technology Laboratory

(POSMIT: http://posmit.postech.ac.kr)

Dept. of Industrial & Management EngineeringPOSTECH

introduction of 3m
Introduction of 3M
  • 3M (Minnesota Mining and Manufacturing Company)
    • 100 years of history
    • About 30,000 products
    • Weight of R&D: Double of average of manufacturing companies in America
  • Vision
    • To be the most innovative enterprise and the preferred supplier in the markets we serve
  • 3M at a Glance (Year-end 2011)
    • Global sales: $30 billion
    • Operations in more than 65 countries
    • 3M products sold in nearly 200 countries
    • 84,000 employees globally
  • Company Culture
    • Respecting Idea: Many ideas lead to successful products
    • 15% Rule: Every employee spend 15% of office hours researching independent fields
    • 25% Rule: Products launched in four years occupies 25% of total sales
    • Generosity to Failure: “There is freedom to fail in 3m”
history of optical system os business unit
History of Optical System (OS) Business Unit

Microlouver technology

  • Visual Products Division
  • New free-standing OS unit
  • - Application for Technology
  • - Effective
  • - Not beyond Projector Film
  • OS Track Record (1979-1990)
    • 3M’s microlouver technology
      • Started from developing light control film in 1979
      • Functions of Light control film: Privacy viewing, Sunlight readability, Light directing
    • New Business Ventures Division (NBVD)
      • Guiding technology to find a market in various application fields
    • Lost between 3 to 5 million dollars per year
      • No major product family
        • Minimal products such as TV projection lens, micro film lens, and bike gauge
      • Low reliability in OS & Low morale in 3M
organizing new innovative team 1 2
Organizing New Innovative Team (1/2)
  • Organizing New Innovative Team by employing talents
    • Andy Wong (Manager), Paul Guehler (Vice President), Rob Noirjean (Marketer)
  • Andy Wong (Joining in 1984)
    • Organizational culture emphasizing invention of new products
    • Making the organization concentrate on the light control film
    • Distributed product types
    • Scouting a new marketer and finding target market
    • Low sales volume

 Developing production strategies: Guarantee of price, quality, deadline, etc.

organizing new innovative team 2 2
Organizing New Innovative Team (2/2)
  • Paul Guehler (Joining in 1990)
    • Setting Standards and goals
      • Suggesting organization’s objectives and vision with 3M’s mission
    • Implementing “Give and Take” strategy
      • Supporting, but forcing members to meet financial objectives
    • Empowering managers
      • Encouraging manages to find opportunity in markets and develop it
    • Support and coaching the organization
      • Supporting members to have confidence and improve their abilities
  • Rob Noirjean (Joining in 1990)
    • Emphasizing the importance of market to products
    • Identifying marketing strategies for microlouvere technology
      • Finding 11 available markets where the technology can be applied
    • Setting privacy viewing market as the target market
      • ATM, Computers in public places
    • Receiving feedback from customers
      • Unclear display, Dazzle problem, etc.
      • Regarding privacy as a sensitive issue
failures and strategies to overcome 1 2
Failures and Strategies to Overcome(1/2)
  • First Launching (Failed)
    • Producing films in various sizes
    • Number of monitor size in the market: over 100ea  High purchase price ($140 for retail)
    • Sale: About $10,000/Month
  • Second Launching (Failed)
    • Producing films with standard monitor size frame
    • Dazzle problem
    • Sale: About $20,000/Month
failures and strategies to overcome 2 2
Failures and Strategies to Overcome(2/2)
  • Third Launching (Proceeded or NOT?)
    • Rob Noirjean (Marketer):Suggesting the product with privacy viewing and anti-dazzle functions (Reposition)
    • Andy Wong (Manager):Organizing a tem with experts in 3M (Product, quality, and technology engineers)
    • Paul Guehler (Vice President): Suggesting development process
      • Phase I: Developing Product Concept- Developing product with privacy viewing and anti-dazzle functions- Releasing the product through distribution channels in 3M
      • Phase II: Feasibility Study- Finding out technological feasibility whether the product can meet the goal price
      • Phase III: Constructing Business Plan- Price: $70 (Retail: $175)- Forecasting sales- Analyzing risk (existing competitors, failure in demand forecasting, etc.)
    • Internal/External Environment
      • Domination of existing competitors such as OCLI, ACCO, FELLOWES, and POLAROID
      • Opposition of the operation division to the distribution plan using the 3M channels
      • Need to get investment of $750,000 to launch the product
discussion question 1 2
Discussion Question (1/2)

What could be the driving force for 3M Optical systems to launch a successful product despite of a series of failures?

discussion question 2 2
Discussion Question (2/2)

In this case, 3M launched the product successfully with an entrepreneurial spirit after two failures. Discuss about another case in which a firm successes by demonstrating an entrepreneurial spirit.