Tag: new products

OM in the News: Is 3M’s Product Design Pipeline Hitting a Dry Spell?

We open Chapter 5 (Design of Goods and Services) noting that leading companies generate a substantial portion of their sales from products less than 5 years old. And The Wall Street Journal (Oct. 6, 2023)  reminds us that “the 20th century belonged to the unruly minds at 3M,” with 30% of their profits from new products. 

Some 3M adhesive products, including the Post-it Note, medical tape and industrial adhesives

What a great company. From its early days, 3M gave its researchers a long leash to chase ideas, many to dead-ends. The hits, though, were indelible: Scotch tape. Masking tape. Videotape. Post-it Notes. N95 masks. Artificial turf. Heart medication. 3M patented adhesives and abrasives. Proprietary coatings and films —materials at the heart of highway signs, weatherproof windows and stain-resistant clothing and carpets. Its optical film brightened the screens of millions of laptops, smartphones and flat-screen TVs.

But of late, there are fewer new products and fewer still have been blockbusters–and the company has retreated from its traditional 30% goal. For decades, 3M released a cascade of new items on the market, confident most would be profitable and a few would become indispensable.

3M’s innovation principles took shape more than a century ago under its then president, William McKnight, who believed in worker autonomy and initiative. “Mistakes will be made, but if the man is essentially right himself, I think the mistakes he makes are not so serious as the mistakes management makes if it is dictatorial,” he said. He instituted the McKnight principles, one of which allowed researchers to spend 15% of their time on projects unrelated to their everyday tasks—even if their managers disapproved.

The principles championed collaboration, encouraging researchers to share findings. The Post-it Note came about after scientist Art Fry, bedeviled by paper bookmarks falling out of his church hymnal, remembered a semi-sticky adhesive discussed at a company seminar. The product was an instant success after it hit stores in 1980.

Now, researchers are encouraged to pursue incremental improvements to existing products rather than novel, swing-for-the fences breakthroughs. A recent CEO installed “Six Sigma,” a regimen used at GE to measure and standardize business practices (see Chapter 6) but loathed by 3M researchers as a creativity killer. Further, budget cuts have trimmed 8,500 employees this year.

Classroom discussion questions:

  1. What do you think of the McKnight principles?
  2. Why are new products so important?

 

Video Tip: Innovation and Ingenuity at Work

“Three decades ago,” writes The Wall Street Journal (Nov. 27, 2017), “a historian wrote several laws to explain society’s unease with the power and pervasiveness of technology“. Though based on historical examples taken from the Cold War, the laws read as a cheat sheet for explaining our era of Facebook, Google, and the iPhone. You’ve probably never heard of these principles.

1. ‘Technology is neither good nor bad; nor is it neutral’. For example, DDT, a pesticide and probable carcinogen that nonetheless saved the lives of hundreds of thousands of people in India as a cheap and effective malaria prevention. Today, we can see how one technology, Facebook groups, can serve as a lifeline for parents of children with rare diseases while also radicalizing political extremists.

2. ‘Invention is the mother of necessity.’ In our modern world, the invention of the smartphone has led to the necessity for countless other technologies, from phone cases to 5G wireless. Here is a great 2 minute video to show your class to prove the point.

3. ‘Technology comes in packages, big and small. Steel, oil and rail were the package of technologies that dominated the 19th and early 20th centuries, especially in America, just as the internet, mobile phones and wireless connectivity are transforming the 21st century.

4. ‘All history is relevant, but the history of technology is the most relevant.’ The Cold War led to the buildup of nuclear weapons and the missiles to deliver them anywhere on Earth. That led to the development of a war-proof communication system: the internet. Many related innovations subsequently seeped into every aspect of our lives.

5. ‘Technology is a very human activity.’ “Technology is capable of doing great things,” Apple’s CEO Tim Cook said. “But it doesn’t want to do great things—it doesn’t want anything. The point is that despite its power, how we use technology is up to us”.