3m Marketing Case Study

SHORT CASELETS

3M

3M is an industrial giant that is well known for its innovative practices. With consistent regularity, the company introduces numerous new products each year, and adds successful new divisions.

It is interesting to see how a project gets started at 3M. Let us suppose someone working in the product development group in a division comes up with an idea. He first does the normal thing by going to the direct boss to seek funding. What happens if the boss turns him down? Then the 3M magic starts. The person goes to another division within his group. If he is turned down again, he goes next to another division within his group. He may be in the adhesives group, but it's not unusual for him to wander off to office products. Now if that group or some other does not have time for him, he goes to the court of last resort – the New Business Ventures Division (NBVD).

To understand how entrepreneurial activities are being encouraged at 3M, we have to look at both the organizational culture, and the way the whole process has been structured. The major cultural factors include:

• Emphasis on innovation. Each division has an ironclad requirement that at least 25% of its sales must be derived from products that did not exist 5 years ago.

• Persistent support for possible good ideas. Even if the new programme hits a snag, the new product champion – if he is committed – is encouraged to persist. Stories of continued persistence that ultimately produced a successful product have been kept alive and often repeated so that an employee with an entrepreneurial spirit who feels discouraged, frustrated, and ineffective in a large organization knows that he/ she is not the first one to face considerable odds. He has the freedom to persist with a rejected idea.

• 3M offers back-up commitment to job security for good tries even if they fail. Failure is O.K.

• Average space between idea and commercial deployment in virtually any field, high or low technology, is observed to be a decade.

• 3M does not limit projects on the basis of potential market size.

• The company celebrates its heroes - past and present.

• Top management has well-publicized record of championing success, and they act as role models for young in the organization.

What are the shared values that guide the whole innovative practice in the organization?

• There's nothing unique in the structural form of 3M.

• It has a radically decentralised business, aiming at adding new divisions.

• Once a project