Is_Innovation_Systemic

Name: Student Number: Lecturer: Date: 22 May 2010 Module 1, Project 3 What does the word systemic mean' My definition of systemic is something that affects the whole system or the entire body. To answer the related question “is innovation systemic'” I would say yes, innovation is systemic as it would affect the entire group or company and it would take it to the next level. In my essay I would like to discuss how new ideas and breakthrough moments led to a systemic change in leading companies. For my essay I would like to use the company 3M, formally known as Minnesota Mining Manufactures. The reason why I chose 3M is that the company started as a mining company and is now a leading multinational conglomerate which manufactures products from masking tape to traffic lights to pharmaceuticals. 3M was founded in 1902 by Henry S. Bryan, Herman W. Cable, John Dwan, William A. McGonagle, and Dr. J. Danley Budd. The original plan was to sell natural mineral called corundum, a rock forming mineral, to manufactures for grinding wheels. This plan did not work out well as they later found that they were selling worthless rock. The founders then decided to manufacture sand paper, although they struggled with quality control due to poor raw materials, management looked at importing raw materials to create a better brand. The first phase of research and development came in the 1920’s when the material which was imported needed to be boiled in order to strengthen the product. The management of the company always placed an emphasis on innovation and new products, only after twelve years did the company produce their exclusive product called Three-M-ite cloth. “3M technical employees are encouraged to devote up to 15 percent of their working hours to independent projects.”(McnerNey, 2002: 21). 3M was the first company to manufacture products such as waterproof sand paper and masking tape. The new ideas and thought process which led to breakthrough moments for 3M changed the whole company from being a supplier of raw materials to a supplier of finished products. This gives us a good understanding why innovation is actually systemic. From the above we can say that innovation is a very important at 3M especially in the technical sector and over the years has become the culture of 3M. According to Mcnerney (2002) 30 percent of 3M annual revenue must come from new invented products. Given the size of the business 30 percent is a large amount, so I would think that sales teams around the world would have to use their thinking caps in coming up with new ways to create a good sales pitch for these new products or to find new ways to meet targets. Leading companies around the world have one common thread; which is that if you had to ask any staff member the values, vision, image and culture of the company they would all tell you the same thing. From top level management right down to a sales representative to the engineers in the labs each of these 3M employees have the same culture a culture to innovate. “William McKnight had a revolutionary idea in 1948. It was an idea uncommon to American business, but one that would ignite growth, diversification and innovation for decades to come.”(Mcnerney, 2002: 170). McKnight a CEO of 3M in the earlier stages restructured the company by creating divisions, which was seen as individual profit centers. Each of which had the power to run independently from each other. McKnight believed that this would be a strong motivator for employees and would be more responsive to customer needs. This idea turned out to be a good idea and boosted growth in the company. This idea also gave a chance to the employees to be more entrepreneurial. 3M worked with a mix of loose and tight business strategies, employees were allowed space to come up with new ideas and financial policies were kept tight. Till today 3M uses some of the philosophies that was implemented in the early stages and these help grow the company the main emphasis of the company is new ideas and innovation The 15 percent rule still applies today , this is when employees are encouraged to use 15 percent of working time for new ideas or own ideas, this can be seen as a driving force to the ever growing success of 3M. To go back to the question is innovation systemic' If we look at 3M as a company on the whole they base their company culture around innovation, spend millions of dollars on research and development, 30 percent of annual revenue must come from new products that the company manufactures and there have the 15 percent rule. All these factors prove to us that innovation I this company is systemic and has an affect on the whole company. Innovation is a thought process which affects the whole company as each and every staff member would strive to come up with new and interesting ideas. This also depends on how the company is structured. It’s very important that the company allows room for growth and that the company vision image and culture is shared amongst all members of the company no matter the job description. If you read Malcolm Gladwell’s Outliers you will read about the ten thousand hour rule Basically he tells us that it takes a long step by step process to be good at something or to find that breakthrough moment and that’s the culture that is adopted at 3M. 3M went through the process of being a good brand to a great brand and the company has a build to last approach as the company has lasted the test of time by creating new and improved products for the customer’s needs. I would like to conclude my essay by taking a look at the history of great powers such as America; innovation is a part of the American culture where new ways of thinking drove the American nation to become leaders in many aspects such as business, academics and sports. This can be seen as major factor in the growth and success of the American nation. China today can be seen as a nation that has shifted from imitators to innovators. What we can learn from 3M is that if you want to get from where you are to where you want to be as a leading company; innovation has to a systemic process and part of the company culture. Bibliography * Collins, J. (2001) Good to Great. London : Random House * Gladwell, M. (2008) Outliers the Story of Success. New York: Hachette * Mcnerney, W.J. (2002) A Century of Innovation, the 3M Story. 3M Company