The 3M CASE - Identify 3M’s core competencies PDF

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Identify 3M’s core competencies...

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ETOIJECK CLOVIS NJIEWEI 19M0653

3M CASE 1. Identify 3M’s core competencies, core products and end products. How are these three sources of competitive advantage linked with each other? 3M’s core competences are innovating, engineering and its tolerance for experimentation. This helped the company to create its core products: the technology leading to production of new products. With help of the BEF3M was able to make end products like special LCD screens with brightness enhancement. These three sources of competitive advantage are linked with each other by all being a part in the process of creating a unique product for the company of 3M. 2. How does 3M mobilize resources at the SBU level?3M mobilized its resources at the SBU level in stages. It began by exporting products to the places of the strategic business units. Then it setup sales subsidiaries in these areas and this process of increased integration in the market of the host country would continue even so far that the host country of the strategic business unit would produce and innovate new products themselves. 3. How does 3M address the problem of bounded innovation? 3M tries to break through the problem of bounded innovation by supporting all kinds of ways of innovations. Firstly 3M makes sure that its employees have a sufficient amount of time and money for research projects. This is done for example by setting up grants for research projects that would otherwise not be able to go through regular funding channels. 3M also assures a sufficient amount of sharing technology and ideas by providing opportunities through

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both formal and informal channels. And, lastly, to help unexperienced innovators there’s also guidance by more experienced-workers 4. What is the strategic architecture at 3M? How did top management build it?The strategic architecture at 3M is to support creativity and innovation at all of its companies over the world. The direction of the growth should be based on innovation. Top management build it by providing independency and decentralization to its subsidiaries, while meanwhile financially supporting creativity. 5. How did 3M internationalize? How did it exploit its core competencies developed at home? How did 3M try to diffuse its core competencies to its overseas subsidiaries? 3M internationalized in stages. It began with exporting abroad, then it established sales subsidiaries, later it would set up warehouses after learning about the local market. This process of increasing integration with the host country would continue and finally even R&D labs would be set upon those countries to innovate from out these countries as well. It exploited its core competencies of innovation and engineering at home by using an aggressive innovation strategy, in which it would take great financial risk to support any innovative idea in order to bring new and revolutionizing core products and end products.3M tried to diffuse these core competencies by integrating into the host country of the overseas subsidiary. Once the company was sufficiently integrated in the host country, it would set up its own R&D labs, which were also

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internationally sponsored by 3M through e.g. international cooperation and international grants. 6. What did McNerney implement to improve 3M’s R&D activities? Do you agree with his approaches? Why or why not? McNerney implemented a new approach to innovation. As opposed to the earlier idea of the direction of growth being led by innovation, 3M’sinnovation would now have to be led by its direction of growth. This would be accomplished by increased communication between researchers and people from manufacturing and marketing. He also dropped the 30 percent rule, by which he tried to prevent introduction of dubious innovations solely to meet the target. Finally, he provided less possibilities for products that had smaller probability of success, while providing more chances by financial support for the innovations with higher probability of success. I do not agree with the approach of McNerney, because by implementing this new strategy he gradually lets go of the principle of tolerance for experimentation which initially led 3M to become successful through break-through innovations. If future choices continue to be in the line ofMcNerney’s choices to let go of this, the company may finally even lose its core competencies, which could finally mean the end of the company 3M if it doesn’t simultaneously create other core competencies. 7. Can you provide an update 3M’s core competencies, using materials available on the Web? McNerney has had a major influence on the 3M company and its core competencies. “When W. James McNerney took the post of CEO in 2001, he immediately set forth an agenda of examining the company’s organizational

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structure. Because of his being an outsider coming into office, he could see things in perspectives others who had been in the company for a long while could not. He initiated the Six Sigma cost reduction programme, decided upon3M Accelerate that favored better in development for quicker market penetration and reformed the research and development to become more concentrated.” (Zohari, 2013)So according to materials available on the web 3M has developed a new core competency in efficiency, as 3M has become involved in the Six Sigma cost reduction programme. 3M has clearly shifted from full focus on innovation to focus on efficiency and cost reduction....