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3M Business Case

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Summary: Keeping the “pace” of innovation is a primary objective to 3M managers and the success of Computer Privacy Screen project, by itself, is irrelevant in the scope of maintaining such entrepreneurial flow. Assuming this project fits into the desired “pace” of innovation, Guehler should approve it; Wong should support it unconditionally.

Intrapreneurship at 3M: With a requirement that divisions derive 30% of sales from products introduced within the last four years, the “15% rule,” and a heavy R&D budget (6-7% of sales) to back it up; 3M is serious about innovation. The organizational requirements for such corporate renewal are demanding and management plays a significant role in encouraging intrapreneurship. Because products belong to divisions and technology belongs to the company, 3M is able to continually innovate on new products by utilizing existing technologies. It is important for divisions to focus on differentiated products and defensible product-market positions. The combination of “innovation-based entrepreneurship” and “well-intentioned failure,” means that building on existing technologies from different perspectives is crucial to success.

Andy Wong: his role as a front-line manager/entrepreneur, is to promote the ideas of his group, a lack of support could be harmful to the motivation of the group and ultimately to the crucial flow of new ideas. There is only one option acceptable to Wong in handling the AFE: approve it, even if Guehler ultimately overrules his decision.

Paul Guehler: As a middle-level manager he must objectively consider if this project meets the appropriate criteria outlined by executive management. The basis of “the 15% rule” relies on individuals to take an existing technology and find a new use for it that others are not seeing (new perspective). He must be careful not to associate the past failures of the OS unit with the privacy screen project, remember this project has been initiated by a new department member with a marketing background (Noirjean). Research and Development is not an exact science, (that’s why they spend $914M) so there will naturally be some ambiguity in Guehler’s decision factors. However, if Guehler does not approve the AFE for the privacy screens, he not only sends a discouraging message to employees but he could be holding back an idea that has a lot of potential to create value for 3M, it is impossible for him to determine, at this point, if the project will be a success.

Conclusion: To deny new funding for the computer privacy screen, Guehler would not be consistent with 3M policies. The light control technology has existed in the company for 15 years and it is not Guehler’s responsibility to re-evaluate its potential contribution to the OS (or other) division(s). Therefore, to fund a small project that would innovate on an existing technology (that has longstanding support) would at the very least demonstrate confidence in the types of ideas that 3M has identified as desirable. While the market is small and the product probably does not have “home-run” potential, it requires relatively little funding and is an acceptable risk to maintaining an entrepreneurial culture. The underlying technology has been around for a very long time without a defined market, and now, as the OS unit gets closer, what is the downside to giving it one more shot. Guehler must be careful to not repeat the “Thinsulate” mistake.

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