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Introduction
Historically, the socio-economic development of any state is determined by the level of its scientific and technological development as a fundamental factor in the formation and development of the states economic potential. At the same time, scientific and technological development is defined as creating new knowledge and technologies based on scientific research with the subsequent transfer of the results obtained to the real economy for the development of innovative and high-tech production (Nambisan et al., 2017). Investors are now paying more and more attention to innovations that increase company profits and accelerate growth, which is the basis for creating competitive advantages.
An innovative business or an innovative project is always a risky but exciting endeavor. According to Michael Porter, leadership in innovation is one of the successful development strategies renowned strategic management guru (Saputra, Haryono, and Untoro, 2019). However, it is of particular importance to systematically and carefully calculate the risks of innovative projects. This paper deals with 3M an American corporation is working in chemistry, industry, safety, and everyday goods (Meng, 2019). This company is associated with innovation since it has been steadily discovering new technologies since 1902 that allow the production of fundamentally new products (3M About us, 2021). For example, the company pioneered photocopying and magnetic recording (3M Timeline, 2021). It is believed that 3Ms merit lies not only in creativity but also in good management. This paper critically examines the role of innovation management and its supporting tools and techniques that underpin new product development. In addition, areas, systems, and processes are assessed that use project and program management to support the goals of a given company.
Critical Analysis
3M is committed to developing innovation. It should be noted that inspiration for new ideas does not lend itself to schedules and plans, but several techniques can increase the likelihood of a breakthrough idea. At a minimum, this fact can be facilitated by professional intuition, which, the higher, the deeper the specialists level of knowledge (Hong and Han, 2021). In addition, industrial innovation is invariably linked to scientific discovery. When mining substances, 3M has often synthesized breakthrough products that mark technological progress milestones (3M About us, 2021). This fact is facilitated by several methods and approaches at once, reflecting the companys orientation in the management of innovative projects.
First, it is the legacy and history of the company, which includes many similar discoveries. 3M tries to use its best sides, and many years of experience and longevity in the market have always been allies of large companies. However, according to the company, the experience category lies a little deeper. The core value of 3M is its employees and managements approach to them (3M Careers, 2021). People in the framework of work processes gain experience, synthesize new ideas from it, and gain exceptional skills, which are then shared with new employees. On the part of the management, all personnel receives certain freedom in matters of innovation and an appropriate attitude that meets the requirements of the corporate culture. All these factors together contribute to employees involvement in the companys global affairs since any discovery can drastically change the world and satisfaction, as each employee is essential and appreciated by management.
On the part of the management in the project management, rather ambitious plans are set for each new product. These events cannot be called naive since most of them bring results. First of all, this tends to have 30% of sales of the companys total turnover due to goods released in the last four years (Von Hippel, Thomke and Sonnack, 1999). Goals like these provide incentives for developers and senior managers to stimulate theoretical and ideological activity. Again, this approachs strength is its many years of experience in application. This organizational process also keeps 3M out of their comfort zone, where they could come up with a hugely popular product and freeze R&D spending. However, such a scenario completely contradicts the companys philosophy, which is not without reason, called one of the most innovative in the world.
In addition, the development of potential in a separate part of the work process rendered 15% of the total working time. During this period, employees work individually to share their new thoughts at the general meeting (Hiranto, 2018). Post-it notes were invented during this period (Karapapa, 2019). However, it is not enough to develop a new idea; implementing it is much more challenging. While many companies have the resources to try new products, not all want to expand their line or portfolio. 3M on this issue takes a much more democratic position of tolerance for failure (Smith, Treem, and Love, 2020). Indeed, the best way to try out a new product is to launch it directly into the market so that the critical decision about its relevance is made by consumers and not by management.
Organizational processes and management decisions also allow employees to form groups and separate companies when sales reach certain levels. The R&D management company offers close collaboration with researchers around the world. Approximately 6% of 3Ms revenues are invested in science, resulting in over three thousand patents every year (Morioka et al., 2017). There is practically not a single branch in science where 3M would not put its hand. At first glance, it may seem that quality may be lost before the quest for quantity. However, growing sales, even during a pandemic, continue to grow and refute this fact (Macrotrends, 2021). New product development (NPD) in this regard remains at the height of 3M.
This approach includes several key features. First, the methodology is designed for the long term, which, together with the companys long history, gives more actual results for the long term. Secondly, this uses unusual combinations at the intersection of various sciences, which are not tested or ordered by other industrial companies. Finally, 3M raffles off many grants every year, thus encouraging scientific endeavors (Howell, 2017). The combination of these factors, with clearly defined goals and company philosophy, can confirm the success of NPD activities and serve as an example for other companies.
Considering that the segment of 3Ms activities is extensive and includes industry and transport, consumerism, security, electricity, communication technologies, and healthcare, there is also a broad segment of their consumers and competitors. The target group is represented by other industries and industries ordering specific packaging, polymer materials, and ordinary users of office supplies and home care products (Chang and Huang, 2017). Naturally, this also includes doctors of various disciplines if they use many technologies and developments of the company.
It is always difficult to assess the market of an international company due to the vast number of factors that affect the organization globally and locally. 3M has competitors in the form of General Electric, Honeywell, and Emerson. Intense struggles, coupled with political restrictions due to the pandemic or foreign actors, for example, in India, can become obstacles to development and a loss of market share (Masharu and Nasir, 2018). Environmental regulations, which are taking the environmental trend more and more seriously every day, can also unexpectedly interfere with producing good products. Moreover, the company already had image threats due to environmental litigation (Guenster and Koegst, 2018). However, the diversity of 3Ms activities is a weak side and a strong one: pointwise, each companys product has a lower risk of impact in case of failure.
Opportunities for any sizeable international company always include diversification. Considering the philosophy of 3M, this approach is one of the most promising and is consonant with the companys goals. However, it is almost impossible to plan for such an activity, given the creative nature of any discoveries and patents. In addition, the automotive industry is one of the most interdependent industries for 3M, where forecasted growth could be good news for the company (Bran, Bodislav, and Mitric, 2020). Finally, since 3M allows its subsidiaries to spin off, takeovers should also be considered in line with 3Ms philosophy.
The economic and financial performance of the company has been demonstrating stable growth for many years, even despite the crises of previous years. This fact means that the commercial stability of the company is ensured, taking into account the approaches in business that are pretty risky for the traditional presentation. In turn, the technological viability of 3M is at an even higher level. First, the companys scientific achievements have been recorded for over a hundred years. Perhaps not all of them survived to the present day, mainly due to the companys approach, and not all of them were breakthroughs at the level of Microsofts discoveries. However, having practically worked with such a massive amount of material, 3M has undoubtedly amassed a knowledge base that gives it an edge over the many companies in the market. Secondly, the company did not limit itself to materials science: the study of physical processes, information technology also gives its fruits in the form of various patents that are used for the benefit of society or within the framework of any production.
A companys strategy more explicitly reflects its goals. First, the three main vectors of the companys activities include society, circular, and climate: any scientific activity or achievement must benefit one of the three directions (3M Strategy, 2021). The 2025 plan also includes a transition to fully renewable energy and an ecological approach to developing any new product (3M Strategy, 2021). Thus, the recycling of materials will become the engine of technological progress around the world. Activities for the good of society meet the requirements of the companys social responsibility, which, together with a humane approach to its employees, only confirms this type of responsibility. Finally, previous bad experiences of environmental collisions must be addressed through new approaches focused on climate, renewable energy, and sustainable new product development methods. Environmental responsibility is now as much a necessary part of a companys reputation as social responsibility, which is why its requirements must be observed. Considering that the companys activities are always aimed at the future, the importance of this type of responsibility increases several times.
The collision of business model innovation and technical competence is almost certainly closely intertwined with its components. First, a company that has worked primarily with technology for such a long time has an extremely high level of competence that many employees develop professional intuition that allows for radical changes in the business model. Second, by dividing the activities of a company down to the production of each product, it can be seen that the scale of business model innovation matters. The companys philosophy is focused on constant change, and therefore the innovation of business models at the lower levels is at the heart of the organization. However, the underlying business model, which dictates a change in each sector, does not change for some reason. First, it has proven itself well over more than a century of history. Secondly, this model allows the company to stay afloat today and stimulates new actions.
When evaluating 3M according to the risk-reward system, one can notice the dual nature of this assessment. On the one hand, the company tries to update its product line every year, exclusively expanding the portfolio. In addition, 3M relies on new products, increasing their sales rates, and focusing on their novelty. Such frequent product updates do not guarantee successful sales in the coming period, so the risk of investing is always there. Nevertheless, investments in the company are growing exceptionally, given a reasonably stable situation in terms of other financial indicators, such as net profit and turnover (Macrotrends, 2021). 3M lacks stars from the sky, but its stability, unshakable by the pandemic and crisis in the late 2000s, really justifies the risks of investing in the company.
Moreover, scientific discoveries openly focused on environmental trends attract investors regardless of their success and further application. In this case, investments are not made for profit but the future of the environment. Given the companys creative nature and its environmental responsibility statements, the investment target is attractive in this situation.
New product development in various fields, as a rule, goes through traditional procedures of verification and implementation. In medicine, this is additional research in laboratory and clinical conditions; in the case of industry or manufacturing, it is economic research for changes in technological processes. In many ways, these processes depend on consumers; 3M only focuses on these procedures to facilitate entry into the required market. Freedom of inspiration and the creation of new ideas after their processing take a convenient form for the end-user. Taking on this activity, 3M has earned an appropriate attitude towards itself for high-quality service and a guarantee of the uniqueness of this or that product or service.
Goal Support Systems and Processes
If the products under development by 3M had only scientific interest, the company would not have lasted so long and now would no longer exist. Naturally, the achievements entering the market should have practical applications that the end consumer will be willing to pay. 3M faced a similar crisis in the early 2000s; however, a series of actions to reorient and create cross-functional teams helped get out of the crisis (Lee and Ahn, 2018). First, a more effective and productive contact was established between scientists in 3M laboratories and marketers, describing the main interests of the market and the possibilities of scientific activity. Secondly, the cross-functional teams created in the company meant the need to keep duplicate records of people from different departments of 3M (Lee and Ahn, 2018). Technological production of products focuses on ideal quality, allowing for a defect of no more than a fraction of a percent. It is noteworthy that this approach uses a strong focus on data, not on intuition. Consequently, intuitive techniques are applied when creating a product, while when manufacturing it, they are entirely excluded from the workflow.
Leadership plays a vital role at 3M. The Six Sigma approach, which has been used with great success in many companies, reflects the basic principles of leadership in the organization: chart the course; energize and inspire others; demonstrate ethics, integrity, and compliance; deliver results; raise the bar; and innovate resourcefully (Alosani, Yusoff and Alansi, 2018). These aspects demonstrate at once several qualities of a leader in a given company. First, the leadership is focused on bringing any business to an end, implying the transition to innovation. This fact is confirmed by the companys democratic policy towards failure. Second, leadership within the company supports the dual nature of the entire innovation development process. Leadership first energizes and inspires to create a new idea using intuitive methods, then requires decency and adherence to processes that exclude any emotional interference. Against the background of ethics, demonstration of results, the constant raising of the bar, and a culture of constant changes in various business models, the company maintains its reputation and leading position in the market.
Supporting a companys three-pronged strategy also occurs in three different ways. Products manufactured for the good of society increase the companys social reputation and bring it closer to the end-user in the form of an ordinary buyer and not an entire military organization or industry. Closer contact always implies better feedback and a better understanding of the needs of the community. As a result, the financial performance in this segment is improving. Concerning development for the benefit of the climate, the financial proceeds are not always an indicator of the projects success. Recognition by the scientific community or the authorities and activists of a given company as an active environmentalist creates the most critical advertisement for 3M in the modern world. Compliance with environmental responsibility requirements is an unspoken prerequisite for a large companys success and high reputation. Finally, inventions for the benefit of processing are best at improving the economy, both within the enterprise and at the national level.
The company itself openly dictates corporate venturing at 3M. First, the company collaborates with entrepreneurs and start-ups in the most promising areas: smart infrastructure, healthcare, digitalization, and modern materials science (3M Ventures, 2021). Secondly, a distinctive feature of the company is that 3M is looking for a strong connection between its future partners and customers. In other words, for collaboration and enterprise creation, the partner must provide a firm idea of their intellectual property, a scalable business model, and a track record of the management team (3M Ventures, 2021). As a result, 3M acts as a platform for bringing innovative ideas to life, thanks to its many years of experience.
As a business example, we will take the 3M 360 Encompass system
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