23:00 02-09-2020

Protagonists:
Rita Shor: senior product specialist MSMD, LUR team co-leader
Mary Sonnack, internal 3M consultant, LUR consultant

History of 3M: Minnesota Mining & Manufacturing

1902: company folded mining operations
entry into sand paper business
1916: started paying dividends
1920s: world's first waterproof sandpaper
masking tape + scotch brand cello tape
1961: founded medical products division
1990s: 30 key technologies
1994: health-care sales >USD2bills
1997: 10K health related prods

Innovation at 3M: huge R&D emphasis since the start

'hot-house' non-corporate nature of innovation
technicians bypass purchasing agents to understand customer needs
'dual ladder' to employees: technically inclined can stick with it
need not shift to managerial track
leading to better retention
decentralized units based on new key product areas
aiming to generate revenue from new product offerings:
30% rev from products that did not exist 4 years ago
1997: 4.5K scientists, engineers, technicians in USA + 2K overseas
USD1bill spent on R&D - not including process engg & QC
operating in 60 countries: overseas business brings 50% of
USD15.07bills rev & USD2.7bills operating income
'skunkworks' teams: technical individuals working on prod dev
no fear of failure: no repercussions but celebrations

Market research at 3M
marketing input from customers & sales reps: very few mrkt researchers
outsourcing market research: 1 mrkt reseracher per 900 engg
For example: Health care unit market need identification
-data from sales reps who are in contact with medical profss
-focus group: 30 nurses twice a year
-customer evaluation of current market needs
-site visit by 3M techs to observe medicos at work
-data on risk factor of diseases
Disadvanatages:
1. outsourcing creates multiple interfaces b/w developer & customer
2. information obtained not necessarily proprietary
3. focus group conclusions very short sighted
4. customers themselves oblivious of their needs
1000s of concepts + inventions benched and awaiting market

Medical-Surgical Markets Division (MSMD): part of health care unit

products to maintain sanitized environment in hospitals
categories: soaps, gloves, masks, drapes, sponges, dressings, antibiotics
surgical drapes: establish sterile fields on the surgical spot of skin
isolating feild of surgery from all microbes: even other parts of body
annual sales of USD100mills for 3M but market stagnant
overseas market limited due to high cost of product
2 years required for product development (best 1 year, worst 4 years)
mis-fires: technology in itself wont sell - customer need necessary
Conventional market research failure: prod developer not owning customer need
ended up eliminatin mrkt research
Lead User: user aware of the upcoming condition/trend in the mrkt segment
their inputs are valuable in innovating new product concepts
in the high-tech or fast moving industries
Traditional strategy backward looking: innvovation cannot be planned
But seniour mgmt too invested in 'incremental innovation': hard to convince
Shor struggled to have ppl assigned for LUR: part time team assembled

Stg1: project planning - homework/scouting [Sep'96-Oct'96]

identifying type of mkt & prods and determining level of innovation
survey of internet, literature, ppl network: building info database

Stg2: trend identification - selecting specific

making sense of all info from stg1 in a 5 day workshop
parameters of breakthrough product:
conform to body, more effictive than current prod, easy apply/remove
indentify experts for more info & ideas from analogous areas of prod dev
contacting: veterinarians, US mobile army surgical hospital, make-up artists
US MASH proved to not be lead users: focused on comms, computerization etc

Stg3: prelim concept generation - prod features for precise needs [6months]
knowledge gathered of developed world only: no info on vast developing world
developed wold: more cancer/cardiovascular casualties
developing world: more infection causing mortality (unsanitary)
more opportunity in developing countries: but disposable prods unaffordable
team travel in two groups: South America & Asia (India, Indonesia, Malasia..)
sanitation protocols not adhered: labour cheap hence unlikely replaced
variety of lead users: infection control expert, make-up artist,

Stg4: final concept generation - lead user complete prod concepts [Summer'97]
change in senior mgmt: Sam Dunlop, trad mrkt research background
close to retirement, opposed to LUR, likely to plug it

workshop: 'is there a revolutionary approach to infection control'

11 of 3M; 11 outsiders to come up with 3 prod concepts
improve microbial control & save cost in surgery today+tomorrow
all signed IP rights to 3M and received fin renumeration
formation of team and competition b/w them
chlng1: lack of structure in the workshop
teams stuck to schedule & came up with solns
chlng2: introverted & extroverted participants
got better with time
chlng3: marrying creative ideas & technical feasibility
introspection & brainstorming
chlng4: managing huge corpus of facts and info
solved by frequent questioning and answering

ranking of product concepts floated in the workshop:

metrics: customer preference, (double-digit annual) business growth,
boosted global presence, higher growth for 3M including in-house tech

three final concept product reccomendations:

economy line: surgical drapes using low cost materials
pre-existing 3M adhesive, fastners to be used
one-size-fits all + time-saving dispensing
incremental proposal: from foreign tours
skin-doctor line: hand-held device for antimicrobial production
to layer antimicrobial substance on surgery surface
 vacuum mode + layering mode: incremental proposal
Antimicrobial armour line: for tubes & catheters
for blood borne, urinary tract and respiratory infections
breakthrough product: consistent with current business strat
entry into USD2bills market

fourth recco: early intervention in disease process - infection prevention

gap in the market: no healthcare company in the lead in this segment
rewriting business strategy: introducing upstream containment
but brand new field for 3M: required new skill & knowledge
sophistication called for combining tech from >1 core areas of 3M
eg: medical-surgical div + diagnostics
but 'diagnostic' replaced by 'detection'
diplomacy necessary: challenging entire business strategy