3 M Innovators

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THE NEW FACE OF HEALTH SERVICES RESEARCH CREATING BREAKTHROUGHS AT By Eric uon Hippel, Stefan Thomke, and Mary Sonnack Companies want breakthrou products, but mos are far more adept at making incrementa improvements to existing lines. A pioneering division at 3M successfully navigated a process that leads to breakthrough thinking. of product development, they all senior a steady stream of breakthrough prodof the same ll grow rapidly and maintain high margins, kind tha bitious goals to tlvat end, demanding, for And agers se percentage of sales come from products that exam that a years ago. Unfortunately, the development did no st a don't deliver the goods. Instead of groups breakthroughs, they produce mainly line extensions and iticremental inipw^ments to existing products and services. And as the pace of change accelerates in today's markets, that's a recipe for decline, not growth. Given the imperative to grow, why can't product developers come up with breakthroughs more regularly? They fail primarily for two reasons. First, companies face strong incentives to focus on the short term. Put simply, although new products and services may be essential for future growth and profit, companies must first survive today to be around tomorrow. That necessity tends to focus companies strongly on making incremental improvements to keep sales up and current customers—as well as Wall Street analysts—happy. Second, developers simply don't know how to achieve breakthroughs, because there is usually no effective system in place to guide them and support their efforts. The latter is a problem even for a company like 3M, long Reprinted by permission of Harvard Business Review. From "Creatinf> Breakthroughs at 3M," hy Kric von Hippel, Stefan Thomkf, and Mary Sonnack, Sept.-Out. 1999. Copyright ' imsource of competitive advantage and refused to would coat catheters and tubes
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