As 3M is technological firm, so it uses technology which is new and have shown resemblance with their idea of unique product. The culture of 3M forces them to adopt new technologies for excellent results and so far they are doing well.
Q 2: The case describes the multi-layer films as an innovative application at 3M. Discuss another innovative application or product of a different organization and state why this product is successful.
ERP is one of the biggest revolutions in the field of technology. It is also called as business solution partners. It was introduced by German company named as SAP in 1992 and after that Oracle and Microsoft develop their own ERP systems. It is a system which controls almost all the activities of company’s business. It provides transparency in companies business processes.
ERP stands for enterprise resource planning. It is divided into different modules like, finance, trade and logistics, warehousing, HRM, IT, customer service and so on. It makes things easy for the company to operate in tough market conditions.
It helps the company managers to make quick decisions and catering the exact demand patterns by analyzing the trend of customers. It is deployed in all functional areas of the company. Alignment of different business functions is easy by using this technology. Its implementation and training cost is high but the potential benefits are even bigger. It reduces the manual working and saves time. Once ERP is deployed by using various steps necessary for ERP deployment, life of the company would be easier.
ERP consist of different modules. Each module covers one functional area of the business. It has few specific terms and conditions and the security system of ERP add value to it. Due to this feature, it’s easy to separate the access of employees related to them which stops any information leakage. It is integrated software which is aligned with all business functions, so once the entry is placed in the system under any head, the impact is n all the functional areas. In this way line of action is clear and ERP reduce the chance of company’s failure.
There is a big difference between MIS and ERP. MIS is a system which helps in forming the integrated system by analyzing the need of the companies but ERP tells the company about the right practices which helps in their business.
ERP helps in all sectors of business irrespective of the size of company. Large and small companies can deploy this system in their company for efficient results. ERP providers keep on updating their software every year so that companies can manage the new technological trends.
ERP is a user friendly software and needs only 1 time training to see how it works and after that it is easy for the employees to operate this software. Problem identification is done automatically so company’s having this system is secured.
Q 3: Discuss the importance of the commercialization process for innovative organizations such as 3M.
Commercialization is a process of transformation of unique and innovative idea in the form of a product that customers need. This process is started from the brainstorming session in which all potential employees give different ideas, after that, possible ideas are separated and analyzed. After analyzing those ideas, the most promising idea is selected and them product development starts. This gives the competitive advantage for the companies to produce that product which does not exist before. In this way companies using commercialization are creating new markets. In this era, companies are facing high unpredictable demand. The major reason is the personalization concept in which people want to denote the product by their community or region. In this situation, it’s a challenge for the companies to cater the demand of potential customers and for that they use unique techniques like commercialization and which eventually helps in converting individual demand into market demand. Innovating product makers are the trend setters. Once they set the market by giving unique product then many other companies try top copy the idea and enter in the same market. This not only help in the growth of the market but helps in the growth of the whole society as well as the economy. It is done through different innovative techniques like incremental, radical and so on. Commercialization helps in overall improvement in the community. Innovative ideas secure the future of the company and introduce those practices which are beneficial in the long run. It helps in promoting the learning culture in the organization.
Commercialization helps in determining the true demand of the customers and gives it a shape which is acceptable even appreciated by the customers. This value added activity builds confidence on the brand. It helps in motivating the managers to be aggressive in their decisions. It also helps in interdepartmental communication as the new product is established with the mutual consent of all the functional managers. Managers can easily gather and share the data by using this concept as the barriers of communication are removed due to extensive collaboration.
Innovation process is very strategic and it needs time as well as phases to fully achieve the benefits.
When commercialization process is executed, a through analysis of the organizational functions is done which result in problem identification in many processes. This is an alarming sign for the managers to focus on these lines.
Commercialization process has few barriers as the employees are hesitant in adopting the new ways of doing process and dealing in new products. But training of the employees; resolve this issue.
Key Performance Indicators
A key performance indicator (KPI) is often used to measure the success of a certain activity in an organization. Write an essay to discuss the importance of KPI to organizations. Support your answers with examples of real organizations and from various business functions.
Key performance indicators KPI is a term used to define the key variables of the organization which lead to goals of the company. These goals are measurable and a standard is set for these goals which are then evaluated by the managers of the company. These goals are aligned with the strategies as well as mission of the organization. Goals are established with the concept of SMART.
- S stands for specific means they are divided into small objectives.
- M stands for measurable means they should be measured.
- A stands for achievable means they are not vague that can’t be achieved.
- R stands for relevant means that they should have alignment with the company’s long term goals.
- T stands for time bound means that a specific time is set for the goals.
KPI’s are identified in both small as well as large organizations. But they are more helpful for large organizations where processes are complex and in order to remove the complexity of the processes, they are divided into smaller goals and even very short objectives. For example KPI’s for a car mechanic are RPM rate, Speedo meter etc.
KPI’s vary according to the culture of the organization and its trends. For example KPI’s for cricket team is different and KPI’s for engineering firm is different. Few companies focus on customer service more then any other operation, especially in service sector, whereas production plants have different KPI’s depending on the nature of the product.
When we talk about KPI’s, the focus is on long term goals. KPI’s directly deal with goals like increase profitability and market share. These goals must be aligned with the vision and mission of the organization.
The main characteristic of KPI is that they are measurable in term of numbers so that managers can easily examine the success and failure of achieving the tasks. Commonly KPI’s are for a specific year which is evaluated at the end of the year. Its unit should be the same like dealing in dollars or any other currency must be fixed for the entire operating period.
KPI’s are divided into different categories
- Quantitative indicators which can be presented in the form of numbers.
- Practical indicators which represent the operational activities performed by the company work force.
- Directional indicators which represent the long term plans of the organization.
- Actionable indicators which represent the set of actions that is necessary for any unforeseen circumstances as well.
- Financial indicators which deal with the profitability and market share.
Key performance is important in the following aspects
KPI’s helps in measuring specific goals, which are set for specific purposes. It helps in evaluating the performance of the company in terms of goals. Once the goals are achieved then the company grows. KPI’s help in measuring these goals as they are the standards set by the company managers.
KPI’s helps in becoming the market leader. Leading companies set the examples for other companies through their increased market share and through their efficient way of doing things.
- Desired VS actual results
KPI’s helps in evaluating the gap between the desired and actual results. KPI’s set the parameters for evaluation of the goals. Operations can only be improved by analyzing the gaps between the goals experienced. In this way companies enhance the learning culture.
KPI’s helps in achieving the objectives set for the company. Planning can only be done once the KPI’s are identified by the company managers. They set the patterns on which objectives are evaluated and leads to goal attainment.
KPI’s helps in adopting good practices of the organization. If goals are not achieved then their must be some problem in identifying the KPI’s for that particular organization or department.
KPI’s helps the organization in improvement of its operations due to set of standards identified by the top managers. As I have already described the gap identification which leads to improvement.
KPI’s is used for external reporting procedures. Variables are identified which necessary for external reporting.
KPI’s are monitor progress toward a variety of goals and its helpful for managers to perform their functions as well as make quick and effective decisions.
HRM is the organizational function that deals with issues related to people such as compensation,Hiring, training, performance evaluation, Leadership, planning, monitoring and other human resource activities have different KPI’s namely job description analysis, performance chart, recruitment advertisements etc.
- Product/ service development
Innovation matrix, balanced scorecard, mosaic management, prioritization, successes failures/ lessons learnt, trade offs, MBO, succession planning, investment appraisal, TBC, technology audit, SCORE, quality circles, decision making, recruitment appraisal, creativity, product age profile, period of grace, trade offs, halo effect, identification of new product/ service concepts, synergy, cannibalization, protocol, IPLC, certification, cascade investment, technology transfer, first mover advantage, time management have different set of KPI,’ on which product and service development is examined. For example Product age spread, R&D%, ideas, strategic fit, budget ratio, protocol score, total cycle time, project review, team creation, testing, % outsourcing, NPDER, budget ratio, license fees, IPR%, IPR infringements, IPR maintenance costs, royalty rate %, time, productive hours %, budget, specification, project success, internal service satisfaction levels, effective headcount.
Contingency plans are the alternatives in case of variability. It includes Authority and responsibility, planning and monitoring, budgeting, successes failures/ lessons learnt, creativity, SCORE, investment appraisal, assumptions, high risk/high probability, Black Swan theory, failure points, reducing potential for failure, setting trigger points, action plan, risk profile, stage gate, team building, communication, training, TEWT, simulations, role play, impact analysis and for these activities, KPI’s used by different organizations are Risk score, response times, budget ratio, KFR, % outsourcing, % SOP, % training, % above/below barrier conditions, success rates, % budget.
In this way different organizations have different set of KPI’s based on their nature of business.
References
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, Article named as commercialization of stretchable electronics written by Dr Peter Harrop, Chairman, IDTechEx.
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2 McMahon, D. (2006) ‘Measuring treasury’s added value’, available at (accessed 20 April 2012).
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Emerald article named as commercialization of new manufacturing processes, written by Vern Simpson.
- Jstore article named as Leadership and Innovation: Relating to Circumstances and Change written by Jim Selman.
- Jstore article named as selecting the right key performance indicator, written by Anthony Mcneeny
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talalkhan (student)
