STRATEGIC DESIGN PLANING
The goal of the project is to experience Strategic Design Planning as a human-centered innovation planning approach and through this journey to reach the understanding of the basic idea of planning as a phase that precedes designing.
Lucerne University of Applied Sciences and Arts Design Management International September - November 2015 Tutor: Hans Kaspar Hugentobler Author: Akar Anil Sinha (akar.sinha@stud.hslu.ch)
PREFACE The intent of this report is to analyze 3M as a company from a Human centered perspective and to understand how planning as a process precedes designing. The report provides us with information of something valuable and new and makes us think about the why and what of it. It informs us that there is a broader view that exists beyond the solution itself where the framework of the same talks about the building blocks of “10 types of innovation”. The process of thinking around the “why and what” take place in the front-end of the innovation process which is unlike the traditional inside-out development as the traditional focus of design which deals with a back-end scope of refining the decision taken upon by others and of being in the service of marketing.
PREFACE
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CONTENT Organization Innovation Profile Understanding Users Visual Data (Photos) Verbal Data (Quotes) Value Innovation Exploration Value Curve Vs. Industry Curve, Four Action Scenarios Breakthrough Exploration 10 Types Of Innovation Future Profile Applied Shift Value Innovation Scenario
CONTENT
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“A satisfied customer is the best business strategy of all.� -Michael LeBoeuf
ORGANIZATION
ABOUT THE COMPANY NAME 3M SLOGAN Science. Applied to life. COMPANY DESCRIPTION 3M is a major American corporation that stands for Minnesota Mining Manufacturing. Headquartered in St. Paul/Minnesota in the United States, the company is a provider of global multi-technology and for the consumers, it is also known through its brands like Post-it and Scotch. The Group produces over 50,000 different products on the basis of 47 technology platforms and more than 25,000 patents. As a top company that caters to a wide range of technology, 3M specializes in six different businesses namely: Consumer and Office, Display and Graphics, Electro and Communications, Health Care, Industrial and Transportation Safety, Security and Protection Services. Business Industry Technology The general business activity and principal products or commercial enterprise of 3M are categorized as being part of the Technology Industry.
ORGANIZATION
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TRENDS The 3M (Switzerland) celebrated its 50th anniversary in 2013. As a future initiative, the company plans that its products and solutions should be able to provide societal challenges and at the same time also contribute to sustainable development. Technology: 3M is a diversified technology company that has a global presence in all major markets. The different areas and the Group’s subsidiaries operate in research, manufacturing and marketing of 3M products closely. Values: The company plans to be the most innovative company and wishes to be the preferred supplier among the customers. Their idea of innovation is not just limited to the products but also to their entire approach to business areas , including the ones which are social and environmental concerns specific. The Corporate Responsibility approach of 3M and their policies and procedures with respect to sustainability are directly linked to their fundamental corporate values.
ORGANIZATION
List of 3M products
1932 revolutionized the 3M abrasives market with the development of the first waterproof sandpaper.
1930 invented the young 3M engineer Richard Drew The waterproof, Scotch cellophane tape for packaging of grocers and bakers.
Everyday objects with a sophisticated design: The witty post-it Dispenser and Scotch Tape Dispenser 3M accents on every desk.
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3M is not the kind of company which stays stuck on one thing, which is why they make everything from tape to high-end security gear. The company is diversified in such a manner that it makes products through five operating segments Industrial; Safety and Graphics; Electronics and Energy; Health Care; and Consumer. The products made by 3M are sold directly to the users worldwide through different channels of wholesalers, retailers, distributors, and dealers worldwide. As per reports, Industrial, its largest segment, accounted for about 34% of 3M’s total revenues in 2014. MAJOR COMPETITORS JOHNSON & JOHNSON BOSTIK SA Sika AG General Electric Co. Honeywell International Inc. Kone Oyj OFFERING PORTFOLIO Scotch® Adhesive Tape Post-it® Notes and Products 3M Command™ Strips & Picture Hangers 3M Scotchgard™ Fabric Protector Ultrathon™ Insect Repellent (3M sells multiple products but these are the top selling products)
ORGANIZATION
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INNOVATION PROFILE
INNOVATION AT 3M 3M is a global innovation company that never stops inventing. Over the years, the company’s innovations have improved daily life for hundreds of millions of people all over the world. 3M has given solutions that has made driving at night easier, while at the same time even focused on making consumer electronics lighter and less harmful to the environment. Every day this company looks into new ideas and how each of these ideas can create a bigger picture for a better world.
INNOVATION PROFILE
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10 TYPES OF INNOVATION The simple Ten types framework can be considered as a useful tool that one can use to diagnose and enrich an innovation that is being worked upon and also to analyze an existing competition. The structure of the framework is divided into three color coded categories. The types on the left side of the framework are the most internally focused and distant from customers; but as one moves towards the right side of the framework, the types become increasingly apparent and obvious to end users. In context to a theatrical metaphor, we can say that the left of the framework is backstage; the right is onstage.
CONFIGURATION Profit Model
Network
INNOVATION PROFILE
Structure
OFFERING Process
Service Product Performance
Service Product System
EXPERIENCE Service
Channel
Brands
Customer Engagement
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SO WHAT ARE THOSE 10 TYPES 1) Profit Model Included as a part of the back end innovation, the primary task under this category is to earn money which eventually leads to a better value extraction by the company. Since they compare international shares with the percentage of total sales, the profit model of 3M is very standardized. The company also has its own R&D program which is helpful in bringing out new cost-effective products and also in increasing the annual profit. 2) Network The second phase of innovation map talks about how the company connects with others, i.e organizations, association or companies to create value. International research firms partner with EMEA (Europe Middle East and Africa) or (European Supply Chain Center for Expertise) for a better networking which intern saves time and helps 3M to enter new markets and create new opportunities.
Total sales comparison across the globe.
Distribution network of 3M INNOVATION PROFILE
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3) Structure This part helps in understanding how assets are aligned with talents inside a company and how the structure of the company gives authority to its various sections and on what basis is the hierarchy determined. In terms of hierarchy, organizational structure of 3M mostly exists at the corporate level because a company with such a large organizational size will require leaders with strong command and control of the business. 3M plays a role in many different types of markets - may it be healthcare or transportation or communication therefore the company also maintains a departmental organizational structure under the larger corporate hierarchical structure. This in turn ensures that the different business departments are properly managed. The matrix organizational structure is used in R&D to support 3M’s innovation through employee contributions.
Hierarchical structure of 3M
INNOVATION PROFILE
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4) Process This is the last stage of innovation that analyses how a company functions to generate output.
At 3M, the company follows a highly specific method of generating the values. This includes: 1) Evaluate the opportunity 2) Develop the strategy 3) Negotiate and secure the agreement 4) Manage the delivery 5) Measure and evaluate Process mapping of 3M
INNOVATION PROFILE
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5) Service Product Performance This can be called as the first step where the 10 steps of innovation can be opened up. This step informs us regarding the 10steps of innovation where new features and functionality are brought to light. Due to the “Open innovation� plan, 3M is able to bring out various new products where there are no barriers to the use of technology both internally and externally. 6) Service Product Performance This part talks about how different services create a platform for interaction with products such that they become a part of the system. In 3M, the ingenious solution team primarily focuses on the Health Care solutions Department. Where the system is responsible to provide intelligent tools that help in compiling information that will be beneficial to the company so that better solutions are offered. 7) Service In the first phase of experience, we get an idea of the supplementary support to amplify the value of the product. Post product/sales services are catered through I) Call center ii) Messages iii) Chat within iv) Safety data sheet
INNOVATION PROFILE
8) Channel The different ways through which the customers are delivered his/ products are called channels. In 3M, the products are sold through a variety of channels, i.e right from direct uses to wholesalers to Retailers, Jobbers, Distributors and dealers. 9) Brand During this phase of innovation, the company is responsible for representing itself or its products in the marketplace. The problem with 3M company is that even though its products are well recognized and accepted all over the world, still the consumers do not know these products have been made by 3M. 10) Customer Engagement. The last phase of experience as well as the Ten steps of innovation, this phase deals with the more than ordinary interaction of the company/products with the consumer. 3M has its own unique way of advertising its products both in terms of customer engagement and making the whole thing interesting and repeatable.
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CONFIGURATION
OFFERING
Profit Model
Network
Structure
Process
Service Product Performance
Compare international sales with the total sales.
For better network 3M patterns with EMEA or ECOE. European Supply Chain Center of Expertise
The firms structure is mainly hierarchical at every level.
Specified steps are followed to achieved the desired results:
3M’s ability to create new products regularly is because of it’s open innovation at both internal and external ends.
3M maybe an American brand but its business is increasingly global. They have an independent R&D program
Strict hierarchal structure is followed all across the world and its challenging to move up.
1. Evaluate the opportunity. 2. Develop the strategy. 3. Negotiate and secure the agreement.
Service Product System 3M has their indigenous solution team. It primarily caters to health care solution. 3M information system provides intelligent tools to help compile information.
EXPERIENCE Service
Channel
Brands
Customer Engagement
Post product services are carried out through specified methods which are as follows:
3M Products are sold through numerous channels from direct use to :
!!!!!
1. Call center helpline.
Retailers
2. Messages
Dealers
3. Chat within
Online
3M has a very unique way of advertising its front end products. From Scotch Brite® or the 3M unbreakable glass. The customer engagement is strong and also interesting.
Wholesalers Jobbers
3M as a company has image problems. Its products are everywhere but the brand is overlooked more often.
4. Safety Data sheet.
4. Manage the delivery. 5. Measure and Evaluate.
Differentiating factor. Attention Required
INNOVATION PROFILE
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UNDERSTANDING USER
3M HASSLE MAP The step by step verbal illustration of all different kinds of physical and emotional hassle that a consumer might have to experience before buying the product he/she desires is called a hassle map. As seen in the 10 steps of innovation, although the 3M products are available through various channels, let us have a look at the process of buying a 3M product at a retail store.
3M Consumer Product
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Scotch Brite and Post Its
UNDERSTANDING USER
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Use them till last peal.
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Figure out if there is any extra left.
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Go to the nearest store
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Look for the product in the respective aisle
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Look for competitors product.
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Buy the product
Use it till the last peal
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VISUAL DATA
UNDERSTANDING USER
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VERBAL DATA
UNDERSTANDING USER
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Value Innovation Exploration
VALUE CURVE AND INDUSTRY CURVE Various strategies are used by strategists when it comes to grab opportunities in newer markets and thus to visualize where they stand against their competitors. To see how a strategy works in relation to close competitors, strategic managers use a value curve to tool to understand this visually. This tool involves various parameters on which a company relies to market its product. Later, the product is then compared with the industry, i.e. the industry curve. This curve consists of 2 divisions that are the high and the low and they indicate what the company does the most and where does it lack. Given below are 11 parameters which indicate the performance of 3M as a company against its competitors. Inferences: Price: The price of the products at 3M are very competitive as their products mostly get white labeled. Innovation and Technology: They are considered to be the driving forces of the company and are responsible for deciding all the factors of production. Availability: Just like its market reach, the availability of 3M’s products is also very large, due to which the service and channels have to be equally vast to keep up to that pace promotion. Variety: 3M has the privilege of owning more than 60,000 different products under various departments. The major difference occurs when we observe their brand image and the hierarchical constraints they have.
VALUE INNOVATION SCENARIO
Low
High
1. Price 2. Innovation 3. Technology 4. Availability 5. Promotion 6. Sales 7. Service 8. Standards 9. Channels 10.Mature 11. Variety 12. Products 13. Brand Image 14. Hierarchy 3M COMPETITORS
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Four Action Scenarios
Chan and Maugborne suggested four ways to alter a product based on Value Curve analysis when it comes to either working on a new product or refining an existing product. The four ways are: Raise: Are there any existing elements that can be enhanced or increased?
RAISE
REDUCE
TECHNOLOGY AND INNOVATION
HIERARCHICAL CONSTRAINTS
CREATE
ELIMINATE
NEWER PRODUCTS
BRAND IMAGE PROBLEMS
Reduce: Are there any elements that can be reduced as there could exist features that are of little value relative to their cost. Create: Can something new (and non-existent) be introduced in the market? Most probably a new feature that makes the product more effective in solving the customer’s problem. Eliminate: Do any elements exist as a part of the product that add no real value to customers but are simply there as part of a status-quo. In achieving the ideal Value Curve, products must be both relevant and compelling for customers, and should be distinct in their valuable attributes from competitors.
FOUR ACTION SCENARIO
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Breakthrough Exploration
There are 10 types of innovations along with customer insights that need to be considered so that a ground breaking and viable solution can be reached. This method is used by strategists and design managers to recreate the image or while creating a new company as a whole.
Design planning Why are we Research/ Analysis doing this? User ethnographic research.
The loop on the side describes what design planning is... How to get it done? In terms of Business. 10 types of innovation.
BREAKTHROUGH EXPLORATION
What to Ideation and design? conceptualization.
How to In terms of do it? design.
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10 Types Of Innovation Future Profile
CONFIGURATION
OFFERING
Profit Model
Network
Structure
Process
Service Product Performance
Compare international sales with the total sales.
For better network 3M patterns with EMEA or ECOE. European Supply Chain Center of Expertise
The firms structure is mainly hierarchical at every level.
Specified steps are followed to achieved the desired results:
3M’s ability to create new products regularly is because of it’s open innovation at both internal and external ends.
3M maybe an American brand but its business is increasingly global. They have an independent R&D program
Strict hierarchal structure is followed all across the world and its challenging to move up.
1. Evaluate the opportunity. 2. Develop the strategy. 3. Negotiate and secure the agreement. 4. Manage the delivery. 5. Measure and Evaluate.
Service Product System 3M has their indigenous solution team. It primarily caters to health care solution. 3M information system provides intelligent tools to help compile information.
EXPERIENCE Service
Channel
Brands
Post product services are carried out through specified methods which are as follows:
3M Products are sold through numerous channels from direct use to :
!!!!!
1. Call center helpline.
Retailers
2. Messages
Dealers
3. Chat within
Online
Wholesalers Jobbers
Customer Engagement 3M has a very unique way of advertising its front end products. From Scotch Brite® or the 3M unbreakable glass. The customer engagement is strong and also interesting.
3M as a company has image problems. Its products are everywhere but the brand is overlooked more often.
4. Safety Data sheet.
If we look into the innovation graph of the 10 types of innovation, we can learn that the products have a fairly less relation with their brand. Consumers are not aware of 3M as a parent brand to a large number of products. While using the different products, the consumers need to be aware of the main brand and why these different products exist.
10 TYPES OF INNOVATION FUTURE PROFILE
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LEARNING FROM EACH DELIVERABLE
Organization
10 Types of Innovation
User Study
Deep dive into the organizations function and operation. What do they do ? How they work ? Who are the competitors ? Where are they from ? Why do they do business ?
Understanding how a company functions in different aspects and how are they different from their competitors ? Also understand where they are weak and where they are leading in the market.
3m is an innovation driven, multi national company.
3M products are very different from its competitors but 3M is not a well known brand in the eyes of consumer.
Hassle Map
Value Curve
4 Action Scenarios
Understanding the user through the verbal or visual means is important as it tell us how they interact with the product.
Helped in understanding what are the hassles (problems) a consumer has to face before procuring the product.
Learned how new opportunities can be created and to visualize where they stand in the market.
Gives us the scope of creating a new image of the company.
Consumers love the products like Post-Its and Scotch Brite but don’t know what 3M does.
Very difficult to differentiate between a 3M product and competitors products.
FUTURE PROFILE
The company needs to raise its brand awarness and needs to reduce rigid hierarchal structure.
The promotion of the products are very less and 3M is not mentioned.
FUTURE PROFILE The way a company showcases itself in front of its customers also determines its future profiling. In the case of 3M, the company should now focus on creating a 3M family due to its large customer base.
10 TYPES OF INNOVATION FUTURE PROFILE
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It is easily overlooked that what is now called vintage was once brand new. -Tony Visconti
Applied Shift
THE 3 TYPES OF SHIFTS There should always be room to do things in a manner that is different. After the application of all the tools, it is necessary to decide where this room for innovation or doing things differently exists and/or how can things be done differently. To understand that we can apply one of the three shifts: 1) BUSINESS MODEL SHIFT The main focus areas of this kind of innovation are Outline assets, networks, structure, process and other elements of the value chain that are intended towards serving customers and then making profit out of the same. 2) PLATFORM SHIFT Reinvent, recombine, or find fresh connections across capabilities and offers to create new value for customers contribute to the Platform-driven innovation.
1) Business model shift
2) Platform shift
3) CUSTOMER EXPERIENCE SHIFT The right side of the framework such as the Channel, Service, Brand, and Customer Engagement are first considered in this kind of innovation. After this, the left side is focused where other types are added that contribute to making the experience work.
3) Customer experience shift
APPLIED SHIFT
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IDEAL APPLIED SHIFT FOR THE FUTURE The current situation The business model that 3M follows currently is a business model shift where technology and innovation are relied upon to create new products. The world wide reach of 3M helps in making more profit as annual sales are calculated. The hierarchical structure of the company thus assigns a specific task to everyone (working there). Future scenario The brands under 3M have very distinct features and this makes them the pioneers of the market. However, there exists no communication regarding the same. Numerous brands have already talked about their inclination towards technology and 3M should also focus on attracting more consumers in the same way.
Current Scenario
Future Scenario
APPLIED SHIFT
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The keys to brand success are self-definition, transparency, authenticity and accountability. -Simon Mainwaring
Value Innovation Scenario
It has been noticed that the companies that have a great history and offer a great plethora of products often change according to their consumers mindset. Strategists and manager therefore try and observe the unconscious needs that consumers have and help companies cater to it.
Needs
Disruptive
Needs are divided under four categories they are: 1) COMMON NEEDS The most fundamental and universal, they focus on the need to socialize, the need to be loved, the need to feel comfortable. 2) CONTEXT NEEDS They occur as a result of the situation in which people live, work, or operate. It is observed that the same need will exist for people operating in the same industry, profession, region, culture, and so on.
Solution
Radical Small Changes
3) ACTIVITY NEEDS These needs are the result of specific activities a person performs or wants to perform. These kind of needs are the same for all people who want to do the same thing. 4) QUALIFIER NEEDS They represent the most immediate types of needs people face. These are often the result of problems with existing solutions.
VALUE INNOVATION SCENARIO
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Different needs are catered by different solutions. Below are mentioned some different types of solutions and their unique properties:
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1)NEW FEATURES In this, the general concepts behind the solutions being offered remain unchanged. The qualities that are modified help in improving the quality of the offering and thus increasing the value. 2) NEW OFFERINGS They are responsible in completely replacing current products and services. Here, instead of correcting the old ways, new ways to do something are offered.
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NEEDS
Solution
Long Term Changes
Common Needs
System Logic
Mid Term Changes
Context Needs
Families
Near Term Changes
Activity Needs
Offerings
Immediate Changes
Qualifier Needs
Features
3)NEW FAMILIES New families of offerings work together to meet a variety of needs. Products within these families support each other, solving needs that the others create. 4)SYSTEMS LOGICS This in reality is the company’s philosophy of determining the needs of the customer and the different ways offerings are organized to meet those needs. As a part of corporate strategy, system logic is a statement of how a firm seeks to differentiate its offerings based on the needs of its customers. Most big firms have disciplined themselves over time to develop a systems logic in such a way that the needs of a customer are met in such a way that other firms cannot meet. VALUE INNOVATION SCENARIO
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Long Term Changes
Mid Term Changes
Near Term Changes
Immediate Changes
VALUE INNOVATION SCENARIO
NEEDS
SOLUTION
Common Needs
System Logic
Should able to use all the 3m products and let the great 3M experience enhance their daily lives
3M comes up with their own store where they sell unique innovative products that are manufactured by 3M
Context Needs
Families
The consumers should feel that they are using technologically advanced and an innovative product.
3M can have their own kiosk or their own aisle in super market. The customer will understand that they are buying product from a 3m family.
Activity Needs
Offerings
The consumer should be able to relate more with the experience of 3M products and how it enhances their daily lives.
Major 3m Products like Scotch brite, Post-It, Nexacare and other should also emphasis on showing the 3m Brand.
Qualifier Needs
Features
Consumers should be able to relate 3M products with its home brand. They should have scene of pride in using a “3M“ product.
An ad campaign showcasing how 3M is th most innovative brand in product market. Informing consumers how 3m adds value to their daily life, with help of advance technology and innovation. 33
Conclusion
Every company has to change its vision periodically to align with consumers mindset. The meaning and relation to technology and innovation could be established well if 3M aligns its vision to the same. 3M had a rich heritage of innovating products and converting them into brands. But in the process of doing it they lost their own brand recall. 3M is one of the most innovative brands in the world. There consumers are spread across the world. To make 3M a more successful brand in the future, they should align their plan accordingly Step 1: An ad campaign showcasing how 3M is th most innovative brand in product market. Informing consumers how 3m adds value to their daily life, with help of advance technology and innovation. Step 2: Major 3m Products like Scotch brite, Post-It, Nexacare and other should also emphasis on showing the 3m Brand. Step 3: 3M can have their own kiosk or their own aisle in super market. The customer will understand that they are buying product from a 3m family. Step 4: 3M comes up with their own store where they sell unique innovative products that are manufactured by 3M. Through these steps 3M can cater to a wide variety of consumer and yet be a more well known brand.
CONCLUSION
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IMAGE SOURCES
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