Evaluating management techniques helps 3M get out of a sticky situation
Nintendo is making computer-game characters out of them. The Smiths’ frontman Morrissey once fired his band’s bassist using one. And you can bet that right now there are millions of them scattered across offices all over the globe.
God bless the humble Post-it Note, memory-aid of the forgetful and modern-day telegram for those on a desk break.
The Post-it was invented in the 1960s by a scientist working at 3M, who wanted to help a chorister keep his bookmarks stuck to his hymn book. But Post-it Notes are not all that 3M does – its portfolio of 55,000 products ranges from stethoscopes to Scotch Tape. With labs in 35 countries, innovation is at the core of the company.
Indeed, in a recent BusinessWeek poll, 3M ranked just behind Apple as the world’s most innovative company. 3M has always been proud of the fact that one third of its sales come from products invented within the past five years, so when that figure recently slipped to one quarter, the newly appointed chief executive, George Buckley, realised that something was wrong. He concluded that over-zealous management techniques were stifling creative thinking in its R&D department, so that the rate at which inventions such as the Post-it Note were reaching the market had slowed drastically.
The problem was that Buckley’s predecessor, James McNerney, had left behind a lasting legacy: the Six Sigma management programme, implemented in 2001. A rigorous methodology which uses data and statistical analysis to measure and improve a company’s operational performance, Six Sigma works by identifying ‘defects’ in manufacturing and service-related processes.
This set of practices was originally devised by Motorola to increase efficiency within a company, and ultimately raise profitability. McNerney saw the company’s major defect as its inconsistent profit and sales growth, so in response he cut capital expenditure by a third over two years.
You can’t have creativity without discipline and you can’t have discipline without creativity Pip Frankish, 3M
But what looks good on paper isn’t always mirrored in reality. In the R&D labs, the analysis and profit-pressure that Six Sigma brought had begun to choke innovation. Instead of squeezing out inventions more efficiently, the structure was squeezing researchers’ creativity. Instead of dreaming up ideas, scientists were dreaming up ways of filling in their Six Sigma databases.
Gradually, the scientists realised that great ideas could no longer flourish and that the environment in which they had previously worked was much more conducive to innovation. The Post-it was invented by an employee using 3M’s ‘15% rule’, which allowed engineers to spend 15% of their time pursuing personal projects. With time and efficiency restrictions in place, it’s unlikely the Post-it Note would ever have stuck.
When Buckley took over, he set about loosening the Six Sigma reins in the company’s labs, increasing the R&D budget by 20%. “It was clear that we had to re-energise the growth engine,” says Pip Frankish, head of corporate communications at 3M, “and the signs are that we’re starting to do that.”
Six Sigma has not been eliminated, but it has been ‘deployed pragmatically’. It is still used in many areas of the company, including R&D, but applied far less rigorously. “The creative process is a messy one,” says Frankish. “You can’t have creativity without discipline and you can’t have discipline without creativity.”
The core goal of Six Sigma is to eliminate defects: yet for true innovation to take place, mistakes must be made along the way. With the focus now on allowing freedom of innovation – even if it means making the occasional error – 3M scientists have already noted the difference.
Article first published in Design Council Magazine, Issue 3, Winter 2007