3m Optical Systems
3M Optical Systems: Case Brief
As Andy Wong, how would you handle the authorization for expenditure for the re-launch of the privacy screen? As Andy Wong, I would take the proposal to one of my senior-level mentors for support. The OS unit has already tried and failed three times with the microlouvered filter and high level support would benefit both Wong and Guehler in this case. If Guehler sees that other areas of 3M are in support of the authorization for expenditure, then he will not have to be concerned about the OS unit’s credibility – this gives Wong a significant plus. If, however, Wong is unable to garner the support from his mentors in order to give this AFE the standing it needs, I would not recommend backing the project. The price point of $175 is a serious concern, the sales forecast seems inflated, and other companies already have a strong presence in the market for this type of item. Instead, I would have to opt for rejecting the proposed expenditure and going with a harvest strategy – cease R&D and reassign personnel to other units. This might allow him to salvage the OS Unit through auto component sales. That said, political support internally could make all the difference and allow Guehler to focus on the positive aspects of the proposal – namely the total potential market of 32.7 million PC’s and the ability to leverage 3M’s existing distribution. The primary reason that Andy Wong is in this position is that he did not engage in enough product championing. As explained in Burgelman’s article, “The lack of articulation between different levels of management results in a vicious circle in resource procurement.” (Burgelman, 1984) Wong did not do enough to demonstrate either the technical or commercial feasibility of the privacy filter. Twice they tried and twice they failed. With an investment of $750k required to continue it is not likely that management will take that chance.
As Paul Guehler, would you approve the AFE if Wong
As Andy Wong, how would you handle the authorization for expenditure for the re-launch of the privacy screen? As Andy Wong, I would take the proposal to one of my senior-level mentors for support. The OS unit has already tried and failed three times with the microlouvered filter and high level support would benefit both Wong and Guehler in this case. If Guehler sees that other areas of 3M are in support of the authorization for expenditure, then he will not have to be concerned about the OS unit’s credibility – this gives Wong a significant plus. If, however, Wong is unable to garner the support from his mentors in order to give this AFE the standing it needs, I would not recommend backing the project. The price point of $175 is a serious concern, the sales forecast seems inflated, and other companies already have a strong presence in the market for this type of item. Instead, I would have to opt for rejecting the proposed expenditure and going with a harvest strategy – cease R&D and reassign personnel to other units. This might allow him to salvage the OS Unit through auto component sales. That said, political support internally could make all the difference and allow Guehler to focus on the positive aspects of the proposal – namely the total potential market of 32.7 million PC’s and the ability to leverage 3M’s existing distribution. The primary reason that Andy Wong is in this position is that he did not engage in enough product championing. As explained in Burgelman’s article, “The lack of articulation between different levels of management results in a vicious circle in resource procurement.” (Burgelman, 1984) Wong did not do enough to demonstrate either the technical or commercial feasibility of the privacy filter. Twice they tried and twice they failed. With an investment of $750k required to continue it is not likely that management will take that chance.
As Paul Guehler, would you approve the AFE if Wong
References: 1. Bartlett, Christopher, A. and Mohammad, Afroze. “3M Optical Systems: Managing Corporate Entrepreneurship”. 1994, The President and Fellows of Harvard College. 2. Burgelman, R.A. “Managing the Internal Corporate Venturing Process: Some Recommendations for Practice”. 1984. Sloan Management Review Association.