Nypro Case Analysis
Managing Innovation at Nypro, Inc.
Morgan State University School of Business & Management
Department of Management Studies
Dr. Leyland Lucas
March 31, 2013
2013
Presenters: Phylicia Jones Justice Brown Dipo Adesina Ayodeji Olubusi
1. How does the internal market for innovation at Nypro Function?
Nypro employs an aggressive internal competition which powers the company’s innovation process. The organization did not believe in competition between peers or against past performances; based on a standardized set of questions that compared groups and teams on fair grounds, performance statistics from one team to another are stacked against each other. Constant innovation was simply a result of each group’s effort to be the best. With great ideas constantly springing up from competition, Nypro did not leave any room for mediocrity.
Nypro was not accustomed to product innovation, since the industry did not require differentiation and the company had chosen to serve a specific target market – clients in need of large-scale molding jobs. However, in the area of processes, they excelled, with different plants competing with each other to be the best by cutting operational costs while increasing quality of products delivered to their customers. Examples of these innovations were seen in plant design (clean-room and visual factory), product development (bi-component molding), quality (above-requirement tolerance practice) and information systems (MRP2).
An important factor in Nypro’s internal market for innovation is the company’s decentralized location strategy. The autonomy of plant managers, combined with company-wide knowledge of groundbreaking process improvements resulted in quick adoption of better processes throughout the organization, in a way that one could term “natural course.” With the competitive nature of their organizational environment, no plant had an incentive to resist progressive value-added change. Since all
Morgan State University School of Business & Management
Department of Management Studies
Dr. Leyland Lucas
March 31, 2013
2013
Presenters: Phylicia Jones Justice Brown Dipo Adesina Ayodeji Olubusi
1. How does the internal market for innovation at Nypro Function?
Nypro employs an aggressive internal competition which powers the company’s innovation process. The organization did not believe in competition between peers or against past performances; based on a standardized set of questions that compared groups and teams on fair grounds, performance statistics from one team to another are stacked against each other. Constant innovation was simply a result of each group’s effort to be the best. With great ideas constantly springing up from competition, Nypro did not leave any room for mediocrity.
Nypro was not accustomed to product innovation, since the industry did not require differentiation and the company had chosen to serve a specific target market – clients in need of large-scale molding jobs. However, in the area of processes, they excelled, with different plants competing with each other to be the best by cutting operational costs while increasing quality of products delivered to their customers. Examples of these innovations were seen in plant design (clean-room and visual factory), product development (bi-component molding), quality (above-requirement tolerance practice) and information systems (MRP2).
An important factor in Nypro’s internal market for innovation is the company’s decentralized location strategy. The autonomy of plant managers, combined with company-wide knowledge of groundbreaking process improvements resulted in quick adoption of better processes throughout the organization, in a way that one could term “natural course.” With the competitive nature of their organizational environment, no plant had an incentive to resist progressive value-added change. Since all