3 3 Company Overview The fifth largest custom injection molder in the world, and the largest non-automotive molder. Three divisions: Healthcare Electronics/communications Customer/industrial Strategically aligned with customers base Building plants near customers in vital markets Striving for uniform world-class technology at all plants. Highly decentralized organization
4 4 Perceived management problems/issues Company facing a shifting basis of competition which was speed and variety in the future. Lankton perceived a new market for Nypro, and was considering how and where to disseminate the revolutionary molding machine, NovaPlast, across the company. Company having the challenge of being innovative while keeping consistent across plants.
5 5 The alternatives of adopting NovaPlast Alternative 1: building a new plant Strengths Most popular with senior management Engineering efficiency Centralizing development would facilitate personal oversight of project Being done rather quickly Weaknesses Transportation costs Against current philosophy of being decentralized No successful experience
6 6 The alternatives of adopting NovaPlast Alternative2: scatter across the network Strengths Close-to-customer manufacturing particularly important in the market segment Allows for the pontential to capture more market share Puts more engineers and marketers to work on exploiting the NovaPlast Better technology would emerge Weaknesses Against economy of scale philosophy Unproven technology and no clear indication of its feasibility
7 7 The alternatives of adopting NovaPlast Alternative3: apply internal market effect, focus on making it successful at a single plant. Strengths Could be implemented rather quickly Allow for engineering/efficiency to be gathered Could evaluate how resource planning systems interoperate Use “internal market” for innovation Weaknesses Time consuming to deploy if research shows that the flexibility is required in other international markets
8 8 The alternatives of adopting NovaPlast Alternative4: not use NovaPlast Strengths The niche market identified and capability allows company to compete in market Weakness Avoids taking advantage of the strengths, innovation Not dealing with problem of the changing market and competition
9 9 Recommendation Go with making NovaPlast successful at a single plant. -Less weakness -Allows flexibility towards others Short term -Continue with evaluation -Continue pursuing orders -Gather data relating to effectives and efficiency Long term - Decide on long term deployment strategy
10 Discussion questions Is NovaPlast a disruptive or sustaining innovation for Nypro? A new-market disruption What is Nypro’s process to implement new innovations? Following four steps Nypro had a good process for exploiting sustaining innovation but not for the disruptions? CEO needs to stand astride the interface between mainstream business units and new disruptive growth businesses.
11 Process of implementing innovations Find the actually occurred process innovations. Select the most important innovations which can implement in other plants. Find the ways to transfer the innovation from the original team to other teams and plants. Nypro sets up the new rules of the innovation.
12 Reference Clayton M. Christensen, Michael Overdorf. Meeting the Challenge of Disruptive Change. Harvard Business Review Article. Mar 1, Clayton M. ChristensenMichael Overdorf
13 Thank you! Questions? Questions? Dongyuan, Xingxing & Ye, March 10, 2008.