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Managing Innovation

at Nypro, Inc. (A)


Dongyuan Zhu
Xingxing Liu
Ye Wang
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Agenda
Company overview
Perceived management problems/issues
Alternatives
Recommendation
Discussion questions
Reference

Company Overview

The fifth largest custom injection molder in the world, and


the largest non-automotive molder.
Three divisions:

Strategically aligned with customers base

Healthcare
Electronics/communications
Customer/industrial
Building plants near customers in vital markets

Striving for uniform world-class technology at all plants.

Highly decentralized organization


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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.

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
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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
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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
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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

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
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Discussion questions

Is NovaPlast a disruptive or sustaining


innovation for Nypro?
A new-market

What is Nypros process to implement new


innovations?
Following

disruption

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.
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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.


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Reference

Clayton M. Christensen, Michael Overdorf. Meeting the


Challenge of Disruptive Change. Harvard Business
Review Article. Mar 1, 2000.

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Thank you!

Questions?

Dongyuan, Xingxing & Ye, March 10, 2008.

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