Five Gates to Innovation Corning Inc.

’s process for developing inventive products actually works, a claim that few companies can make. by William J. Holstein By 2007, some cell phone makers were at their wit’s end about the screens on their devices. The plastic screens broke too easily when the handsets were dropped, and keys and other objects left deep scratches. Sensing a business opportunity, a small team in the specialty materials division of Corning Inc. dug out of the company’s archives the formula for a superstrong but flexible glass — something called Chemcor, which Corning had unsuccessfully attempted to introduce in 1962 for automobile windshields — and sought to test it for mobile phones. But just producing an experimental batch was slated to cost as much as US$300,000, enough for the division to miss its budget target for the year. Primarily for this reason, the team’s boss, Senior Vice President and General Manager James Steiner, was opposed to the idea. But he concedes he had another reason as well: “I didn’t really get the concept of using glass on cell phones,” Steiner recalls. However, team leader Mark Matthews was persistent — and his hunches had been right before. In 2003, Matthews had led the charge at Corning to sell a specialized glass product to Texas Instruments (TI) for its digital light processing projectors, considered a highly chancy venture at the time because sales of high-tech items had slowed after the dot-com bust. But TI’s product proved to be a hit, and Matthews’s risk taking made his boss, Steiner, look savvy. Trusting Matthews’s instincts once again, Steiner finally relented and gave the go-ahead for the cell phone glass test run at a company facility in Danville, Va. Matthews “took all the risk, knowing I wasn’t thrilled about it,” Steiner says. Today, after only a couple of years on the market, Corning’s cell phone glass — now known as Gorilla — is a huge success. Samsung, LG, and Motorola have placed it in three dozen handheld models, and Dell has chosen it for some of its laptops. Gorilla is selling at an annual rate of $100 million and is projected to become a $500 million business by 2015. That will make it a significant revenue stream for Corning, whose sales in 2009 totaled $5.4 billion. In Record Time Like other top companies, Corning has a rigorous system for managing ideas through a stagegate process in which they are embryonic in Stage 1 and commercially marketed in Stage 5. But in Corning’s case, the system actually produces consistent results; few organizations could move a product from concept to commercial success in the short time that it took Gorilla to reach customers. “If I have 100 students in a class and I ask them, ‘How many of you have a stage-gate process in your company?’ about 95 raise their hands,” says Rebecca M. Henderson, a Harvard Business School professor who has studied innovation and knows Corning well. “But if I ask, ‘How many of you have a stage-gate process that really works?’ only about 15 raise their hands. For a company of its size and complexity, Corning is exceptional.” What Corning appears to do better than most is insist that innovation be managed not by individual inventors or small teams in silos, begging for scraps of support from the parent corporation, but by multidisciplinary groups throughout the organization. Overseeing this process and making sure that Corning departments cooperate in product development efforts sanctioned by management are two bodies: the Corporate Technology Council, led by Executive Vice President and Chief Technology Officer Joseph Miller, and the Growth and Strategy Council, cochaired by Corning Chairman and CEO Wendell Weeks and President and Chief Operating Officer Peter Volanakis. The former unit concentrates on early-stage ideas, and the latter takes over when an idea is nearing commercialization.

as a result. Steiner and his team needed all the scientific help they could get. Steiner made sure that the scientists attached to the project were meeting face-to-face with possible customers. the glass is soaked in potassium at several hundred degrees centigrade until sodium ions on both sides of the glass are replaced by much bigger potassium ions. intervention from CEO Weeks was unnecessary. other projects had to be pared away.” says Harvard’s Henderson. Xavier Lafosse.Y.” Matthews says. Indeed. low-loss optical fibers.” Moreover. “You’ve got to put resources behind the opportunity and jump on it. Ky. He approached his colleagues in the much larger and highly successful display division and was able to obtain tank space in a plant in Harrodsburg. and highly efficient. the company says. management. Although turf issues can be tricky to navigate — executives approached by Steiner had little to gain from working with him because their compensation was based primarily on meeting their own targets — Corning’s division heads recognize that the company expects them to support promising new product launches. Corning officials say.” says Steiner. Company Expectations That Steiner could even accomplish that illustrates a key advantage of Corning’s innovation process. N. “The credibility they give us is more than we can grow on our own. As the Gorilla project raced toward its last stage gate. and replacing them with basketballs. Keeping business units motivated in . There was little time to waste. For one. who also works for the top brass at Sullivan Park in a dual reporting arrangement Corning designed to facilitate joint activities between the commercial units and research teams. Steiner enlisted his business technology manager. Obviously. After that event. home of such technical breakthroughs as cathode-ray tubes. and by June.In Gorilla’s case. reaching across traditional turf lines to obtain scientific. the company’s heralded R&D facility. Four months later. Essentially. In this case. To recruit a group of scientists for the Gorilla project. and sales help. With Lafosse pointing the way and Steiner reaching out in person to individual scientists to spark their interest in Gorilla. it soaked up more and more resources at Corning. “We kind of had to wedge in.” Convincing the Researchers The key source of technical expertise was Sullivan Park Research Center in Erwin. the wall would have much higher density. Corning won its first Gorilla customer.” Steiner says. once the test run had been completed and customers grew excited about the possible product. the researchers can at times anticipate their needs.. Scientists at Sullivan Park liken the operation to taking a wall made of tennis balls. full-scale production and marketing were under way — a fast track through the stage gates that posed any number of challenges. and our scientists are one of our best commercial weapons. by talking to customers frequently. The rate of innovation in the consumer electronics field is so relentless that “you can’t be out there making promises with vaporware. Steiner had to gear up the whole organization. ripping out most of the tennis balls. Steiner had to find a melting tank to manufacture Gorilla in large batches because the Danville facility couldn’t handle such an ambitious effort. “In many companies. Throughout the development of Gorilla. The manufacturing process was a complex affair marked by a painstakingly intricate ion exchange in a salt bath. advanced purification materials for catalytic converters. as many as 100 researchers joined the project either full-time or part-time. she adds. “Our scientists will work where they know they can make an impact and where they’re appreciated. Gorilla glass might get to use the tank one time because the CEO makes the phone call. the CEO’s attention is often diverted and the upstart is likely to be frozen out. “We have to create demand. which because of their size greatly strengthen the material.” Steiner says. Sampling began in December 2007.

” Author Profile: . but employees don’t trust one another and don’t cooperate. other companies encourage a close-knit culture but lack the systems and processes to wring innovation out of the staff. his people are going someplace else within the company.” Add it all up. a very low percentage of researchers’ creativity is turned into an actual product. Corning’s response is to maintain the backlog of development efforts as live but unstaffed and to avoid laying off researchers in favor of moving them to ongoing development programs.the face of cutbacks is one of the toughest challenges in managing innovation. a prominent instance in which a successful item emerged from a 3M employee’s idea. and Corning is able to maintain an equilibrium that other companies struggle to find.” CTO Miller says. But despite the oft-cited Post-It Note example. “If there is no place to plug that work in later.” Henderson says. Henderson notes that researchers at 3M are allowed to take 10 percent of their time to pursue personal interests. or if the investment is unaffordable. they have a perfect loose–tight balance: looseness when it comes to creativity but tightness when it comes to making decisions. it tends to dribble away. “But at Corning. self-preservation kicks in. “If there is an absence of pull in the marketplace. Otherwise. As an illustration. a fundamental flaw in the technology. says Harvard’s Henderson. “He’ll do that if he feels safe that if we shut it down. the project manager is responsible for bringing that information forward. Some companies have the right processes in place.

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