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“A World of Creative Destruction” — How Corning Continues to Dominate

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"A World of Creative Destruction" — How Corning Continues to Dominate

Currently longtime companies/brands are trying to stay afloat long enough to create business models and innovations that enable them to remain viable businesses, or are simply shutting their doors – unable to change quickly enough to remain relevant in today’s change-driven world.

Then there’s Corning.

Corning doesn’t simply churn out new products. Corning excels in creating entirely new categories of products – across a broad array of industries.

Highly Innovative – For More Than 160 Years

Corning, based in Corning, NY, with 35,000 employees worldwide, 2015 revenues of nearly $10 billion and net income of nearly $2 billion has been in business more than 160 years. However, you wouldn’t get that sense from today’s operations. (1)

One exciting growth driver is ‘Gorilla Glass’, very resistant to scratching, is used in a high proportion of smartphones worldwide, is a relatively recent product that’s in its fourth generation. Gorilla Glass now accounts for over $1 billion in sales. Other recent innovations also make sizeable contributions to Corning’s growth and profitability.

Corning’s CEO, Wendell Weeks, identified four strategies he believes drive success in a “world of creative destruction”:

  1. Understanding why your institution is here
  2. Organizing staff to deliver that core message
  3. Collaborating with others who share your vision
  4. Having a clear framework for guidance
     

Corning’s initial “big opportunity” came in the late 1870s when they were approached by Thomas Edison. He needed a firm that could make the glass for his incandescent light bulb. By 1908 Corning had developed a mass manufacturing process for these bulbs, and they accounted for half of company revenues.

Corning has continued to create new opportunities through strong R&D that have paid off well.

“At Corning, the lab is driven by what Weeks calls ‘grand challenges.’ For generations, one of those ongoing challenges has been ‘Glass breaks. Fix it’”

Innovation the Corning Way

Corning is driven by two types of insights that lead to category creation: 1. technology insights, invention of a new technology that needs to find a market, and 2. market insights, new opportunities that could be met with a new technology. Corning invests heavily in their research labs to provide a continuous stream of technology insights.

And, they listen well to their customers’ ideas and problems. Steve Jobs told Weldon Weeks about his then radical idea of making the whole surface of the phone a touchscreen. The surface had to be scratch proof, but he had yet to find a plastic to meet his needs. What Weldon Weeks heard was: “Jobs was going to create a new category of mobile device – the smartphone. And smartphones – all smartphones! – were going to need a new category of glass that did not yet exist.” He told his lab team, “if we create a solution (new glass), we’ll have a problem waiting to suck it out of us (smartphones).”

In 2007 the iPhone launched with Corning’s Gorilla Glass. By 2012 Gorilla Glass was on a billion devices worldwide – with nearly $1 billion in revenue and 70% of category profits.

Key Market Segments

Corning has identified the following as their current key market segments:

  • Aerospace and Defense
  • Architecture and Design
  • Communications
  • Consumer Electronics
  • Life Sciences
  • Optics
  • Transportation
     

Looking Forward

Corning’s continued success in merging technological innovations with market-driven needs that not only solve identified customer problems, but create entirely new product categories, using a very institutionalized innovation process, their future looks very bright!

Considering that they have exceptional success in collaborating with their customers, (e.g. Apple, Dell, BMW, Sony, Ford) continuing their process of sharing ideas and listening to customer ideas and problems appears to be an excellent strategy.

Recalibrating Actions:
 

  1. Assess your internal R&D and innovation process. Does it incorporate the consistency of funding and rigor of Corning’s R&D/innovation labs? If not, should it? Are you currently able to remain focused on future – sometimes several years out – innovations – rather than being pulled into short-term focused initiatives?
  2. Along with your leadership team evaluate the relationships your company has with its customers. Do you have very open and frank discussions that include not only the discussion of ideas, but also identification of problems which currently have no solution? Is your team listening well enough to identify not just ways to make things “better”, but instead develop concepts that are completely “different” answers to current problems?
  3. Is research and innovation thoroughly embedded within your company’s culture? If not, is it appropriate to take steps to create and formalize internal processes that provide your company with the best possible opportunities for not just new product development, but new product category development?

 

Sources:
  1. Corning: A 150-year Old Category Creation Machine, Knowledge@Wharton, June 15, 2016
  2. corning.com, Corning’s website, Accessed 7.17.16
  3. Johnson, Adam, and Regan, Trish, Corning’s Growth Driven By Gorilla Glass, CEO SaysBloomberg, February 7, 2016 (modified from video)
  4. Negrea, Sherrie, Research, innovation allows Corning to thrive, says CEO, Cornell Chronicle, Cornell University, November 26, 2014
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