W.L Gore & Associates Inc.'s Culture of Innovation (Case Study Sample)

W.L. Gore – Culture of Innovation
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W.L. Gore – Culture of Innovation
* Company Background
* History
W.L. Gore & Associates, Inc. (sometimes referred to as Gore) is an American conglomerate manufacturing company that focuses on manufacturing products derived from fluoropolymers, particularly polytetrafluoroethylene (PTFE). The privately held company is headquartered in Newark, Delaware, and was started in 1958 by Bill Gore and his wife Vieve Gore in the basement of their suburb home. Bill Gore was previously working in the research and development (R&D) department of DuPont. However, he decided to start his own company after realizing that his employing company was not keen on fully utilizing the potential of Teflon, a derivative of PTFE (Rao, 2012). The first product from the newly founded company was the Multi-Tet insulated wire and cable.
Gore's first significant order was 7.5 miles of insulated ribbon cabling from the Denver Water Company. The order required a bigger manufacturing capacity and prompted the company to move from the basement office into its first production facility in Newark. The company has since expanded and currently has more than 50 manufacturing facilities and sales offices in 30 countries, including the Americas, East Asia, Europe, and Australia. W.L. Gore & Associates, Inc. was ranked for the 14th consecutive year in 2011 as among the “100 Best Companies to Work For” by Fortune magazine. It has received similar accolades for several years in a row in other countries such as the United Kingdom, France, Germany, Italy, Sweden, and Spain (Rao, 2012).
* Organizational Structure
The company employs the lattice organization framework, which is essentially a flat structure where there are no layers of management and employees have the power and responsibility to make decisions and govern themselves. Bill Gore wished to design a company that would break out of the traditional bureaucratic management practices and cherishes human imagination and freedom. He conceived the organization as a lattice connecting every staff (associate), thereby allowing the free flow of information and ideas.
The lattice organizational structure at Gore comprises a CEO, four primary divisions, several product-specialized business units, and the usual organization support functions, each headed by a recognized leader chosen by the employees themselves. Most teams are self-managed, and there are no titles or job descriptions, which are often general and negotiated within teams. The company is committed to keeping its organization functions small and informal to maximize collaboration between teams and departments, which include R&D specialists, engineers, machinists, chemists, and salespeople.
* Products and Services
Products derived from fluoropolymers have numerous applications. Some of Gore's primary product categories are consumer products, medical devices, fabrics, cables & cable assemblies, electronic components & electrochemical materials, filtration devices, fibers, pharmaceutical & biopharmaceutical products, venting components, and sealants. The company products have found widespread use in various sectors, including aerospace, apparel & textiles, automotive, chemical, environmental protection, industrial & manufacturing, life sciences, military, power & utilities, fire & public safety, oil & gas, mobile electronics, test & measurement, semiconductor & microelectronics, technology & telecommunication industries (Gore, 2021).
* Situational Analysis
* Internal Environment Analysis
Some of the factors that influence Gore’s business strategy and are under the organization's control are value system, vision, mission, and objectives; organizational structure; corporate culture; human resources; along with physical resources and technological capabilities. The company is founded on the value system of autonomy, collaboration, and innovation and has endeavored to foster a work environment where employees can exercise and grow their natural curiosity and creative spirit without the encumbrances of rigid management structures.
The company’s purpose is to enhance everyday experiences through curiosity, creativity, and customer collaboration. Unlike most companies, Gore encourages employees to develop their vision and mission statements and implement them as a team. One of the guiding principles, which constitute Gore's culture of innovation, is freedom: employees are free to come up with their own goals and are encouraged to direct their efforts to the success of these aims and the organization as a whole (Writepass, 2012).
The company also believes in its staff to do what is suitable for the company without constant supervision. This idea of collective responsibility has allowed the company to harness diverse perspectives, fast decision-making, and collaboration of small teams to become one of the most successful technology-driven companies. Other guiding principles in Gore culture are fairness, consultation, and commitment (Manz et al., 2009). The company encourages fair workplace and business dealings, commitment to one's projects, and consultation, especially when specific actions might cause severe damage to the company.
Gore's flat structure not only remains a critical element of its success in entrepreneurial innovation but is also the reason it has managed to capitalize on the diverse talents and perspectives of its 9000 employees with different cultures and educational backgrounds. The company has over 30 manufacturing plants and sales offices spread across the globe. It is also a leading company in the fluoropolymers industry with over 2,000 patents worldwide in various fields, including medical devices, fabrics, consumer products, polymer processing, electronics, consumer products, and pharmaceuticals.
* External Environment Analysis
Some of the factors that influence Gore's business strategy but are beyond the organization's control are economic, legal, competitive, technological, and social factors. The economic environment of business has changed markedly in recent times, especially with the tariff wars between China and America and the Covid-19 pandemic. For a company that relies disproportionately on the manufacturing sector, the stalemate between the two largest economies coupled with the enduring epidemic caused major upheavals similar to the 2008-2009 financial crisis (Wyman, 2020). Most production facilities and buyers of Gore products were forced to shut down, and the simultaneous supply and demand shock adversely affected the company. It may take a while for the company to return to pre-Covid-19 levels of growth and dominance.
The legal environment is the most complex external factor the technology-driven company faces: in order to stay in business, Gore must comply with numerous regulations, laws, and liabilities in most of the industries its products have found application in. For instance, the company must comply with stringent FDA regulatory requirements of medical devices manufactured and marketed in the U.S. Gore faces few competitors in the fluoropolymers industry due to the patents and copyrights it possesses and the high barriers to entry. Still, some of its major competitors, such as the 3M Company, the Chemours Company, and LeMaitre Vascular, have considerable resources and significant potential to disrupt Gore’s position in the industry. For instance, the 3M Company is an American multinational conglomerate operating in adhesives, personal protective equipment, passive fire protection, and electrical and electronic connecting and insulating materials.
The Chemours Company, a spin-off of DuPont, is one of the largest chemical companies in America specializing in the same flour products as Gore. On the other hand, LeMaitre Vascular is one of the largest producers of medical devices, including implants used to treat vascular disorders. The company supplies its products to hospitals throughout the world. Some of the technological factors affecting Gore include the proliferation of AI technologies and the rise of social media. Both innovations have the potential to shape how Gore produces its products and how it reaches its customers. Most manufacturers are already leveraging AI technology to improve production processes and use social media to expand and cement brand loyalty.
One of the most significant social factors affecting Gore is the mounting concern about the environmental impacts of fluoropolymers, especially the effects of perfluorooctanoic acid (PFOA) and trifluoroacetic acid (TFA). Most environmentalists believe that fluoropolymers contribute to the accumulation of fluorinated toxins in the environment, which could destroy the world's entire biological system. Even though TFA is not very dangerous to people, it lasts so long and could accumulate in the environment enough to pose a problem for plants (Lohmann et al., 2020). There are growing demands from the public that companies like Gore be “good corporate citizens” and safely and reliably use fluoropolymers according to industry guidelines, over and above, adopt environmentally responsible waste management practices.
* MAIN ISSUES
* Challenges
The problem in the case is Gore's dependence on Teflon, which could restrict the company's potential for growth, particularly if another company invents an advanced variation of PTFE. Although Teflon has innumerable uses in different industries, a su...