Toledo Specialty Glass Company - Case Study Example

The presented case study analysis relates of the Toledo Specialty Glass company established by Johann Gerhart in the early twentieth century (Fleming, 2007). Mr. Gerhart after working for several years in the Libbey Glass Company decided on taking the entrepreneurial path and purchased a closed glass foundry that he renamed the Toledo Glass company in 1909, which would eventually become the Toledo Specialty Glass company under the leadership of his grandson, Peter Gerhart. An innovative and driven person, Mr. Johann Gerhart specialized in the design and manufacturing of various glass products including windshields for automobiles, mirrors and headlamps. His penchant for innovation led him to establish an organization that would be heavily focused on the invention and innovation of glass related products. The company mostly followed the criteria of a "technology push" for its innovative process where the emphasis was mostly given to R&D without so much input from a user perspective of market perspective. However, as it is shown in the present study, the company was able to do admirably well in the various sectors it went after primarily due to the unusual yet productive and creative environment it provided for its workers. The presented analysis is centered around several axioms of the innovative process that kept in vigor within the Toledo Glass company during and after Mr. Johann Gerhart's time. More specifically, the paper discusses of the organizational culture in the company, of the innovative strategy it followed to achieve its notable success, and of the simplistic corporate structure it used to direct and develop the company throughout the years. Being an inventor himself, Mr. Gerhart was particularly fond of Thomas Edison of the General Electric company, and in several ways applied the Edisonian method of innovation in his Toledo Glass company. Thomas Edison, the US most prolific inventor to date, had a particular approach to inventions and innovations. In part because he never received formal engineering or scientific training, most of his inventions were the fruit of hard labor and empiric proceedings, whereby he would focus on creating, refining or improving a product through empirical experimentation until he attained the desired outcome. In his own saying about his assiduity toward the inventive process, Edison claimed "Results' Why man, I have gotten lots of results! If I find 10,000 ways something won't work, I haven't failed. I am not discouraged, because every wrong attempt is often a step forward." His empirical approach to invention combined to an amazingly radiant drive got him the sympathy of several notable inventors of his time. Among those who admired him, Mr. Gerhart went a step further to emulate the Edisonian empirical method for coming up with commercially viable inventions. The Toledo company culture would remain deeply marked by the distinctive Edisonian method for arriving at novelties regardless of the field. In the early twentieth century, a select number of companies had the innovation strategy that Mr. Gerhart decided to implement in its company. In fact, the first laboratory of the Toledo company was established to model the Edison's Menlo Park facility in New Jersey. The facility was stocked with various equipment and tools to facilitate the innovative process of its workers through experimentation and trial and error. In the early facility, Mr. Gerhart set the stage for a company culture to be build around a liberal attitude toward innovation and invention. That particularity would eventually become the cornerstone of the Toledo Glass company. As pinpointed in the case study, Johann Gerhart began working with a small team of five inventors who were free to utilize the tools at hand to come up with new products having commercial viability in the glass industry. Each member of the team had "carte blanche" to specialize on the use of a given tool or equipment to derive newer and better processes for producing glass products. Agreeably the method is quite unusual for a technological company even at the beginning of the twentieth century. Schumpeter's theory of innovation depicted it as a process of creative destruction where the conditions gathered for innovation are often punctuated by external factors (market, competition, of industry pull) which cause the need for a dramatic shift in trends to arrive at new innovations. The liberty that Mr. Gerhart allowed his employees to have at the Toledo Glass company would set the stage for a convivial atmosphere resembling that of a modern day lounge where inventors were reported to be talking across experimentation tables as close collaborators would engage in a chatter at the local coffee shop. In the early days of the company and in its most recent days, most of the innovative process remained driven internally rather than externally at the exception of the photovoltaic department of the company which became in part due to the opportunity presented by the energy crisis of the 1970s. The seemingly childish environment however proved essential for arriving at creating a working environment were employees felt comfortable not only with their co-workers but also with themselves. The direct result being the attainment of a corporate culture based on the freedom of expression and the collaboration of innovative and spirited people who worked hand-in-hand in a formal entity to do what they enjoy doing most, which is designing and developing new products. The corporate culture that Mr. Gerhart was able to instill in the early stage of the company would take him a long way as the company strived on the innovation of glass products to become a leader in the field. Consequently, at the time of his grandson leadership of the company, the Toledo Glass Company had evolved into several other glass related markets including hardened glass, glass for semiconductors, ceramics; and had established working relationships with government agencies providing products for defense, aerospace, and telecommunication industries. Interestingly enough the corporate culture of innovation would remain one of the main assets of the company even during various episodes of the company's expansion. In fact as the company opened new centers for developing and manufacturing its products, it kept the same emphasis on allowing a certain level of flexibility to its researchers, engineers, scientists, inventors and innovators to insure continued success in spite of the habitual newer challenges presented by the company's expansion. The organizational culture of the Toledo company thereby remained highly focused on the design, manufacturing, and commercialization of novel glass related products. The company would eventually venture into other markets as well, all without the use of outside capital. In fact as the company ventured into newer territories, company leaders also had to reevaluate the company's approach to creating products and began to emphasize the importance of scientific applications rather than simple empirical proceeding. The shift in the company strategy and approach to innovation however would not sensibly affect the corporate culture of nurturing a casual work environment. As the company grew, its need for diversifying the qualities and responsibilities of its workforce became evident; yet a strong focus was kept on innovation despite of the industry it may pertain to. In fact the company kept the Toledo laboratory as its main R&D facility while expanding with a manufacturing facility in Long Beach, CA and another facility in Palo Alto. The innovation process would also indubitably change to meet the newer demands of a growing organization first, but mostly were altered to meet the demands of the competitive markets that the company desired to go after in addition of its glass making. Progressively, the Toledo company would adopt more of a scientific approach to inventing in establishing working relationships with notable research oriented universities in the US such as the University of Michigan, Carnegie Mellon, MIT, and Stanford. For several years the company had operated its processes for invention primarily based on their inventors' drive and capability to arrive at novel products. However, the company soon began to consider entering newer segments based on existing needs for innovation. In particular, the energy crisis of the 1970s created a market pull for the research and development of novel technologies for power generation without the need for fossil fuels; and at that moment the Toledo company invested several millions of dollars into renovating the Toledo facility and for the purpose of entering the photovoltaic segment. With company expansion, and the search for newer sources of revenues came a new organizational structure which despite the success of the company remained simple and effectively focused on the research and development of technological products. As presented in the study the company kept a simple organizational structure with a consequently low number of employees. The executive management at the R&D department of the Toledo Glass Company was made up of : a Chief Executive Officer, a Director of R&D, a Gerhart Lab Manager, a Materials Research Head, a Nanotech Research Head, and a Long Beach Engineer. The organizational structure presented had a traditional hierarchy that can be expected in a technology company, however the overall low number of employees at the firm was impressive considering the success the company has had. Some of the key employees of the company do not appear per se in the top management of the company yet played an instrumental role in it. In particular, one individual of the name of Frank Harlan who became an employee for the company in the early 1980s has had a particular impact in the company's intellectual property development. Frank Harlan, as denoted in the study was a college dropout who found his way into the Toledo company primarily due to his impressive creativity when it came to devising new processes to arrive at new glass products. His profile fits perfectly that of the empirical inventor who pursues inventions mostly by trial and error, yet who seems to have a gift for intuitive direction. Although not part of the executive team at Toledo, Mr. Harlan made quite a name for himself in the company not only because of his amazing inventiveness, but also for his style of work which was difficultly tolerated by senior management in the company. Mr. Harlan single handedly made the photovoltaic department at Toledo by coming up with his sandwich technology for solar cell design in the late 1980s. His creative inclination and drive to come up with new sets of materials for the conception of novel photovoltaic panels was significantly impressive to earn him the respect of his peers at the workplace despite the competitive and sensitive traits he had in regards to working with people who had completed their degrees. This is a distinguishable trait about the Toledo company and the unusual yet productive environment it provided for its workers. Harlan had a particular gift for coming up with new ways and methods for creating a product whether for the glass family of products at Toledo or concerning the Sandwich process breakthrough that he brought into the company. However, he often had difficulty explaining why its inventions would work or why a certain batch of semiconductor materials would give a particular efficiency of solar conversion to electricity. Amazingly enough, the entire photovoltaic department at the Toledo company relied on the creativity of a few people, Harlan being the leading inventor, had little scientific theoretical knowledge to explain his breakthroughs. His position in the light of the early days of the company was focused solely on the invention of products. Eventually the company hired other professionals with PhD degrees to attempt at explaining the scientific reasons behind Harlan successes. Among some of the people who worked closely with Harlan at the company, are Linda Choate (eventually named as R&D Director) and Mr. Heras (senior level scientist at the research facility); both PhD graduates from Stanford University. Evidently, Harlan had some difficulty working with people who had obtained their diplomas at college, mostly because he felt that his lack of having a degree did not in anyway undermine his ability for being creative and thus a capable resource with the Toledo company. He proved his point at several occasions with Choate who inspired a grand level of competition in him at drove him to arrive at some impressive inventions in the photovoltaic domain. Because of his fantastic creative ability, he earned the respect of his co-workers and carved himself a sweet spot at the company where he would have the leisure of inventing at will, often with little input from the market he would tailor to. This is another distinguishable trait of the Toledo company where the innovative process was kept mostly as an internal process, rather than the typical process of technology oriented companies were innovation is often driven by markets pressures or external competitive measures. The freedom of expression that is pictured in the Toledo company research environment is indeed quite unusual for a technology focused company in the twentieth century. The culture of innovation remained so deeply rooted in the company practices that the executive management would take on measures that are simply unimaginable in other structures or firms in the semiconductor industry such as the Intel corporate structure for instance. The Toledo company, despite its remarkable commercial successes in the glass industry, remained a relatively small company and kept privately held since its inception by Johann Gerhart. Overall, the case study presents the several aspects of a small company filled with amazingly talented people who mostly were allowed to follow their intuition in their work and due to that level of independence were able to render a higher productivity in an environment which despite the occasional discussions and disputes, made for the type of setting that any employee would dream of belonging to. As unusual as some of the company's practices would appear, they remained very much in line with the type of corporate culture that the founder desired of having in its enterprise. Such longevity of procedure in the entrepreneurial environment is uncommon and often testifies of great leadership. The Toledo Glass Company as it evolved over decades remained true to the innovative and casual work environment that allowed it to arrive at succeeding in the majority of the markets it would venture in; here again the mark of a great company. Reference Lee Fleming, Photovoltaic Breakthrough, Harvard Business School, rev. February 1st, 2007. Read More