Wendell Weeks at Corning Inc Harvard Case Solution & Analysis

Wendell Weeks at Corning Inc Case Study Analysis

In the mid of 1970s, as a drive to remain innovative, the leaders of the company took decision of entering into the new market and industry, for which, Corning’s head of researchand development put half of the resources of R&D on the development team, as a result, the scientist of the company came up with the unique process, and its products became successful within few years.

One of the managerial actions thatallowed Corning to reinventwas the attitude of its owner. One phrase is “if you broke it so you will fix it”.In 2002, the worldwide telecommunication crash had cut the company’s revenue with almost 4 million. In order to fix the company's loss, the leadership took quick steps and closed seven plants and all of its fiber making companies. The company had laid 28% of its workforce and scientists. Furthermore, the company had cut its spending on R&D by 40% in order to recover its loss.Shareholder’s dividends were also eliminated for the first time in the history of the company. Changing in the top management was also one of the managerial actions that allowed the company to reinvent itself anddecrease its loss.

Another managerial action is changing in the corporate strategy framework. In 2004, Weeksincorporated a new strategic framework that defined Corning’s future ambition and provided clear boundaries to help and guideit with corporate decision-making within each business unit.(Khajeh, 2018).

In 2012, Weeks issued a company-wide mandate that was “Form Bottom and March Up”. Form bottom means stop declining in the net income, which would be done by taking various decision such as cutting the cost across the enterprise and by freezing new hiring as well as having some reductions in the salaried workforce and decreasing the overall capital spending. After achieving the Form bottom, the company would move to the “march up” which means that the company would take measures to increase its profitability by growing its existing businesses, bringing new innovation to the market through strategic acquisitions. This strategy of Week led the company towards profitability, and in 2012, the company started to increase its revenues and net income.

The other managerial action that the leaders of the company had taken in order to reinvent its self wasto make “The 3-4-5 Innovative framework” and “Emerging Innovation Groups (EIG)”. The mission ofthese groups was to evaluate the opportunities to convert the company’s research into products with commercial potential.

Why do you think Wendell Weeks failed to anticipate the problems that faced Corning during his time as head of the Optical Communications business?

In 1996, Wendell Weeks became the Vice President and General Manager of the telecom products division, which made optic fiber and cables. He failed to anticipate the problems that were faced by Corning during his time as head of the Optical Communications business, because at that time the company had highly invested in the communication business and the sudden burst of the bubble gave a big shock to the company and its owners. The company had suffered from severe loss at that time, and even went to the edge of bankruptcy. Another reason for the failure is that they did not forecast the consumer demand and put heavy investment in the communication segment and expected that in future, the demand would increase. As per forecasting, Weeks continuously invested in the telecommunication industry in order to acquire other telecom gear and increased in fiber optic capacity production so that the company could increase its revenue in the future. But the sudden burst did not give time to the owners to take their company to a safe place. Another reason due to which Weeks failed to anticipate the problem was that the company had its entire focus on the communication segment and had negligence or less focus towards other business segments.

If you were Wendell Weeks, would you continue to invest in Valor Glass?

Wendell Weeks would continue to invest in Valor Glass, because the product is in its growth phase and has the potential to generate profit over a long period. However, the company has a strong history of innovation, which indicates that the company would cover the issue of existing products by continuing its innovation. Furthermore, it is also recommended that the company should have an insurance of this R&D, so that just in case of rejection the company would be able to recover most of its cost. The insurance of its research would provide a security to the company. In addition to this, if the company would recover from the current issue of Valor Glass and would be able to improve the standards of safety for injections and drugs. The improvement in the standards also reinforce the pharmaceutical companies to adopt high-quality solutions, which would positively affect the health of patients. If the company would be able to recover the current issues and gets successful in its innovation,then this success would not only improve the profitability and reputation of the company, but would also provide it witha first-mover advantage. However, it is also mandatory that the company should pay attention to the other products as well, and avail the other opportunities for growth rather than paying its entire attentiontowards Valor Glass because if the company diverts its attention solely to Valor Glass, which might increase the risk and reduce the profitability of the company in future if the Valor Glass fails.............................


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