After a decade or more of obsessive focus on slashing costs, many manufacturers are looking to innovation for a competitive edge. GE CEO, Jeffrey Imelt, is telling managers that no matter how efficient their work processes are, they won't achieve his goal of 8 percent organic growth unless they have great products and services to sell, reports Carol Hymowitz. At Proctor & Gamble, the vice president of design and innovation, a position that didn't exist before 2001, encourages engineers, designers and marketers to pool their ideas.
Some companies only talk about innovation; not so at John Deere. Writing recently in The Wall Street Journal, Hymowitz says although cost-cutting and manufacturing efficiency have been main concerns for CEO Robert Lane since he took charge 6 years ago, he hasn't cut spending for research. Lane reminds employees that Deere was founded on the invention of the steel plow that could turn prairie soil. Deere's newest tractors and combines are computerized grain factories on wheels. Guided steering systems keep tractors and planters on track, and combines use on-board computers plus GPS to record yield in both real-time and location in the field. Half of Deere's salaried employees are engineers, and Lane says the key to Deere's growth is still the company's ability to keep inventing new products that are useful to customers.