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Growth Strategies

Innovation: What Works

By Matt Edison

History can teach us a great deal about innovation. In 1872, the Baldwin Locomotive Works of Philadelphia, Pennsylvania could produce nine ready-to-roll 65,000 pound custom designed, state-of-the-art, highly complex locomotives in eight weeks from receipt of order. This feat was accomplished without highways, motorized delivery trucks, telephones, or degreed engineers. Baldwin employed a simple system that ensured the latest knowledge was applied to each locomotive sold. This system was a major factor behind the firm’s long lasting success.  But few firms today use such a system.

The recently written Chasing the Rabbit by Dr. Stephen J. Spear of Harvard University describes how leading organizations of our time stay out in front.  Toyota is one such company described in the book that stays out in front by fanning the flames of innovation every day.  It has built a variety of systems to encourage and enable innovation from the shop floor up. Toyota’s results are impressive, but they do it with all the modern conveniences like cell phones, email, CAD software, airplanes, trucks, and college educated engineers. 

But then one must consider Toyota’s been innovating since 1950 before CAD, email, cell phones, computers, robotics, and the like. Then consider that Baldwin innovated impressively in 1872 with far, far less. And when you finish reading Chasing the Rabbit and The Baldwin Locomotive Works, 1831-1915, a surprising conclusion sparks to life.  Both companies managed innovation and complexity in a very similar manner. This means the key element of both firms’ success isn’t complicated, has been in existence for at least 137 years and, most importantly, works. 

Baldwin developed a system of Card Books and Law Books to capture the best knowledge available and to ensure the best knowledge was applied to the design and manufacture of each subsequent locomotive. Cards were developed to collect the latest drawings for all manner of specific locomotive parts like connecting rods, reversing gears, cylinders, and smoke stacks. Law Books contained guidelines for drawing new cards, rules for designing new parts like how to join two forged frame rails, and current shop practices and capabilities like the common gauge sizes employed for flanging fire hole doors. 

Toyota maintains a similar system where, for example, the latest shop capabilities, design restrictions, material options, and assembly methods for car fenders are collected in a simple notebook kept in the design office.  This system ensures the best available knowledge of design and manufacture is applied to the next new vehicle.  It’s a major reason why Lexus overtook Mercedes and BMW in luxury car sales so quickly.

Both Baldwin and Toyota built simple systems that made sure the best knowledge was captured, disseminated, and implemented.  And both companies made sure the best knowledge kept getting better by involving everyone in the process.  If it worked for Baldwin in 1872 and it has served Toyota for nearly six decades and counting, maybe it’s a system worth implementing at your firm.

Matt Edison works as the Reactive Silicones Business Manager for Gelest, a specialty chemical manufacturer. Since 1989, Matt has also worked for DuPont, General Chemical, and Inolex Chemical where his jobs included Plant Manager and Engineering Manager, among others. In his current role, Matt leads business development projects, manages the company’s silicone technology group, and improves the company’s business systems. These duties combine his special interest in aligning resources to realize customer opportunities. Matt lives in Woodbury, New Jersey with his wife Ellen and their four children. He can be reached at [email protected].

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