Organization Theory and Innovation

Christine Galgano

Organizational Theory Extra Credit

11/21/13

Electrolux, the appliance company, spent two years in Australia, France and Russia surveying consumers on the most unpleasant things about vacuuming. Their findings led the company to develop a bag less vacuum cleaner called the UltraCaptic. The company is looking to revamp the wait it develops its lineup and it is hoping to get new models on the market 30% faster by 2015. The company goal is to increase “hit-rate” with consumers through consumer-focused innovation. Previously, engineers and accountants ran product development; they have recently realized that consumer input has been revolutionary for the company. Electrolux is also developing new innovative products to compete in other appliance markets. Such as, upscale equipment for at-home cooks, ovens outfitted for sous-vide cooking in vacuum-sealed bags, and a line of minimalist stainless steel appliances. “Two years ago, Electrolux institutionalized what it calls an “innovation triangle,” bringing together the design, research and development, and marketing departments to jointly hammer out decisions on new products. Management in Stockholm embraced” The company tests potential designs with focus groups and anything less than a 70% approval rating is rejected. The UltraCaptic is a vacuum cleaner that compresses dust into a spongy pellet, eliminating flyaway particles when the machine is emptied. This innovation sets Electrolux apart form competitors such as Dyson and Hoover. Electrolux is a design-focused organization that is moving from being capital-intensive to being talent-intensive, which will increase the rate of innovation within the company.

For General Electric, the biggest source of revenue is energy infrastructure. “That’s where Quirky comes in. A sort of invention-by-committee club run as a startup on Manhattan’s West Side, Quirky solicits ideas each week for inventions that its users can put through the design process.”...