My ESADE MBA

The family business “Brasilata” of a fellow One Year MBA classmate from Brazil has made into the news and it is definitely worth reading it. McKinsey Quarterly (March 2010) interviewed “Chip Heath” the author of a book called “Switch: How to Change Things When Change Is Hard”, where he mentions Brasilata as a model for suggestion programs as well as some of its innovative management tools. 

Congratulations Brasilata and keep making headlines like this. The following is an excerpt (full article here):

Excerpt from Switch: Inventing an identity

Brasilata — a $170 million Brazilian producer of steel cans—actually invented the identity that became the engine of its success. Can manufacturing is a relatively mature industry—not much growth or excitement. But Brasilata defies the boring, stuck-in-its-ways stereotype. In fact, it has one of the best reputations for innovation of any company in Latin America.

How does a metal can company become known as an innovator? Brasilata’s founders were inspired by the philosophy of Japanese car manufacturers like Honda and Toyota, which empowered their frontline employees to take ownership of their work. In 1987, the founders launched their own employee-innovation program.

A new identity was its core. Employees became known as “inventors,” and new hires were asked to sign an “innovation contract.” This wasn’t just feel-good language. Employees were challenged to be on the lookout for ideas on how to create better products, improve production processes, and cut costs. Systems were developed that made it easy to submit ideas. The program succeeded beyond reasonable expectations. In 2008, a total of 134,846 ideas were submitted—an average of 145.2 ideas per inventor!

These suggestions often led to new products. In late 2008, for instance, the company came up with a new approach for a steel can designed to carry flammable or otherwise dangerous liquids. To meet UN standards, such cans must withstand a drop from about four feet. Most companies had solved this problem by thickening the metal layers, which used up more raw material. And even the reinforced cans were prone to split if they landed on an edge. Brasilata’s inventors suggested a new design, inspired by car bumpers that collapse on impact. The new cans deformed slightly on impact, reducing stress on the critical seam. They resisted falls better while also reducing the amount of steel in the can.

Inventors have also led the company through emergencies. In 2001, a severe energy crisis forced Brazil’s government to give businesses a strict quota of electricity. In response, Brasilata’s employees dreamed up hundreds of power-saving ideas. Within a few weeks, Brasilata’s energy consumption had fallen by 35 percent, reducing it below quota, so the company could resell the extra energy.

Let’s remember something: this inventor identity, which has fueled the company’s business success and employee satisfaction, was made up. None of Brasilata’s employees was born an inventor. This identity was introduced to them, and they decided it was a mantle worth wearing—a source of pride and strength.

Most successful companies have a distinctive identity in our minds. I can picture the identity of a Wal-Mart or a Southwest or an IBM employee. I have a harder time picturing the identities of some of their competitors. Intel recently has been running a national ad campaign that features its own employees. It’s called “Our rock stars aren’t like your rock stars.” Ajay Bhatt, one of the coinventors of USB, is shown walking into a company canteen and being surrounded by adoring employees. The point is that what they value at Intel may be different from what’s valued in the outside world, but if you’re the next Ajay Bhatt, you want to work for Intel, where your talents will be respected. Another great example of a company that motivates employees by giving them a sense of identity is Brasilata.