Corning Incorporated: Reinventing New Business Development

Throughout its history, Corning Incorporated had maintained a strong commitment to technology and innovation, spending about four to six percent of its annual revenue on research, development, and engineering (RD&E) until that number increased to 10 percent. percent in the late 1990s. Even as the company faced significant financial challenges in the early 2000s when the telecommunications industry, its largest business unit, collapsed, Corning saw investment in innovation, and especially in the development of new businesses, as a path to recovery. While other companies may have cut their R&D budgets in a desperate effort to regain profitability, Corning increased and formalized the time, money, and resources devoted to identifying potentially large startups. After the company weathered the financial crisis, management set a goal of doubling Corning’s innovation rate with the goal of creating two to four major new businesses each decade. To achieve its ambitious goals, Corning created an organization called Strategic Growth. The purpose of this new team was to work with corporate research to identify and develop new, large (approximately $ 500 million), and profitable business opportunities. Under the leadership of Dr. Mark Newhouse, Corning’s senior vice president, it was Strategic Growth in its charter for more than three years at the end of 2007. Although the group had had many successes since its inception, Newhouse, his team, and executives were they imagined how well the company’s innovative approach to organic growth worked. This case describes the strategic growth organization, its process, and its challenges.

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