case study – project managemnt case study  Format  – write about case  – ans the questions  – conclusion link with the course material and case KE1081

case study – project managemnt case study 

Format 

– write about case 

– ans the questions 

– conclusion link with the course material and case KE1081

Click here to Order a Custom answer to this Question from our writers. It’s fast and plagiarism-free.

case study – project managemnt case study 

Format 

– write about case 

– ans the questions 

– conclusion link with the course material and case KE1081

August 8, 2018

©2018 by the Kellogg School of Management at Northwestern University. This case was prepared by Professor Russell
Walker and Andrew Dilts ’17. Cases are developed solely as the basis for class discussion. Cases are not intended to
serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Some details
may have been fictionalized for pedagogical purposes. To order copies or request permission to reproduce materials, call
800-545-7685 (or 617-783-7600 outside the United States or Canada) or e-mail custserv@hbsp.harvard.edu. No part
of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form
or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Kellogg
Case Publishing.

R U S S E L L W A L K E R A N D A N D R E W D I LT S ’ 1 7

Polaris Battery Labs:
Startup Risk Management

Polaris Battery Labs was an Oregon-based startup that provided innovation services to
companies in the lithium ion battery industry. Its operating philosophy and expertise in this fast-
growing industry enabled it to provide great value to its clients, but as a startup that was seeking
growth the company was subject to multiple risks.

Lithium Ion Batteries
From laptops to cellphones and watches to digital cameras, rechargeable lithium ion batteries

powered many of the world’s portable electronic devices. As a result, the lithium ion battery market
had experienced high growth (see Exhibit 1). In addition to electronics, the batteries were used in
new markets such as electric vehicles, grid storage, and wearable technology.

Consumers were constantly demanding batteries with longer life, greater power, and different
sizes and shapes, which put pressure on the industry to develop new materials, improved battery
cell structures, and more flexible form factors. The value chain for lithium ion batteries began
with the companies that manufactured the chemical materials that made up the batteries
(see Exhibit 2).

Chemical materials were purchased by cell developers that developed the individual lithium
ion battery cells (see Exhibit 3 for the components of a cylindrical cell and Exhibit 4 for the
process of building a cell).

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

2

P o l a r i s B a t t e r y l a B s KE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

Battery cells were combined into battery packs, which were sent to original equipment
manufacturers (OEMs) that incorporated the battery packs into their devices (completing the
chain shown in Exhibit 2).

Company Background
Polaris was founded in 2012 in Portland, Oregon, by Doug Morris. The company’s core team

members were the CEO, senior scientist, IT manager, and scientist (see Exhibit 5).

Morris had worked for Motorola for more than thirty years as an engineer and executive in
telecommunications, components, batteries, and energy storage. At Polaris, he was responsible
for attracting potential new clients, finding ways to meet their needs, negotiating the deals, and
maintaining customer relationships. His unique combination of experience, strategic vision, and
personal connections had been essential to the company’s ability to secure clients and identify new
opportunities and promising new technologies.

The company provided a variety of services for enterprises looking to innovate in the lithium
ion battery market:

• Prototyping

• Research and development

• Cell development

• Consulting

• Small-scale production

• “Match-making” services that connected clients to third-party partners with expertise
beyond what Polaris offered

Polaris offered several selling points to its clients that distinguished it from its competitors.
First, it made no claim to its clients’ intellectual property either before or after providing services.
Eliminating IP concerns enabled it to reach a broader client base and collaborate more closely and
openly with its clients’ in-house R&D innovation teams.

Polaris also was able to quickly create prototypes and research promising areas for innovation.
Many of its clients lacked the equipment, intellectual capital, or organizational nimbleness to
match its speed.

The company possessed valuable insight into new technologies, which enabled it to advise
clients on future trends as well as improve its own processes and capabilities. For example, if an
OEM was developing a new product that required a special lithium ion battery application, Polaris
could propose up-and-coming technology that could meet its needs.

Also, Polaris’s network enabled it to connect a client with a third party in the industry for
further value. For example, if a client needed mass production of a prototype that Polaris developed,
Polaris could recommend one of its factory partners with mass-production capability.

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

3

P o l a r i s B a t t e r y l a B sKE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

Clients
Polaris had four types of clients: startups, OEMs, universities and national laboratories, and

large chemical companies, each of which played different roles in the industry value chain (see
Table 1).

Table 1: Polaris Clients and Value Chain Roles

Material
Providers

Cell
Developers

Battery Pack
Makers

Device
Manufacturers

Startups 

OEMs 

Universities and national laboratories    

Large chemical companies 

When evaluating potential clients, Morris and his team assessed the value Polaris could
create versus the cost—financial, equipment, and human resources—of providing its services.
Qualitatively, Morris did not like clients that “negotiated every penny”; he turned down potential
deals if the prospective client approached the engagement with this mindset.

The company charged a fixed fee for many of its main services regardless of the client’s
unique requirements.

Startups

Startup clients operated throughout the value chain, but most commonly they were trying to
bring new technologies to market as cell developers. However, because of their scale they lacked
the infrastructure and production/process capabilities to build prototypes and prove the benefits of
their new technologies. They often also lacked cell design skills and funding to invest in equipment
and other capital projects. These limitations were magnified by the very long go-to-market time
frame for lithium ion battery startups.

Polaris created immense value for these clients by filling all of those gaps. As a startup itself,
the company understood the challenges of raising money and valued “helping the little guy” who
might just have the next breakthrough technology. One way it did this was occasionally accepting
an equity position in a startup client in lieu of monetary payment. Of course, startups posed a
greater risk of going out of business (which was especially true in the lithium ion battery market),
so Morris and his team tried to maintain a balanced client portfolio.

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

4

P o l a r i s B a t t e r y l a B s KE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

OEMs

The main challenge faced by the industry’s OEMs—manufacturers of devices requiring
batteries—was procuring the precise type of battery they needed for each product. Different
products required different cell sizes, energy density, volume, sourcing, or other performance
characteristics, such as high heat resistance or malleability (see Exhibit 6 for examples).

OEM clients were desirable because they were well-capitalized and provided stable cash flow.
However, sometimes they demanded mass production of the cells developed by Polaris, which
it was unable to deliver. As a result, the company not only missed out on potentially profitable
projects but also risked losing those clients’ business in the future.

With OEMs and other large corporate clients, Polaris tactically lowered its prices as needed to
enable client engineers to commit to a project without having to get additional levels of approval.
In return for this small revenue sacrifice, Polaris built client loyalty and reduced the time required
to get a project approved.

Universities and National Laboratories

Universities and national laboratories subcontracted their cell development activities to
Polaris as part of their research grants. These clients’ expertise was broad and deep in their areas of
specialization, but they lacked rapid iteration and cell testing capabilities. When universities and
labs spun off startup companies to commercialize technologies they developed, Polaris assisted
with their early-stage activities as well.

Working with universities and national laboratories gave Polaris early knowledge of and access
to new technologies and research advancements. However, because it made no claim to its clients’
intellectual property, the company could be integrally involved in early-stage development of a
new technology and not receive any financial benefit. When working with early-stage spinoff
companies, Polaris incurred the same risks as with its other startup clients.

Large Chemical Companies

Large chemical clients viewed batteries as a secondary market for their products, which meant
they lacked the capabilities or data to fully exploit the opportunity. These companies used Polaris
to outsource their R&D and prototype development. Polaris also collected the data necessary to
get the attention of cell developers and provided consulting on strategic opportunities.

Chemical clients had ample funding available for projects, including ongoing research and
prototyping engagements, but some preferred to pay a lump sum at the end of their projects.

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

5

P o l a r i s B a t t e r y l a B sKE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

Plans for the Future
Polaris planned to continue serving clients with a broad range of technology needs, but it

made a strategic decision to focus more on wearable technology (“wearables”). In addition, it
planned to add people and equipment to increase its capacity to execute projects and to expand
its manufacturing capabilities. While this growth could eventually be accomplished via internal
resources, it would be greatly accelerated with external financing.

Morris’s plan was ultimately to sell the company; in fact, he had actively entertained potential
offers during the past two years. However, he had not yet identified an attractive buyer.

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

6

P o l a r i s B a t t e r y l a B s KE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

Exhibit 1: Worldwide Battery Market, 1990–2015

Source: Christophe Pillot (Director, Avicenne Energy), “The Rechargeable Battery Market and Main Trends 2014–2025,” 32nd
International Battery Seminar & Exhibit, March 9, 2015.

Exhibit 2: Lithium Ion Battery Value Chain

Material
providers

Cell
developers

Battery pack
makers

Device
manufacturers

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

7

P o l a r i s B a t t e r y l a B sKE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

Exhibit 3: Components of a Cylindrical Cell

Source: Polaris Battery Labs, citing “What’s the Best Battery?” Battery University, October 2013, http://batteryuniversity.com/
learn/archive/whats_the_best_battery.

Exhibit 4: Cylindrical Cell Manufacturing Process

Source: Polaris Battery Labs, citing “What’s the Best Battery?” Battery University, October 2013, http://batteryuniversity.com/
learn/archive/whats_the_best_battery.

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

8

P o l a r i s B a t t e r y l a B s KE1081

K e l l o g g s c h o o l o f M a n a g e M e n t

Exhibit 5: Polaris Core Team Members

Doug Morris
Founder & CEO

Dr. Curtiss Rem
Senior Scientist

Kellye Just
IT Manager

Nick Gurnon
Scientist

Exhibit 6: Freeform Lithium Ion Batteries for Wearable Technology

Source: Polaris Battery Labs, 2016.

For the exclusive use of B. Gaga, 2021.

This document is authorized for use only by Belay Gaga in 2021.

Looking for this or a Similar Assignment? Click below to Place your Order