Spring 2009
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3M
Moving Into the Future of Technology
T H E M A G A Z I N E F O R M A N U FA C T U R I N G E X E C U T I V E S
3M Moving Into the Future of Technology Written by Shelley Seyler & Produced by Hanim Samara The next time you use a touch screen monitor or view a presentation through a projector, you can bet you are one of billions around the globe benefitting from an original 3M product. Their name recognition stretches not only across industries but literally throughout the world, holding offices in 62 countries with their products being sold in every country on the planet. 3M works in displays and graphics, consumer and office, electro and communications, health care, safety, security, and protection services, and industrial and transportation. Their products have not simply advanced with technology but have helped facilitate the fresh ideas that have made these sectors of the global economy what they are today.
Their Defining History Though their beginnings span as far back as 1902, the company still stands on the same foundation on which it was built: â€œâ€Śinnovation is the mantra of success. For companies large and small, the big winners are those that match new, marketable ideas with customers, before anyone else.â€? This was the vision of the founders and remains the driving force behind 3M. In the Lake Superior town of Two Harbors, Minnesota, five businessmen set a goal to mine a mineral deposit for grinding wheel abrasives. The abrasives proved a disappointment and the Minnesota Mining and Manufacturing Co. promptly moved to nearby Duluth and, rather than giving up on their dreams of success, switched their focus to new sandpaper products.
COMPANY AT A GLANCE Established : 1902 Employees : 79,000 Annual Revenue : $25.3 Billion
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The following years for 3M continued to pose struggles for this new business but the pioneers persevered through challenges that could have easily destroyed any business in the dawning days of the 20th century. When the company mastered the requirements for quality production and control of their supply
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chain, they were propelled to a new level. Investors gradually became interested in 3M, one of the first being Lucius Ordway who took it upon himself to move the company to St. Paul in 1910.
remarkable milestone: sales topped $20 billion for the first time, thanks to their new products such as Post-It® Super Sticky Notes, Scotch® Transparent Duct Tape, and optical films for LCD televisions, among others.
Fourteen years after their birth, in 1916, the company paid its first dividend of six cents a share thanks, in part, to the success of their first marketing and technical innovations. Continuing to move forward with new products, 3M produced the world’s first waterproof sandpaper in 1920, which reduced airborne dusts during automobile manufacturing.
The industrial and transportation sectors of 3M are only one aspect of this impressive and influential company but play a vital role in these markets. Their manufacturing products have a simple but important goal: to help manufacturers improve their business. 3M’s global influence allows them to achieve this objective for multinational and local companies.
Another important milestone occurred in 1925 when Richard G. Drew, a lab assistant, invented masking tape, the first step toward diversification of the company and the first of many Scotch® Pressure-Sensitive Tapes. The following years brought more technological advances which eventually led to Scotch® Cellophane Tape that could be used for box sealing.
Executive Spotlight: Jan Reyers, Channel Director of the Manufacturing and Transportation Sectors
During World War II, 3M manufactured defense materials which led them into new markets, producing Scotchlite™ Reflective Sheeting for highway markings, magnetic sound recording tape, filament adhesive tape, and marking the beginning of 3M’s involvement in the graphic arts field with offset printing plates.
When trying to understand the manufacturing and transportation sectors of 3M we have to start with Channel director of these industries, Jan Reyers, who has been with the company since shortly after graduating college, where he attended both the University of Minnesota and the University of Tulsa. With a degree in marketing, he came on board with 3M in their sales department in 1979. Since then, he has held various posts, never staying in one for more than four years: “3M, by nature, moves people,” said Reyers.
The subsequent years saw the expansion of 3M into the markets it dominates today, 2004 marking a particularly
Reyers was stationed abroad in Korea where he served as project manager. He then moved back to the states to
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become manager of two businesses in their abrasives sector. Next, Reyers served as marketing director and was then, once more, moved abroad to become director for 3M Switzerland. Finally, he landed where is today. The manufacturing and industry sector of 3M offers products for a wide range of businesses: composites manufacturing, construction and architecture, converter markets, maintenance and repair, mining, packaging solutions, paints and coatings, utilities and power, water filtration systems, windows and doors, woodworking and furniture. Their transportation sector provides abrasives, tapes, films, adhesives, and specialty materials for the manufacture, repair and maintenance of aircrafts, automobiles, boats, and other vehicles for the aerospace, automotive, marine, specialty vehicle, and traffic safety systems sectors.
he said. 3M’s ability to keep from imposing their complexity onto the marketplace reverberates throughout Reyers’ sectors of the company. “There is a lot of power in complexity and that’s how we succeed, by taking all the pieces and combining them in different ways; that’s the core of our success,” he added.
Reyers makes it his responsibility, however, to ensure that this does not make the manufacturing and transportation industries more complicated. “There are a lot of strategies and each unit makes it something usable for our businesses,” said Reyers.
In order for 3M to best serve these diverse and numerous businesses in the industries, Reyers spends half of his time in the marketplace with distributors and the other half working with divisions and channel opportunities groups, managing key accounts and sales organizations, and distribution organizations. As a “matrix organization,” 3M specializes in basic technologies, abrasives, tapes, and other necessities for the industry that translate to value for their businesses and make it profitable and easy for them to work with 3M. “We help them execute their strategies in the marketplace and help their distribution in the market,” said Reyers. One of his most important responsibilities: synthesizing their strategies into something they can execute in order to benefit their businesses and industries. Complimenting and enabling this to take place is 3M’s “boundarylessness,” as Reyers likes to put it. “3M is a boundary-less organization, allowing our customers to move from one division or function to another,”
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In 2009, this will be taken to another level. The industry and manufacturing and transportation sectors of 3M are trying to re-segment distribution and align their values to specific models in segmentation. With every business model in the marketplace being different, 3M needs to differentiate their own strategies of distribution for each business in order to make them as effective as possible. Though there are still many challenges ahead for Reyers in his current position with 3M, he can imagine being involved with trying to assimilate acquisition into the corporation and trying to serve international markets again, or becoming involved with general business management and management from a cross cultural perspective. “There is always a new horizon and a new experience� at 3M.
Strategies On the Inside Within 3M’s manufacturing and transportation sectors, six sigma efficiency programs have been used for six years and lean manufacturing methods have also been employed for back office, supply chain, and customer service requirements. The entirety of 3M stresses the
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importance of homegrown managers, recruiting from lab positions and experienced roles in the field, occasionally taking in outside MBA students, this portion of the company following suit. 3M also makes it a point to employ locals of the countries in which they operate, priding themselves on their low turnover rate. “We benefit employees in that location and thus contribute to the community as a whole; our employees have a high degree of loyalty. They are proud to be a part of 3M,” said Reyers.
When it comes to sales and marketing, 3M has historically invested in direct sales, their culture being to bring new solutions and innovations through a direct relationship with the consumer. “That is our number one market and role. It is very difficult,” Reyers conceded.
Not surprisingly, 3M has a detailed process for introducing their new products, from the very first conception of the ideas through commercialization. During this process,
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the company does not forget to elevate some of the most important aspects of their business: safety and understanding the impact of the product and its production on the environment.
In Context: Help For and From Others For the manufacturing and industry portions of the global economy, the Industrial Supply Association (ISA) provides valueless benefits, these sectors of 3M also recognizing ISA for its contributions. As the voice of its distributors, ISA members get together on a regular basis, providing a feedback loop and creating a way for members to find standardized aspects of indus-
try, e-commerce, and e-business. This creates a platform for discussions on how to improve and standardize these services of distribution. Reyers and his team partake in ISA’s classes and workshops that provide them with greater insight into the market, economy, and the latest industry trends. 3M places a special emphasis on community, creating a workplace that employees are proud to be a part of and assisting developing countries in which they hold offices by employing local residents. 3M is also involved with numerous global charities that work throughout the world to contribute to global development from another avenue.
In addition to this focus on aiding the
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developing world, 3M is steadfast in their dedication to play a role in energy reduction and improving the environment. For more than 30 years, 3M has elevated the importance of “going green.� Take a look at the Dow, and 3M is number one or two on the list for environmental and waste efficiency. Having received recognition for their efforts, they are considered one of the strongest in the world in their ability to improve the environment through reduction of greenhouse gas emissions, along with other means. 3M has also integrated this effort into their business through their 3P strategy: Pollution Prevention
Pays, which celebrated its 30th anniversary in 2005. Over the last 33 years, thanks to this mission, 3M has prevented more then 2.7 billion pounds of pollutants, and saved nearly $1.2 billion. The company prevents pollution at its source rather than eliminating it after it has been produced through product reformulation, process modification, equipment redesign, and recycling and reuse of waste materials. Most recently, in October of 2008, 3M was recognized for their efforts by the EPA, having exceeded their goal set in 2002 to reduce their absolute greenhouse gas emissions by 30 percent by 2007. Exceed does not quite cover what they actually achieved: a 60 percent decrease in greenhouse gas emissions by 2007.
Elevating the importance of environmental stewardship derives from the company’s cultural belief that what is good for the environment is also good for the economy. “There is a comparative advantage [for green products]; the challenge is to get the customer to recognize that this value doesn’t always mean a cheaper price,” said Reyers.
Here to Stay Over the last century, this world has seen two world wars, a severe economic depression, and recessions, among other tragedies. 3M survived it all. Breaking into the industry fighting, the spirit with which the founders persevered through 3M’s early struggles remains the power driving this global force. Serving as a leader in their industries only begins to cover the influence 3M enjoys.
“We walk to the customer, and they expect to see something new in our hands,” said Reyers. Rest assured, innovative thinking will continue to be their focus into the depths of the 21st century; after all, it is thanks to this facet that the company was propelled to the position it is in today.
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Spring 2009
www.canadianexecutivejournal.com
3M
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