Analysis of the 3m Company

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  • Topic: July 5, 2009, 1911
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3M Company
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By Peggy Nenninger|

Introduction: 3M Company
My interest in 3M Company comes from the fact that my brother used to work for them. Also the diversity and globalization of 3M intrigued me. 3M Company was founded in 1902 in Two Harbors, Minnesota as the Minnesota Mining & Manufacturing Co. (MSN Money, 2009) It is now known simply as “3M”. 3M is a primary manufacturer of products for many of the markets it serves. 3M operates in six operating business segments: industrial and transportation; health care; safety, security and protection services; consumer and office; display and graphics, and electro and communications. The Company’s products are sold through numerous distribution channels, including directly to users and through numerous wholesalers, retailers, jobbers, distributors and dealers in a variety of trades in many countries worldwide. In February 2009, the Company announced the formation of its Renewable Energy Division within 3M's Industrial and Transportation Business. (MSN Money, 2009) 3M is a diversified technology company serving customers and communities with innovative products and services. Each of their six businesses has earned leading global market positions. A recognized leader in research and development, 3M produces thousands of innovative products for dozens of diverse markets. 3M’s core strength is applying its more than 40 distinct technology platforms – often in combination – to a wide array of customer needs. With $24 billion in sales, 3M employs 75,000 people worldwide and has operations in more than 60 countries. (Our Company, 2009). Included are countries in The Americas, Europe, The Middle East & Africa, and Asia & the Pacific. In this paper I will discuss the international products and strategies around Marketing, Sales, Operations R&D, Human Resources, Manufacturing/Production, and Distribution. Strategies for Functional Areas:

Marketing
Most 3M products involve expertise in product development, manufacturing and marketing, and are subject to competition from products manufactured and sold by other technologically oriented companies. (Buckley & Campbell, 2008). In the fourth quarter of 2008, as part of its restructuring program, 3M took aggressive actions to reduce general and administrative expenses and also pared back selling and marketing costs in certain businesses. 3M Digital Signage is reshaping the industry by expanding its customers’ marketing reach through a comprehensive offering of digital signage technologies, products and services, including projectors and rear projection films, software, message delivery and consulting. (3M Press Releases, 2008). This software is designed specifically for single location/single computer applications.

According to an article in Management Science, 3M uses a different approach in idea generation techniques. This approach is called the “lead user process.” This process collects information about both needs and solutions from users at the leading edges of the target market, as well as from users in other markets that face similar problems in a more extreme form. (Lilien, Morrison, Searls, Sonnack, & Von Hippel, 2002) Sales

Like everyone else, 3M was hit hard by the failing economy. According to a brief article in Nonwovens Industry, 3M reported first-quarter sales of $5.1 billion, a decrease of 21.3% from the first quarter of 2008. (3M posts Q1 earnings. (Earnings: Facts and Figures From Key Industry Players)(Financial report)(Brief article, 2009). The article goes on to say that net income was $518 million versus $1 billion in the corresponding period last year. The company adjusted its 2009 sales and earnings expectations to reflect ongoing economic uncertainty. 2008 was a year of tremendous challenge for 3M as it was for many companies. The people of 3M confronted the downturn with both resiliency and resolve. Fighting through deteriorating economic conditions in the first half of the...
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