Case Analysis of 3m Company

Case Analysis of 3M Company

Oscar E. Romero

Abstract

The 3M Company, the maker of Post-it-Notes, and Scotch Tape, and over 55,000 different products has long been one of the most innovative enterprises around the world. They closely adhered to the “30/5” principle where 30 percent of its sales should come from products that were not more than five years old. This method of doing business served the company well and was instrumental in making 3M profitable and very innovative (3M was ranked as the number on company by the Boston Consulting Group not less than ten years ago). Today, 3M, is not even in the top 100 fortune 500 companies according to Forbes. So what happened? A serious of management style changes was introduced in the company as a result of a new CEO taking charge—more specifically, an efficiency program known as Six Sigma was implemented. This management system ended up interfering and stifling 3M’s current innovative structure of new products and ideas. As a company that once prided itself on acquiring a minimum of one-third of its sales from products not more than 5 years old, now it has dropped to a mere one-quarter. 3M’s innovation methods and long-term profitability have been negatively affected by all of these changes.

The Minnesota Mining and Manufacturing Company (3M), from its early beginnings in 1902, has been an innovator and an excellent financial performer for its investors. The 3M Company today, with almost $30 billion in revenue and more than 55,000 different products, has a workforce of about 84,000 people. The mega company produces a wide array of innovative and technological products and services from a broad spectrum of industries (transportation and industrial, healthcare, electro and communications, office supplies, consumer safety, car care products, tapes and car care products, healthcare, transportation, communications and electronics, Thinsulate, and Post-it-Note). One of the chief contributing factors...