3M Investor Day Notes

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Inge Thulin

Infrastructure > Manufacturing > Retail > Healthcare

“as you know, in all economies, you have the evolution of infrastructure coming first, followed by manufacturing, after that, safety coming in place, then you have retail and then finally healthcare is the evolution of all economies and it’s true for all economies around the world. This is the way it goes.”

Paul Keel

Manufacturing is one component of supply chain, logistics, engineering and procurement are others

“manufacturing is one of our four fundamental strengths, very important. But manufacturing is just one component of supply chain at 3M. We also lead logistics, engineering, procurement and a number of other activities”

Drive returns with automation

“Pick a 3M product that you know well, post-it notes, scotch tape, Tegaderm dressings. These products run at line speeds several fold what you will find in a competitive plant. And when you automate this level of process capability, as you can see, the returns are very attractive. Now, those of you who have been following us for a while know that Lean Six Sigma is the foundation of our culture of customer centricity and operational excellence.”

Six sigma has yielded $16B in benefit to this company

“Since inception in 2001, Lean Six Sigma has generated over $16 billion of benefit for our company. We have completed more than 100,000 projects and we have trained more than 75,000 employees. And despite being more than a decade into the journey, we find that the impact from Lean Six Sigma continues to grow. In 2005, an average project for us yielded about $300,000 of benefit. By 2010, that number had grown to $450,000.”

Frank Little

7 million people died from air pollution in 2012

“There are over 120 million workers that are exposed to dangerous noise levels in the workplace today. Over 1 million people die in traffic-related accidents with over 20 million additional injuries. And in 2012 alone, there were more than 7 million people who died from air pollution-related health issues.”

Mike Roman

We stay very close to the customers in auto

“In automotive, that means we align our organization around our top 20 global OEMs. We get very close to them, sales, marketing, supply chain, technical top to top. We engage them on a regular basis. We get deep understanding of their challenges, leading to opportunities for designed-in unique solutions from 3M. We also get a very clear understanding of their value chains and so we can better support their tier suppliers. This deep engagement leads to an understanding of the market trends and what’s behind the market trends and you can see some examples here around fuel efficiency, light-weighting and electrification.”

Products come from listening to what our customers need

“This understanding leads to customer-inspired innovation, acoustic control, lightweight assembly and increasingly, solutions to help enable the use of aluminum in automotive manufacturing. Ultimately, all this turns into high-value 3M products, 3M Thinsulate acoustic control, glass bubbles for light-weighting and acrylic foam tapes to help solve the increasing complexity of the bonding solutions as automotive manufacturers introduce new materials and dissimilar materials.”

Jim Bauman

By 2030, 50% of component costs of an automobile will be electronics

“By 2030, 50% of the component cost of an automobile will be electronics. What we will do is leverage our existing partnerships. Mike talked about it, the automotive OEMs, the deep understanding at the tier”

Joaquin Delgado

Four industry success enablers in healthcare:

“We see that there are four industry success enablers: prevention; care pathways innovation; digitization; and health economic-based outcomes. A health economic-based outcome is that the outcome is going – has to be based on the clinical outcome that it delivers that solution, but also the economics that are associated with it. So, we see more and more the need to make the decisions by not only just in clinical data, but it’s in economics data put – being put together.”

H.C. Shin

Healthcare is the fastest growing and most profitable business for international

“I will start from healthcare. Joaquin talked about healthcare. We love healthcare. That’s the fastest growing and most profitable business for international. It has been growing very, very nicely. And I think we can accelerate the growth rate in healthcare. Why? Because healthcare spending is increasing rapidly, whether in developing – even in developed market, healthcare spending is growing very, very nicely. ”

Nick Gangestad

Seeing organic growth still down slightly but tracking better than expected

“Before I head into the main portion of the agenda, let me just comment on what we are seeing so far in 2016, where we remain on track for the planning estimates that we shared in our December Outlook Meeting. As we further stated in January, giving a little more color about first quarter, we stated that we are expecting first quarter organic growth to be very similar to what we saw in the fourth quarter, which was down slightly. And as the quarter is progressing, we are seeing four of our five businesses tracking either at or above what we were expecting at that time. Those are Healthcare, Consumer, Safety and Graphics and Industrial. Our Electronics and Energy business is trending below our expectations. We are seeing end-market demand weaker in the Electronics and Energy business. So, we are trending to a first quarter organic growth that is low double-digit decline due to softer consumer electronics.”