3M WORLDWIDE Auditing a Diversified, International Corporation

Presentation Outline  Overview of the company  Core values  Business Units  Former/Current Global Strategy  Concerns/Benefits  Asia Pacific  Questions

3M Overview  Founded in 1902 as Minnesota Mining and Manufacturing Company.  Started Mining Mineral Deposits  About 55K of products  Currently they have worldwide sales of 23 billion dollars with about 75K employees worldwide.  Operations in more than 65 countries and have operations in 28 states in the US.

3M Overview (cont)  567 US Patents  Organized into six business - Consumer and Office - Display and Graphics - Electro and Communication - Health Care - Industrial and Transportation - Safety, Security and Protection Services

Core Values  Act with uncompromising honesty and integrity in everything we do.  Satisfy our customers with innovative technology and superior quality, value and service.  Provide our investors an attractive return through sustainable, global growth.  Respect our social and physical environment around the world.  Value and develop our employee’s diverse talents, initiative and leadership.  Earn the admiration of all those associated with 3M Worldwide.

Consumer and Office  This business segment includes produces for consumer and office retail, education, home improvement, building maintenance and food service  Examples  Post-it Note Pad, Flags and Labels  Scotch Glue and Tape  3M Pet care Pet Hair Removers

Display and Graphics  This business segment includes produces for electronic display, touch screen, traffic safety and commercial graphics  Examples  3M Desktop LCD Filters  3M Overhead Projector

Electro and Communications  This business segment includes produces for electronic and electrical equipment and the construction of electric equipment and telecommunication  Example  Electronics Assembly

Health Care  This business segment includes medical, surgical, pharmaceutical, dental, health information systems and personal care  Examples  3M Littmann Stethoscope  3M Wound Cleanser  3M Nexcare Reusable Cold/Hot Pack

Industry and Transportation  This business segment automotive and marine care, aerospace, appliances, electronics and paper and packaging  Examples  Scotch Box Sealing Tape  3M VHB Window Tapes  Scotchgard Paint Protection Film

Safety, Security and Protection  This business segment includes produces for safety, security and productivity of workers, facilities and systems  3M Tamper indicating products  3M Hard Hat  3M Protective Eyeware

Former/Current Global Strategy  Gradually Penetrated  Partnership only  Simple Produces only  Lasted until around the 70’s.  Big Bet - 3M Manufacturing plant in Singapore  Built market shares  Gain Product Loyalty  Specific mix of Products Former Strategy Current Strategy

3M Concerns for a new market  Governmental Bias  Import Restrictions  Need Special Permit or Franchises  Cartels  Large enough Market?  Lack of distribution Centers  Already established brand names  Protections of 3M Patents, Copyrights and Trademarks.  Personal Safety of employees

Benefits for entering a new market  Increase international sales  Reduce currency exposure  Lower shipping cost  Design products tailored to a specific market  Gain market shares

Relative Sales by Region (2003)

Relative Profits by Region 2003

Asia Pacific

Questions 1) What year was 3M founded A) 1900 B) 1902 C) ) What international regions did 3M focus on A) Latin America/Africa/Canada B) Europe and the Middle East C) Asia Pacific 3) What is a benefit for entering a new international market A) To gain international tax benefits B) Better market shares C) To go on vacation

Answers  1) B  2) C  3) B