This video is about George W. Buckley, 64 year old Chairman of the Board, President and Chief Executive Officer of 3M since December 2005. The video is about his advice and philosophy on a management. 3M, headquartered in Minnesota, is a diverse technology driven public company offering various products.
Before becoming a CEO of 3M in December of 2005, George Buckley was Chairman of the Board, President and Chief Executive Officer of Brunswick Corporation, a global manufacturer and marketer of recreation products. He also performed leadership roles at Emerson Electric Co. as Chief Technology Officer and President of the Electric Motors Division from 1993 to 1997. His mastery in understanding of 3M’s technologies and global businesses, his expertise and wisdom of managing a big global corporation across numerous industries and various markets, his exceptional skills in business and finance, and his in-depth experiences as a director at many respectable companies, qualify him to as a CEO of 3M.
Key Issues: Define the key issues/factors in terms of marketing and the roles of the Key Players. You should include only those issues that impact the identified problem.
In this video, Buckley talks about the struggles, and how optimism can carry the company. Impact of leadership is significant in any business. Great leaders like Buckley plant his people a hope for better future and a belief in the company. Buckley is one of those optimistic leaders who empower people to reach their goals. Buckley said he’s “kind of a live-and-let-live guy.” (Welbes, 2011) Buckley is a popular leader who managed to make a positive impact despite his radical decisions. It’s his responsibility to right the ship when the ship is going to a wrong direction. 3M was a company known for its innovativeness. In nearly 100 years of existence, the company had launched several breakthrough products, most of which were the result of its employees’ creativity and inventiveness.
3M is known for:
-Relentless pursuit and dedication of Research & Development- 3M is fundamentally a science-based company. “We produce thousands of imaginative products, and we’re a leader in scores of markets – from health care and highway safety to office products and abrasives and adhesives. Our success begins with our ability to apply our technologies – often in combination – to an endless array of real-world customer needs.” (3M.com)
-Diverse business segments (Total 6 different markets according to 3M.com)
Consumer and Office Business
Display and Graphics Business
Electro and Communications Business
Health Care Business
Industrial and Transportation Business
Safety, Security and Protection Services Business
-Great Network of Global Manufacturing – 3M has significant global presence which extends to subsidiary companies in more than 60 countries and markets in nearly 200. (3M Company, n.d.)
-Strong Brand Recognition – 3M is widely known globally. Red 3M logo is known for quality.
However, 3M’s culture of innovation had started to weaken in the 1990s, and its financial performance had become somewhat lackluster. How did Buckley manage to make 3M overcome the slow regression of the company? Why did 3M hire Buckley who is an outsider? What are the pros and cons of choosing people for top leadership positions from outside the company? Was it necessary to hire new CEO?
Buckley brought much needed sparks to this industry leading company in turmoil. Buckley’s strategy as a CEO is to exploit company’s great strengths, bolster its competitive advantage, and maximize value. At the end of 2006, after first year as a CEO of the company, Buckley successfully led the company to see sales growth and profit margin.
“The strategic performance of 3M over the last one year has been impressive under George Buckley.” (Forbes, 2011) After Buckley’s reign, the sales & profits have increased. The company witnessed a steady improvement on the efficiency. New opportunities have been created for 3M. Buckley was on a roll. Most importantly “there were constant innovations at 3M, which resulted in improvement in its operational and financial performance.” (Forbes, 2011) The net income margin of 3M has increased drastically. Its net income margin was already over 15%. Bottom line, Buckley improved 3M. What does Buckley has to do now to continue to make 3M profitable and be the innovative leader in the world?
Define the Problem & the Opportunity. Identify one key problem. While there may be several problems and a multitude of symptoms, attempt to identify one problem, the resolution of which would alleviate most of the symptoms found in the case. The problem can frequently be defined around one of the key factors of marketing, target market, environment, or marketing mix elements (product, price, promotion, or distribution).
Buckley is responsible for revitalizing the company’s competitive advantage and core competency. (Norton, 2011) This suggests that drawing from previous success of 3M’s is a critical element to planning the better future. The following strategies and core capabilities have been instrumental in past successes for 3M:
-Continuation of technology developments
-Focusing on market niches.
-Abandoning unsustainable markets
-Knowing how to sell new products.
In addition to a growth strategy based on enhancing core competency, 3M has more recently adopted an acquisition strategy to take quick advantage of technology opportunities and to fill openings in geographic markets and channel capacity.
Buckley has done great. He made huge impression. His optimistic philosophy and his vision is contagious. His success can also be seen in numbers. He made $6.9 million in 2009. In 2010? $23.2 million. (Kennedy, 2011) How did George Buckley overcome obstacles at 3M? Is his management style effective? What can he do to make better 3M?
Alternative Solutions. Develop two or more alternative solutions to the defined problem. This should not be a laundry list of actions one could take to address every symptom, but alternative actions that could correct the problem at hand. Identify the pros and cons of implementing each alternative.
There are many ways further improve growth and strengthen 3M to its core. Buckley has done great job and became a model CEO. Can he possibly make the 3M better? Sure he can. He has an ability to lead the company and he can continue to improve the company, and explore new territories. These are alternative solutions.
1.Conquer small countries – Many undeveloped countries have yet to catch up with today’s fast paced innovative industry. 3M must reach out to the countries they have yet to conquer. These small & underdeveloped countries can be a huge gold mine. 3M must focus on penetrating into these markets so they can maximize margins and capture emerging growth opportunities. Downside of this is that the market is not strong yet. Currently 3M Co. “says the global economy continues to send mixed signals, as sectors like automotive and technology show strength but the housing market remains weak.” (Bomkamp, 2011)
2.Pursuit of new technology – Spend more R & D on new technologies would allow 3M to expand its business. What would happen if 3M dedicates on
saving environments by researching how to save water, OLED based Post-It, hydrogen powered medical supplies, and etc. Spending on a R & D has huge risk and reward. This could be the most costly venture which might not be wise to initiate near future.
3.Eco-friendly company – More than ever before, we live in a world where people are more conscientious about saving the Earth. What does 3M has to do to become the leaders in Eco – friendly technology? 3M is a big part of paper world in an ever growing paperless era. Could Post It be a paperless? Could environmentally friendly Scotch tape make sense for the 3M? Driving toward to Eco-friendly Company is not only great for the image, but great for the world we live in. However, this again could cost too much, or may not be profitable.
4.Move away from personal care markets – We’ve seen retailers drive down margins. This segment has seen declines. Allocate its resource to something more profitable or segments with better future. Selling a commodity always has good side and bad side. If it is profitable then it may not be wise to allocate its resources elsewhere.
Selected Solution to the Problem: Select one of the alternatives and explain why it would be best. Most of this work is already done if the alternative solutions clearly point out advantages and disadvantages to each.
I recommend a second choice. In a real world, great companies like 3M can focus on all the possibilities I’ve mentioned above. But it is importantly important to develop new technologies for the world and for the future of the company. Buckley must continue to commit developing new technologies. Business opportunities with high growth potential market are intriguing venture, but focusing on new technology that will not only generate more public awareness, but will make 3M get stronger when recession hit the U.S again. Combined with 3M’s available technologies and the company’s ability look for the bright future will help Buckley to make a lasting impression as a CEO.
He is reaching his retirement age, so he may or may not be a CEO of 3M down the road. It’s a human nature to focus on what we have in front of us and focus on current profits. How can Buckley leave a lasting legacy? Too often initiatives don’t last because companies are busy focusing on what’s in front of them. There could be plans that are hidden so deep the organization that the average 3M employee doesn’t even know or heard about them. “Research shows only 37% of employees are aware of their companies’ Corporate Social Responsibility programmes.” (Bansal, 2011). Buckley must continue to share his vision, and build a better future for 3M before he retires.
Implementation/Recommendations: Identify how to implement the selected solution and what the expected results (positive and negative) might be. Your job is to identify an action, not put off action.
3M must maintain the integrity of their core competency and must plan new strategic initiatives to develop and spend on new technologies. Potential technological breakthroughs like nanotechnology, which could be applied in materials science and digital world or improve current hydrogen technology, which for more than a decade, been considered as “a clean alternative to fossil fuels because it releases a significant amount of energy relative to its weight and also produces nothing but water when it burns.
It can also be produced cleanly, using biological methods, such as photosynthesis.” (http://wyss.harvard.edu) Could 3M be the company which solves the major hurdle of producing and storing hydrogen? Or should 3M acquire a small, but passionate company which focuses on new display technology to enhance 3M’s current touch screen technology? Regardless of which direction Buckley choose, it’s important that he spend the rest of his tenure for brighter future of the company. Once he does that he will leave a lasting legacy that will be talked and dissected for years to come.