Business Transformation Update Eric Hammes Senior Vice President Business Transformation and IT December 12, 2017 1
Agenda Enhancing the customer experience Delivering sustainable productivity Positioned to grow 2
Our Playbook is working Portfolio Management Investing in Innovation Business Transformation 3
Business Transformation starts and ends with the customer Enabling Growth Personalize partner portal Access 3M s full portfolio Strong customer intimacy Expand market coverage Sustainable Productivity View services end-to-end Connect sales teams Maintain quality and accuracy Create scale and leverage 4
Business Transformation evolution Technology Process Value 2012 Global single-instance ERP Simplify and standardize Benchmarked goals 2017 Ecosystem of technology Optimize Achieving scale with three service models Digitally enabled business Data and analytics enabling new opportunities Long-range growth & productivity benefits 5
Putting our customer first Creating a premier customer experience with seamless deployments From our customers: Business Services Operations Thanks to the careful planning done by the 3M team with the Lowe s team there was no interruption to business and the transition was seamless. Quick access to product info pricing and availability right there in an instant Speed is an important advantage for our company dealing with our suppliers using 3M bcom we have much quicker access to the information we really need! 6
ERP deployment Advancing U.S. deployment and preparing APAC Information Technology Deployment Progress (2017e sales in $B) 2017 2018 2020 Post 2020 75% U.S. and Canada $13B 10% 25% Latin America $2B EMEA $6B 30% 70% Asia Pacific $10B 5% 10% 40% 60% 85% 7
United States deployment Continuously applying our learnings Customer Engagement Deployment Approach Businesses Engage early Partner through change Enable growth Distribution Centers Plants 8
Health Care distribution center Deployed second half 2017 $1.6B Annual sales Business processes ready at Go Live Fastest deployment to date Delivered on customer expectations 9
Value realization by 2020 Leveraging our three service models All major support functions and geographies are active Precise, proactive customer targeting Driving supply chain productivity, leveraging real-time information Leveraging Lean Six Sigma, data analytics and automation >40% automated order processing Improved cycle time and reduced waste Continual expansion over the next three years Global Service Centers $125M - $175M >99% automated order pricing Business Services Operations $125M - $175M $500M working capital improvement Supply Chain Centers of Expertise $250M - $350M Pre-tax operating income benefit 10
3M s culture of continuous improvement Enabling growth Ideation for improvement Lean Six Sigma Agile software development Single global process to capture ideas for improvement Enhancing operational performance Improving and deploying the technology faster Sustainable productivity 11
Business Transformation Delivering now and into the future Process Customer Growth Transforming our global processes while enabling business flexibility and improved decision making Optimizing all touchpoints for one seamless customer experience Improving our customers productivity and partnering for stronger growth 12
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