Enabling Growth H.C. Shin Vice Chair and Executive Vice President December 12, 2017 1
Agenda Business Transformation o Enhancing customer experience and 3M productivity Supply Chain roadmap Investing in Innovation update 2
Our Playbook is working Portfolio Management Investing in Innovation Business Transformation 3
Agenda Business Transformation o Enhancing customer experience and 3M productivity Supply Chain roadmap Investing in Innovation update 4
3M Business Transformation value creation Enables enhanced customer experiences and sustainable productivity Standardization and Optimization Global Data Transparency Scale and Leverage Global Processes Streamlined and standardized end-to-end global processes Single-Instance ERP Deployment Critical enabler for generating value realization in all business processes Global Service Models Supply Chain optimization and business services centralization 5
Business Transformation enhancing Customer First Enabling growth by helping our customers deliver on their promises 6
Transforming and improving customer experiences Managed by one integrated customer experience platform Integrated Customer Touchpoints Integrated Global Platform 3M s Competitive Advantage Integrated experiences across all touch points Digital interfaces, transactions and content Access to information faster and process automation One integrated global platform provides growth and productivity opportunity Service automation Marketing automation Sales automation 360 view of the customer Enhanced and differentiated customer experience Take full advantage of digital commerce opportunities Improve sales and marketing productivity Reduce cost to serve 7
Achieving value realization goals Centralized services enable improved customer experience Business Services Operations Global Service Centers Supply Chain Enabling new business models Inside Sales Global ecommerce growth Optimization of supporting functions Follow-the-Sun model Integrated customer touchpoints Regionalized supply chain Disruptive technology deployment Lean Six Sigma $500-$700M annual operational savings and $500M working capital improvement by 2020 8
Agenda Business Transformation o Enhancing customer experience and 3M productivity Supply Chain roadmap Investing in Innovation update 9
Supply chain regionalization Sustainable optimization opportunities enabled by global ERP capability EMEA EMEA COE Latin America Latin America COE Asia Asia COE EMEA Center of Expertise (COE) inauguration 10
Sales Value of Production Optimizing our footprint Sales value of production by site, 2015 $ Millions Objectives of footprint optimization Improve customer service Accelerate operational efficiencies Opportunity for footprint optimization Increase cash flow Sites Ranked by Sales Value of Production 11
Disruptive technology deployment program Creating the next generation 3M Supply Chain Proprietary technology Superior solutions with six sigma quality and cycle time Customer First Automated Consistent, no-touch processes Connected Data driven, real-time process and product control Efficient Lean, continuous process flow Safe and sustainable Lasting positive impact on our people, communities and customers Highest quality and shortest lead times to our customers Accelerated investment deploying 3M advanced technologies 12
Agenda Business Transformation o Enhancing customer experience and 3M productivity Supply Chain roadmap Investing in Innovation update 13
Investing in Innovation: continuous investment in R&D Extending core platforms R&D Intensity R&D / Total Sales 5.5% 5.8% 6.0% Expanding into new markets 2012 2015 2017e 14
Leveraging game-changing platforms Connecting customer needs with 3M technology 4 global research centers 56 customer innovation centers 46 technology platforms Ab Abrasives Ad Adhesives Fi Films Md Medical Data Management Am Advanced Materials Fl Fluoromaterials Ec Energy Components Mf Mechanical Fasteners Ce Ceramics Nt Nanotechnology Ac Acoustic Control Fe Flexible Electronics Mi Microbial Detection and Control Co Advanced Composites Do Dental and Orthodontic Materials Nw Nonwoven Materials Po Porous Materials and Membranes Mo Molding Mr Microreplication Pe Predictive Engineering and Modeling Pm Polymer Processing Rp Radiation Processing Su Surface Modification An Analytical As Application Software Fc Flexible Converting and Packaging In Inspection and Measurement Pr Process Design and Control Se Sensors Bi Biotech Dd Drug Delivery Fs Filtration, Separation, Purification Im Imaging Op Optoelectronics Tt Track and Trace Em Electronic Materials Sm Specialty Materials Pd Particle and Dispersion Processing Pp Precision Processing Vp Vapor Processing Es Electronics and Software Is Integrated Systems and Design We Accelerated Weathering Di Display Lm Light Management Wo Wound Management Materials Processing Capabilities Applications 15
Leveraging technologies across our businesses Industrial Structural adhesives and bonding tapes Ad Adhesives Safety & Graphics Health Care Scotchlite reflective material and car wraps Medical tapes and dressings Electronics & Energy Electronics assembly liquid adhesives and tapes Consumer Post-it notes, Scotch tapes, Command strips 16
Leveraging technologies across our businesses Industrial Sound insulators and liquid purifiers Nw Nonwovens Safety & Graphics Health Care Respirators and masks Patient warming solutions and medical tapes Electronics & Energy Electrical insulation and thermal management Consumer Thinsulate insulation, Filtrete filters, Scotch-Brite 17
New-to-the-world solutions from combining technologies Ad Adhesives Fi Films Nt Nanotechnology Lm Light Management High-performance window film Filtek Dental adhesives, restoratives and crowns Ad Adhesives Nw Nonwoven Materials Fi Films Sm Specialty Materials Fc Flexible Converting and Packaging Su Surface Modification Pm Polymer Processing Wo Wound Management Am Advanced Materials Do Dental and Ortho Materials Ce Ceramics Pd Particle and Dispersion Processing Nt Nanotechnology Su Surface Modification Co Advanced Composites Bi Biotech Medical dressings 18
Bringing 3M technologies to new markets and applications Cooling and Cleaning Fluids solutions Infection Prevention Super rapid biological indicator Digital Health Care Intelligent control inhaler Biopharma Filtration solutions 19
Game-changing filtration solutions for biopharma 3M s proprietary filtration technology Combined with Membrana acquisition 3M Zeta Plus 3M LifeASSURE 3M Emphaze AEX $5.5 Billion Market Size 9-11% CAGR Enabling New Biologic Therapies Advanced Membrane Technologies 20
3M s Novec and specialty fluids platform Existing applications Evolving applications Semiconductor manufacturing Solvents Data center immersion cooling Precision cleaning $1.5 Billion Market Size 14-16% CAGR Fire suppression Protective and easy clean coating Insulation gases Electric vehicle battery cooling 21
Sustainability-inspired innovation Sustainable Materials Inclusion of sustainable materials in creation of new products and reformulation of existing products Sustainability Solutions Helps customers be more sustainable in their operations or product use Market Enablers Products and business models that enable a new market or market shift 3M Envision Wrap Films 3M PPS Paint Prep System 3M Glass Bubbles 22
3M and Nobel international partnership Advancing our shared values: science, innovation, sustainability High-impact events with Nobel Laureates, customers, students Engaging society on challenges impacting lives around the world 23
Summary Business Transformation enhancing customer experience and productivity Value realization from all business processes Supply chain optimization drives competitiveness Unleashing 3M s technologies to solve current and future market needs Commitment to science, technology and sustainability 24
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