3M: A Case Study

Introduction
Brief History
The Minnesota Mining and Manufacturing Company, better known as 3M, was founded
in 1902 and manufactures a wide array of consumer products. Henry S. Bryan, Herman W.
Cable, John Dwan, William A, McGonagle and Dr. J. Danley Budd founded the company as a
seller of sandpaper made from imported Spanish garnet.
Headquartered in St. Paul, Minnesota, 3M employs approximately 84,000 employees in
more than 60 countries. In addition, 3M products can be purchased in more than 200 countries
worldwide. In 1916, 3M purchased its first laboratory and quickly began inventing new products
in its newly-formed Research and Development department. Among the companys early
inventions were waterproof sandpaper, masking tape, cellophane "Scotch" tape and sounddeadening materials for automobiles. Scotch tape is 3M's iconic product.
3M experienced tremendous growth after World War II, opening many plants across the
country. Around 1950, the company went global, opening facilities in Canada, Mexico, France,
Germany, Australia, and the United Kingdom. By 1951, international sales had already reached
$20 million.
In the 1960s, 3M produced several models of magnetic tape recorders for instrumentation
use and for studio sound recording and the company was involved with digital recording
equipment by the end of the 1970s. One of its best known products, Post-It Notes, appeared in
1980. In 1998, the company realigned into three organizations: Industrial and Consumer
Markets; Health Care Markets; and Transportation, Safety and Chemical Markets.

Growth continued and the company's product line is still expanding, placing 3M among
the best companies on the Fortune 500 list. Global sales total about $30 billion annually with
international sales accounting for more than 60 percent of all sales.
Company Perspectives
At 3M, they are committed to satisfying their customers with superior quality and value;
providing investors with an attractive return through sustained, high-quality growth; respecting
our social and physical environment; and being a company of which employees are proud.

Review of Related Literature

Innovation
Following Joseph Schumpeters 1934 book The Theory of Economic Development: An
Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle innovation is distinguished
from invention by the fact that innovation is usually applied successfully in practice.
Three main ideas come from Schumpeters theory:
1. Inventive activity is entirely exogenous (external) to the economy, that is, inventions are
grasped by entrepreneurs that figure out how to make money, through inventions, with these new
discoveries;
2. Technological innovations lead to economic development, through the new products and
processes that are introduced by the entrepreneurs;
3. The innovation process is linear, beginning with inventions, and ending with innovations,
where monetary profits are to be made.