3M's Organizational Culture|Human Resource|Organization Behavior|Case Study|Case Studies

3M's Organizational Culture

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Case Details:

Case Code : HROB022
Case Length : 14 Pages
Period : 2001 - 2002
Pub Date : 2003
Teaching Note : Available
Organization : 3M
Industry : Mining and Manufacturing
Countries : USA

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Inventing 3M

In 1902, five businessmen founded Minnesota Mining and Manufacturing (popularly referred to as 3M) in Two Harbors, US. The new company was in the business of mining corundum, a mineral best suited for making sandpaper and grinding wheels. In 1904, when an artificial abrasive replaced corundum, 3M decided to manufacture sandpaper.

Edgar Ober (Ober), one of the founding members of 3M, approached his friend Lucius Ordway (Ordway), a successful businessman for funds for the new venture. Ordway agreed to invest $25,000 in the company, on condition that he won't be involved in the day-to-day affairs of the company.

Human Resource and Organization Behavior | Case Study in Management, Operations, Strategies, Human Resource and Organization Behavior, Case Studies

However, by 1906, Ordway had invested around $200,000 in 3M and had become involved in the day-to-day affairs of the company. In the same year he became the President of the company.

When 3M realized that the corundum owned by it was a low-grade anorthosite, it decided to shut down the mine and shift to Duluth in 1905. In the same year, 3M decided to import garnet5 from Spain. 3M received its first shipment of garnet in 1907 and started producing sandpaper. By 1911, 3M reported sales of $212, 898 and in the same year Ober appointed William L. McKnight (McKnight), who joined the company in 1907 as assistant bookkeeper as sales manager. In 1911, 3M brought out its first breakthrough product, Three-M-ite cloth. Three-M-ite became the company's first profitable product. The Carborundum Company, which had developed artificial abrasive coated emery cloth before 3M, filed a patent infringement suit against the company.

3M hired Paul Carpenter, a Chicago based lawyer and expert in patent law, and won the case against Carborundum. Due to Three-M-ite's success, 3M became debt free and announced its first dividend of 6 cents per share in 1916. In the same year, McKnight became vice-president.

In the 1920s, 3M recruited people with diverse backgrounds and expanded its product portfolio. It also introduced two breakthrough products, waterproof sandpaper and Scotch masking tape, invented by Francis Okie (Okie) and Dick Drew (Drew) respectively. In 1922, 3M entered the English market and reported sales of $68,000 in the first year of its operations. In order to consolidate its presence in global markets, 3M established research laboratories, and a sales and marketing network across Europe...

 Excerpts >>

5] Abrasive mineral used for making sand paper.


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