Transcript Slide 1
3M Canada Review
Brian Young
President and General Manager
With a
Focus on Growth
1
© 3M 2011. All Rights Reserved.
Morning Agenda
Afternoon Agenda
7:30 a.m. – 8:30 a.m.
11:30 a.m.
3M Canada Overview
Brian Young
CMPA
Chip Allan
8:30 a.m.
Business Services
Britta Lesaux
9:00 a.m.
Manufacturing
Jim Brock
12: 45 p.m.
10:00:Human
a.m.
Capital Plan
• Break
Janette Batten
• Depart for meeting with Ontario
1:30 p.m.
– 4:45
p.m.McGuinty
Big B Review
Premier
Dalton
1:30 • George
2:00
• HC
Bill Boyce
Martha Bennett
SS&PS
• Brian
COB
•Break
Lunch2:30
12:00
– 12:45
p.m.
– 2:45p.m.
p.m.
• Private Dining Room
3:15
2:45
• Resume
Richard Chartrand
Tim
Brown 12:45 p.m
Health Care
D&G
3:45
John Kosnik
4:15
Kevin Higgins
ECB
I&TB
9:30 a.m.
2
R&D
Randy Frank
Wrap-up: 4:30 p.m. │ Depart to Airport: 5:00 p.m.
© 3M 2012 All Rights Reserved.
3M Canada
Domestic Business
2011 Sales - $860 M
Interco. Business
2011 Sales - $728 M
90%
Imported
90%
Exported
800
Employees
1,100
Employees
3
Market
Focused
$1.1 Billion
SVOP
Growth and Operational Excellence
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Highlights
4
OI Vs OP – 4 for 4 in 2011 – 12 for 12 in last 3 years
Generation of Cash, repatriated $149 Million
Implementation of the Tax change (estimate ~$15M savings to the company)
Business Services Organization formed
Infection Prevention and Skin & Wound Care awarded 5-year $70 M HealthPRO contract
M61 Military Program
Recognition as one of “50 Most Engaged Workplaces (Top 7)
Excellent Brand Reputation Survey Results
Two Global Marketing Excellence Awards
NPVI Progress – 26.6%/$28 Million
Manufacturing offsets about $10m of RM headwinds
World Class Compliance and EHS performance
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3M Canada Track Record
5
12 Consecutive Quarters – 17/18
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Canada’s Economic Outlook
6
2012 GDP
2012 IPI
Resource Rich
Financial
Stability
Healthcare
Economics
Export
Dependency
Strengths and Challenges
Source: Global Insights January 2012
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GDP/IPI Trends and Outlook
7
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2012 Operating Plan
US$000
Net Sales
% Org Volume
% Net Acq and Div
% Price
% LC Growth
% Transl
% Total
Gross Margin
% to Sales
R&D
% to Sales
SG&A
% to Sales
All Other
% to Sales
Contribution Income
% to Sales
% Change
8
Contribution Tax Expense
Contribution Tax Rate
Contribution Net Income
% to Sales
% Change
Q1
206,875
6.6%
0.2%
0.5%
7.3%
-5.1%
2.2%
110,513
53.4%
10,575
5.1%
44,184
21.4%
2,053
1.0%
53,700
26.0%
10.8%
15,579
29.0%
38,122
18.4%
20.2%
2012
Operating Plan
Q2
Q3
Q4
223,925
220,179
218,148
5.5%
0.0%
0.6%
6.1%
-6.1%
0.0%
122,665
54.8%
10,759
4.8%
47,112
21.0%
1,180
0.5%
63,614
28.4%
1.2%
18,605
29.2%
45,009
20.1%
5.1%
5.4%
0.0%
0.5%
5.8%
-4.2%
1.7%
117,950
53.6%
10,819
4.9%
44,322
20.1%
1,153
0.5%
61,656
28.0%
15.3%
17,868
29.0%
43,788
19.9%
16.5%
3.9%
0.0%
0.5%
4.3%
-3.6%
0.7%
112,303
51.5%
10,795
4.9%
43,889
20.1%
1,093
0.5%
56,525
25.9%
7.1%
16,380
29.0%
40,145
18.4%
8.6%
TY
869,127
5.3%
0.1%
0.5%
5.9%
-4.7%
1.1%
463,430
53.3%
42,948
Accelerated Growth
Continued Margin
Expansion +0.7%
4.9%
179,508
20.7%
SG&A Ratios down 1%
5,479
0.6%
235,496
27.1%
8.2%
68,433
CI% up 2%, good
leverage
29.1%
167,063
19.2%
12.1%
Continued tax drop
Continued operational focus balanced with growth to secure OP +
© 3M 2012 All Rights Reserved.
Managing the Balance
Growth
Operational
Excellence
Domestic
Operational
Intercompany
Strategic
Leadership
9
Gas
Risk
Brake
Reward
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A Balanced Strategy – Growth and Operational Excellence
Growth
Protect and
Grow the Core
Operational Excellence
Shared Services
High Priority Markets
Customer Focus
The “Big” 3M
Brand
Building
Competitiveness
Pyramid
Management
Alignment
Innovation
New Products
Lean Six
Sigma
Inventory
Management
Tax
Business Execution
Sourcing
NPI
Performance
Transformational
Leadership
&Engaged
Employees
10
Deliver Operationally/Manage Strategically
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Human Capital Plan
Gross Margins
Full Alignment
2
Annual
Strategic
Objective
s
3
Top –
Level
Improve
ment
Priorities
1
Long Term
“Breakthrough
” Strategic
Objectives
1
Targets
to
Improve
11
© 3M 2012 All Rights Reserved.
KEY POINT: This simply shows that BEP is
the “Execution Process” for the Strategies
(assures that we are working on what will
get us to both short and long-term goals)
3M Canada X-Matrix
KEY POINT: BEP is HOW the team will
manage its execution to Deliver Results!
(Executives don’t need to see the details to
appreciate that they employ this process)
3
Top –Level
Improvement
Priorities
2
Annual
Strategic
Objectives
4
Targets
to
Improve
1
Long Term
“Breakthrough”
Strategic Objectives
12
Deliver Operationally/Manage Strategically
© 3M 2012 All Rights Reserved.
3M Canada X-Matrix
Breaking the X-Matrix into components is
useful to clearly articulate your message
A Leader in Prioritized Markets
$500 MM Sales from New Products
Benchmark for Marketing Excellence
Healthy Organization for the Future
World Class Operational Excellence
1
Long Term
“Breakthrough”
Strategic Objectives
13
13
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3M Canada X Matrix
Annual Strategic Objectives
This demonstrates how your X-matrix Flows,
connecting Annual Objectives to the
IMPROVEMENT Objectives and Targets
Targets to Improve
- $252 M Total
Top Level Priorities
14
The message here is that while many things
are measured and important in running the
Subsidiary, these are the MOST IMPORTANT
elements to execute, THIS YEAR.
© 3M 2012 All Rights Reserved.
3M Canada X-Matrix
NOTE: Highlighting the VITAL FEW,
among the finite list of Targets to Improve
Growth
from Strategic
Accounts at Financial
& Operational
Milestones
Total)
Growth
from Strategic
Accounts
at Financial
&($167.4M
Operational
Milestones
Execute a Quality Input Plan that Strengthens
Customer Total)
Loyalty from 55% to 65%
($167.4M
Execute Growth Plans for Priority Markets ($80M Total)
Execute
Plans for
PriorityBusiness
Markets
Hoppering and
tracking ofGrowth
A&A and hoppering
of Alternative
Models($80M
Total)
Execute Key Growth Opportunities over $1M ($56M Total)
Execute Sales Excellence Plan
Execute Sales Excellence Plan
Improve rigor of NPI process for "Imported" Products & achieve NPVI target ($180M Import)
Achieve New
Product
Dev. Milestones
& Success
for Local new&products
($72M
Achieve
New
Product
Development
Milestones
Success
forLocal))
Local New Products
Develop and Execute Strategic Business Development
Growth
– ($72M for
Local)
Execute Marketing Excellence Plan
Execute Marketing Excellence Plan
Gross Margin Improvement Plan from 52.6% to 53.3%
Execute Human Capital Plan and Align Resources to Priorities
Execute
Employee
Engagement
Performance
Execute Employee
Engagement
and Performance
Culture,and
incl. the
new building Culture
Leverage Bus Services to Drive Productivity, Consistency & Quality of Services (31,000 hrs in productivity)
15
Leverage Business Services to Drive Productivity, Competency and Quality of Services
Strengthen Business Execution and Strategic Planning through BEP Roles
(31,000 hrs.)
Meet our Customer Service & Inventory Targets (>93%, D&E = 2%, SDE=5%, YE Turns = 11.75)
Deliver LSS Cost & Cash & Value Stream Objectives ($12.8MM, $3.9MM, VS=$1.2MM productivity)
Make Variance and Factory Cost Plan (Dom. & Interco) ($0 variance for year)
Indirect Spending Reduction of $11MM from 2011
Biz Conduct,
Regulatory
Compliance
& World Class
Safety
Business
Conduct,
Regulatory
Compliance
and World Class
© 3M 2012 All Rights Reserved.
Safety
4
Targets
to
Improve
Business Conduct, Regulatory Compliance and World Class Safety
16
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Business Conduct, Regulatory Compliance and World Class Safety
A3 Highlights - Owner – Blair Fantillo
17
Culture of Compliance and Pro-active Leadership
Continued implementation of Anti-Bribery Program
100% Completion of On-Line Compliance Courses
Education and Training
Maintain and Improve Operational EHS Scorecards
SOX and GFS Compliance
Improve Communication Process for Acquisitions
Delivering the Big 3M
Zero Unsatisfactory Audits and Zero Past Due Issues
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Growth from Strategic Accounts at Financial and Operational Milestones
18
Delivering the Big 3M
© 3M 2012 All Rights Reserved.
Growth from Strategic Accounts and Financial and Operational Milestones
A3 Highlights – Owner – Brian Young
19
A3s for all 12 Strategic Accounts
Total 2012 Sales - $ 167 MM
Industry consolidation continues to elevate the strategic
importance of key account relationships
The breadth of 3M's cross divisional product offering is a key
differentiating factor
Improve communication and co-operation to leverage “Big 3M”
with the last slide, it is generally good to show the A3
with strategic accounts. As
briefly in the background – but go quickly to the KEY
Monthly MOC review points of your ACTION PLAN of the A3. You are conveying
to the executives that you have a plan and disciplined
approach as to HOW your will achieve the objective.
Delivering the Big 3M
© 3M 2012 All Rights Reserved.
Execute Growth Plans for Priority Markets
20
© 3M 2012 All Rights Reserved.
3M Canada Corporately Funded Priority Markets
Construction
Oil and Gas
21
Corporate Wide Initiatives
© 3M 2012 All Rights Reserved.
Mining
Identify the Market
Identify the
Market
Funding
Investments
Talent
Align
Technical
Resources
Key Account
Alignment
Oil and Gas
22
World’s 5th largest energy producer
3.3 million barrels per day of oil produced
1.8 million barrels per day of oil from
oil sands production
3rd largest producer of natural gas in the world
580,000 kilometres of pipeline in Canada
$200B of new O&G Oil Sands projects in next 10 years
Opportunities in Construction and Operations
© 3M 2012 All Rights Reserved.
Product
Development
Funding Investments
Identify the
Market
Funding
Investments
Key Account
Alignment
Talent
Align
Technical
Rexources
3M
Canada
Sales
23
Funded by Sales% Not Big B Benefit
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Product
Development
Talent
Identify the
Market
Funding
Investments
Talent
Key Account
Alignment
Align
Technical
Resources
Product
Development
Recruitment
• Hire industry expertise
Positioning
• Locate close to customer – Fort McMurray
Retention
• Unique compensation
Ft Mc
• Flight ‘home’ 1 time per year
Based
Team
• Housing allowance
• Relocation to another Canadian city with 3M position after commitment
• 4X4 Pickups for rough terrain
Alex Isings O&G
EBO Leader
2 yrs O&G
Open
3M PI Sales
Darrell Uchach
CPP BD
15 yrs O&G
Kam
HP Coa
5 yrs
Scott Gardner
OH/FPS
7 yrs O&G
Yatin Pandit
EAMD/EPC BD
15 yrs O&G
Edgar
HP Coat
10 yrs
Tyrel Power
EMD/CPP
1 yr O&G
Chris Gatfield
ULWP/Dyneon BD
6 yrs O&G
Tina Bhela
OHES
15 yrs O&G
24
Advertise
Nationally
Hire
© 3M 2012 All Rights Reserved.
Train
Locally
using S5s
1-2 mths
Relocate
to Ft. Mc
Site
access
using
existing
resources
3-5 yrs in
Ft. Mc
Train
replacement
Relocate
anywhere
in Canada
Key Account Alignment
Identify the
Market
Funding
Investments
Talent
Key Account
Alignment
Align
Technical
Resources
Industry HQs in Calgary
25
Key Account Focus – Supplier Agreements
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Product
Development
Align Technical Resources
Identify the
Market
Funding
Investments
Key Account
Alignment
Talent
Align
Technical
Resources
Product
Development
Application engineering and product development laboratory in Calgary
Monty Malik O&G
Tech. Leader
5 yrs O&G
Alex Isings O&G
EBO Leader
2 yrs O&G
26
Open
3M PI Sales
Darrell Uchach
CPP BD
15 yrs O&G
Kam Wu
HP Coatings PD
5 yrs O&G
Jennifer Molnar
OH&ES TS
3 yrs O&G
Scott Gardner
OH/FPS
7 yrs O&G
Yatin Pandit
EAMD/EPC BD
15 yrs O&G
Edgar Boada
HP Coatings ADE
10 yrs O&G
Phil Marentette
EMD/T&T TS
2 yrs O&G
Tyrel Power
EMD/CPP
1 yr O&G
Chris Gatfield
ULWP/Dyneon BD
6 yrs O&G
Ft Mc
Based
Team
Monty
Tina Bhela Malik
OHES
15 yrs O&G
© 3M 2012 All Rights Reserved.
Teresa Pena
ADE
6 yrs O&G
Product Application and Development
Identify the
Market
Funding
Investments
Talent
Key Account
Alignment
Align
Technical
Resources
Product
Development
Enhanced Abrasion Resistant Liner
Ultra Light Weight Proppant
E-Mat Applications
Nano Release Coatings
27
© 3M 2012 All Rights Reserved.
3M Canada Oil and Gas Markets
Integrate
into
Big Business
Oil& OilGas
Sales Forecast
and Gas Sales and Forecast
GlassGlass
Bubble
Bubble Sales Sales
70
5000
57.6
4000
53.0
50
3500
49.0
41.0
40
44.7
36.5
Sales
32.5
29.0
Forecast
30.0
30
27.8
Sales ($ 000)
Sales ($ Millions)
4515
4500
60
3000
2500
Sales
2000
20
500
450
10
0
2006
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
585
2007
2008
2016
Year
28
Self Sustaining – Integration into Big B
© 3M 2012 All Rights Reserved.
1687
1000
17.2
2005
1399
1336
1500
23.4
2009
Year
2010
2011
3M Canada Priority Markets
$000 CAD
Oil &Gas
2009
2010
2011
2012 F
3 Year CAGR
$30,200
$35,522
39,256
$40,989
10.72%
$12,000
$19,998 $23,007 $25,647
28.81%
$2,050
$7,826
89.73%
Mining
29
Construction
© 3M 2012 All Rights Reserved.
$11,000 $14,000
Execute Sales Excellence Plan
30
© 3M 2012 All Rights Reserved.
Achieve New Product Development Milestones & Success for Local New Products
31
© 3M 2012 All Rights Reserved.
Execute Marketing Excellence Plan
Global
Core
Marketing
Management
Marketing Competency
Development
Marketing Planning
& Analytics
Interactive Marketing
Excellence
32
© 3M 2012 All Rights Reserved.
Local
Strategic Business
Development
Business Execution
Process
Strategic
Business
Development
Strategic Business Development
A3 Highlights – Owner – Chip Allan
•Central team focused on new product and business development
•
•
•
•
33
Accelerated NPI in Priority Markets
White Space Exploration & Opportunity Definition
Incubate high potential projects
Strategic consulting & project management
•Develop a formalized path for marketing and business leadership.
•New career path for high potential marketing professionals
•Opportunity to get broad exposure to the breadth and depth of 3M.
•Regular exposure to senior leadership
•Entry point to attract and recruit strong external talent in marketing.
•Help to achieve internal expectations for Marketing Excellence
Another Example – If you want to show an A3, do it briefly
in the background – but go quickly to the KEY points of
your ACTION PLAN of the A3. You are conveying to the
executives that you have a plan and disciplined approach
© 3M 2012 All Rights Reserved.
as to HOW your will achieve the objective.
SBDL Department Approach
Prospecting and supporting relevant growth opportunities for 3M Canada
OUTSIDE IN
1. Strategic opportunity
assessment of current
and future BIG
market spaces with
high value growth.
2. “Connect the Dots” to
map out technology
solutions (internal &
external).
3.
34
© 3M 2012 All Rights Reserved.
Work with the
Divisions to scope
and bring it forward.
Strategic
Business
Development
Strategic Business Development
In 2011, 34 projects were entered into SBD hopper and ranked
• 16 NPI projects
• 15 market research/new market model projects
• 3 integrations
13 projects were completed in 2011
• 7 launched and 6 killed
– Projects Launched
– Lymphedema │ Arizant │Original Wraps │ Bovine Mastitis │ Specified Construction – Building
Envelope (Air Barrier).
12 active projects in 2012
35
– Algae-Biofuels │ Abrasives Leadership │ Patient Bathing │ Own the Floor │ Data Centers │
Mobile Workers │ Retail Home Health │ Government Sales │ Shelter Grade Thinsulate │
Water Infrastructure
Rejuvenate the SBD Hopper
© 3M 2012 All Rights Reserved.
Execute Employee Engagement and Performance Culture
Leaders
of the
Q
36
© 3M 2012 All Rights Reserved.
Summary
Strong track record of operational excellence
Disciplined approach to Human Capital Planning
Consistent quarter-to-quarter, year-to-year performance
Strong compliance orientation
Traction with new products
World class manufacturing performance
Growth focused
37
Centralizing, Optimizing, Standardizing For Lean Business
© 3M 2012 All Rights Reserved.