3M's Strategic Management: Analyzing Innovation and Market Performance

This case study analyzes the strategic management of 3M, focusing on the decline in innovation and market value. It identifies the problem as a loss of innovative power due to strategic shifts aimed at high profits and low production costs. The analysis applies Schumpeter’s Innovation Theory of Profit and Keynes Theory to understand the situation. Alternative actions include using problem-solving tools like TRIZ, budgeting for micro-innovation, and introducing brainstorming sessions. The preferred action plan involves objectives like achieving business market recognition, expanding the product portfolio, and restoring the company's innovative culture through employee retention, time for idea creation, and reinvestment in R&D.

Running head: STRATEGIC MANAGEMENT
STRATEGIC MANAGEMENT
Name of the Student
Name of the University
Author Note

1STRATEGIC MANAGEMENT
Define the Problem:
Denoted as one of the famous Minnesota mining and manufacturing company, 3M stood top in
the culture of innovation and creativity in the manufacturing products. In respect to the particular
analysis, the issue or the problem that needs to be focused is the decreasing market value of 3M
together with the lack of the capability of innovation. The unprecedented steps by McNerney like
increased in house competition, threatened employments of the workers and down size of some
of the plants and laboratories had a negative impact on bond among employees and the company.
In short the main problem lies in the lost of the innovative power of 3M due to the strategic
movements for high profits and low production cost.
List any outside concepts that can be applied:
In the context of this case study of 3M, the two most relevant theories that can be illustrated are
the Schumpeter’s Innovation Theory of Profit and the Keynes Theory. According to the
innovation theory of profit by Schumpeter, it is possible for the business organization to gain
economic profits by the introduction of effective and successful innovations. Keynes theory
depicts the condition where total investments and the expenditure of the production of a
company together with the development of employee retention policies helps in increase in the
production and the profit level of the company.
Describe the results of your analysis:
Innovation has been one of the essential factors for 3M in their business aim. Solving of the
unsolved issues with the ways and the procedures of innovation has been the foundation target
for the business. The business however fell on the early 1990s with the lost in the financial grip
and the intellectual resources. The profit theory from the innovative introduction was not valid at
this point since it was analyzed that the company was lacking any of the new introductions. It
was furthermore analyzed that 3M in their next phase experienced high unprecedented steps like
job threatening, lack of time for idea generation, profit asked working only for the R&D projects.
Describe alternative actions:
Some of the alternative actions after the analysis of the business structure of the company, 3M
may include a problem solving, forecasting and analysis toll like Triz for the further and detailed
analysis of the invention in the context of the global pattern. Fixing up the budget for the micro
innovation, introduction of disruptive innovation and introduction of the brainstorming session
are some of the alternative approaches.
Describe your preferred action plan:
Objectives Success Criteria Time Frame Resources
Success in business
market recognition
Successful participation
in the competitive niche
1 year Sharing and transferring
technologies across the

2STRATEGIC MANAGEMENT
market products and the
markets
Expansion of the
product portfolio
Various product ranges
in the market
2years Innovative approaches,
brainstorming activities,
crowd sourcing and Idea
management
Restoration of the
original company
innovative culture
Comfortable work
environment together
with proposals of
innovative ideas
6 months-1 year Rehabilitation without
restrictions for the R&D
operations
Narrowing the gap
among the employee
and the organization
Satisfied employees and
high end productivities
6 months Employee retention,
time and space for the
creation of new ideas to
implement
Climbing on Fortune
500 list
Gradual climbing in the
rank position with the
increase in the sales and
the profit margin
2 years Re-installation of the
company’s innovative
power