The Geeks Get Loud
3M may be the greatest idea factory in the world—smarter than Apple, more innovative than GE. But has Minnesota modesty been holding it back?
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Something happened to 3M in the 1990s, or rather something didn’t happen. Nearly every major corporation in America was changing, becoming leaner if not meaner—except 3M. Soon enough, its insular, lab-driven culture, with its de-facto credo of “now that we’ve invented it, people are going to want it,” as one 3M marketing executive puts it, proved no match for streamlined global competition. Sales were erratic. 3M stock barely budged during the late ’90s tech boom. In a business world increasingly driven by Wall Street, with its twin loves of buzz and efficiency, 3M’s old-fashioned reputation for eureka moments had become a liability. There was a sense, says Carter, that 3M was “a bunch of bumbling scientists who just discover these things.”
Then, in 2000, James McNerney was named the new 3M CEO, the first outsider to hold the post. Within days of the news, 3M stock jumped 20 percent. A disciple of General Electric deity Jack Welch, McNerney quickly axed 8,000 employees (about 11 percent of the workforce), cut expenditures by 22 percent in his first year and another 11 percent in his second. He implemented Six Sigma, a management protocol popularized at GE that attempts to remove variability and waste from a production process, starting with developing only those products that can be made most efficiently. Thousands of 3Mers were indoctrinated in the process and in turn taught their colleagues. “They drank the Kool-Aid,” a former engineer told me.
By the time McNerney bolted for Boeing, in 2005, manufacturing speed at 3M factories had risen 40 percent and profits had grown, on average, 22 percent each year. But 3M’s research and development labs were, by many accounts, deeply demoralized. Mention Six Sigma to former 3M engineers who worked through the McNerney years and they invariably sigh, raise their eyebrows, shake their heads. Current, profitable products took precedence over “blue sky” research, as the discovery process is known. The number of new inventions dwindled.
Fry declared at the time that McNerney, given enough time, would likely have killed the 3M mystique entirely. “What’s remarkable,” he said, “is how fast a culture can be torn apart.”
Equally remarkable may be how fast a culture can be knit back together, if in fact that’s what is happening at 3M. George Buckley, who took over from McNerney, was also an outsider. But as a scientist himself, he seemed to understand the conflict between creativity and control. He built the research budget back up and yanked Six Sigma out of the laboratories, calling innovation “an inherently messy process.”
3M is now trying to reignite the sort of idea-sharing between divisions that fostered Post-it Notes and came naturally when 3M was a much smaller company. Walls are literally being torn down throughout the headquarters and a central plaza is being constructed where employees will be compelled to cross paths.
Instead of trying to restrict invention, 3M is now trying to explain it, advertise it—get a little louder. It hired Porcini, of course, and, five years ago, it opened an Innovation Center at its headquarters, a kind of private science museum complete with a movie theater and dozens of displays (including a prototype of Armstrong’s moon boots) designed to dazzle clients with 3M’s technological prowess. It has similarly educated its own employees, grooming them through guidebooks and seminars to be “brand ambassadors” (some of the most eloquent have appeared in videos on 3M’s YouTube channel) and helping them to refine their “30-second elevator speech” on what exactly 3M does, so they’ll be ready when someone asks, “So what do you do?”
But some observers, including former employees, wonder if the push to talk about innovation isn’t solving a problem so much as covering one up: the ongoing struggle to bring 3M culture into the modern era.
“You wouldn’t have to talk about innovation if it was obvious,” says Travis Hoium, a former product developer at 3M who left in 2009. Hoium worked in various 3M labs in Minnesota, finishing in a blue-sky lab “where I was working on whatever I wanted,” he says. He has a handful of patents from those days. But he believes that as the company has grown, it’s inevitably lost some tolerance for risk along with the employee trust that McKnight advocated.
“Of course it’s not the 1960s anymore; the economy is different, things have changed for all large companies,” Hoium says. “But 3M was a family business. They built a golf course. Everyone was a neighbor. If you won a technical award, you’d get a week at Wenowak. If the executive plane was flying somewhere and you wanted to visit relatives there, you could ride along. That doesn’t happen anymore. ”
Hoium recalls a tech meeting in which Buckley was invited to address the engineers. “We thought we’d get some rallying, some inspirational talk,” he says. Instead, Hoium says, Buckley noted that Chinese workers toil for far less pay. “The takeaway was, if you don’t work harder, you’re all going to be fired,” he says.
Hoium now works as an analyst and columnist for the Motley Fool investment-advice firm, and while he hasn’t advised against buying 3M stock—he owns some himself—he has opined that the company’s innovative magic has been replaced by something else: predictable if profitable genericness. “3M got to a size and age where it wanted Six Sigma,” he says, “and once you go off that cliff, I don’t know that you ever come back.”
Many analysts have cheered the arrival of new CEO Inge Thulin, who marks a return to 3M’s insider tradition: he has spent 33 years working for 3M around the world. Jeff Lavers and other 3M spokespeople argue that the magic is already back, noting that sales from products released in the past five years, a gauge of 3M’s inventiveness, are expected to comprise 32 or 33 percent of the total this year, up from 21 percent in 2005. The goal is 40 percent, Lavers says, better than the good old days.
Even if the labs have regained their luster, however, the question now is whether 3M can ever grow out of its shell without breaking it. “What we’ve learned,” Lavers says, “is that we sometimes take the beautiful culture we have here for granted. The more customers know about it, the more they like it. But how do you bottle that magic?” In other words, how do you sell serendipity?
It’s not difficult to spot the Design Lab at 3M headquarters, though it’s nestled inside one of the nondescript Mad Men-era buildings. The ordinary tan floor tiles in the corridor suddenly snap to fluorescent pink carpeting, which meanders, stream-like, through the lab. (Porcini, employees say, is constantly inventing new nicknames for it, like “the pink river leading us to greatness.”) And there, suddenly, are bearded young men eschewing sweaters. Massive Post-it Notes about two-feet square—what they look like at the factory before they’re cut down to size—are stacked in the entryway. Fluorescent, of course.
“If you want the best designers in the world, you need the right space to attract them,” Porcini tells me. “But we had to make it easy for tech people to be comfortable here, too. Without interaction we would be, how do you say, a dead branch.”
The designers work in an open area: no cubes, no walls. Design manager Lee Fain, who calls himself “a right-brain thinker in a left-brain company,” has marked out a desk-side parking spot with tape (3M presumably) for the Razor scooter he uses to cross campus. On the periphery are eight brainstorming rooms for specific brands or divisions, like the Post-it Note room, where a deer mount covered with the stickers hangs from the wall, and the Scotch tape room, with its fluorescent green carpeting, a shade that Porcini knows best by its Italian name: verde olive.
Porcini’s office, dominated by a poster of Audrey Hepburn hanging askew behind his desk, is full of the latest, greatest 3M inventions. His favorite is a video projector so small you can carry it in your pocket. “You can project everywhere!” he says.
He also keeps a tiny man nearby—the Little Tape Man. Created by the Milanese designer of Alessi’s playful kitchen utensils, he appears to be crawling on his belly. Scotch tape is pulled through his head and attached to his upraised foot. It was Porcini’s idea, back in 2004, to update the Scotch tape dispenser—after 43 years—with something provocative. It was displayed in exhibits and design books. Buckley had one on his desk. But ultimately the Little Tape Man never hit the market.
“Innovation is about risk,” Porcini tells me, “working on the fine edge of feasible and not feasible. But it was too early for 3M to embrace that kind of language.” He keeps the Little Tape Man close at hand “as a symbol of this journey.”
Tim Gihring is a senior editor for Minnesota Monthly.