Thread regarding 3M layoffs

Things have changed so much

I've enjoyed reading the posts from this site. I worked at 3M for 35 years only to be downsized in Q4 2015 because financial goals were not going to be met in Q1 2016. I thought it was a great company to work for back in 1981 when I started.

Work hard and play hard was the mantra. Tartan Park and Lakeside were alive with 3M employees on any given night. I was proud to work for such an ethical company that treated employees fairly, and safety & the environment were a priority. At least that's what I thought at the time. It was THE company to work for in the Twin Cities.

Most of the people I knew in Engineering regularly put in the hours needed to get the job done right. Sometimes that was 40 hours / week but it could be 50, 60, 70, even 80 during project installations. Not much complaining or push back at that time but maybe there should have been. I think employees felt more appreciated by their supervisors / managers and they were given challenging projects. It also had the feel of a company that would take care of you until you decided to retire and, of course, there was the defined benefit retirement plan.

Much changed when McNerney came on board. Some positive, but much of it was negative with Six Sigma and Black Belts becoming the so-called future of the company. As someone had said earlier, many good middle aged employees were passed over for these BB positions just because of their age. It wasn't even kept a secret. Some were simply told that they were too old. I was actually in a room when a senior manager told an employee exactly that. I was part of the class action lawsuit for age discrimination. Mid 30's was the sweet spot. BB's completed their two year assignment and were given huge promotions to positions (JG15-16) that, in many cases, they were not prepared for. Chaos ensued.

Relationships / teamwork started to take a back seat to the bottom line. HR no longer represented the employee but now protected the company by any means possible. Diversity and inclusion were stressed for promotions at the expense of more qualified employees. Performance appraisals had to "fit" a certain curve depending on business results and there had to be a certain number / percentage that were rated 1 or 2 on a scale of 5. There was no exceptions to this rule. I could barely stomach the process when HR told the managers we would have to "give some people up" and change their rating from a 3 to a 2 to fit the rule. I made my feelings known (unfortunately in an ill-advised e-mail) and I was subsequently given a rating of 2 in two different leadership qualities and was told I was lucky that it wasn't worse.

Now it's all about the bean counters and the stock price & shareholders. Most investors that haven't sold yet are still in love with the dividends that 3M keeps churning out. Otherwise the stock price has been abysmal for the last 6-7 years. I'm not sure why the current CEO is allowed to hold his job with these type of results. Given the billions that will be paid out in future lawsuits for PFAS and ear plugs, 3M is doing what they can to free up money.

I fear 3M will not come out on the other side. RIP 3M but not until you clean up the global mess that you are directly responsible for. Watch the movie "Dark Waters". Mostly about DuPont but 3M is also part of the storyline.

This deserved its own post. OP is @1dpf+1kvY6pdz.

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| 4212 views | | 12 replies (last January 24, 2023) | Reply
Post ID: @OP+1ky1mvTg

12 replies (most recent on top)

The more things change the more they stay the same. I can certainly empathize with those employees that have been let go or will be let go. It happened to me 8 years ago. It feels awful but unfortunately becoming more the norm in todays environment.

The plant sites are the backbone of the company but the accountants rarely see it that way. They are typically already very lean because they are actually held to their financial forecasts on a monthly basis. The fat that needs to be cut resides in the corporate offices. Layers of bureaucracy with little results to show for the level of JG. It’s the old Peter principle: employees are promoted based on their success in previous jobs until they reach a level at which they are no longer competent, as skills in one job do not necessarily transfer to another.

Announcement in the Star Tribune today.
Maplewood-based 3M is cutting 2,500 manufacturing jobs worldwide as demand for its products slows.

CEO Mike Roman called it a "necessary decision to align with adjusted production volumes" following a "slower-than-expected" end to the year and bleak outlook for 2023.

The company announced the cuts Tuesday morning and did not immediately say where the job losses would occur. This wave of layoffs represents about 2.6% of 3M's 95,000-person global workforce.

3M's disposable respirator business and other consumer-facing markets have especially declined.

The company expects respirator sales to drop to pre-pandemic levels this year, a roughly $500 million decline in revenue.

Roman said several other factors are converging to push down sales — the company's exit from Russia; the slow rebound from China's COVID-19 lockdown; "aggressive" inventory reductions by retailers; and weak demand from industrial customers.

A steep drop in demand for electronics — and a continued shift from LCD to OLED screens — is also putting pressure on 3M sales.

Over the last three months of 2022, 3M's profits slide to $541 million from $1.3 billion in the fourth quarter of 2021. Adjusted for litigation and environmental issues, earnings per share still came in below analyst expectations.

Quarterly sales of $8.1 billion were flat compared to the same period a year before, when removing the effect of divestitures.

For the full year, 3M reported a $5.7 billion profit, which is 2% lower than the previous year. Adjusted earnings per share were down 6% compared to 2021.

The company had $34.2 billion in revenue in 2022, a decline of 3% attributable in part to a strong dollar and divestitures.

For 2023, 3M expects a 6% to 2% drop in sales and a 10% decline in adjusted earnings.

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Post ID: @ipmv+1ky1mvTg

I would agree with the Boomer and his / her 35 years of insight. I wanted to add some more comments on the transformation of HR in the corporate workplace. This may be in other companies as well but my only insight was at 3M.

Originally HR handled most of the disciplinary issues from attendance, performance, etc. This was transitioned to the supervisors / managers as it should. HR then focused on policies / procedures and pre-2000 it appeared to me that they were there for the employees. Employees had rights and when these employees felt these rights were infringed upon, they would go to HR if they could not get satisfaction with their immediate manager. As time went on this conversation became more of an employee to manager and then manager to HR coaching discussion. HR no longer represented the employee but transitioned to keeping the company from lawsuits, bad press at any and all costs. This coincided with the arrival of McNerney. McNerney was a one-trick pony. OK a two trick pony. He knew how to cut costs and he knew how to put rigor into a process with Six Sigma. However, he felt six sigma processes were applicable in all cases and should be used in all cases. He didn't know how to grow the top line and he certainly didn't know how to drive innovation through R&D. R&D hated McNerney and actual new products to the marketplace fell off the cliff. There was a lot of game playing with variations of the same SKU to meet the "25% profits from new products introduced in the last 4 years" or whatever that statement was. Wall Street loved the guy.

I was also a manager in the room during performance rating time and was witness to the buy-in from HR on the "rate and yank" process. It was brutal. Good employees that were originally to get a "3" rating were given a "2" (and no annual raise) just to fit the profile for the business. I pushed back and my reward for standing up for the employees was to receive a "2" also.

The 2000's were also a time where inclusion and diversity were preferred over the more qualified employee. In my opinion, this transition and some early black belt graduates being promoted into jobs that were not prepared for is where the downhill slide started. Also some class action lawsuits (age discrimination) that most of us predicted would happen, happened.

I will end this post with a rant on a specific HR person that I crossed paths with on two different assignments. This person must have been THE most unqualified employee in the company. But mainly because of diversity this person was promoted time and time again. It wasn't just me that thought this, it was pretty much everyone that had the same opinion. Always thinking they are right, quick to speak and not think, and being the loudest voice in the room. What a liability, especially in a union setting where you don't know the history and are not willing to listen to those that do. This person is still at 3M in a corporate job and as I understand it, a JG15. What a waste.

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Post ID: @adur+1ky1mvTg

Yes, McNerney was the genius behind highjump software. Not only paying top dollar for something 3M knew nothing about. It was bought in 2004 and Jim dumped a lot of cash into it the first year then blew town for Boeing in mid 2005 after their CEO got caught cheating on his wife with a boeing exec. Buckley wisely dumped it in 2008 at a big loss. Unfortunately Buckley then turned around and bought aearo which is the earplugs lawsuit from hades.

Not so Mighty Mack also dumped tens of millions on some ointment (Aldara) for STD related warts that Desi started but jimmy wanted to go all in for 3M pharma, only to waste a lot of dough and then Buckley sold it in 2006.

My Cousin Eddie could have used a dart board to make better investments than jimmy boy, and his meister brau costs a lot less than the imported wine bonanza that was guzzler down at the last leadership conference.

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Post ID: @1eox+1ky1mvTg

Isn't McNerney the one that wanted the Highjump Software acquisition, which 3M got rid of quickly thereafter?

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Post ID: @1bme+1ky1mvTg

Kodak arrival, you came in just after jim McNerney from GE was leaving or about to leave. He was the first CEO of 3M from outside the company and never respected 3Ms culture of innovation. Jim kept trying to make wall street happy by goosing quarterly earnings by a few pennies per share. He did this by slashing "costs" which to him meant starving R&D below where it had even been per dollar of sales. In less than 5 years, he destroyed enough of the pipeline of new products plus morale in the labs that it never recovered.

If you had joined 10 years earlier, you would have saw 3M at its finest for innovation.

Buckley replaced McNerney and wanted to increase investment in research but by then the board was packed with McNerney disciples and refused to invest the money vs. Keeping the same short-term GE mindset on only the next quarter.

3M has a future in some of the businesses like health care and a few others as long as they hire the right people to lead the spins. That is, people who invest in the long term with research and marketing.

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Post ID: @1jbq+1ky1mvTg

amazing to see someone mention Kodak, I left Kodak to come to 3M in 2005 and even i saw the R&D for the digital age was terrible, lack of funding and went in a direction they were warned about multiple times, far be it from me to say , I can see the same scenerio happening here, incredible to see how much fat is at the top of the ladder in 3M, going to be some seriously big payouts this year when a lot of decisions mean Spinco is taking the main lead of overall 3M. The guy from Tireshop looks like he is trying hard to set a class leading supply chain but that costs a he-l of a lot of money . Anyway it is a massive Q1 and Q2 for the Corp, good luck to Mike and the team

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Post ID: @1suh+1ky1mvTg

@1dao+1ky1mvTg

On what planet do you live where material science isn't relevant to the economy? It sure as he-l isn't Earth.

It is essential to literally everything that has been developed since the stone age. Including the computing device you wrote your post on.

Kodak died largely because it rested on its laurels too long, not that the technology it worked on and was working on wasn't relevant. Kodak's more adaptable direct competitor - Fujifilm - is still quite active and growing.

3M still has time to improve and survive. Current leadership is psychologically incapable of doing it.

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Post ID: @1jiw+1ky1mvTg

B👀mer here just checking in.

Awesome synopsis, thank you!
Very well done 👍
Matches my 36 year journey as well.

The fist few waves of Black Belts has successful careers. By the time my wave and subsequent waves were on boarded, it was utilized by management as a parking lot for expendable employees. The gig lasted for several years, and morphed into new product introduction project management. I was let go as my department focused on maintenance of legacy products.

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Post ID: @1rcm+1ky1mvTg

3M has been devastated by owner cost and digital competition for decades. Material science is irrelevant in today's economy. They have had to be a lot more hard nosed in HR due to the realities of global capitalism. Asking why ruin a good thing is like asking why couldn't Kodak still be the great company it was in the 80s....

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Post ID: @1dao+1ky1mvTg

Thanks for reposting. What puzzles me is why did 3M ever change from being the great company is was for the 20th century. It provided well better than average returns to shareholders and was always on the great places to work list.

Why mess with a great thing?

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Post ID: @1ybj+1ky1mvTg

So real t3o me. Thank you for this sharing.

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Post ID: @1ikp+1ky1mvTg

Using the despised GE forced ranking system with rankings from 1 (you're fired!) To 5 (you're a god, may I kiss your ring?), I'm sure Mike and monish would get 5s from the comatose board of directors and negative infinity from anyone below LG15.

So true here. From the penthouse to the potty is what happened to this company since it was wonderful in 1980s, still good in the 90s. Mcnerney was only CEO for 4.5 years but that was more than enough to forever destroy this place.

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Post ID: @wrf+1ky1mvTg

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