Workplace

Why 3M is unique

September 26, 2010

What kind of company is 3M? Yes, I know that 3M is a 108-year-old manufacturing company, based in St. Paul, Minnesota, which brought in $23 billion in revenues last year from  a range of products including abrasives, adhesives and, famously, Post-it notes. Remarkably, 3M makes 55,000 different products.

But what’s the core business of the company? What is its unique advantage? What is its purpose?

When I visited 3M last month to prepare a story for FORTUNE, George Buckley, the CEO, waxed enthusiastic about the firm, as you would expect a chief executive to do. “There is no company like it in America,” he told me. “There is no company like it in the world.”

That sounds like hype, but I think he’s right. 3M is not a conglomerate like GE or United Technologies, which own a variety of industrial businesses that operate, for the most part, on their own. Nor, like Apple or Sony, is it a technology company that focuses on a single industry or two, i.e., consumer electronics and entertainment. Instead, 3M — a supplier to all of those companies– is a set of businesses organized around a big, busy and intellectually productive R&D lab which researches new technologies and processes and then develops them into products. The company’s purpose, as best as I can tell, is to invent useful new things. Its unique competitive advantage is a culture that fosters innovation.

My story, 3M’s Innovation Revival, is in the current issue of FORTUNE. Here’s how it begins:

3M is everywhere. That’s the point George Buckley, the chairman and CEO of 3M, is trying to make as he talks about his favorite subject, inventing things. Last year, he says, “even in the worst economic times in memory, we released over 1,000 new products.”

As if on cue, Buckley’s new iPhone rings, showing a photo of his daughter. “Daddy’s in a meeting,” he says, and hangs up.

“I’m told there’s some 3M inside that phone,” I say. Buckley replies, “There’s lots of 3M inside.” He can’t say exactly what 3M (MMM, Fortune 500) gadget is in the iPhone; Apple’s skittish about such things. But point well made: 3M is everywhere.

Apple–and many other companies–couldn’t do what they do without 3M. The St. Paul company produces a mind-bending 55,000 products. Some of them you know — Post-it notes, Scotch tape, Dobie scouring pads, Ace bandages, Thinsulate insulation. But most you don’t, because they’re embedded in other products and places: autos, factories, hospitals, homes, and offices. Scientific Anglers fly-fishing rods? Nutri-Dog chews? They also come from 3M.

The story goes on to argue that 3M’s ability to innovate slipped some under its prior CEO, Jim McNerney, who came from GE and went on to Boeing. McNerney is, by all accounts, a great leader and he brought needed discipline and cost controls to 3M. But Buckley, an British-born engineer, better grasped the 3M culture and its importance, and the company has become more inventive since he was hired at the end of 2005. [click to continue…]

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Sustainability and your brain

August 25, 2010

Yesterday was my last full day before taking off on vacation. It was a busy day, as usual. I wrapped up a story for FORTUNE, hosted a webinar for Greenbiz, wrote a blogpost, pushed through my email, which now arrives at a rate of 100-200 a day, and ran a couple of errands.

In between, by coincidence–or perhaps not–I stumbled across a couple of NPR interviews. Diane Rehm talked with Dr. Herbert Benson of Harvard Medical School about his new book, Relaxation Revolution, and Terry Gross of Fresh Air interviewed Matt Richtel of The New York Times about his excellent series of stories, called Your Brain on Computers, which explores how digital media is changing our lives, our culture and, yes, our brains. The interviews were so compelling, and so timely, that I listened to both programs, in full, this morning. (They’re available on iTunes.)

Both were, in a way, about the same thing: how stressing the brain affects health. And while many things are more stressful than being “always on,” facing  tight deadlines and being nagged by that feeling that you haven’t checked your email, oh, in the last 45 minutes,  most of us will never go to war or perform surgery, so these are the of stresses that touch us every day. They can literally be deadly–Richtel won a Pulitzer Prize this year for his terrific series of stories, Driven to Distraction, about the risks of talking and texting behind the wheel. (One of my very top pet peeves is people who talk on the phone while driving.) [click to continue…]

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Sustainable Smucker’s: It’s all in the family

August 5, 2010

In 1897, a farmer in Orrville, Ohio, named Jerome Monroe Smucker began selling stoneware crocks of apple butter from the back of a horse-drawn wagon. He signed the lid of each one, to vouch for its quality.

The J.M. Smucker Co. still sells apple butter with the family name on the label. It also sells Smucker jams and jellies, Jif peanut butter, Folger’s coffee, Crisco shortening, Pillsbury cake mixes, Eagle condensed milk, Hungry Jack pancakes and R.W. Knudsen juices — 2,100 products in all, which brought in $4.6 billion last year.

This is noteworthy but hardly unprecedented. Some of America’s biggest companies took root in the 19th century as family businesses selling a single product—DuPont with gunpowder in 1802, Procter & Gamble with candles in 1837, General Electric with the electric lamp in 1892.

What makes Smucker unique is that, more than a century later, it remains a family-run business. Still headquartered in rural Orrville (population: 8367), the company has had five chief executives, all named Smucker—J.M. (1897-1947), his son Willard (1948-1960), his son Paul (1961-1987) and, since then, Paul’s sons Timothy and Richard Smucker, who currently share the job of  CEO.

Fifth-generation cousins Mark Smucker and Paul Smucker Wagstaff are being groomed to succeed them. “We would like that, but it’s not a fait accompli,” Richard Smucker, the boys’ uncle and their boss, told me when I visited the Smucker Co. last month.

I’ve got a story about J.M. Smucker in the current (Aug. 16) issue of FORTUNE; it’s one of a series of profiles of FORTUNE 500 companies that I’m writing for the magazine. While working on the story, it struck me that the Smucker offers a interesting and little-known case study in sustainability: Why has this company, which for most of its life has focused on the prosaic business of making jellies and jams, lasted for 113 years? [click to continue…]

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Modern-day slavery: Here, there and everywhere

June 27, 2010

57470512SH007_migrantsModern-day slavery is not just about sex workers or poor people in faraway places.

Some farmworkers in the U.S., for all practical purposes, work as slaves.  Laborers  with few or no rights, working under inhumane conditions, typically far home, have produced such products as  blueberries, organic milk, personal computers or cell phones and garments imported from India, a new report says.

Consider:

An estimated 12 to 27 million people are victims of slavery, and other forms of forced labor around the world. In the United States alone, 10,000 or more people are being forced to work at any given time.

The report, called Help Wanted: Hiring, Human Trafficking and Modern-Day Slavery in the Global Economy (PDF for download, here),  was published by Verite, a non-profit based in Amherst, Mass., that monitors and reports on  labor rights abuses around the world. (It was funded by Humanity United, a nonprofit focused on peace and human rights started and chaired by Pam Omidyar.) Over the years, Verite has helped identify and clean up the supply chains of such global brands as Timberland, Gap, Levi Strauss, Apple, Disney and HP. I met with Verite’s executive director, Dan Viederman, last week in Washington to talk about the report, and what can be done to deal with slavery. [click to continue…]

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For business, is health the new “green”?

May 2, 2010

A decade ago, few people would have thought that major banks, retailers or Internet companies would need environmental strategies. Yet today, they do–Bank of America has promised to invest $20 billion on sustainability initiatives over 10 years,  Wal-Mart’s aggressive environmental efforts are well known and eBay, while selling second-hand stuff, touts the idea of sustainable consumption.

This is largely because expectations of business are always rising. To pick another example: When I was a kid, we didn’t think about how or where or under what conditions our sneakers or T-shirts were made. Now brands that sell footwear or apparel maintain expensive and extensive efforts to monitor their supply chains, to avoid possible scandal around child labor or unsafe factories. Just as Nike or Gap.

So what’s the next big issue that companies need to worry about?

Edelman-Health-Barometer2The Edelman public relations firm says it’s health. Last month, after surveying 15,000 people in 11 countries, Edelman released what it calls its Health Engagement Barometer. The firm says health is emerging as a major corporate responsibility issue, not just for the obvious suspects–drug companies, insurance companies, the fast-food industry–but for companies of all kinds.

Of those surveyed, 69% said that

business should be as engaged in maintaining and improving personal and public health as it is in maintaining and improving the environment.

Respondents to the survey said they would be more willing to trust, do business with and even invest in companies that are engaged in health issues–by, for example, making available products that promote health, communicating the health risks of their products, helping their workers become healthier, helping address obesity or contributing to global health.

“Health is joining environment as a major sustainability issue and therefore a major issue for businesses that want to prosper in the future,” says Nancy Turett, global president for health at Edelman. [click to continue…]

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PepsiCo, sexism and “diversity”

February 16, 2010

This is PepsiCo’s SoBe brand, showcasing the actress Ashley Greene and her “zero inhibitions” in a painted-on swimsuit, as part of the Sports Illustrated swimsuit extravaganza. What better way, after all, to promote Sobe’s  “zero calorie” flavors than with a babe wearing zero clothes on your corporate website and on You Tube videos, which have attracted more than 500,000 views?

sobe_ashley_green

And then there is the photo below, from the page about Our Commitment to Diversity on the PepsiCo website, which goes on at some length about the company’s efforts to foster a workplace of caring and candor and where everyone is treated with respect. As best as I can tell, all the PepsiCo employees in this photo appear to fully clothed, although it’s possible that some wise guy in the back isn’t wearing pants.

diversityinclusion_commitment_contentThe company says:

Diversity isn’t just the right thing to do. It’s the right thing to do for our business. We’ve made it our commitment to make diversity and inclusion a way of life at PepsiCo….In fact, we view diversity as a key to our future.

And:

PepsiCo has been nationally recognized as one of the top places for women and minorities to work. We were one of the first companies to begin hiring minorities in professional positions, as far back as the 1940s. We were the first Fortune 500 company to have an African-American vice president.

The company also says that its

Multi-year strategic plans for diversity are developed with the  same vigor and goal-setting process as other business issues.

Interestingly, PepsiCo apologized for its sexist advertising just last fall, according to Mashable, a website about social media. The company had launched an iPhone application for its AMP energy drink called “before you score,” with “score” meaning (to put it in the most subtle of terms) having a successful night with a woman. The company subsequently removed the application from the iPhone store.

So….here’s my question. Why would PepsiCo–a company with a female CEO, Indra Nooyi–now run a high-profile advertising campaign using a naked young woman to sell flavored water? Does that reflect its commitment to diversity? Or is it old-fashioned sexism?

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Shop with your (gay-friendly) values

November 26, 2009

67838081_e8084e86acWith the (yuk) holiday shopping season upon us, this weekend seems like a good time to devote a series of blogposts to the idea of shopping with your values. But before I get to today’s topic–the Buying for Equality guide published by the Human Rights Campaign–let me first humbly suggest that one way to express your values this season, if you care about leaving a more sustainable planet to our children, is not to shop at all, or to shop less.

Over-consumption is a problem. If all of the 6.8 billion people on the planet lived like Americans we’d be in trouble. Today, Black Friday, the busiest day of the year is also known as Buy Nothing Day. This year the organizers are saying:

We want you to not only stop buying for 24 hours, but to shut off your lights, televisions and other nonessential appliances. We want you to park your car, turn off your phones and log off of your computer for the day.

This is a nonstarter for me. I’m not parking my car, turning off my phone or shutting down my laptop (obviously). No way, no how. Indeed, I worry that a call to action like that turns off more people than it inspires. I much prefer the holiday messaging from the Center for a New American Dream, which exhorts people to simplify the holidays, by planning a holiday with more fun and less stuff. But most of us still want at least some stuff. Today, and over the next couple of days, I’ll try to suggest some ways we can acquire stuff that aligns with our values. [click to continue…]

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AES: Business as unusual

October 19, 2009

Imagine a company where profits took second place to values, where workers could decide whether to be paid by the hour or get a salary, where there was no HR or PR or strategic planning department, where executives were trusted to make deals without approval from headquarters and where people were encouraged to have fun. That was the old AES—a radically decentralized and entrepreneurial power generation company where revenues grew to $7.5 billion and the headcount grew to more than 50,000 people—until it all nearly came crashing down, post-Enron.

AES_Logo

Since then, AES has since recovered. My story about the Arlington, Va.-based company, called A Powerful Comeback, appears in the October 26 issue of FORTUNE. It was a fun story to report–AES is easily one of the most unusual companies I’ve run across, and the people who work there, who haven’t been written about much lately, were uniformly thoughtful, interesting and cooperative. Unfortunately, space is tight these days in the magazine biz so FORTUNE was only able to publish a fraction of what I wrote. Because there’s lots to say about this pioneering firm, whose goal is to bring clean, reliable and safe electric power to billions of people around the world, I’ll add a few thoughts here.

AES was started by two men who, by all accounts, were brilliant thinkers: Dennis Bakke and Roger Sant. Both were evangelists, in a way—Bakke was a deeply religious man who [click to continue…]

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Now that’s green tea!

October 7, 2009

Nothing is more wasteful than, er, waste. Companies pay for the raw materials that they don’t use. Then they pay again to have it trucked to the landfill. That’s why zero waste is an exciting idea. Reducing or eliminating waste is not only good for  the planet, it’s good for  business, as companies like Toyota and Wal-Mart have learned.

Smart companies that pursue zero waste are also taking us closer to an industrial system inspired by nature, where there’s no such thing as garbage. Think about a tree or plant, where this fall’s dead leaves become next spring’s food.

Lipton Green OPJToday’s zero waste story comes from Lipton, the world’s largest tea company. Lipton is a unit of London-based consumer-products giant Unilever (40 billion euros in 2008 revenues), whose brands include Dove soap, Ben & Jerry ice cream, and Hellmann’s mayonnaise. Unilever’s an environmental leader—it helped start the Marine Stewardship Council which certifies the world’s fisheries as sustainable, it’s working with Greenpeace to develop environmentally preferable refrigerants and it led the laundry industry to concentrate detergent and reduce packaging when it came up with Small and Mighty All.

It turns out that virtually all the Lipton Tea sold in the U.S. comes from a plant in Suffolk, Virginia, which brings in tea from more than 20 countries, runs its production line around-the-clock and produces about 1 million tea bags per hour. Last month, the Suffolk facility became a zero waste operation. Credit goes not just to the managers but to the plant’s 400 workers, who got the ball rolling. [click to continue…]

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Hyatt (still) should be ashamed

September 25, 2009

Business for Social Responsibility (“The Business of a Better World”) does valuable work with business around social and environmental issues. It’s helped organize efforts to get global companies to take responsibility for the rights of workers in their supply chains, particularly in poor countries.

So what will BSR do about its 2009 conference, the premiere event on the corporate-responsibility circuit, now scheduled for the Hyatt Regency Embarcadero in San Francisco?

hyattYou’ve heard about Hyatt’s labor problems by now, haven’t you? Last month, Hyatt laid off 98 housekeepers at three Boston hotels, replacing them with lower-paid workers from an outsourcing firm called Hospitality Staffing Solutions of Georgia, which provides 4,500 workers to hotels in more than 30 cities.

The Hyatt workers were paid $14 to $16 an hour, according to The Times, while the replacements will make $8 an hour. Workers who lost their jobs say they were told to train their replacements for “vacation relief,” then abruptly informed that they were being canned. Hyatt denies that it misled anyone.

[click to continue…]

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