3M realigns its corporate structure, combining safety and industrial activities

3M is realigning its business groups, combining its safety business – which it has strengthened in recent years with major acquisitions – with its industrial unit.

The measures announced by the new CEO of the Maplewood-based global company reduce 3M’s business groups from five to four.

The change will allow the company to better serve global customers and markets, said CEO Mike Roman, who took over as CEO in July after Inge Thulin retired.

Corporate reshuffling appears to be a common tool practiced by new chief executives of the $33 billion giant. At one time, 3M had seven business groups.

“We continue to move 3M forward into the future, and today’s actions will strengthen our ability to meet the rapidly changing needs of our customers,” Roman said in a statement. “Our new alignment will leverage our progress in business transformation, accelerate growth and deliver greater operational efficiency.”

The new business sectors are: security and industry, transportation and electronics, healthcare and consumer goods.

In 2015, 3M bought Capital Safety for $2.5 billion. He followed that purchase in 2017 with the purchase of Scott Safety for $2 billion.

3M said Monday that the new Safety & Industrial business group will focus on global industrial, electrical and safety markets. The business segment will include personal safety, work harnesses, hearing protection, adhesives and tapes, abrasives, closure and masking systems, electrical markets, automotive aftermarket and roofing granules.

The security and industrial businesses serve the same channel partners, which made combining them a smart fit, officials said. This segment will generate annual revenues of approximately $12 billion.

The new Transport & Electronics activity of 3M restores importance to the transport section and places electronics with a new partner. 3M previously associated its electronics business with energy.

Going forward, the $10 billion unit will focus on global transportation and electronic original equipment manufacturers, as well as electronic display materials and solutions, automotive and aerospace, commercial solutions, advanced materials and transportation safety.

3M spokeswoman Lori Anderson said the new combination of business units better aligns with 3M’s customers and how the company markets its products.

Analysts noted that over the past five years, 3M has worked hard to strengthen its presence in the automotive electrification sector.

3M sensor enhancement technology is increasingly being used by automakers experimenting with self-driving or self-driving vehicles.

3M has increased its products used to make smart dashboards and high-tech information displays that appear on vehicle windshields. It is also working with state transportation departments across the country to integrate smart chips and sensor products into cars, traffic signs or roads so that smart vehicles can better “read the road” and prevent crashes. accidents.

With 3M’s focus on this area, it may make sense for 3M to consolidate its transportation and electronics units into a single division, said Edward Jones analyst Matt Arnold.

3M Healthcare will continue to be a $7 billion beast. It will focus on the global healthcare industry, medical solutions, oral care, separation and purification, health information systems, drug delivery systems and food safety.

3M’s consumer business will generate $5 billion in revenue and will focus on home improvement, stationery and office supplies, home care and consumer healthcare products. public. The consumer home improvement division will include the automotive retail service business that was previously part of 3M’s automotive aftermarket business.

The business realignment is accompanied by announcements of new leadership appointments, which will take effect on April 1.

Michael Vale will move from overseeing the healthcare unit to executive vice president of the new Safety and Industry group. Vale will succeed James Bauman, who is retiring as executive vice president of the industrial unit.

Ashish Khandpur, currently Head of Electronics & Energy, will serve as Executive Vice President of Transportation & Electronics.

Mojdeh Poul, currently head of security and graphics, will become executive vice president of the Health Care group.

Paul Keel will leave his position as senior vice president of business development and marketing to become executive vice president of the consumer unit. Keel succeeds retired Joaquin Delgado.

Keel’s business development role will be taken over by Stephen Shafer, who currently leads 3M China.

Denise Rutherford, currently Vice President of Industrial R&D and Commercialization, has been named Senior Vice President of Corporate Affairs.

Shares of 3M closed Monday at $208.49, up 41 cents.