inge g. thulin executive vice president, international operations

3M Investor Meeting 2006 © 3M 2006 All Rights Reserved

Inge G. ThulinExecutive Vice PresidentInternational Operations

Our Largest Growth Platform


Six Market Leading Businesses – Executed in a Worldwide Network of Subsidiaries

Electro and Communications

Consumer and Office

Display andGraphics

Health Care

Industrial and Transportation

Safety, Security and Protection Services

Decide Where to Play and How to Win Decide Where to Play and How to Win


3M’s Subsidiary Network

KeySales & Mar keti ngManufacturing/ConvertingTechnical Capabilities

Canada

Puerto Rico

Trinidad& Tobago

Brazil

Uruguay Argentina

Venezuela

Chile

Peru

Colombia

Ecuador

Panama

Jamaica

Costa RicaEl Salvador

Guatemala

Dominican Republic

MexicoChina

Korea

Japan

Taiwan

Hong Kong

Vietnam

Philippines

Thailand

India

Malaysia

Indonesia

New ZealandAustralia

Singapore

Sri Lanka

UAE

Switzerland

Austria

Greece

Italy

Pakistan

SaudiArabia

Lebanon

Kuwait

Egypt

KenyaZimbabwe

South Africa

Morocco

Tunisia

France

Germany

United Kingdom

Ireland

Belgium

Netherlands

Denmark

Norway

Sweden Finland

Spain

Portugal

Poland

CzechRepublic

Hungary

Russia

Turkey

Romania

UkraineEast

Israel


3M International Overview

Subsidiaries in 69 countries organized in three geographic areas – Representing 61% total 3M sales for 200533 countries with laboratories79 manufacturing sites36,600+ employees99% 3M International subsidiary employees are local nationals3M product sales in over 200 countries

Local Knowledge and Execution Supported by Global Processes and Capabilities

Local Knowledge and Execution Supported by Global Processes and Capabilities


3M International Recent Performance

$3.4

$10.7$12.1

$12.9

$0.0

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

$14.0

2003 2004 2005 Q1 2006

$1,059

$2,552

$3,654$3,328

$0

$1,000

$2,000

$3,000

$4,000

2003 2004 2005 Q1 2006

E & C 13%

SS & PS 10%

I & T 29%HC 16%%

C & O 10%

D & G 22%

Sales Operating Income

LC Growth 10.1% 24.0%7.4% 5.1% 10.3% 27.4% 28.3% 30.7%OI Margin

$Billions & YOY % Chg $Millions & YOY % Chg

+20%+14%

+6%

+7%

+30%+10%

+14%

APAC 45%

Europe 41%

LAC 14%

2005 International Sales by Business and Region

+26%*

*2002 estimated stock options, not restated.


3M’s Competitive Advantage – International

Technology Platforms

Manufacturing and Process Capabilities

Geographical Reach and Local Market Knowledge

Borderless Customer Success: Unique Ability to Serve Transnational Accounts Globally and Domestic Accounts Locally

Borderless Customer Success: Unique Ability to Serve Transnational Accounts Globally and Domestic Accounts Locally


Importance of Geographies in Global Execution

Know the cultures and business practices. Speak the language.

Know the customers and their needs. Develop and sustain long-term key account relationships.

Understand the local competitive environment. Anticipate and respond to market opportunities.

Provide knowledgeable, responsive and ethical representation where the customers are. Protect the Corporation.

Local Knowledge is Key to Global ExecutionLocal Knowledge is Key to Global Execution


3M Path to Local Market Penetration

Import toEstablishPosition

Establish Local

Converting Mfg.

Add R&D for Local

Application

Add R&D for Local Product Development

Full Manufacturing for Local Needs

M&A –Products and Technologies

Potential Global

Source of Supply

Sales

Time

Building products, services and

businesses closer to customers

Meeting Local Requirements &

Demand

Local Ownership and AccountabilityLocal Ownership and Accountability

PolandChina

JapanGermanyCanada

UKBrazil

TaiwanKoreaMexico

RussiaIndia


International Growth Imperatives

Alignment to Imperatives Enables Consistent Customer Focus and Service on a Global Basis

Alignment to Imperatives Enables Consistent Customer Focus and Service on a Global Basis

Developed Countries

Developing Countries

Operational Excellence

Market Focus / Customer Success

Engaged Employees


International Growth Imperatives in Action


Operations / Commercialization

Engaged Employees

Power of Local Subsidiaries Power of Local Subsidiaries

Sustainable GrowthSustainable GrowthSustainable Growth

Local SourcingLocal SolutionsGlobal Technology Platforms


Mining Market: CopperExtraction Transportation & Crushing Flotation & Smelting

LeachingElectroWinning &

ElectroRefiningDistribution& Final Sale

Electrical SplicesRespiratorsReflectivesGlass BubblesDust Suppressant

Electrical SplicesRespiratorsReflectivesGlass BubblesDust Suppressant

Electrical SuppliesConveyor Kit RepairAsset TrackingNovec I/C Cleaning

Electrical SuppliesConveyor Kit RepairAsset TrackingNovec I/C Cleaning

Electrical SuppliesRespiratorspHmeter

Electrical SuppliesRespiratorspHmeter

Cuno FiltersHigh Flow FiltersLeach AdditivesClose Loop Control

Cuno FiltersHigh Flow FiltersLeach AdditivesClose Loop Control

Cathode TrackingSurfactant for Acid MistNomad for Acid MistAbrasivesElectrical SuppliesRespiratorsNovec Degreaser

Cathode TrackingSurfactant for Acid MistNomad for Acid MistAbrasivesElectrical SuppliesRespiratorsNovec Degreaser

Bundle LabelsTracking SolutionsBundle Strapping

Bundle LabelsTracking SolutionsBundle Strapping

Local Subsidiaries Bring All 3M Businesses and Solutions to Mining Customers

Local Subsidiaries Bring All 3M Businesses and Solutions to Mining Customers


Food & Beverage Market: SalmonHatchery

ThermographsRFidCuno FiltersInfection Control

ThermographsRFidCuno FiltersInfection Control

Farming at SeaReflectiveSafety WalkDuct TapeThermographAntifoulingTracking SolutionsLabelsRecoveringNet Cage Cleaning

ReflectiveSafety WalkDuct TapeThermographAntifoulingTracking SolutionsLabelsRecoveringNet Cage Cleaning

Harvesting & Sea Transport

AbrasivesMarine ProductsTracking Solutions

AbrasivesMarine ProductsTracking Solutions

Plant Process

Labels & TPSStretchable TapeCleaning ChemicalsAbrasivesMicrobiologyAdhesivesOH&ESMattingsPrimary Packaging

Labels & TPSStretchable TapeCleaning ChemicalsAbrasivesMicrobiologyAdhesivesOH&ESMattingsPrimary Packaging

Exportation & Cold Chain

ThermographsHighjumpRFidCold-PackDLRSecurity Labels

ThermographsHighjumpRFidCold-PackDLRSecurity Labels

Distribution &Final Sale

Special LabelsSmart PackagingPackaging MaterialsRFidShelf Life Extension

Special LabelsSmart PackagingPackaging MaterialsRFidShelf Life Extension

Local Subsidiaries Bring All 3M Businesses and Solutions to Food & Beverage Customers

Local Subsidiaries Bring All 3M Businesses and Solutions to Food & Beverage Customers


Developed Country Growth - Customer Success




Engaged Employees

Developed CountriesDeveloped Countries


Managing Transnational Accounts: Toyota

Account managed globally by Sumitomo 3M JapanFast, accurate and expert response to customer issuesApplications from over 10 different 3M Divisions

Program Highlights

TOYOTA “Innovative International Multi-purpose Vehicle” (IMV)

Enabling Borderless Customer SuccessEnabling Borderless Customer Success


Sumitomo 3M Japan Growth Model

New Products Flow

Idea

Launch

Concept

Feasibility

Development

Scale-up

“Voice of Customer”is a Critical Input- Replicate at other

key accounts

3M B

usine

sses

Prospects Forwarded toCross Functional TeamsProspects Forwarded toCross Functional Teams

SalesSales MarketingMarketing

Customer Technology

Center

Customer Customer Technology Technology

CenterCenter

Manufacturing& EngineeringManufacturing& EngineeringApplication &

DevelopmentApplication &Development

LaboratoryLaboratory

Apply IntellectualCapability toOpportunities

Apply IntellectualCapability toOpportunities

++

++

+

Market Centers

AutomotiveAutomotive

ConstructionConstruction

ElectronicsElectronics

HealthcareHealthcare

IndustrialIndustrial

CustomerRelationships - Key account focus


Sumitomo 3M Japan Customer Technology Center

Tokyo, JapanOpened January 199832,300 Square Feet6,500+ Visitors in 2005


Customer Technology Centers (CTC) Global Reach

CTC’s in More than 25 countries

Workplace for addressing Customer articulated and unarticulated needs

Knowledge transfer between 3M and Customers –mutual exchange

Showcase for 3M technology, capabilities and products

Internal coordination ensures customers linked around the world

CTC Success Lies in Local Bench-to-Bench Technical Expertise Combined with Cross-Business Product Application

CTC Success Lies in Local Bench-to-Bench Technical Expertise Combined with Cross-Business Product Application


3M Germany – Customer Technology Center

Neuss, GermanyOpened November 2001213,000 Square Feet4,000+ Visitors in 2005


Successful Applications for Growth: BMW 5 Series

Meeting Customer’s Quality & Performance Demands All Over the World

Meeting Customer’s Quality & Performance Demands All Over the World

Where’s 3M?

Door Reflector

Sun Roof Seal

Door MountedSeals

Rear Spoiler Mounting

Mirror ButtonAttachment

Trunk LidTape

Cabin Air Filter

Fogging Sensor Attachment

WindowMounting

Cover Cup Holder

Scratch Protection Film

Rain Sensor Attachment

Navigation Display Film


3M - BMW Group Partnership

: BMW Location

China

USA

South AfricaBrazil

UKRussia

EgyptMalaysia

Indonesia

Thailand

Austria

GermanyGermany

Enabling Borderless Customer SuccessEnabling Borderless Customer Success


in

Germany

GROWTH | SERVICE | PRODUCTIVITY


Professional Plus: % Variable Pay Based on Plan AchievementPosition New System Old SystemSales Representative 30% 14%Marketing 20% 7%Sales & Marketing Management 30% 20%

3M Germany Compensation for Growth Program

Growth Incentives For All EmployeesShift from Fixed to Variable Pay

101.5 110.5

EmployeeGrade F

PresentGrade A

% Target Operating Plan

Bonus Value in Percent

Sales Bonus Structure Example

Aligned Company and Employee Growth AspirationsAligned Company and Employee Growth Aspirations


Developing Country Growth

Developing CountriesDeveloping Countries



Engaged Employees

Developed Countries


Solutions for Developing Markets

Increased Spending On Healthcare

Migration of Industrial Production

3M Business Portfolio Meets Developing Market Opportunities3M Business Portfolio Meets Developing Market Opportunities

Infrastructure SpendingEmerging Middle Class


Sales in Developing Countries

Strong Track Record in Developing MarketsStrong Track Record in Developing Markets

2001-05 CAGR 14.2%Brazil

Russia

India

China

Poland

Other Asia Pacific (excludes Japan, ANZ)

Other Eastern Europe

Middle East/Africa

2001-05 CAGR 14.2%Brazil RussiaIndia

ChinaPoland

Developing Markets Sales (% of 3M)

0%5%

10%15%20%25%

2001 2002 2003 2004 2005


BRICP Subsidiaries

India

● 722 Employees

● 3 Plants

Poland

● 652 employees

● 2 Plants

Russia

● 237 Employees

● 1 Plant

Brazil

● 2,943 Employees

● 4 Plants

China

● 2,070 Employees

● 6 Plants

Strengthening Local Teams and Operational CapabilitiesStrengthening Local Teams and Operational Capabilities


3M Brazil – Latin America’s Growth Driver

• Manufacturing Capacity and Broad Regional Reach

• Local Technical Expertise• New CTC Opened July 2005


3M Russia – Broad-based Opportunity

• Improving Economy • Customer Contact Center in St Petersburg - Opened 2005

• New CTC in Moscow Q2 2006• Local Manufacturing in Q4 2006


• Broad-based Penetration Opportunity

• R&D and Local Conversion in Place

• Expanding Market Coverage

3M India – Significant Growth Opportunity


• Economy Remains Strong • Broad Geographic Reach • New Investments in R&D

• Executing Well Against Plan

3M China – Increasing Investment and Returns


3M China Geographic Coverage

Zhengzhou

Urumqi

Kunmin

Xi’an

Chongqing

Nanjing

Tianjin Dalian

HangzhouWuhan

Kaohsiung

Taichung GuangzhouFuzhou

Shenzhen

Taipei

Hong Kong

Qingdao

Chengdu

Beijing Shenyang

SuzhouShanghai

LEGENDGeneral Office, Manufacturing Warehousing & Technical CenterExisting Customer Sales CenterHome base location

Nanning

Haerbing

Dongguan

Jinan

Zhenzhou

ChangshaNanchang

Xiamen

Changchun

ShijiazhuangYantai

Hefei

Foshan

Ningbo

KunshanWuxi


3M China Local Manufacturing

CAOHEJING PLANTCAOHEJING PLANT

Six Major Focused PlantsXin QiaoSupports: Consumer, Display & Graphics, Industrial & Transportation and Safety & SecurityCaohejingSupports: Consumer, Electro & Communications and Industrial & TransportationWaigouqiau Supports: Display & GraphicsSuzhouSupports: Display & GraphicsShanghai CunoSupports: Industrial & Transportation (Cuno)Guangzhou (Opens Q4 2006)Will Support: Display & Graphics, Industrial & Transportation

CEO Safety Award in 1997, 1999, 2003ISO 9000 v2000 CertifiedISO 14001CertifiedOHSAS 18000 CertifiedQS9000 Certified


3M China R&D Investment

Shanghai, China

180,000 square feet

Facilities assignment:30 Tech Service Labs12 R&D LabsCustomer Technical CenterMultiple Customer WorkshopsTarget 300 Staff by 2007

Total Investment: USD $40 MillionTotal Investment: USD $40 Million


3M Poland - Bridging Europe and Asia

• Untapped Domestic Market

• Emerging Destination for Business Migration

•Successful Local Brands• Global Manufacturer


3M International Growth StrategyExtend the Core through new market adjacencies, acquisitions and EBOs

Extend the Core in all countries – emphasize locally-relevant brands, products / applications and business models

Grow the current 3M Core in all countries –emphasize Borderless Customer Success

International Expansion in All Three DimensionsInternational Expansion in All Three Dimensions


Local Brands: Viscoplast

Acquisition secured existing market position in Poland for Viscoplast portfolio

Accelerating penetration of 3M product portfolio in Poland

Leveraging low-cost manufacturing and converting capabilities

Providing low cost entry level products for other neighboring markets


Viscoplast High Brand Awareness - Poland

14%

3%

2%

1%

3%

12%

12%

3%

45% 3M Viscoplast

Salvequick

Cleanic

Hansplast

Urgo

Cosmos

TZMO / Matopad

Compeed

3M Nexcare

Source: Millward Brown, SMG/KRS, Omnibus, Sept 2005

Balancing Strategic 3M Brands with Locally-Acquired Brands …Where to Grow and How to Win

Balancing Strategic 3M Brands with Locally-Acquired Brands …Where to Grow and How to Win


3M - LG.Philips (LPL) Global Collaboration

Borderless Customer Success• Dedicated Technical & Business Teams

Support LPL Global Operations in Korea,China& Poland

• 3M Korea Transnational Account Team Supports 3M China & 3M Poland teams and LPL Global Suppliers

Business Partnership• 3M Korea Supports LPL Business on a Global Basis• Simultaneous Investment in Poland• Total Solution Provider with 3M Technology Platforms• Exchange Business / Technology Roadmap • Executive Engagement for Strategic Collaborations

Technical Partnership• Timely Technical Service Support on Site• Quality Engineers on LPL Sites • Quarterly Lab-to-Lab Meetings• Collaboration for New Product Development• Testing, Optical Simulation & Design Supports• Annual Technical Fair at LG


International Growth Imperatives

Developed Countries




Engaged Employees

3M’s Geographic Presence and Reach Enables Borderless Customer Success

3M’s Geographic Presence and Reach Enables Borderless Customer Success


3M International Summary

International growth continues to expand Developed countries will grow through transnationalaccount management and coordinated on-the-ground technical expertise Developing countries strengthening – BRICP strategy and ongoing product localization are significant drivers in 3M growthStrategic acquisitions provide locally-relevant customer/market knowledge and product portfolioAll about EXECUTION starting with the CUSTOMER!!!

Growth Possible in All “Corners” of the WorldGrowth Possible in All “Corners” of the World

inge g. thulin executive vice president, international operations

Economy & Finance

local nationals

win3m investor meeting

countries local knowledge

local market penetration

local competitive environment

international sales

mining market

lc growth