BUSINESSWEEK ONLINE : NOVEMBER 20, 2000 ISSUE
BUSINESS WEEK E.BIZ -- WEB SMART COMPANIES

Getting Out the Goods


3M ( MMM) sells more than 50,000 products to customers in 200 countries. That has caused problems with deliveries, inconsistent data, and inventory levels. Using the Internet, 3M has been able to reduce errors and improve efficiencies. Here's how:

BAD DATA
Problem: With 230 sales offices and distribution centers globally, much of 3M's information was erroneous. Nearly 40% of the records in its U.S. customer database, for example, had invalid addresses.

Solution: By checking records against a Web database of valid U.S. addresses, the percentage of invalid addresses is down to less than 10%. New software could drive that lower.

INVENTORY BLOAT
Problem: As retailers streamlined inventories, 3M had to build stocks to fill orders fast. But in 1998, inventory costs contributed to the 45% drop in earnings.

Solution: Using a Web-based system to gauge demand, 3M has cut inventories to three months of sales, from almost four months two years ago. The new system added $437 million to 3M's cash flow.

POOR SERVICE
Problem: With ordering systems using phones and paper forms, there was a good chance that customers would not get their orders.

Solution: A new inventory system lets customers see what's in stock and order online. The number of customers getting goods on the first try is up by 39%.

TOWER OF BABEL
Problem: With more than 70,000 employees across the globe, 3M had trouble linking employees, managers, and customers through incompatible networks.

Solution: 3M uses 180 interlinked intranet sites, some dedicated to specific tasks, such as online meetings.



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