3M is one of those companies that is more adept than others at creating products, marketing those products, and being financially astute. 3M is the world leader in optical films, industrial and office tapes, and nonwoven fabrics. Consumers may recognize 3M as the maker of Post-it notes, Scotch tape, and sponges, in addition to thousands of other diverse products such as overhead projectors and roofing granules. The company has always been known for its ability to create new products and markets, and, at times, as much as 35 percent of its sales have been generated from products developed in the previous five years. To accomplish these goals, 3Ms research and development has to be financed, the design and production functions funded, and the products marketed and sold worldwide. This process involves all the functions of business.

Did you ever stop to think about the importance of the finance function for a $32 billion multinational company like 3M where 64 percent of sales are international? Someone has to manage the international cash flow, bank relationships, payroll, purchases of plant and equipment, and acquisition of capital. Financial decisions must be made concerning the feasibility and profitability of the continuous stream of new products developed through 3Ms very creative research and development efforts. The financial manager needs to keep his or her pulse on interest rates, exchange rates, and the tone of the money and capital markets.

To have a competitive multinational company, the financial manager must manage 3Ms global affairs and react quickly to changes in financial markets and exchange rate fluctuations. The board of directors and chief executive officer rely on the financial division to provide a precious resourcecapitaland to manage it efficiently and profitably. If you would like to do some research on 3M, you can access its home page at www.3m.com. If you would like to understand more about how companies make financial decisions, keep reading.

Our Chapter 1 discussion will focus on the role of the finance function for 3M. Using the discussion area, tell us your reaction to the following:

Describe what you consider to be the major challenges facing the finance function of the 3M Company in today's business environment.

Participation Guidelines:

Each student must respond to the discussion question that appears above as an original post. In addition, you must also reply to at least one fellow student's response. Please refer to the course syllabus for forum deadlines.