Analysis 3M. Company MMM

Complete 3 pages APA formatted article: Analysis 3M. Company MMM Co. Division: Consumer and Office Introduction: The profitability of a company is heavily influenced by various business factors such as diversification, vertical integration, strategic alliances, M&A integrations and divestment. These factors play an important role in determining the business and the success of a company. These drivers improve the overall efficiency of an organization. It is highly important for a business to understand and analyze the role of these factors and how these factors affect the overall strategy of the business and how these factors can help the customer to maintain their trust on the organization, increase the performance efficiency, grab the maximum market share and what strategies a company would implement to approach the customers. These factors also help the company to gain competitive advantage in the market and to maintain its good will and credibility in the market. Diversification: It is the form of corporate strategy adopted by the company to increase the profitability and market share of the firm by increasing its sales volume by expanding and diversifying its products and services as well as by opening new gates of profitability in new markets. It can occur at any level in a firm either at the single unit level in a business or at a corporate level. At business unit level, the firm would expand its operations into the new market by creating a new segment in the specific industry that the firm was already in. However, at business level, the diversification of the firm includes the investing strategy. In this strategy, 3M would analyze the market situation to make sure either to invest in any promising business or to penetrate the market by creating a new segment for the expansion of the business and to gain a competitive edge on the other companies within the same industry. Vertical Integration: As we know that that vertical integration is the process of merging of two businesses that involves the different stages of production (Harrigan). If 3M would adopt this strategy of vertical integration with the other business excelling at different production level. would enhance the 3M’s capability and performance. As well as, it would help the company to control its costs, units of production, quality of the products and delivery structure. Strategic Alliance: Strategic Alliance is the kind of approach used by the organizations to form corporate relationship between them. In this kind of relationship, a firm develops strategic alliance with another firm to meet shared goals, needs and objectives. Companies can strategically alliance with other companies for anything from benefiting with resources such as products, using the distribution channels, expertise, knowledge, machinery and many more. Forming strategic alliance with the other companies in the market would benefit 3M and its partner firms for fulfilling the goals, benefiting each other as well as it would help the companies to become more attractive for competition by the other firms. Merger & Acquisition: In M&A strategy, the firms grow or expand in the same sector by acquiring or merging with the other firm to acquire, divide or merge with one or different operations within the firm. This strategy would benefit 3M to either merge or acquire with the other firm doing the same business in the industry. It would help the company to grow, expand its business processes or units and to benefit from the knowledge, expertise or production of the other company. Divestment: Divestment is the reverse of the investment. It is the corporate strategy in which the company fulfills its financial or social objectives or needs. Divestment would benefit 3M, if the company wants to overcome its financial losses by divesting its particular subsidiary to remained focus on the core business of the firm. Conclusion: Adopting all of the above discussed or any one of the strategy would help the company to grow its operations in the market. This would help the company to overcome its losses, its weak areas and to remain ideally competitive in the market. Works Cited: Harrigan, K.R.


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