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Integrating Forward along with the supply Chain:3M Dental Products Division

A customer satisfaction rating of good is no longer good enough for 3M Dental Products Division (DPD), a Minnesota-based supplier of products used around the world. The 700-employee division of 3M has determined that only by striving to earn grades of excellent in all product and service areas can it set clear goals for performance improvement, continue to increase sales, and boost productivity at industry-leading rates.

Pursuit of excellence explains why 3M DPDs customer surveys no longer combine good and excellent responses in a single category, why it has developed a comprehensive network of customer listening posts, and why it has built an information system that tracks the purchasing decisions of dentists. It also accounts for how 3M DPD sets its prioritiesby concentrating people and resources on opportunities most likely to improve products and services beyond customer expectations.

The divisions careful reading of customer requirements drives a finely tuned innovation process that delivers a steady stream of new or improved products. Products introduced within the last 5 years now account for 45% of total annual sales, up from 12% in 1992. 3M DPD manufactures and markets more than 1,300 dental products, including restorative materials, crown and bridge materials, dental adhesives, and infection-control products. Most of its 700 employees are based at its St. Paul, Minnesota, headquarters and at its manufacturing and distribution facility in Irvine, California.

In the United States, in which it has a leading share of the market, 3M DPD competes with more than 100 manufacturers of dental products. Sales and distribution to U.S. dentists are carried out through a network of independent distributors. In foreign markets, the division uses 3M subsidiaries for sales, marketing, and customer support. Sales of 3M DPD products outside the United States account for 65% of the divisions total sales.

3M DPD aims to become THE supplier of choice of dental professionals worldwide. Setting a clear course to achieve this aim is the objective of the divisions systematic strategic planning process, cited as an industry best practice by Fortune magazine. Led by a steering committee of top executives and senior managers, the process is designed to build consensus on what needs to be improved and how it will be accomplished. More than 20% of employees participate. The result is a 10-year vision, a detailed 5-year strategic plan, and a 1-year operating plan.

For each priority improvement, the steering committee negotiates with the appropriate department or functional unit to establish the anticipated business impact, determine resource allocations, and set metrics and target values for assessing progress.

The Employee Contribution and Development Plan is the divisions chief personnel appraisal tool. It sets individual goals in the areas of business results, team effectiveness, and employee development; and is used to determine performance ratings and to guide promotion decisions.

3M DPDs measurement systemthe Business Performance Management Matrixprovides an easy-to-grasp framework for aggregating performance measures and for directly linking these measures to key business drivers and goals.

Most dentists in the United States and Europethe divisions largest marketsalready use 3M DPD products. Future growth will depend largely on expanding existing customers optionsand spendingfor 3M dental products. To do this, the division must have a thorough knowledge of customer requirements. The division has graded the dentist market, resulting in five groups that reflect differences in satisfaction, purchasing behavior, referrals, repurchases, and number of 3M DPD products used.

Inhouse and third-party surveys, focus groups, and hands-on evaluations are among the wide variety of methods that the division uses to listen to and learn from dentists in each segment. In addition, virtually all customer contactsfrom visits by field representatives to calls to the technical hotline provide additional information that also is entered into the divisions customer information system. This extensive database provides the information necessary to determine whether specific products and services are meeting key customer satisfaction goals and to spot opportunities for new products.

Insights into changing customer requirementscombined with knowledge of technological, societal, and environmental trendsare the starting point for product and process innovations. Dentists, distributors, and major suppliers are involved in the divisions systematic approach to translating key customer requirements into design requirements, prototypes, andultimatelyreliable, quality products.

Continually raising the bar for performance improvement, 3M DPD is realizing benefits in nearly all facets of its business. Over the last 10 years, the division has doubled global sales and market share.