3M is a old company with new ideas in mind. When most of old guys like 3M tend to keep the old wisdom "If there is nothing broken, don't try to fix it", 3M encourages all employees to "fix" the "unbroken". Everyone is company is allowed to spend 15% of time to do whatever he/she chooses to do w/o approval from manager. Similar to Google's 20% free time. Beside this free time, 3M built new IT system which allow everyone to refer to others innovation to create new "usage" or enhance it. Our daily office helper, Post-It note is created not by purpose but by employee's idea. Keep the innovation in mind and really take action on it keeps 3M leading in several industries.
Diversification and de-diversification are opposite and both right direction. Some companies fly high when one of them. Intel and AMD have been fighting each other for long time. In late 90s, Intel decided to get into high speed communication business with the steps of acquisition. These acquisition made Intel to be 4th largest communication company in the world. However a new market plus a bad timing hit Intel badly and made Intel to abandon the market in 2004. This failure shows if a company diversify its business, there is a great challenge and unknown risk in front.
Compared to Intel's diversification, Tyco International has a different and refined implementation. Tyco only do friendly acquisition and carefully review candidate's financial records. Tyco only acquires companies have potential to grow and willing to be acquired. These strategy makes acquisition to be a plus to it. Another important principle is Tyco only acquires the companies which help to "glue" its current business. These principle together helps Tyco grows strongly.
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