Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2015

Stock-Based Compensation

Stock-Based Compensation Expense

Stock-Based Compensation Expense

	Years ended December 31
(Millions)	2015		2014		2013
Cost of sales	$	46	$	47	$	27
Selling, general and administrative expenses		185		192		183
Research, development and related expenses		45		41		30
Stock-based compensation expenses	$	276	$	280	$	240
Income tax benefits	$	(87)	$	(79)	$	(71)
Stock-based compensation expenses, net of tax	$	189	$	201	$	169

Stock Option Activity

Stock Option Program

The following table summarizes stock option activity for the years ended December 31:

	2015			2014			2013
		Weighted			Weighted			Weighted
	Number of	Average		Number of	Average		Number of	Average
	Options	Exercise Price		Options	Exercise Price		Options	Exercise Price
Under option —
January 1	39,235,557	$	90.38	43,938,778	$	83.84	56,565,030	$	80.33
Granted:
Annual	5,529,544		165.91	5,736,183		126.77	6,220,810		101.55
Progressive (Reload)	—		—	—		—	140,447		109.83
Other	—		—	—		—	191		119.62
Exercised	(5,978,382)		83.74	(10,219,261)		82.37	(18,825,218)		79.25
Canceled	(234,274)		128.99	(220,143)		105.11	(162,482)		89.92
December 31	38,552,445	$	102.01	39,235,557	$	90.38	43,938,778	$	83.84
Options exercisable
December 31	27,262,062	$	85.97	27,502,208	$	81.42	32,038,228	$	79.58

Stock Option Assumptions

Stock Option Assumptions

	Annual									Progressive (Reload)
	2015			2014			2013			2015			2014			2013
Exercise price	$	165.94		$	126.72		$	101.49		$	—		$	—		$	109.84
Risk-free interest rate		1.5	%		1.9	%		1.2	%		—	%		—	%		0.2	%
Dividend yield		2.5	%		2.6	%		2.7	%		—	%		—	%		2.7	%
Volatility		20.1	%		20.8	%		20.0	%		—	%		—	%		16.3	%
Expected life (months)		76			75			75			—			—			12
Black-Scholes fair value	$	23.98		$	19.63		$	13.46		$	—		$	—		$	6.42

Restricted Stock Units and Restricted Stock Activity

Restricted Stock and Restricted Stock Units

The following table summarizes restricted stock and restricted stock unit activity for the years ended December 31:

	2015			2014			2013
		Weighted			Weighted			Weighted
		Average			Average			Average
	Number of	Grant Date		Number of	Grant Date		Number of	Grant Date
	Awards	Fair Value		Awards	Fair Value		Awards	Fair Value
Nonvested balance —
As of January 1	2,817,786	$	104.41	3,105,361	$	92.31	3,261,562	$	85.17
Granted
Annual	671,204		165.86	798,615		126.79	946,774		101.57
Other	26,886		156.94	78,252		152.74	44,401		111.19
Vested	(1,010,612)		89.99	(1,100,675)		90.37	(1,100,095)		79.93
Forfeited	(64,176)		118.99	(63,767)		97.23	(47,281)		90.82
As of December 31	2,441,088	$	127.47	2,817,786	$	104.41	3,105,361	$	92.31

Performance Shares Activity

The following table summarizes performance share activity for the years ended December 31:

	2015			2014			2013
		Weighted			Weighted			Weighted
		Average			Average			Average
	Number of	Grant Date		Number of	Grant Date		Number of	Grant Date
	Awards	Fair Value		Awards	Fair Value		Awards	Fair Value
Undistributed balance —
As of January 1	1,099,752	$	102.65	895,635	$	88.12	1,089,084	$	79.27
Granted	227,798		158.88	305,225		124.89	353,734		96.87
Distributed	(323,938)		83.08	(277,358)		84.74	(507,083)		75.16
Performance change	(106,760)		127.70	212,461		109.74	(6,949)		77.01
Forfeited	(25,660)		125.33	(36,212)		109.44	(33,151)		91.34
As of December 31	871,192	$	120.89	1,099,752	$	102.65	895,635	$	88.12

General Employees' Stock Purchase Plan (GESPP)

General Employees’ Stock Purchase Plan

	2015			2014			2013
		Weighted			Weighted			Weighted
		Average			Average			Average
	Shares	Exercise Price		Shares	Exercise Price		Shares	Exercise Price
Options granted	1,007,669	$	133.52	1,073,956	$	118.73	1,259,247	$	93.46
Options exercised	(1,007,669)		133.52	(1,073,956)		118.73	(1,259,247)		93.46
Shares available for grant - December 31	28,104,335			29,112,004			30,185,960