Henkel Annual Report 2011 - Henkel AG & Co. KGaA Annual Report ...

Henkel Annual Report 2011 Group management report
Strategy and financial targets for 2012
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Focus more on our customers
In order to place our customers right at the center
of all we do, we have prioritized expanding our
dialogue with them at the highest managerial
level (top-to-top contacts), coupled with the
further development of our customer partnership
structures. Our aims are to establish a joint
strategic approach to our markets, to expand
services offering measurable added value for our
customers, and to effectively leverage our own
competences, such as our leadership in the field
of sustainability.
Strengthen our global team
Our employees are our most important assets.
With clear and unequivocal feedback, discernible
rewards in recognition of individual performance,
and tailored development plans, we ensure that
our competent and motivated team can master
the challenges with which they are confronted.
We are keen to develop and promote our managers
from within. At the same time, we are also aware
of the need to bring in external talents, especially
when their knowledge of their local markets
is better than that of the established managerial
staff within the company. Already today, there
are people from more than 120 nations working
for Henkel; and the proportion of female managers
is around 30 percent worldwide, with the trend
clearly rising. The diversity of our global team
gives us a competitive advantage, one that we
intend to further extend.
Progress in fiscal 2011
We made further substantial progress in the pursuit
of our three strategic priorities in fiscal 2011.
The salient advancements were as follows:
Achieve our full business potential
• Despite major challenges and uncertainties
in the economic environment, all three of our
business sectors achieved very good results.
• We have further expanded our shared service
centers in Bratislava (Slovakia) and Manila
(Philippines), and have opened a third in Mexico
City (Mexico). In addition to increasing the
level of usage of these facilities for corporate
functions such as Finance, Purchasing and HR,
we have also transferred to them a number of
activities from our business sectors, for example
aspects of market research and certain controlling
functions.
Focus more on our customers
• We have further extended our partnerships
with customers and regularly meet with their
representatives at the highest management
level in order to identify further possible joint
projects.
• We have developed a new sustainability strategy
with goals extending through to 2030.
Strengthen our global team
• Throughout Henkel, there have been numerous
activities implemented in order to establish
the new vision and values introduced in 2010.
Together with their teams, all our line managers
have examined the implementation of the
measures agreed in 2010 as applicable to their
spheres of responsibility, and are continuing
to drive such activities forward.
• We have adapted our global short-term incentive
on the basis of the globally standardized system
developed in 2010 for differentiated assessment
of the performance and development potential
of our managerial staff.
Financial targets 2012
In 2008, we set ourselves financial targets for
2012 which we intend to achieve through diligent
pursuit of our strategic priorities.
Financial targets 2012
Annual organic sales growth (average):
3–5 percent
Adjusted 1 return on sales (EBIT):
14 percent
Annual growth in adjusted earnings per
preferred share (average):
> 10 percent
Despite major challenges and uncertainties in
the economic environment, 2011 was a successful
year for us: We achieved strong organic sales
growth of 5.9 percent and succeeded in increasing
adjusted return on sales by 0.7 percentage points
to 13.0 percent. Adjusted earnings per preferred
share came in at 3.14 euros, an increase of 11.3 percent
above the level of 2010.
1 Adjusted for one-time charges/gains and restructuring charges.