palfinger at a glance

Risk Report
conSoliDateD MANAGEMENT REPORT / PERFORMANCE OF PALFINGER
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Strategic risks
ProDUct portfolio
The continuation of the ongoing integration projects in the relevant product divisions is of crucial
importance for the successful development of the Group. The identified potential synergies must be
exploited.
With its entry into the marine crane business, PALFINGER has firmly established itself in a promising
customer segment with great future potential that also supports further internationalization and
profitability enhancement.
Another important factor of success is the consistent continuation of turnaround projects with
effective control mechanisms. Professional project management as well as support through risk
management have the object of ensuring that the targets set will be reached.
Organization and corporate cULture
Within PALFINGER’s areas, the strengthening of the individual product fields has brought about
flexibility in meeting various local customer demands. At the same time, Group-wide standards have
been defined, particularly in supporting areas, to allow for the use of synergies.
The Asian markets are going to become more significant for PALFINGER, which will require adjustments
and changes to be made in the entire organization. In this connection, open-mindedness and
the willingness to recognize, understand and especially accept other work approaches and cultures
are important at all levels.
Internal risks relating to value creation
DeveloPMent
PALFINGER is faced with the challenge of regularly proving its technology leadership within its
industry and of adjusting new developments to the needs of the different markets. Customized
solutions offered by PALFINGER’s competitors may generate a market advantage for them, while
resulting in a loss of market shares for PALFINGER.
Close cooperation between the development and distribution departments and a strong regional
approach of the development projects are in place to ensure that PALFINGER maintains and/or
further expands its status as innovation leader.
Development work has fundamental consequences for the cost structure of future serial manufacturing.
Highly complex products also mean a high level of complexity in value creation and consequently
also high costs. At PALFINGER, process optimization starts at the development stage, thanks
to successful cooperation with the subsequent value-creation levels procurement and production
and PALFINGER’s focus on complexity management.
Important innovations have been secured by patents, and confidential information within the
Company is protected against unauthorized access.
Procurement
As the market upswing levelled off in the second half of 2011, delivery times in procurement
became shorter again. Nevertheless, in order to minimize risks, increasing attention is being paid,
particularly in the case of strategically significant materials and parts, to finding at least one
additional procurement option.
72 palfinger Annual Report 2011