Daimler Annual Report 2011 - Alle jaarverslagen

Procurement market risks. Procurement market risks arise
for the Group in particular from fluctuations in prices of
raw materials. After the price increases in raw-material markets
of the years 2009 and 2010, prices continued to follow
that trend with high volatility until the middle of 2011. Market
uncertainty due to the European debt crisis led to prices
remaining flat or actually falling for many raw materials in the
second half of the year. The development of raw-material
prices and their volatilities in the past three years also reflect
worldwide expansive monetary policies as well as diverging
economic expectations in the United States, Western Europe
and Japan compared with the emerging markets. The outlook
for future price developments remains uncertain, due in particular
to the ongoing development of the debt crisis and the
increasing influence of institutional investors. That influence
can be seen in the stronger demand for commodity investments,
and is exacerbating the high volatility of prices in rawmaterial
markets. Vehicle manufacturers are generally limited
in their ability to pass on the higher costs of commodities and
other materials in higher prices for their products because
of the strong competitive pressure in the international automotive
markets. Daimler continues to counteract procure ­
ment risks by means of targeted commodity and supplier risk
management. We attempt to reduce our dependency on individual
materials in the context of commodity management,
by making appropriate technological progress for example.
Daimler protects itself against the volatility of raw-material
prices by entering into long-term supply agreements, which
make short-term risks for material supplies and the effects of
price fluctuations more calculable. Furthermore, in connection
with some metals, we make use of derivative price-hedging
instruments. Supplier risk management aims to identify
suppliers’ potential financial difficulties at an early stage and
to initiate suitable countermeasures. Also after the recent
crisis years, the situation of some of our suppliers is still difficult
due to the tough competitive pressure. This has necessitated
individual or joint support actions by vehicle manufacturers
to safeguard their own production and sales. In the context
of supplier risk management, regular reporting dates are set
for suppliers depending on our assessment of them, in which
key performance indicators are reported to Daimler and any
required support actions are decided upon.
Information technology risks and unforeseeable events.
Production and business processes could also be disturbed
by unforeseeable events such as natural disasters or terrorist
attacks. Consumer confidence would be significantly
affected and production could be interrupted by supply problems
and intensified security measures at territorial borders.
Information technology plays a crucial role in our business
processes. Storing and exchanging data in a timely, complete
and correct manner and being able to utilize fully functioning
IT applications are of key importance for a global group such
as Daimler. Risks of occurrences which could result in the
interruption of our business processes due to the failure of IT
systems or the loss or corruption of data are therefore identi ­
fied and evaluated over the entire lifecycles of applications and
IT systems. Daimler has defined suitable actions for risk
avoidance and limitation of damage, continually adapts these
actions to changing circumstances, and monitors their
implementation. These activities are embedded in a multi-stage
IT risk management process. For example, the Group minimizes
potential interruptions of operating routines in the data
centers by means of mirrored data sets, decentralized data
storage, outsourced archiving, high-availability computers and
appropriate emergency plans. In order to meet the growing
demands placed on the confidentiality, integrity and availability
of data, we operate our own risk management system for
information security. Despite all the precautionary measures
that we take, we cannot completely rule out the possibility
that IT disturbances will arise and have a negative impact on
our business processes.
Reputation. The general public is becoming increasingly
aware of companies’ behavior in matters of ethics and sustainability.
Compliance of corporate actions with applicable law
and ethical principles is essential for the Daimler Group. Furthermore,
customers and capital markets critically observe
how the Group reacts to the technological challenges of the
future and the extent to which we succeed in placing up-todate
and technologically leading products on the market. Dealing
securely with sensitive data is also a precondition for conducting
business relations with customers and suppliers in
a trusting and fair environment. Daimler applies comprehensive
packages of measures so that risks affecting the Group’s
reputation are subject to formal internal controls.
Specific risks in the area of human resources. Daimler’s
success is highly dependent on the expertise and commitment
of its workforce. Competition for highly qualified staff and
management is still very intense in the industry and the regions
in which we operate. Our future success also depends on
the extent to which we succeed over the long term in recruiting,
integrating and retaining executives, engineers and other
specialists. The application of our human resources instruments
takes such personnel risks into consideration, while contributing
towards the recruitment and retention of staff with high
potential and expertise and ensuring transparency with regard
to our resources. One focus of our human resources manage ­
ment is on the targeted personnel development and further
training of our workforce. Our employees profit for example
from the range of courses offered by the Daimler Corporate
Academy and from the transparency created by LEAD, our
uniform worldwide performance and potential management
system. Because of demographic developments, the Group
has to cope with changes relating to an aging workforce and
has to secure a sufficient number of qualified young persons
with the potential to become the next generation of highly
skilled specialists and executives. In addition it might can come
to impacts on production in Germany due to collective wage
bargaining.
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