Diversification "out of the box" - Roland Berger
Diversification "out of the box" - Roland Berger
Diversification "out of the box" - Roland Berger
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EXAMPLEAustralian conglomerate Wesfarmers manages businessesunits successfully as "portfolio investor"Role <strong>of</strong> <strong>the</strong> center> Full autonomy <strong>of</strong> business units (homeimprovement, coal, insurance, industrial & safety,chemicals & fertilizers, energy, o<strong>the</strong>r)> Active portfolio management with good M&A trackrecord (incl. smart shopping) and deep pocketsallowing for longer-term approach> Performance culture grounded on financialperformance (ROC) measures and value-basedmanagement in combination with risk managementand incentive systems (e.g. stock options)> Strict appliance <strong>of</strong> corporate governance rules andshareholder value approach> Focus on development <strong>of</strong> managementemployees (corporate center as pool <strong>of</strong> talentedresources)Share price vs. index [%]700600500Wesfarmers400300 ASX200100031.08.199831.08.199931.08.200031.08.200130.08.200229.08.200331.08.200431.08.200531.08.200631.08.200729.08.2008Source: Thomson financial, Wesfarmers annual report, Press research, <strong>Roland</strong> <strong>Berger</strong>47