Our Compass strategy - Unilever

customers come shopping. We have
developed a unique capability for this
collaboration with retailers: the 5 Step
Approach, which helps to identify
inefficiencies and designs specific
solutions. We work alongside customers
to improve our systems and theirs.
The global programme has increased
our OSA to 92% † .
Quality
We are determined that consumerperceived
quality is at the core of all that
we do. We are intensifying our focus on
quality at every level of the organisation
and at every step in our processes,
from the raw material to presentation
on the shelf – and our results have been
encouraging. In 2010, we had 11% fewer
consumer complaints and market quality
incidents were down 46%.
Advantages of global scale
Our global reach is the envy of many
competitors and we need to make the
most of our opportunities for finding
efficiencies through scale. Key areas we
are focusing on include procurement
and business services.
Procurement
Our move to a single global procurement
strategy has brought significant benefits.
We have achieved significant savings
in indirect spend. Success like this gets
noticed – Unilever’s Marc Engel was
named Chief Procurement Officer
of the year at the International Supply
Management Congress.
A phased global supply chain change
programme gives an idea of the scope
and pace of improvement. Rolled out first
across Europe and Asia, we launched the
programme in the Americas in April 2010
to create a new business unit, the Unilever
Americas Supply Chain Company, which
will become operational in late 2011.
Bringing together common systems and
processes across all Unilever’s supply chain
operations, this will deliver even better
service to our customers and consumers
around the world.
Business services
Business services account for nearly half
of Unilever’s indirect costs, and they can
benefit from economies of scale and
qualitative improvements just as much
as the supply chain. In April 2010 we
launched Enterprise Support (ES) as
our global shared services organisation,
bringing together our HR, IT, finance,
workplace and information management
support services. ES has already secured
new global contracts with providers like
BT, Vodafone and Accenture as part of
a drive towards better services for less.
The best return on brand
and customer investment
Unilever is the second biggest advertiser
in the world. In 2010 alone, we spent
around €6 billion on advertising and
promotions. Improving the return on our
brand and customer support is one of the
most effective ways to achieve growth.
We do not accept that this sort of return
on investment cannot be measured –
and we have challenged everyone in
the business to consider this return and
find ways to improve it.
The result has been an increase in rigour
across the board; in 2010 we ran over
500 more advertising pre-tests, and more
than doubled the number of projects
that were tracked globally. We expanded
our analytical modelling and created a
strategy for improving agency costs and
trade promotional spend.
Report of the Directors About Unilever
Top products delivered
5to cus0tomers
faster
%
€6bn
spent on advertising and
promotions in 2010
† Unilever’s OSA measurement
considers both Out of Stock
(OOS) and Void.
Winning at the shelf
When shoppers go into a store, we want them
always to find our products on the shelf. That sounds
simple – but we can lose millions of sales globally
because our products are not displayed to best
advantage. ‘On-shelf availability’ is so critical to our
success that we have devised an industry-leading
collaboration with customers: Unilever experts go
into a retailer’s operations to coach staff through our
5 Step Approach. For example, Ian Christian (right)
has been working in numerous stores and retail head
offices in Europe, helping customers boost their sales
– and ours.
Unilever Annual Report and Accounts 2010 17