Business International Gallia, 10 4 03
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Transcript of Business International Gallia, 10 4 03
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Francesco Picconi www.merloni.com [email protected]
The Rewarding Challenge
Milan, April 10th, 2003
2
Merloni Elettrodomestici at a glance
Headquarters Headquarters Headquarters Headquarters Fabriano - Ancona (Italy)
Production facilitiesProduction facilitiesProduction facilitiesProduction facilities 16 plants in 7 countries
Annual salesAnnual salesAnnual salesAnnual sales 13 m appliances
Major BrandsMajor BrandsMajor BrandsMajor Brands2 global: Ariston, Indesit3 regional: Scholtès, Stinol,Hotpoint
Commercial presenceCommercial presenceCommercial presenceCommercial presence Subsidiaries in 21 countries
European market shareEuropean market shareEuropean market shareEuropean market share 15%
TurnoverTurnoverTurnoverTurnover 2002 2.5 bl € (2003 > 3.0 bl€)
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Merloni Elettrodomestici: a success story
1975 2001
250
500
750
1,000
1,250
1,500
1,750
2,000
20 Times in
20 Years
Focus on household appliances, moving from Italy to “Big Europe”
Today we have a well balanced product mix equally split among cooking, cooling and washing
Today we have a well balanced geographical presence and market shares
From the 300th to the 3rd position in Europe by market share
•
•
•
•
Turnover, Mln. €
Merloni Elettrodomestici was created in 1975 from the Household Appliances Division of Industrie Merloni, a company founded in 1930 by Aristide Merloni. It Is
the youngest and most successful multinational in the sector
4
5
Our vision
To be the European leader in
producing innovative solutions,
to create day after day,
the quality of time
6
• Quality: CAGR (00-02, Rev) = 20% CAGR (00-02, EBIT) = 42%
• Basis: Acquisition choice and
integration capabilities Good mix of organic and
acquisition growth
• Quality: CAGR (00-02, Rev) = 20% CAGR (00-02, EBIT) = 42%
• Basis: Acquisition choice and
integration capabilities Good mix of organic and
acquisition growth
Growth = focused organic growth + good acquisitions + fast integrations
Organic Growth
Organic Revenues’ Growth, M EUR
1999 2000
1,419
2001 2002
182
138
240
CAGR 11.7%
CAGR 11.7%
• Maintaining momentum
• Optimizing scale effects
• Exploiting synergies
• Maintaining momentum
• Optimizing scale effects
• Exploiting synergies
• 12 acquisitions in 25 years
• 1/3 international
• Experience in acquiring and
integrating
• 12 acquisitions in 25 years
• 1/3 international
• Experience in acquiring and
integrating
STARStinol
Indesit
Sch-oltes
1977 1980 1982 1986 1987 1988 1989 1992 1995 1995 2000 2001
Fri-Sado
Smeg
Colston
Philco
Fab-Por.
Pekel
New World
: International Acquisitions: Italian Acquisitions
Hot-point
STARStinol
Indesit
Sch-oltes
1977 1980 1982 1986 1987 1988 1989 1992 1995 1995 2000 2001
Fri-Sado
Smeg
Colston
Philco
Fab-Por.
Pekel
New World
: International Acquisitions: Italian Acquisitions
Hot-point
Acquisitions History
Acquisitions Total Growth 2000 - 2002
53%47%
Organic
Acquired
The “One Single Company” concept (1 organization, 1 structure, 1 manufacturing network, …)
enables Merloni to realize synergies from acquisitions fast and efficiently
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Merloni inside
Entrepreneurial
Simple & online
Even if listed is a family owned company driven operationally by the entrepreneur until 1996Entrepreneurship is in the DNA
Flexible, quick and fast in decision taking. Adapting quickly to continuously changing scenarios
Young The youngest company in the sector. Young in spirit. Growth is an obvious objective
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Organization and HR are critical for performance and growth
Annual Performance Appraisal
Annual Performance Appraisal
Annual Salary Reviews
Annual Salary Reviews
Jan
Feb
Mar
Apr
May
JunJul
Sep
Oct
Nov
Dec
First Half Year Performance Review
First Half Year Performance Review
Objective setting
HR Performance
Review
HR Performance
Review
HR Commitee organization
overview
HR Commitee organization
overview
HR Commitee
people overview
HR Commitee
people overview
HR Organization
Review
HR Organization
Review
Aug
4th Qtr 1st Qtr
2nd Qtr3rd Qtr
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HIGH
MEDIUM
LOW
BELOW THE STD(1-2)
STANDARD3
ABOVE THE STD(4-5)
H.R. Evaluation MATRIX - ……………………
POTENTIAL
PERFORMANCE
Eagle
Solid
Better use
BackboneNot for Merloni
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REWARDS SYSTEMS: OUR JOURNEY
ITALY-CENTERED
BASED ON
ITALY-CENTERED
BASED ON
FROM
ONE COMPANY. ONE COMMON COMPENSATION APPROACH
• AGE
• CONTRACTUAL LEVEL
• POINTS
• MARKET SALARY SURVEYS
EUROPEAN / GLOBAL
BASED ON
EUROPEAN / GLOBAL
BASED ON
• ONE GLOBAL GRADING LINKED
TO MARKET SALARY SURVEYS
TO
} ITALY
} ABROAD
}WORLDWIDE
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• ASSIGNMENT OF ABOUT 140 ROLES TO ONE BAND AND ONE GRADE(WITHIN THE BAND)
• 3 BROAD BANDS BETWEEN THE C.E.O. AND THE CLERICAL ROLES
• ABOUT 14 GRADES TO MAP THE MERLONI ROLES WORLDWIDE
• DIRECT LINK OF THE GGS WITH SALARY SURVEYS IN ALL MERLONI COUNTRIES
• HR ROLES IN THE ASSESSMENT PROCESS:
• TIMING: GGS UP AND RUNNING BY END OF JUNE 2003
THE GLOBAL GRADING IN A NUTSHELL …
– HR DIRECTOR FOR EXECUTIVE BAND
– K.A.’S FOR MANAGERS AND PROFESSIONALS
– O.D. MANAGER AS THE SYSTEM ARCHITECT
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TOP
The Merloni Grading System
ONE COMPANY SYSTEM FOR PROMOTIONS / COMP & BENS PLANNING / DEVELOPMENT
TOP
EXECUTIVES
MANAGERS
PROFESSIONALS
JUNIOR PROFESSIONALS (IF GRADUATE)OR
CLERICALS (IF NOT GRADUATE)
DIRIGENTI
QS
Q
PROXYTO THEITALIANCONTRACT
SHORTGRADUATES
ENTRY LEVEL
GRADUATESENTRY LEVEL
LO
NG
TE
RM
INC
EN
TIV
E P
RO
GR
AM
ST
OC
K O
PT
ION
S
TA
RG
ET
ME
RIT
CA
R
ME
DIC
AR
E
MB
O
3 PROFESSIONAL BANDS- EXECUTIVES- MANAGERS- PROFESSIONALS
SP
EC
IAL
BO
NU
SE
S
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MERIT POLICY: THE APPROACH
GUIDELINES FOR ITALY (AGE / CONTRACT / POINTS)
COUNTRY BASED DECENTRALIZED APPROACH FOR ABROAD (MARKET SALARY SURVEYS)
SELECTIVE IN ITALY (BUT COVERAGE HIGHER FOR PROFESSIONALS THEN FOR MANAGERS!)
VERY TACTICAL ABROAD
GUIDELINES FOR ITALY (AGE / CONTRACT / POINTS)
COUNTRY BASED DECENTRALIZED APPROACH FOR ABROAD (MARKET SALARY SURVEYS)
SELECTIVE IN ITALY (BUT COVERAGE HIGHER FOR PROFESSIONALS THEN FOR MANAGERS!)
VERY TACTICAL ABROAD
FROM
THE CHALLENGE: KEEP THE FLEXIBILITY TO MANAGE TALENTSIN A MORE STRUCTURED FRAMEWORK
TO
COUNTRY BASED POLICY DRIVEN BY- MERIT BUDGET- COMMON GRADES- CLOSER LINK TO PERFORMANCE (GUIDELINES BY GRADE AND PERFORMANCE LEVEL)- POTENTIAL
CLEAR RULES OF THE GAME… …BUT ALLOW FLEXIBILITY TO MANAGE TALENTS
COUNTRY BASED POLICY DRIVEN BY- MERIT BUDGET- COMMON GRADES- CLOSER LINK TO PERFORMANCE (GUIDELINES BY GRADE AND PERFORMANCE LEVEL)- POTENTIAL
CLEAR RULES OF THE GAME… …BUT ALLOW FLEXIBILITY TO MANAGE TALENTS
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GRADE INITIATIVEBASE SALARY(TARGET %)
EXECUTIVES MBO 30%
MANAGERS MBO 20%
PROFESSIONALS TARGET 15%
PURCHASING TARGET PURCHASING 15%
SHARED SERVICE CENTER TARGET SSC 10%
COMMERCIAL COMMERCIAL INCENTIVE PLANS AD HOC
SPECIAL BONUSES AD HOC
MBO / TARGET / SPECIAL BONUSES
THE CHALLENGE: REWARD PERFORMANCE LINKED TOCOMPANY / GROUP / INDIVIDUAL GOALS & SPECIAL GROUP EFFORT
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STOCK OPTIONS
- PLAN LAUNCHED INTERNATIONALLY IN 2000
- TODAY IS AIMED AT: * EXECUTIVES (100%) * MANAGERS (58%)
* HI-POT PROFESSIONALS (10%)
- PRICE: AVERAGE OF THE MONTH BEFORE THE ASSIGNMENT DATE
- VESTING PERIOD: * 50% OF OPTIONS EXERCISABLE AFTER 2 YEARS * 100% OF OPTIONS EXERCISABLE AFTER 3 YEARS
- OTHER FEATURES: * MINIMUM 1 YEAR OF SENIORITY IN THE COMPANY * EXPIRATION AFTER 10 YEARS FROM THE ASSIGNMENT DATE
- PLAN LAUNCHED INTERNATIONALLY IN 2000
- TODAY IS AIMED AT: * EXECUTIVES (100%) * MANAGERS (58%)
* HI-POT PROFESSIONALS (10%)
- PRICE: AVERAGE OF THE MONTH BEFORE THE ASSIGNMENT DATE
- VESTING PERIOD: * 50% OF OPTIONS EXERCISABLE AFTER 2 YEARS * 100% OF OPTIONS EXERCISABLE AFTER 3 YEARS
- OTHER FEATURES: * MINIMUM 1 YEAR OF SENIORITY IN THE COMPANY * EXPIRATION AFTER 10 YEARS FROM THE ASSIGNMENT DATE
THE CHALLENGE: BIND KEY MANAGERS AND HI-POT PROFESSIONALS TO MERLONI, LINKING A
SIGNIFICANT PART OF THEIR COMPENSATION TO MEDIUM / LONG TERM COMPANY RESULTS
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Thank you !
The Merloni HR Gardeners