2Provide Unilever with the platform to deliver sustainable growth Path to Growth identifies what we will do to deliver on our promises to shareholders:Increase revenue growth to 5% per annumIncrease operating margin from 10% to 15% by 2004Deliver an incremental €2.7billion in operating profit by 2004Provide Unilever with the platform to deliver sustainable growthNote: Figures do not include Bestfoods
3Why do we need the Path to Growth? Unilever Share Price Performance v Peer Group “Shadow”Unilever Share Price Performance v Peer Group “Shadow”UnileverPeer Group:Beiersdorf,Avon, Cadbury, Clorox, Coca Cola, Colgate, Danone, Eridania, Gillette, Heinz, Kao, Lion, L’Oreal, Nestle, P&G, Philip Morris, Reckitt Benckiser, Sara Lee, Shiseido, PepsicoPeer Group(Based on Quarterly Average Share prices)The Market is concerned about our ability to execute our strategy
6World Class Supply Chain We aim to:Close the gap to world class in supply chain within three yearsBy:Establishing a Global Buying programmeEstablishing a world class manufacturing programmeResulting in (approximately):100 fewer manufacturing sites€€1.6 billion buying savings by end 2002€€0.5 billion manufacturing savings per annum
7“The only way to safeguard our position is to perform, to deliver, and to grow our business.”
8Supply Chain - What does it take to succeed? Depth and breadth of the Supply Chain Professional SkillsAn excellent overall understanding of the business, it’s processes and their linkagesBusiness behavioursOutstanding performanceSlide 15. What does it take to succeed in the Supply Chain?Secondly, in addition to the Competencies, it takes depth and breadth of the SC Professional skills acquired over time by working in a range of SC jobs (more on that in a few moments).However it takes more than just competencies and skills. It takes an overall understanding of the business and its processes and an ability to act not just as a SC professional, but also as a businessman.Business awareness gives insight to break existing paradigms and create growth opportunities. This is essential to progress to more senior levels in the SC.Lastly, but by no means least, to succeed in the SC takes a track record of outstanding performance at each level.
9The Supply Chain Process Model PlanSourceMakeDeliverSupply Chain Mission & StrategyBrand DevelopmentCustomerDevelopmentSuppliersConsumers&CustomersInformation ManagementHuman Resource ManagementQuality & Business ExcellenceFinance ManagementSafety, Health & EnvironmentTechnology Management
10Supply Chain - the Heart of Operations Plan/SourcePlan/MakePlan/DeliverPlanning links the processes togetherSlide 11. The Heart of operationsEach SC sub-process requires planning. Planning also links the sub-processes together. It is therefore critical to optimisation of SC performance.Because It guides our everyday life working in the SC requires a thorough knowledge of the planning process.
11Driving Value Creation in the Supply Chain ‘Beating the Fade’:continuous innovation and cost savingsGrowth through:making new products availableimproved distributionbetter customer serviceIncreased margins through:cost savings along the supply chainoverhead cost reductionreducing complexityCapital efficiency improvements:minimising investment in plant & equipment and inventoriesThese elements together contribute more than 50% of Unilever’s total Value Creation
12Organisational Development Business has moved, and continues to move, towards process managementEmergence of Supply Chain process rolesA career in the Supply Chain requires development of breadth and depth of skills, Leadership competencies, and experienceSlide 5. Organisational DevelopmentsBefore we focus on career management, it is worth while spending a few minutes to review the organisational developments against which any discussion about careers has to take place. The move towards process management, the emergence of single integrated supply chain structures, regional sourcing and e-commerce have changed and enhanced the role of the Supply Chain. To equip ourselves for this new role we must build our professionalism to higher levels.
13What do Supply Chain people in Unilever do? Roles in different parts of the organisationfactoriesregional supply chainsbusiness groupscorporate centreRoles:with strategic focusin a more operational environment,Roles in various parts of the supply chain: Plan–Source–Make–DeliverRoles which focus onthe multi-local aspects of the business at a national or regional levelthe multinational aspectsRoles in related professions, e.g. R&D, Customer ManagementRoles in QA, SHE and Technical ManagementSlide 13. What do Supply Chain people in Unilever do?SC managers work in a wide variety of roles. They cover both operational and strategic activities. They can be in one of the main sub-processes (Plan, Source, Make or Deliver) or in enabling processes such as QA, Technology and SHE.The trend in is toward integrated management of the SC in which SC managers deliver value by leveraging their professional capabilities and business understanding.The content and focus of SC roles vary according to specific organisational and business environments. SC managers can expect to (and should) undertake a number of different types of role during their career.
14Building Successful Careers Focuses On: Processes and tools used in career developmentKey career building blocksCareer phasesThe need for breadth and depth of skills and experienceThe impact of each individual’s potentialThe importance of tactical and strategic career planningThe need for a global perspectivePlanning life and careerSlide 7. Building successful careersThe general booklet “Building Successful Careers” focuses on the eight major components of career management. Some of these are processes and tools; some are guidance about the general requirements the business has set down; and some are personal to each individual.
15Building Careers - Key Principles ProfessionalSkillsExperiencePerformanceLeadershipCompetenciesSuccessful careers are based on outstanding performance founded on skills, competencies and experience
16Building Careers - Key Principles ProfessionalSkillsExperiencePerformanceLeadershipCompetenciesSuccessful careers are based on outstanding performance founded on skills, competencies and experience
19What is the Leadership Growth Profile? It is :A leading edge competency model that focuses on driving growth throughout the businessA tool for development and assessment of performanceBy helping our leaders grow, we will grow our businessApplicable to everyone at WL2 and above
20Why we need to develop Competencies? SUPERIOR JOB PERFORMANCECompetenciesKnowledge & SkillsPersonal characteristics (values, traits, motives) shaping HOW the job is undertakenMeasured by clearly observable behaviourTransferable knowledge and abilities (professional and general) to do WHAT is required by the jobMeasured by demonstrated capability
21What are Competencies?“ … underlying characteristics that are directly related to superior performance in a given role”skills - what you know how to do e.g. make an effective presentationknowledge - what you know e.g. theories of effective presentationself image - how you see yourself e.g. public speakervalues - what you think is important e.g. achieving excellencetraits - relatively enduring characteristics e.g. self-control ‘big picture’ thinkingmotives - the unconscious factors that drive behaviour; they are intrinsically satisfying and rewarding e.g. achievement
22The Iceberg ModelA competency: any characteristic of a person that differentiates outstanding from more typical performance in a given job, role, organization or culture.}SkillKnowledgeValuesSelf-ImageTraitsMotives}AcquiredcapabilityNecessary butnot sufficientDistinguisheffectiveperformanceDeeper seatedtraits andmotives
23Competencies are: observable and measurable behavioural characteristics that can be developedbased on the business needs of today and tomorrowfactors which drive superior performance in a given job
24How was the LGP developed? Step 1:Was developed by a rigorous research process:Assessment of Unilever’s business context, the challenges facing leaders and the capabilities needed to achieve growthIn-depth research of 39 Unilever ‘growth’ leadersInterviews and feedback from colleaguesComparison of the Unilever ‘growth’ leadership characteristics to a world-class benchmark sampleLarge international organisationsAchieved substantial growth in own sectorsResult: LGP was rolled out to WL6 and 5 in 2000
25How was the LGP developed? Step 2:Focus groups and interviews with WL2, 3 and 4 in 14 countries around the worldTested relevance and made relevant adjustmentsResult: Now rolling out to all WL2+ managers across Unilever
26How were the Criteria Established? Original Research Compared and Contrasted Two GroupsCurrentSuperiorLeadersCurrentOutstandingLeaders“Baseline”CompetenciesBoth groups show“Distinguishing”CompetenciesOnly outstanding show
27How were the External Benchmarks used? Compared both groups to competencies required to meet the future strategy and against the external benchmark populationCurrentSuperiorLeadersCurrentOutstandingLeadersExternalbenchmarkof ‘worldclass’leaders“Baseline”Competencies“Distinguishing”CompetenciesPotentialVulnerabilitiesEven the best need to show more
28What makes a world-class leader of growth? World-class leaders of growth:Driven by bigger ambition and drive for step changeGenerate and encourage ‘big’ thinkingAre highly ‘street smart’ and savvyThink and act over a longer term perspectiveEnergise others for significant changeDemonstrate a greater focus on individuals - developing, empowering and holding them accountableUse highly effective influencing strategies to gain support: they know how to orchestrate the organisation - colleagues, bosses, their teamsHow does Unilever measure up?Although the best of the Unilever sample demonstrates these behaviours and creates growth orientated climates, we are often still more ‘controllers’ than ‘enablers’ in our leadership style.We are good, but we know we can be better
29How is the LGP different? Directly related to our current business agenda - GrowthExternally benchmarked against the bestOne set of competencies for all levelsCreates a focus on development of outstanding leaders at every levelIt is easily modified to support future new business goalsAs a result, LGP will replace the ‘Effective Unilever Manager’ competencies
30Leadership Growth Competencies Supply Chain - What does it take to succeed?Leadership Growth CompetenciesBuilds Commitment to GrowthStrategic InfluencingTeam CommitmentTeam LeadershipPossesses the intellectual power to determine directionEnsures that direction is market drivenDrives for GrowthSeizing the FutureChange CatalystDeveloping Self & OthersHolding People -AccountableEmpowering OthersClarity of PurposePractical CreativityObjective Analytical PowerMarket OrientationAchieves through integrity, teamwork and learningSelf Confident IntegrityTeam CommitmentLearning from ExperienceDelivers through peopleActs decisively to improve performanceCreates a Growth VisionPassion for GrowthBreakthrough ThinkingOrganisational AwarenessLeading OthersDeveloping OthersInfluencing OthersEntrepreneurial Drive
31LGP - The Levels Four levels: Example: Passion for Growth Foundational DevelopingGrowthWorld ClassExample: Passion for GrowthFoundation LevelDeveloping LevelGrowth LevelWorld Class LevelAre highly motivated to achieve their personal targets in order to contribute to the sustainable profitable growth of the businessAre ambitious for excellence and constantly search for opportunities to improve the businessSet challenging growth goals for themselves and others and put into place plans to achieve theseTake significant entrepreneurial action and ask “what is possible?” to ensure growth opportunities are realised
32LGP - The Levels (continued…) Behaviours needed to demonstrate World Class are very stretchingThis reflects our business targetsWe can’t have significant growth without an incremental shift in behaviourBut…..These behaviours are not beyond our capabilitiesWe need to make our people development a higher priorityTo help people assess their performance against the profile, target criteria have been established for each work level
33Passion for Growth Does this person DEMONSTRATE DRIVE BEYOND EXPECTATION TO DELIVER outstanding results?Outstanding individuals radiate a Passion for Growth, the personal drive that enables individuals to go the extra mile in delivering excellent performance. They recognise that everyone has a contribution to make to ensure that Unilever achieves its growth objectives. Outstanding individuals constantly push the boundaries of excellent business, ask big questions about what is possible and then take significant entrepreneurial action over time to expand the horizons of the business. Success is the delivery of sustainable profitable growth. .Foundation LevelDeveloping LevelGrowth LevelWorld Class LevelAre highly motivated to achieve their personal targets in order to contribute to the sustainable profitable growth of the businessFocus on business improvement and are ambitious for excellence, constantly search for opportunities to improve the businessSet challenging growth goals for themselves and others and put into place plans to achieve theseTake significant entrepreneurial action, and ask “what is possible?” to ensure growth opportunities are realisedAmbitious to hit set targets and standardsDeliver on commitments made to othersPersist in overcoming obstacles to successTake full responsibility for delivering their contribution to the businessMeasure performance against internal and external benchmarksMake specific changes to improve performance (e.g. re-engineer processes to be faster, more efficient)Focus on raising quality and customer and consumer satisfactionStimulate and encourage others to bring about performance improvement for the businessCreate stretching but achievable goals to align own activities with growth initiativesAim to find and realise new growth opportunitiesAlign own activities and goals with growth initiativesAim for performance excellence through own effortsStimulate growth by bringing about step change improvementsAim to make the impossible possibleEntrepreneurially commit significant investments to reap major rewardsDefy conventional wisdom and internal opposition to achieve major growthCreate new markets by exploiting growth opportunitiesObsess with growth and focus on delivering new ways to gain competitive advantageNegative Indicators:Too busy dealing with immediate, urgent issues to look for new growth opportunitiesSettle for the status quo - take no action to improve mediocre performanceEasily side-tracked from important growth goalsUnconcerned about missing deadlines or failing to meet business objectivesDo not take responsibility for contributing to growth objectivesLinks with: Organisational Awareness
34No negative indicators LGP Guideline criteria for work levelsWL3WL4WL5WL6WL2Two in each cluster at Growth including one of Seizing the Future and Change Catalyst and one other from the same clusterNo negative indicatorsMost competencies at Developing level. At least one competency in each cluster at Growth levelMeets WL4 target and has one World Class competency in each of two clustersMeets WL4 target and has at least one World Class competency in each clusterMore competencies at Developing level than at Foundation
35Using the LGP and Competencies Coaching &MentoringPDP/DevelopmentTalentManagementLeadershipGrowthProfileRankingReward forGrowthListing
36Where has LGP been used so far? Already used for:Assessment of all WL5 and WL6Personal development planning for WL5/6Executive selectionOne element of WL4 assessment in Unilever/Bestfoods merger
37Going Forward - Future Uses of LGP The LGP will be used in:PDP - in all organisations for WL2 and above by 2002/2003 PDP cycleIndividual performance and capability will be assessed against the LGP competencies based on previous years’ dataSelf-assessment and personal development planningListingRanking for WL4 (others may follow)Assessment, selection and recruitment of all posts at Graduate level and above
38Next Steps for youAccess the ‘How good can I be?’ document on the HR website [address] to understand the model, the competencies within it and how to use the modelStudy the target criteria for your role and work level in the documentConsider your strengths and development needs against the modelWork with your manager and your employees (either in the PDP process or independently) to identify critical gaps to close - and build and implement an action plan
39Building Careers - Key Principles ProfessionalSkillsExperiencePerformanceLeadershipCompetenciesSuccessful careers are based on outstanding performance founded on skills, competencies and experience
40Supply Chain Professional Skills Job Skills ProfileAbilities to do the job wellnow + future.Person Skills ProfileMy current abilities.GAP ANALYSISPersonalDevelopmentPlanDifference
41The New Skills Framework for Supply Chain Supply Intelligence & Strategy DevelopmentContract Agreement/Arrangement & ManagementIntegrating Supplier Value into the BusinessDriving Production Performance ImprovementInfluencing & Implementing Product & Process InnovationMaintenance & Project EngineeringCore2. Integrated Supply Chain Modelling and Design1. Extended Supply Chain Strategy Development & DeploymentMakeSource3. Supplier (& Contractor) Relationship 4. Developing & Implementing/Economic Management Supply Chain Innovation6. Managing Quality, Safety (& Environment) 5. Formulation, Process &Packaging KnowledgePlan7. Optimising Supply Chain Operations PerformanceCustomer Service Development & ManagementWarehousing and Distribution ManagementChannel Logistics DevelopmentIntegrated/Collaborative Supply Chain PlanningOperational Planning & ForecastingMaterials ManagementKey GeneralBusiness EconomicsNegotiation & InfluencingSupporting Sustainable DevelopmentUsing Information TechnologyPeople ManagementProject Management(HR) Employee RelationsR & D Development SkillsDeliver
42Building a Supply Chain career Learn the Trade Career Building Blocks Experience - WL2at least 2 of the 4 Supply Chain sub-processes (Plan, Source, Make, Deliver).(especially those with Finance/Business backgrounds): Technology as a Supply Chain enabler.
43Building a Supply Chain career Act as a Businessman Career Building Blocks Experience - WL3As a Supply Chain leader at WL3 you will need to gain experience in:managing in an integrated SCleading a SC sub-process at regional level
44Building a Supply Chain career Strategy into Action Career Building Blocks Experience - WL4As a Supply Chain Director at WL4 you will need to gain experience in:operational management of integrated supply chainsleading strategic development of Supply Chain or sub- processes at regional/international level (BG/ Corporate/Category)
45The Supply Chain Career Platform: My Professional Development There are Supply Chain jobs at every level in UnileverProgress to senior levels by moving through challenging jobs.Unique experience of working in positions of different typesWork alongside other business processes, including:Financial ManagementCustomer DevelopmentBrand Development.Slide 20. Your Professional developmentThere are SC jobs at every level in Unilever and therefore there is every opportunity to progress to senior levels by moving through challenging jobs.The SC also offers the opportunity to work in many different types of environments and increasingly with other business processes such as Customer Management and Brand Development.And some managers, given their breadth of experience in the SC and General skills, will use their background as a basis for moving into “unit general management”, e.g. a company chairman type of role.
46The bottom line: Unilever is a Meritocracy Whatever the career route, Supply Chain managers canbe assured that:Unilever’s focus on performance, and the use of objective means by which to assess skills, experience, competencies and potential,will lead the best managers to reach the most senior levels in the business.
47Slide 22. What do you do next. Use PDP to develop skills and competenciesUse each career step as a learning experienceBe realistic about your own potentialDeliver outstanding performanceSlide 22. What do you do next.These are the four guiding principles which you should keep in mind to give you the best chance of maximising your own potential.* use PDP to develop skills and competencies* use each career step as a learning experience* be realistic about your own potential, and* deliver outstanding performance.Finally: If you deliver your targets you will always get noticed. And if you consistently meet tough targets you can be assured that your career will prosper.