Increase operational effectiveness

In September 2008, we announced planned restructuring savings of €100 million, which was increased by an additional €100 million in savings announced in early 2009. We are on track to deliver this €200 million in cost savings and the improvements we have made are already visible in our 2009 results. In fact, during the year, we realized €300 million of cumulative annualized restructuring savings. Given the uncertainty in the market environment, we will continue to look for opportunities to improve our processes and performance.

A particular focus for improvement is in mature markets, where we continue to consolidate manufacturing and distribution facilities. The cost savings brought about by this consolidation will help us to generate the financial flexibility we need to invest in high growth markets where the growth prospects are stronger.

Operational effectiveness goes beyond restructuring to cover all aspects of cost and cash management. Our operating working capital (OWC) initiative aims to realize a structural and sustainable improvement in the level of working capital in our businesses. We have increased our management focus on this important topic and are encouraging the application of best practices. An example is shown on the right.

Another key area for operational effectiveness is energy and waste reduction. Work in this area provides two important benefits: reduced costs and improved environmental footprint.

OWC improvement efforts in Industrial Chemicals

  • Targeted incentives
  • OWC champions at key decision points
  • Development of OWC dashboard including detailed targets for the OWC components
  • OWC manual
  • OWC challenge (competition) to harvest our BU best practices.


Operating working capital development per quarter
Operating working capital development (bar chart)

Non-reusable waste reduction at Surface Chemistry

Surface Chemistry has been able to reduce its non-reusable waste by more than 20 percent by switching to higher purity raw materials and eliminating a product purification step using clay, which was previously treated as non-reusable waste.

Non-reusable waste in kilotons
Non-reusable waste in million tons (bar chart)
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