BMW 2012 Annual Report Download - page 69

69 COMBINED GROUP AND COMPANY MANAGEMENT REPORT
supplier risk evaluation questionnaires and external
sustainability audits. In addition to managing risk,
we are also constantly on the alert to identify oppor-
tunities, including options for using resources more
efficiently.
The risk of certain suppliers suffering capacity bottle-
necks rose during the period under report, mainly
reflecting the growth in volumes that needed to be
handled in 2012. Material supplies were nevertheless
fully assured at all times by means of appropriate early-
intervention measures.
Sales and marketing
The regional spread of sales, the composition of the
model mix, and hence the volume of related services,
is
constantly changing. Sales and production processes
within the BMW Group are flexible enough to allow
new opportunities to be exploited at short notice. We
also offer new and attractive services whenever changes
in demand patterns warrant it.
Personnel
As an attractive employer, for many years we have en-
joyed a favourable position in the intense competition
for qualified technical and management staff. Having
a satisfied and motivated workforce is a key factor for
success. Training programmes for new employees re-
cruited from specific target groups and attractive per-
sonnel development programmes make it easier to re-
cruit and further the careers of highly qualified staff
and protect the Group from the risk of know-how drift.
Demographic change will have a lasting impact on con-
ditions prevailing on employment markets, giving rise
to risks and opportunities that are likely to affect busi-
nesses to an increasing degree in the coming years. We
see demographic change as one of our main challenges
and we are taking a proactive approach to softening
the
impact it is likely to have on operational processes.
Our key focus is on creating an optimal working envi-
ronment for the future, promoting and maintaining the
workforce’s ability to perform with the appropriate set
of skills, increasing employees’ awareness of health is-
sues and the development of individual employee work-
ing life-time models aimed at retaining a motivated
workforce in the long term.
We encourage diversity within the BMW Group’s work-
force. Heterogeneous teams comprising men and women
from a variety of cultural backgrounds and differing age
groups are often more productive and show greater
innovative skill.
Risks relating to pension obligations
Risks arise for the BMW Group in conjunction with
obligations relating to defined-benefit pension plans.
Pension obligations to employees under such plans are
measured on the basis of actuarial reports. Future pen-
sion payments are discounted by reference to market
yields on high-quality corporate bonds. These yields are
subject to market fluctuation and influence the level
of pension obligations. Furthermore, changes in other
parameters, such as rising inflation, also have an impact
on pension obligations.
Most of the BMW Group’s pension obligations are ad-
ministered in external pension funds and the assets of
those funds kept separate from Company assets. As a
consequence, the level of funds required to finance pen-
sion payments out of operations will be substantially
reduced in the future, since most of the Group’s pension
obligations are settled out of pension fund assets. In
the case of the UK pension fund, the risk of the rising
life expectancy of pensioners has also been hedged. The
pension assets of the BMW Group comprise interest-
bearing securities with a high level of creditworthiness,
equities, property and other investment classes. Pension
fund assets are monitored continuously and managed
from a risk-and-yield perspective. Risk is reduced by
ensuring a broad spread of investments which are struc-
tured to coincide with the timing of pension payments
and the expected pattern of pension obligations. In their
own way, each of these measures helps to reduce fluc-
tuations in pension funding shortfalls.
Information, data protection and IT risks
We attach great importance to protecting individual
rights, business secrets, innovation and process infor-
mation from unauthorised access, damage and / or mis-
use. The protection of information and data is an inte-
gral component of our business processes and based on
International Security Standard ISO / IEC 27001. Staff,
process design and information technology each play a
role in our comprehensive risk and security concept.
The requirement to apply uniform standards across the
Group is embedded in the BMW Group’s core princi-
ples and documented in detailed working instructions.
These instructions require employees to handle all in-
formation (such as customer and employee data) appro-
priately, ensure that information systems are properly