Quest Diagnostics 2000 Annual Report Download - page 5

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Getting Results Tomorrow We are the undisputed leader in diagnostic testing, uniquely
positioned for growth. Looking to the future, I am confident that our business strategy will yield
exceptional results, as we pursue our financial goals: double-digit top-line growth, EBITDA margin
improvement to more than 20%, and continuing growth in earnings per share of at least 40% in
2001 and at least 30% each year for the next several years.
Our Business Strategy Our three-pronged business strategy sets the framework for achieving
these goals.
The Undisputed Leader in Diagnostic Testing We see substantial opportunities in our
diagnostic testing business, which is growing after a decade of stagnation. Favorable demo-
graphic trends strongly support continued expansion. At the same time, the genomics revolution is
changing medicine, starting with new diagnostic and predictive lab tests. We are partnering with
pharmaceutical and biotechnology companies to develop new diagnostics and therapeutics. The
rise of consumer awareness in health care is creating new opportunities as educated baby
boomers take more responsibility for directly managing their own health. They want to order tests
and receive relevant information about their own health, and are willing to pay for it directly. We are
poised to extend our leadership position into these important new growth segments.
The Undisputed Leader in Health Care Insights We intend to be the leading provider of health
care insights. Because we perform so many tests on so many patients, we see things others
simply don’t see. We make those insights available to doctors and other health care providers to
enable better treatment decisions that lead to better patient outcomes.
For example, we provide a statistical analysis of individual laboratory test results to physicians
treating patients infected with HIV. This analysis predicts the response to different antiretroviral
treatment regimens. Additionally, our informatics capabilities allow us to help practitioners unearth
patterns of care, risk profiles and other information to help improve patient health. Getting better
information to health care providers is what it’s all about —combining key bits of information from
various sources and making them more readily available through secure information
technology. The convergence of laboratory science and information technology makes better
insights possible.
The ‘Gold Standard’ in Health Care We intend to be recognized as the gold standard for excel-
lence in health care. We see quality — in particular Six Sigma Quality — as the primary opportunity
to set Quest Diagnostics apart from the competition. Quality management is not a new concept in
well-managed industrial companies. However, it is nothing short of radical throughout most of the
health care industry. The widely publicized landmark study on medical errors published by the
Institute of Medicine in 1999 clearly indicates that a laser-like focus on quality is urgently needed in
health care. I am committed to lead this effort in our industry.
During 2000, we launched Six Sigma Quality with more than 30 projects to improve service quality
as defined by our customers. Nearly all of our employees have received training in the fundamen-
tals of Six Sigma Quality, more than 40 Black Belt quality experts have been trained and are
leading improvement projects, and several Master Black Belts have joined our company. We will
accelerate our investment in quality improvement in 2001.
Our Dedicated People Whenever two companies join together, there are challenges as well as
opportunities. Our management team and our diverse workforce of employee-owners have consis-
tently shown flexibility and commitment as we adjust our organizational structure and
decision-making processes to gain speed and increase focus on our customers. Again and again, it is
their dedication to embracing change that fuels our success.
Individuals are the heart of any great organization, and we owe a great deal to those who provided the
early leadership for our company. We were saddened during the year by the passing of two retired lead-
ers who helped establish Quest Diagnostics as an independent entity. We will miss the wisdom and
wit of Bob Carothers, our first Chief Financial Officer, and Ray Marier, our first General Counsel.
Our Bright Future Together Our industry has entered a new phase in its evolution. Diagnostic
testing and services are more relevant than ever in the health care equation. Quest Diagnostics is
the clear industry leader, positioned to deliver outstanding financial performance. We have the
people, the strategy, the commitment and the proven track record to make it happen.
Thank you for your trust. I look forward to a bright future together, as we continue to improve the
health of people by giving results—and getting results!
Kenneth W. Freeman, Chairman and Chief Executive Officer
00999897
Net Income*
($ millions)
*Before special items
18
27
41
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