Volvo 2006 Annual Report Download - page 19

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Highest quality in implementation
Enhancing productivity and cost-efficiency
The Volvo Group strives to continuously optimize cost-efficiency and pro-
ductivity in all parts of its operations. This contributes to increased profit-
ability and improves the Group’s capacity to handle economic fluctuations.
Part of the internal cost-efficiency work involves reducing production
costs and the costs for sales and administration. Product costs must be
constantly scrutinized and kept to a minimum to generate competitiveness
without compromising on quality.
The Volvo Group strives to be characterized by the highest quality. Getting
it right from the start increases customer satisfaction, keeps costs down
and saves time and energy.
The Volvo Group plans to continue with the introduction of the Volvo
Production System (VPS), which was designed to establish common pro-
duction processes throughout the Group. VPS increases flexibility and effi-
ciency in the industrial organization. It is also expected that VPS will create
value for customers through improved quality, more reliable deliveries and
reduced costs.
Execution in focus
A key competitive advantage in the commercial transport sector is the
capacity to be efficient and suited to purpose. The Volvo Group’s capacity to
handle development projects, combined with its ability to rapidly introduce
processes for new ways of working, contributes to improved results.
Maintaining expertise
The Volvo Group is growing in new geographic markets and developing new
technology, as well as meeting a number of demographic challenges. It is
therefore vital to develop the appropriate expertise to assure the Group’s
future competitiveness.
Diversity is a commercial driving force and a source of international com-
petitiveness and hence profitability. The Volvo Group is increasing its efforts
to benefit from the strength that stems from diversity in terms of gender,
age, ethnic background and education, among other areas.
The quality of leadership is another key success factor for the Volvo
Group’s capacity to generate future business.
We work continuously with our
processes with the aim to increase
quality and to optimize manufac-
turing.
3
A global group 2006 15