Waste Management 2008 Annual Report Download - page 7

Building a strong financial foundation takes
time. Keeping it strong takes a consistent,
disciplined strategy.
At Waste Management, we work hard on both
fronts. For the past several years, we have focused
on improving our business processes, reducing
costs, and generating better returns in exchange
for the value we provide our customers—in other
words, being efficient. That’s a valid strategy in
good economic times and an essential one when
the economy falters.
Our focus on operational improvement remains a
key contributor to our financial strength. We have
created a new operations and support structure
that aligns our company around 25 areas.
This consolidation from 45 market areas will
reduce our expenses to better reflect current
business volumes. It should also enable us to
emerge from the economic downturn as a stronger
company, well positioned for growth.
In 2008, we began the process of organizing our
sales programs around customer segments. This
will give our customers the benefit of working with
sales representatives who serve as a single point
of contact for all Waste Management services and
who are focused on specific businesses—from
refineries, automotive, manufacturing, and
chemical plants to healthcare, office buildings, and
others. We plan to target customer segments that
can best benefit from the range of services and
superior value that Waste Management offers.
We also developed a new tool to help manage
operational costs and fuel usage. All of our route
managers and district managers are being trained
to use this efficiency-focused tool that helps our
field operations flex costs to match the volume
of business.
Despite the economic challenges of 2008, we
achieved strong financial results. Income from
operations of our collection business improved
even though volumes declined, demonstrating the
effectiveness of our pricing and cost control
strategies developed over the past three years.
In 2008, we strengthened this discipline by using
the combined input of operations, sales, and price
management teams to ensure that we have a
competitive offering for new business
opportunities.
In 2008, our fuel surcharge program protected
our operating income during a time of volatile oil
prices, minimizing the impact of higher prices
and also allowing our customers to benefit when
prices fall.
2008200720062005
1.08
.96
.88
.80
Cash Dividends Paid Per Share
(declared quarterly)
$ 1.25
1.00
.75
.50
2008200720062005
1,756
1,703
1,474
1,092
Income Before Taxes
(in millions)
1,500
1,000
500
0
$ 2,000
5
2008 ANNUAL REPORT