Whirlpool 2004 Annual Report Download - page 5

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Creating unmatched customer loyalty for our
brands is the cornerstone of our strategy. This simple idea
is based on an in-depth understanding of our customers'
needs, wants and expectations, so that we can consistently
deliver unique, innovative solutions to meet or exceed
those expectations. By consistently satisfying our
customers, we will create a distinctive and valuable brand
franchise that will continue to reward all of our
stakeholders in the years ahead. The benefits will be seen
in the form of faster growth due to repeat and cross-brand
purchases, proactive recommendations among consumers
and higher margins due to the willingness of customers to
pay for the value they receive.
The success of our strategy depends on knowing the
rational and emotional drivers that build customer loyalty
for a brand. Our organization has made the comprehensive
understanding of customer loyalty one of our core
competencies. We have translated our extensive customer-
focused market research into training programs and
practical applications so employees and trade partners can
better understand both the customer and their role in
building loyalty. In 2004, more than 10,000 Whirlpool
people completed customer loyalty training sessions and
participated in unique customer-focused exercises, such as
buying experiences and serving as brand ambassadors for
friends and families.
Delivering a continuous stream of innovation to
consumers is central to our strategy because it ensures that
we are providing a brand experience unmatched within
the appliance industry. To accomplish this, our people at
every level are harnessing creative thinking and turning it
into market realities. Innovation is ingrained in the
Whirlpool culture, with over 5,000 employees trained and
actively involved in innovation initiatives. Our people
have contributed thousands of ideas, with hundreds of
commercial concepts currently in our innovation pipeline
at various stages of evaluation and development. This rich
set of ideas and projects has the potential to generate
approximately $2 billion of additional revenue growth in
the years ahead.
Building strong relationships with trade partners is
crucial to building lifelong loyal customers for our brands.
To make sure our customers have a positive experience with
those who sell our products, we “partner” with retailers and
builders who share our commitment to exceeding
expectations for customer service and quality.
Our business model is based on developing efficient
and effective business-to-business systems and an
integrated supply chain that ensures products are available
when and where our customers want them. The strategic
alignment is built around innovation, training, customer
service and total customer experience–the areas where
customer loyalty begins. This shared customer perspective
creates opportunities as well as value for Whirlpool, our
trade partners and our customers.
Improving global operating efficiency is a
fundamental requirement to meeting the expectations of
our customers and shareholders. Our teams employ
rigorous processes and measurement tools to ensure the
efficiency of our global operating platform and leverage
the assets of our operations worldwide. By managing each
of our facilities from a global perspective, our asset-
utilization rates, productivity and quality assurance
systems are driving toward best-in-class levels within the
global major home appliance industry.
To achieve this, we set aggressive goals and use a
disciplined approach to evaluate progress. Since 1997,
we have successfully applied Six Sigma and Lean
Manufacturing processes across our global operating
platform, and certified over 1,500 black belts and master
black belts. Consequently, we are generating millions of
dollars in annual cost savings.
Today, 34 percent of our manufacturing production is
located in low-cost locations, and Whirlpool exports
between regions now represent 15 percent of sales, which
further improves our asset efficiency. Additionally, we are
• Best consumer position
• Best trade position
• Best cost position
A Differentiated Value Creation Strategy
Global Operating Platform
Best Trade Position
Best Customer Position
Total Cost Productivity
Quality
Working Capital
Fixed Asset Turnover
Best Cost Position
Partnerships
Coverage
Share of Business
Cost to Serve
Trade Management Platform
Customer Loyalty Platform
Customer Focus
Brand Focus
Innovation
Growth