Whirlpool 2005 Annual Report Download - page 9

Dave Swift, President, Whirlpool North America
More than ever, Whirlpool people are bringing to life our
vision of “Every Home, Everywhere, with Pride, Passion and
Performance.” Based upon a unique set of core competencies,
we are delivering innovative products and services that
customers value, which is driving growth and value for
shareholders. Our strategy is working.
Executing our strategy requires a unique toolkit of
competencies that we continue to build for our people globally.
The starting point of building new competencies is what
we call “Customer Excellence” — our ability to proactively
understand and anticipate the needs of customers. Customer
Excellence is a collection of tools that allows our people to
analytically assess and prioritize the needs and desires of
customers along all aspects of the purchase cycle — from
when they first might investigate an appliance on a web site,
to the in-store experience on a retailer’s floor, to the features
and aesthetics of the product, to the installation and service
experience, and ultimately to their need to repeat this cycle.
With these consumer insights in-hand, we then turn them into
customer solutions through our innovation tools. As a result,
our innovation capability has produced a robust pipeline of
products, achieving a steady-state estimated value of over $3
billion. Our 2005 innovation revenue is more than twice the
amount in 2004. Our knowledge of customers, coupled with
our innovative customer solutions, is driving the attractiveness
of our brands and creating greater value for our shareholders.
Additionally, we’ve extended Six-Sigma practices
into non-manufacturing areas of our company to create an
important tool we call “Customer-Centered Operational
Excellence.” This process enables our people to constantly
improve upon the way they do their jobs, saving time and
money while contributing directly to meeting customer needs.
Each of these tools are
being used by our people
around the world to better
serve our customers,
improve our performance
and create value for
shareholders.
Mike Todman, President, Whirlpool International
In addition to our unique toolkit of competencies, we also
are aggressively building certain operational capabilities
and rapidly taking what we learn about our business in one
part of the world and applying it globally. Specifically, these
capabilities include being the best cost producer through our
productivity efforts, delivering the highest levels of customer
quality, and enhancing the mix and value of the products sold
– collectively helping to improve margins.
Our operational discipline focuses on achieving
efficiencies, which in turn creates resources to fund our
innovation efforts. Through the use of lean manufacturing and
Six-Sigma tools, our 2005 non-material cost productivity gains
increased year-over-year, helping to offset the unprecedented
rise in material costs we faced during the year. At the same
time, we successfully increased our best-cost regional
manufacturing sourcing to approximately 40 percent this year,
up from 35 percent in 2004. And, we’re well on our way to
successfully achieving our goal of sourcing about 50 percent of
our manufacturing from low-cost production by 2007, while
still ensuring we are the best cost, best quality producer in all
our locations.
Product quality is another ongoing priority for
Whirlpool. We continue to rapidly build upon our capabilities
to achieve “best in class” quality status within the industry.
Accordingly, our people are strengthening the Whirlpool
Quality Excellence System across our organization.
During 2005, more consumers continued to validate
our innovative solutions. To make the selection of our
products easier, we’ve developed training tools to educate retail
salespeople and trade customers on the appropriate choice of
our innovative products to meet consumer needs. This effort
has enabled us to sell a richer mix of products and improve
upon our margins.
Each of these
capabilities is embedded in our
strategic global councils representing the functional
disciplines of marketing, sales, manufacturing,
finance, technology and customer service in each
region of the world. Collectively, they are at the
heart of our business strategy and vision to improve
how we serve our customers and to exceed their
expectations in “Every Home, Everywhere.”
Message from the Presidents Core Competencies and Operational Capabilities
Mike Todman, President, Whirlpool International
Dave Swift, President, Whirlpool North America