Harman Kardon 2008 Annual Report Download - page 7

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5
Harman InternatIonal annual report 2008
premium brands in this large, fast-growing region. This initiative will also provide a template for expansion of
our activities in Russia and India.
To characterize the new energy of Harman International and to unify its voice, we have implemented programs
to strengthen both internal and external collaboration. A cross-functional team spanning executive manage-
ment, functional and geographic managers now guides key decisions. A new group Intranet and town hall
meetings with executives are reinforcing to employees the rewards of working as One Harman and embracing
key strategic principles. New corporate advertising and sponsorship activities will commence in the fall of
2008 to strengthen our brand presence and highlight the “star power” that characterizes every element of our
global business.
While facing up to challenge and opportunity, we have dramatically
sharpened the impact of our most important asset – People. New
initiatives are in place to attract, develop and motivate the best team
in the business. A measurable approach to compensation clearly
links group strategy and vision with rewards at every level. A clear
spirit of social responsibility remains in the forefront as we support
the communities where we operate and contribute generously to
those affected by natural disasters at home and around the world.
Complementing these initiatives, we launched a sweeping
productivity improvement program called STEP Change on July 1st. This 24-month initiative will employ
a “bottom up” approach, involving every level of the organization to deliver measurable operational and
structural cost savings. Consistent with and inclusive of the goals we outlined in February, this program is
targeted to yield about $400 million in sustainable enterprise – wide savings beyond 2010. Along with other
initiatives, STEP Change will contribute substantially toward lifting our company’s operating margins into the
double digit range.
As I reflect on my first year at the helm of Harman International, I am pleased but not yet satisfied with the
company’s achievements. Most important, I am energized by the opportunities that lie ahead. Just as Fiscal
Year 2008 was a year of dramatic transition, the next twelve months will be a time of decisive execution toward
our vision of achieving clear industry leadership in market impact, shareholder value creation, and profitable
growth. We will delight our customers by delivering a superior audio and infotainment experience, shaped
through an environment of innovation, operational excellence and integrity.
With our strategy and vision clearly defined, we will focus on measuring our progress and raising the bar
of our performance at every strategic milestone. Continuous improvement will be the guiding principle as
we leverage Harman’s robust product portfolio, talented people and global market opportunities to create
sustained value for our shareholders.
Best regards,
Dinesh C. Paliwal
Chairman and Chief Executive Officer