Harman Kardon 2011 Annual Report Download - page 7

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5
HARMAN ANNUAL REPORT 2011
landmark HARMAN STEP Change
program, launched in mid 2008 as
the global economy edged closer
to recession. We acted early and
aggressively with nearly 250 separate
measures targeted to deliver $400
Million in cost and productivity
savings by Fiscal Year 2011.
Through the hard work of hundreds of
people across the HARMAN team and
deep culture change at every level,
we exceeded the STEP Change target
three months ahead of plan, and have
realized $434 Million in permanent
savings as of fi scal year end. Every
element of our organization has
benefi tted from these improvements,
from deep restructuring and global
footprint optimization to common
global processes and supply chain
agreements that bring new cost
effi ciency to the way we work. We
will carefully guard these savings
while using many of our STEP Change
initiatives as the model for additional
improvements.
Recognizing that HARMAN employees
are integral to this success, we
continue to empower our team
through innovative programs. The
annual HARMAN People Cycle
includes regular evaluations, clear
target setting for the year ahead, and
compensation strategies that clearly
link employee pay with performance
toward both individual and group
goals. In addition, we operate
specialized learning and development
programs at many levels. During 2011,
for example, we certifi ed some 50
people to the standards of the Project
Management Institute and some 60
others engaged in advanced Lean Six
Sigma training.
Reaching out to the communities
where we live and work also remains
a priority at HARMAN. During
Fiscal Year 2011, our employees
actively supported such prominent
organizations as Habitat for Humanity,
the United Way, Toys for Tots and the
Salvation Army. Following the recent
earthquake and tsunami in Japan, we
raised some $200,000 in Red Cross
relief funds through employee and
corporate contributions.
It was with deep sadness that we
marked the passing of a distinguished
member of the HARMAN community
during 2011. Dr. Sidney Harman, our
company’s Founder and Chairman
Emeritus, passed away in April
following a brief illness. Dr. Harman’s
friendship and support will be deeply
missed, but his legacy will endure in
the caring culture across the company
that bears his name. In recognition of
his lifelong passion for learning, we
have established the Sidney Harman
Vision Scholarship to support the
children of employees with higher
education goals.
As of July 1, 2011, we have further
optimized the HARMAN structure
to sharpen the focus on profi tability
in our large infotainment business.
The former Automotive division has
been split into separate Infotainment
and Lifestyle divisions. The former
Consumer division is being merged
into the newly-created Lifestyle
division to bring together automotive
audio, consumer audio, car
aftermarket and luxury audio under
one management structure.
The Professional Division remains
largely unchanged.
I am very proud of the eff ort our
team has made during Fiscal
Year 2011 – sharply focused on
the strategic fundamentals of
innovation, execution, and continuous
improvement. I am very fortunate to
have partnered with a world-class
Executive Committee and Board of
Directors, whose diverse business and
cultural expertise enrich our global
operations immeasurably. I am also
grateful for the continued support
of our customers and shareholders,
whose candid feedback is vital for
measuring our progress. We remain
committed to leveraging this trust
as we work closely together to take
HARMAN to the next level of success.
Best regards,
Dinesh C. Paliwal
Chairman, President and
Chief Executive Offi cer