Mercedes 2012 Annual Report Download - page 97

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Despite the worsening economic environment, the year
2012 also drew to a successful conclusion. Therefore, the eligi-
ble employees of Daimler AG in Germany will once again be
rewarded with a fair and appropriate performance participation
bonus. We will inform of the exact level of that bonus as soon
as the Board of Management and the Group Works Council have
decided on criteria for the performance participation bonus
with long-term validity. The payout is planned for April 2013
as usual.
Average age at prior-year level. The average age of our
employees worldwide in 2012 was 41.9 (2011: 41.9). In Germany,
the average age of the employees was 43.1 (2011: 43.0). In
our core workforce in Germany, the proportion of employees
who are 50 or over is currently 30%. That proportion can
increase to approximately 50% in the next ten years. This demo-
graphic trend will be accelerated by wage-tariff and statutory
conditions such as retirement at the age of 67.
In order to meet the challenges presented by this demographic
development, we have firmly anchored generation management
in our human resources strategy. The management of an aging
workforce requires on the one hand workplaces appropriate
for older people, and on the other hand the safeguarding of our
employees’ knowledge and experience.
Employees’ average period at the Group and proportion
of women in management positions. The average period
for which Daimler employees have been at the Group was close
to the prior-year level at 15.8 years in 2012 (2011: 15.9). At
the end of the year, Daimler Group employees in Germany had
been with us for an average of 18.8 years (2011: 18.8); the
average for employees of Daimler AG was 19.1 years (2011: 19.0).
The average period for our employees outside Germany was
11.0 years (2011: 11.2). Women accounted for 14.4% of the total
workforce of Daimler AG at the end of 2012 (2011: 13.9%).
In management positions of Levels 1 to 4, the proportion of
women increased from last year’s 12.4% to 13.4%.
Procurement
Global procurement activities. The Daimler Group’s procure-
ment organization consists of three departments – Procurement
Mercedes-Benz Cars and Vans, Procurement Daimler Trucks
and Buses, and International Procurement Services for non-
production materials – and is present at more than 50 locations
all over the world. The goal of the procurement organization
is to create the world’s most effective supplier network and thus
to contribute to Daimler’s overall success. The best suppliers
are recognized each year for their outstanding performance
with the Daimler Supplier Award. In the context of the Daimler
Key Supplier Meetings in 2012, we also awarded a special
prize in the category of “Partnership” to our Japanese suppliers.
Above all, this was to honor the exceptional commitment
of our Japanese partners with the reconstruction of the supply
chain after the natural disaster in March 2011.
Performance-oriented partnership with our suppliers.
Under the “Commitment to Excellence” motto, the Daimler
Supplier Network (DSN) defines the business philosophy
of Daimler’s procurement organization. Its principles are perfor-
mance and partnership: With the help of the external balanced
scorecard, suppliers’ performance is measured in the categories
of quality, technology, costs and reliability. To us, partnership
means fairness, dependability and credibility.
Sustainability and integrity in procurement. In order
to be successful also in the future, we take our responsibility
to the environment and society very seriously. Our suppliers
are contractually obliged to fulfill the standards we have defined
in the areas of business ethics, environmental protection and
human rights. In addition, they are also required to propagate
those standards in their upstream value chains. We support
our suppliers with this task by providing targeted information
and extensive possibilities to obtain further qualifications.
The central information platform for this is the Daimler Supplier
Portal. In 2012, we reformulated our principles and the
expectations we place on our suppliers with regard to the topic
of integrity, and communicated them to our suppliers around
the world in the form of a brochure.
Expansion of local sourcing activities. Daimler is expanding
its procurement activities in international markets. In the future,
we want to purchase more from local suppliers – especially
in those countries where we are expanding our production activ-
ities. In 2012 for example, we started various activities for
the development of local suppliers and sub-suppliers in the BRIC
countries.
Prices of raw materials remain volatile. Market uncertainty
in connection with the European sovereign-debt crisis once
again led to large price fluctuations in raw-material and capital
markets in 2012. After the economy-related fall in raw-material
prices in late 2011, the trend reversed in early 2012 and led
to significant price increases, especially in the first quarter.
As the year progressed, somewhat lower raw-material prices
were offset by the euro’s loss in value. Overall, the development
of prices continued to be very volatile. Daimler protects itself
against price fluctuations with a number of measures, including
long-term agreements and hedging transactions.
Continuous risk management. In the year 2012, we continued
to regularly monitor the financial development of our suppliers
in the context of our risk management. We focused on refinanc-
ing, the development of working capital and the continuation
of productivity-enhancing projects. Due to the great importance
of suppliers for our production processes, the Daimler Supplier
Risk Board convenes regularly. If required, it also develops
and decides on measures so that we can react at short notice
to any potential supplier insolvencies.