II. Summary Here is background of BASF Company. BASF is leading chemical company on the world market. It has four production market departments: Europe, North America, South America and Asia. Moreover, the production of the company is separate in sex different segments: Chemicals, Plastics, Performance Products, Functional Solution, Agricultural Solution and Oil & Gas. The department located in Germany is oriented in production of personal care products, so called Performance Products. BASF does not sell product to the final customer. Its products are intermediates like catalysts, molecules and raw materials, which are used from other manufacture companies. The main mission of the company is to produce products for sustainable future. The report objective is to analyzing the external and internal environment of BASF Company. This is useful for understanding the company`s current situation. Based on these analysis, this report gives recommendations to the company, how to keep its position on the market and to use on the best way its opportunities. Research information was collected in the fallowing way. Firstly, was done the secondary research. For it the main source was internet.
Secondly, the primary research was done by conducting an interview with Mrs. Sengel, who is member of Executive Board of the company. Finally, based on collected information the company`s strengths, weaknesses, opportunities and threats was analyzed with used of SWOT analysis. Based on the analyzed information, research results are as fallow. BASF is leading company on chemicals market. One of the company`s strength are so called Verbund sides – perfect conglomerates between different departments of the company. Every product produced in the company is used in the most efficient way. BASF has opportunity to rising commodity chemicals market in regions like Africa, Asia Pacific and Middle East. The company is negative influenced by some economical factors like increasing energy prices and current credit crisis. Moreover, the negative political factors which influence the company are different laws and regulars in European Union about Genno – modified products and some kind of molecules. The threat for the company is raising competition. In conclusion, BASF is leading company with a lot of strengths and opportunities. There are some external threats, which influence the company. Nevertheless, if the company use its own potentialities and hold on external negative factors, it can develop its market positions and to expect its great future.
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Recommendations are as fallow. Firstly, the most important thing for the company is to make innovations. This gives opportunity to BASF to be better than competitors. The company can develop the business if it is oriented to the market place in new development countries like Asia and Middle East. Secondly, internal environment of BASF will be better if there are more common and strictly rules for the employees of every department. Moreover, the company has to hold the good communication within the different departments. Finally, if company makes more researches it will know better the customer’s needs and demands. To close, BASF has to do everything possible to create products for sustainable future.
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III. Preface Here is the framework within which this report has been written. This report functions as a final output of PLA1-Project Organisation of Business. During this project, we worked in a group of students. Our purpose was to analyze a chemistry company – BASF located in Dusseldorf, Germany. This is how we made our purpose, reality. During lectures, we studied theories of primary and secondary research, useful for analysis of a company. After that, we did secondary research into BASF`s internal organization. Furthermore, we did interview with Mrs. Sengel, who is member of Executive Board of the company. All of this data, our group prepared a group file. Finally, the collected information was analyzed. Based on this analysis, the individual report was written, that now lies before you. In this report, I address the fallowing audience. My primary audience is my lecture M.Sc. M.Hajjoubi, who will graduate my report. My secondary audience is every person who works in BASF Company and who is interested in read it. I would like to express my gratitude to the fallowing people. First, I would like to thank to my group members – Simon Braun, Muzzeyen Gundoghu, Anna Wolter, Ivet Mladenova, Mo Vania and Radu. It was pleasure and really useful experience to work together with you as a team. Secondly, I would like to express my sincere appreciation for our PLA1`s lecture M.Sc. M. Hajjoubi, whose consultations, guidance, understanding and patience support us from our fist week till the end of this project. Thirdly, special thanks are due to Miss. C. Jacobs, for her efforts and guidance to improve our language skills. Last but not least, I proffer my heartfelt thanks to Mrs. Sengel with who we made our interview. Without contribution of these people, this analysis would not have been possible.
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Juveniles may well be the most maligned age around in our society myths abound about their contribution to crime and the extent of damage for which they are responsible. The ones who are involved in delinquent behavior are young youths between the ages of 18 – 21 years. According to the study done by the Citizen Television (TV) on June 2012, young boys between the age of 15 yrs to 18 yrs are ...
Place: Venlo, the Netherlands 11th November, 2012 Eleonora Georgieva
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Table of contents – PLA1 report
Title page Summary Preface Table of contents Glossary 1. Introduction 2. Company description 2.1 General company description 2.2 Product description 3. Project description 3.1 Project description 3.2 Project aim 3.3 Research approach 4. Theoretical framework 4.1 External analysis 4.2 Internal analysis 4.3 SWOT overview 5. External analysis 5.1 Political factors 5.2 Economic factors 5.3 Social factors 5.4 Technological factors 6. Internal analysis 6.1 McKinsey 7S framework 6.2 Interconnection of the 7s 7. SWOT overview 8. Conclusion 9. Recommendation 10. Critical appraisal Reference list Appendix 1 15 І ІІ ІІІ ІV V 1 2 2 2 3 3 3 3 4 4 5 6 7 7 7 7 7 8 8 9 11 12 13 14
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V. Glossary PEST Analysis – Political, Economical, Social and Technological factors which are analyzed SWOT Analysis – Strengths, Weaknesses, Opportunities and Threats analysis R & D – Research and Development department
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1. Introduction To start, here is the macro perspective on BASF Chemical Company. BASF is one of the leading chemical companies in the world, like this BASF is influenced by many political and economical factors. Different laws and regulations determine the production of the company. Moreover, the technological factor has hardly influence in this area of chemical production, where the innovations are leading force. In addition, the main mission of the company is to create chemistry for the sustainable future. Consequently, BASF Company has a lot of strategic methods to achieve its goals. This report has some objectives. To start, one of the main objectives of the report is to analyze BASF Company. To show the strengths and opportunities of the company`s future development. On the other hand, this report presents the weaknesses and threats of the company, for which it gives advice to make BASF more successful. In other words, this report aims to gives advice to BASF Company how to improve its internal and external situation. The following information was collected for this report. For collecting of information were used two main research methodologies. First, secondary research was done on micro and macro environment of BASF Company, for which the main source was used internet.
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Second, the primary research was done by conducting an interview with Mrs. Sengel, who is member of Executive Board of the company. The report has the fallowing structure. In chapter two, BASF Company and its product line are shown. In chapter three, the project`s description and aim are explained. Chapter four of the report is the Theoretical Framework of the report, in which the McKinsey`s seven S model, PEST analysis and SWOT analysis are theoretically described. In chapter five and six, PEST analysis and McKinsey`s seven S model are attached to collected information. PEST analysis is used to analyze BASF`s eternal environment, while the McKinsey`s model is used to analyze BASF`s internal organization. In chapter seven, is shown SWOT analysis based on the collected information. In chapter eight the conclusions based on the analyses are drawn. In chapter nine, recommendations for company improvement are given. In chapter ten, this report is critically appraised.
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2. Company description 2.1 General Company Information Here is general information about BASF Company. BASF is the leading chemical company, which chemicals are used in almost all industries. The production of the company is separate in six different segments: Chemicals, Plastics, Performance Products, Functional Solution, Agricultural Solution and Oil & Gas. BASF like an International company has 70 global and regional business units around the world. The department in Germany is thoroughly oriented in produce of Performance Products. BASF combine economic success, social responsibility and environment protection. The main mission of the company is to create chemistry for a sustainable future. BASF’s 111, 141 employees, located all over the world, help the company to achieve its goals. BASF is market oriented in four main areas: Europe, North America, South America and Asia. In 2011, the most sales are made in Europe and company`s annual turnover amounted to 73, 5 billion Euros. 2.2 Product Description Germany`s department of BSAF has a broad range of products. The main segment is called Performance Products, which includes the fallowing product lines: Dispersions and Pigments, Care Chemicals, Nutrition and Health, Paper Chemicals and Performance Chemicals. The product portfolio of the company in this segment includes vitamins and foods additives, ingredients for pharmaceuticals and for hygiene, home and personal care items. Examples are products for hair care, sun and decorative care, body care, facial and oral care. The company does not offer products to the final client. BASF develop and sale molecules, catalysts and ingredients to the other companies which use this things for manufactures of products for final client. These things are not end- product; they are intermediate products which go to other steps of the production process.
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3. Project description This chapter will give project description. The chapter will be separate in tree sub chapters, which will describe project description, project aim and research approach. 3.1 Project description This sub chapter will show the project description. To start, BASF is one of the leading chemical companies on the world market. In this market there is a big competition. Firstly, the future opportunity for the company is to create new products. Secondly, to find new market`s possibilities. Thirdly, one of the most important things in this branch is innovation. On the whole, to achieve its goals, BASF have to understand its own strengths and weaknesses. 3.2. Project aim The purpose of this sub chapter is to explain the project aim. For this project was collected information about external and internal environment of BASF Company. The aim of this project is to understand the company`s situation based on McKinsey 7S analysis, PEST and SWOT analysis and based on it to give recommendations about BASF`s future development. Furthermore, to show BASF`s strengths, weaknesses, opportunities and threats. In other words, these are most important factors which describe present situation and future possibilities for one organization. 3.3 Research approach To start, for analysis of BASF Company`s present situation are used two research methods. First, the primary research was done by conducting an interview with Mrs. Sengel, who is member of Executive Board of the company. This information is used for internal analysis of the company. Second, the external environment is analyzed by secondary research method. This includes McKinsey 7S analysis and PEST analysis. Thirdly, the strengths, weaknesses, opportunities and threats are described with use of SWOT analysis. In conclusion, all of collected information is used to give recommendations of the company, about its future development.
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4. Theoretical framework The purpose of chapter four is to show the theoretical framework of internal and external analysis. Hence, the real company’s situation will be shown. First, in sub-chapter 4.1 will be shown the internal analysis- McKinsey 7S model. The model include seven elements, which are separated in so called hard S`s – Strategy, Structure and Systems and four so called soft S`s – Shared Values, Skills, Staff and Style. Second, in 4.2 will be discusse the external PEST analysis. In other words, Political, Economic, Socio-cultural and Technological factors that influence the company will be include. Finally, in 4.3 SWOT- overview of the company will be given. 4.1 Internal analysis Figure 1: McKinsey 7S model
Source: 7S strategy software In this paragraph will be shown the so called hard S`s of McKinsey 7S model. Firstly, Strategy describes actions and plans of an organization to achieve specific goals. The external environment influences the company and its strategy. Thus the enterprise prepares to adapt on changes and to determine the right place among customer and competitors. Secondly, Structure describes the hierarchy of the company. It shows the relationships between the people which work in the organization. It can be seen on the organization chart. It always depends from the business strategy, form the business internationalization, size and diversity. The third “S” from so called hard S’s is Systems. Systems are all procedures which company uses to operate every day. This includes internal and external procedures. Systems are directly related to the Structure and Strategy of the company, because they describe the main practices of the organization to achieve its goals (Cuypers 2010, 3-9).
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The soft “S” from McKinsey 7S model, which will be given in this paragraph includes – Shared Values, Skills, Staff and Style. Peters and Waterman’s (1984) argued that shared Values in 7S analysis determine the core guiding principles of the company. Moreover, it refers to what an organization stands for and believes in. Understanding the Shared Values of the company is the easiest way to find the main ideas and goals of the enterprise. To achieve these goals helps Skills. Skills are the unique abilities of the company. Skills describe the capacity and quality of the company in contrast with the competitors. It refers to the learned capability of staff within the company. Very important here is quality of the products and services within the organization. These things are related with the Staff and Style of the company. Staff refers to the number and type of people employed by the company. However, staff describes the processes used to manage the careers of employees. It is related to the Style, because it is directly dependent on the human resource’s system that manage the way staff is encourage, reward and motivate. Style is the work culture. It is describe the main way in which senior managers run the organization. It is related to the system that influences the procedures in the company. The most important things that style describes are how managers allocated their time, beliefs and their leadership skills. The main factors are the size and the structure of the organization which determines how different departments inside of the company are managed (Spencer, 2011).
4.2 External analysis In the first place, every organization depends on the political factors. Political factors include government regulations and legal issues. The political factors define the structure of the company and the rules under which the company must operated. It depends on the structure, because in the different countries the trade restrictions, tariffs, tax policy and employment laws are not the same (Oxford University Press, 2004).
The second factor which directly influences every kind of company or organisation is the economic factor. The economic environment consist different factors, for example income and income distribution, current and project economic growth, inflation and interest rate. This environment can offer to the company both opportunities and threats. Understanding of economic environment determined the company development (Oxford University Press, 2004).
Thirdly, the company is influenced by social factors. This lifestyle trends and demographic changes determined the consumer behavior. The main purpose of every company is to understand which exactly are the consumer’s wants and needs. If social-cultural changes are clear, it is easier for the company to developing strategies and practices to achieve its goals (Oxford University Press, 2004).
Finally, in these days, one of most important factors which influence the company is technological environment. This is the most dramatic and the fastest development factor. These are forces that create new technologies, products and market opportunities. In the world of technology, the company has to be open and prepare for new opportunities (Oxford University Press, 2004).
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4.3 SWOT According to Berry, the SWOT analysis is an extremely useful tool for understanding and decision-making for all sorts of situations in business and organizations. SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats (Berry, 2012).
Strengths are internal capabilities that may help the company to reach its objectives; in contrast weaknesses may interfere for that. This includes understanding of the internal environment or the situation inside of the company or organisation. The factors which determined the straightness and weaknesses of the company are tend to be in the present. Factors are relating to products, pricing, quality, staff and processes within the company. With understanding of these factors the company may understand the unique selling proposition and how to improve it (Berry, 2012).
Opportunities and threats are related with the external environment which shows the situation outside of the company or organisation. Here, the factors tend have to be in future. Factors here are relating with markets opportunities – fashions, trends, seasonability, politics, society, competitors and every other external factor which influence the company. With understanding of opportunities company is able to exploit the external factors to its advantage. Threats are negative factors that may challenge the company`s performance (Berry, 2012).
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5. External analysis This chapter explains the external environment analysis – PEST. The chapter is divided into four sub charters. Firstly, sub chapter 5.1 will give the Political factors, which influence the BASF Company. Secondly, 5.2 illustrate Economic factors. Thirdly, 5.3 show Social factors. Finally, sub chapter 5.4 analyzes Technological factors which influence the company. 5.1 Political factors There are some political factors, which influence BASF Chemical Company. One of these factors is a common initiative for a sustainable chemicals industry has launched by European Union in 2005 year. This factor has a positive effect on BASF, because the mission of the company is to create chemicals for sustainable future. This political factor gives opportunity to the company to make more innovations with collaboration on European Union. The negative political factor for the company is unfavorable political environment. In European Union there are different laws and regulations about Genno- modified products and some molecule products. For these reason USA is more favorable market for these kinds of products (Thomas, 2005).
5.2 Economical factors One of the results from present credit crisis is reduced consumption of customers. This is strong factor, which influence BASF Company. It makes the future more unstable and precariously. Only the best companies with the best products could keep their market`s place. The second economic factor which influences BASF is increasing energy prices. It is negative because it could damage chemicals industry competitiveness further. On the other hand, there is increasing competition from new economic powers, such as China. To avoid these negative factors, BASF Company could orientate to different markets, such as Africa and Middle East (Thomas, 2005).
5.3 Social factors In chemical`s industry is very complicated to find new well educated faces. The reason is the fact that young people choose other careers in different branch. Young talents in chemical`s branch, which are well educated require very high remuneration and good working conditions. BASF Company is working to improve matters. Flexible working time is one of decisions of the problem. On this way could be attached qualified labour (Thomas, 2005).
5.4 Technological factors For BASF Company the technological innovations are very important. The main reason is that technological innovations gives opportunity to the company to make products better, and to add new products in company`s portfolio. The company is focus of solutions for sustainable future, and definitely innovations are the key point for it. At all, the global technology platforms act as partners in product development (Thomas, 2005).
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6. Internal analysis 6.1 McKinsey seven S framework To start, for BASF like as world`s leading chemistry company is very important to strengthen its position on the market. To achieve this goal, company has to focus their business on customer`s needs and demands. In chemistry market, and for company, which do not produce product for the final consumer is required to focus on innovation, to create new products and functionalized materials, and to find new solutions for more sustainable future. These things are very important too, for the other aim of the company, which is to increase year`s profit with average four percent per year, and to grow two percentage points faster than global chemical production (Interview, Appendix 1) (BASF, 2012).
The structure of BASF Company is a Matrix structure. The Matrix organizational structure divides authority both by functional area and project area. In BASF there is Board of Executive Directors which consist eight members. They are responsible for the management of the company. The Board of Executive Directors regularly reports to The Supervisory Board. Supervisory Board consist 12 members, six shareholders representative elected by the Annual meeting and six members appointed by the representative body of the employees. Every country and every different department in BASF Company has a chief, who are supervise from the Chairman of the management board – Kurt Bock (Interview, Appendix 1) (BASF, 2012).
The company systems are very important for the business and for good done work. BASF has an own marketing department in every country where the company is located. In addition, they have supporting marketing agency outside the company, which helps them to develop the motives and the way BASF wants to present itself to the customers. Like a chemicals company, BASF use only trait media for advertising – home personal care magazines or eurocosmetic magazine, which are special magazines for cosmetic market. To exist and to be successful a big company like BASF is necessary to have fixed rules and good communication between different departments. Primary method within the company to discuss the problems and development in the market are manager`s meetings. The complicated structure of the company determined the need from daily meetings of the leader figures in the organization, much that the other companies (Interview, Appendix 1) (BASF, 2012).
One of BASF`s goals is to make rules and system more common in the different countries. The leader style in the company allows to employees to share their ideas about innovations. Every idea on issue placed by some of employees is consider, but the main decision is always taken by The Supervisory Board. In the same time, the management style is people oriented, one of the most important things for the company is to understand consumer needs, and to create values for them (Interview, Appendix 1) (BASF, 2012).
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BASF is company with almost 200 000 employees. Every day in Germany for BASF works 54 000 employees. They work in different departments but the responsibility for their work is taken by managers of every department. There are a lot of frameworks and guides which are coming from the central department, and which are common for every employee. The employees have to respect the rules and framework given by the main department. Rewards and warnings in the company depend from Human Resource Department. There is not something special within the company, they fallow the legal system. Every employee has a set of target which is called “employee dialogue”. This makes management style in the company open for ideas from employees. “Employee dialogue” gives opportunity to employees to talk about the goals which they are achieving in the year and to share new ideas. The incentive system in the company is connected with reward as money bonuses for well done job (Interview, Appendix 1) (BASF, 2012).
BASF Company, as company which do not produce product for the final customers, it is very important to makes products better, healthier and safer than competitors. The reason is that the end consumer never seen and could not understand that BASF Company is better than competitors, and cannot contrast them. The most important thing for the company are innovations, this is the only way that company can be unique and distinctive from competitors. The Company spending a lot of money every year to make research, which helps to find new opportunities for development. In the same time, the company makes everything possible to have products which are already developed and to make them successful on the market. The main question for BASF is to understand better than competitors what are exactly consumer`s needs and to be ready to satisfy these needs on time (Interview, Appendix 1) (BASF, 2012).
The core value of BASF is to create chemistry for sustainable future. To achieve its goals BASF tries to be a company with innovative products, intelligent solution of problems and good service departments. The company strives to be the world most widespread supplier in the chemical industry and to generate high return of its assets. It wants to reach these intentions without harming the environment and nature (Interview, Appendix 1) (BASF, 2012).
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6.2 Interconnection of the seven S To start, for BASF like as world`s leading chemistry company is very important to strengthen its position on the market. For achieve its goal for the Company is necessary to make its products better than competition and to has high quality of its services. For this helps The Matrix organisational structure and the management style of BASF, which is people oriented – oriented to understand customer’s needs. The company is focus on innovations and every decision for a new idea is taken by The Supervisory Board. For the company`s success is important to have good communication between the different departments and to have fixed rules. In BASF this is achieve with regular meetings of The Board of Executive Directors. The company strives to be the world most widespread supplier in the chemical industry and to generate high return of its assets. For these goals, company has to employ highly qualified staff. Moreover, the leader system of the company is focuses to encourage the employees to share their new ideas. For this, the company use so called “Employee dialogue”. On the other hand, the company has to invest in researches. The R&D department is responsible to find new market opportunities for BASF. The main mission of BASF is to create chemicals for sustainable future. For this goal helps the good organisation structure, cooperation between departments. On the other hand, very important are employees and the way they are managed. Very important are innovations and the style of the company. All of these things determined the current situation of the company and its future position and development of the market.
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7. SWOT overview First, BASF Company is one of the leading chemicals company in the world. This factor gives chance to the company, to manage the big part of the market and to have hard influence on smaller chemicals companies. Moreover, as so international and big company BASF has a lot of production sides around the world. One of the company`s strengths are production sides, so called Verbund sides. These sides have really good conglomerates of the production. This conglomeration allows, every kind of product produced within the company, to be used in the most efficient way. Different materials produced in one department of the company, can be used in another one, which means that the BASF Company produce raw materials which use in its own production. Besides, this allows to the company, to produce a lot of different materials and products, to make innovations in this sector and to create more value for the customers than competitors (YouSigma 2011).
Second, BASF Company has a huge profit in the last year. Nevertheless, in the last few years is observed declining earnings in several business segments, which is one of the company`s weakness. There are several reasons about this fact. The firs reason, is one of the company threats, is the Economic slowdown in the European Union Region, which is due of the present credit crisis. The credit crisis in these days covers and influence, both small and in the same way huge companies like BASF. The other reason is that people in European Union have possibility to choose between hundred different products. Here the competition is really strong and the market in Europe is developed till maximum. One of company opportunities is to rising commodity chemicals market in regions like Africa, Asia Pacific and Middle East. These are the growth regions of the future, for almost every kind of industry, because the growth rate of profit in future in European countries would not be so high. The other opportunity for the company is always to develop new products and new ideas (YouSigma 2011).
Figure 2: SWOT analysis table Location of factor Internal Strengths
Leading chemical company Concept of Verbund Variety of products
Favorable
Unfavorable Weaknesses
Decrease earning in some countries Less expenditure for R&D
External
Opportunities
Product innovations Expand the business in Africa, Asia and Middle East
Threats
Laws and regulations Economic slowdown in European Union
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8. Conclusion BASF is international company, which is leader in chemical market. The company production is separated in six different departments and its market is oriented in four main regions. The department of the company which is located in Germany is oriented primly in production of Performance products – products for personal care. Moreover, the main mission of the company is to keep its position on the market and to create products for sustainable future. For understanding the present situation of the company was collected information, based on it was made analysis for internal and external environment of the BASF Company. In this report, BASF Company was analyzed. For this analysis were used McKinsey 7 S model for internal environment of the company. The weaknesses, strengths, opportunities and threats were analyzed based on SWOT analysis of BASF. Based on these analyses it was found that the company has well conducted Matrix Structure and good working management style. Nevertheless, global company like BASF is difficult to manage and demand strict rules and frameworks for the employees. On the other hand, the company produces intermediates, which are used from other manufacture companies to produce final products. For these reason, the final customer is not always informed for the quality of BASF`s products. This is the main fact, that one of the most important things for the company is innovations. Certainly, the innovations and development are the company`s main mission. For this mission helps quality R & D and marketing department. The conglomeration of the different departments is one of company`s strength. For understanding of BASF`s external environment was used PEST analysis. It was found that, there are different political, economical, social-cultural and technological factors which influence the company. One of negative factors is different laws and regulations, which limited the production of Genno- modified products and some molecule products in European Union. In the same way, negatives factors which influence the company are increasing price of the electricity in these days, and increasing competition from countries such China. But at the same time, the European Union gives opportunity for innovations, which is positive political factor for the company. In conclusion, the company is focus to produce products and to find solutions for sustainable future. Understanding of internal and external environment is the main factor for achieve its goal.
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9. Recommendation In this report BASF Chemical Company was analyzed. Based on these analysis was determine the opportunities, threats, strength and weaknesses of the company. Moreover, the internal and external environment of the company was analyzed. Based on this information, this report gives recommendations of BASF how to take advantage of its opportunities. Firstly, BASF Company can be better than competition if it makes more innovations. This is possible with collaboration of R&D and marketing department. The company has to be open for new ideas and to search for people who are useful for it. Moreover, the opportunity for the company is to rising commodity chemicals market in regions like Africa, Asia Pacific and Middle East. On this way, BASF will continue to develop the business and to retain its position on the market. Secondly, one of BASF`s mission is to make its management systems more common for every company`s department in the world. For this mission the company has to create more strictly rules and frameworks, which a common for every employee. Furthermore, BASF have to keep the good communication within departments. Finally, BASF Company have to invest more in research about customer`s needs. This is the best way to strengthen its position on the market. The most important thing for one company is to know exactly customer’s demands and to make everything possible to create products better than competitors.
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10. Critical appraisal Firstly, the information collected for the external environment of the company – PEST analysis, was very less. There were not interview questions about PEST analysis. For this reason, was very difficult to determine the current external environment of the company and factors which influenced it. Secondly, BASF Company is huge company for which is easy to find a lot of information. It is difficult to determine which of the information is really important. Moreover, the time for writing the report was limited and the interview was conducted late. It is very difficult with so much information to find the right source. To close, it is necessary to be more prepare with the information for this kind of report.
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Reference list Books: Cuypers P.J.M. 2010. Background reading PLA1 Websites: Berry, T. 2012. How to perform SWOT Analysis. [online] http://articles.bplans.com/business/how-to-perform-swot-analysis/116 [Accessed 20th Nov. 2012] BASF. 2012. [online] http://www.basf.com/group/corporate/en/ [Accessed 23th Nov.2012] MarketingTeacher. 2012. What is PEST analysis? [online] http://www.marketingteacher.com/lesson-store/lesson-pest.html [Accessed 16th Nov. 2012] Oxford University Press. 2004. PESTEL analysis of the macro-environment. [online] http://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_12.htm [Accessed 20th Nov. 2012] Spencer T. 2008. McKinsey 7S Framework [online] http://www.tomspencer.com.au/2008/09/13/mckinsey-7-s-model-analysis-framework/ [Accessed 24th Nov. 2012] Thomas. S. 2005. Chemicals – vision of the future [online] http://www.eurofound.europa.eu/emcc/content/source/eu05022a.htm?p1=ef_publication&p2= null [Accessed 23th Nov.2012] YouSigma. 2012. BASF SWOT analysis [chart] http://yousigma.com/comparativeanalysis/basf.html [Accessed 18th Nov. 2012] Personal communication Singel. Mrs. 2012 Personal communication 1st appendix. Dusseldorf. Germany. Interview protocol
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Appendix 1 Interview BASF Good morning. We are students from Fontys University. Thank you, about your time and that you are agree to conduct interview with us. We will use the interview for analysis to BASF Company, which we have to use for writing a report. BASF is huge company, so can we start with little general information? If you looked at BASF you have here some information, about the sales and habit results from last year and also, about the number of employees. This is very general figures and you also see that it’s a lot of production sides around the world. It is 370 production sides, and six of them are so called Verbund-sides, which means they have really big conglomerates of production, where the structure is optimist, in that way that you say that there is one raw material which is than processed in a way and what comes out of this process maybe two/ three different materials go to another plant then inside this organization, and then will be processed further, so that you have really good interaction between all this different productions entities and then you can use resources like energy or water in a much more officiant way and so this is the core of this Verbundgedanke and the German word Verbund is used also internationally to describe this kind of structure. So this is very special for BASF this connection between all this different productions at a big side. And then you have a lot of general or strategic methods which really come from the BASF company as a whole and these definitely are valid also for each group company which is under that roof. So this counts for us here locally as well but we have maybe slidely different points where we made our emphasis because our market is specified. So the core company, the cause why this company exist or what they see as a main challenge is really to make possible that in the future people can live on this earth with this resources, which are given and the chemical industry and BASF that they have the potential to help and to solve a lot of this issues and problems, which are there when the growing world population has to live with this resources, which is one earth gives us because they say there is a prognoses not from BASF but from the United nations that in 2050 there will be 9 billion people and this would mean if you would use the resources like today we would need three earths with this resources. So everybody see that there is a lot of challenge there and BASF says that chemistry is an able to solve these problems a key role and so they defined that the company is there to create chemistry for stainable future. This is the frame work of the whole business strategy and companies strategy. Under that we have things like what do we want to do, and then there is this we are working as one company, even if we are so big and have different things in our portfolio, as well so many production sides around the world so this is really evaluate itself to say but we want to achieve these things as one company. You can already imagine if someone said such a goal that there is a kind of challenge behind it. So it is really a challenge to give this big organism. And then definitely innovation is one of our key potentials. We need to bring our innovation to our customers to be successful and we have to start focus on our sustainability, this is directly related to this point we need to look for solutions for stainable future and then we have this internal goal, to say we will be the best team in the industry, that means that also
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all kind of or how we work together is optimal and people would like to come this company and work for this company because it is so good. And then it comes to this complicated structure, because we have here as you see 15 business units which are put together to six segments. The leading structure, the board of the management and you have information about the people who are there. And then I think I need to go to this one here which talks about the segments. This six segments cover the whole business portfolio or product portfolio of the BASF group, and there for example you have the oil and gas segment which has a whole different structure than the rest because it is really about oil and gas exploration and transportation in pipelines to the big plants of BASF and so this is really a point where the company insures its own raw materials supply because about 90% of the raw materials which are used are coming from petrol, and there is one section of this oil which is called Nafta, and this Nafta is the core of 90% of the products from BASF. But this is one molecule and all other things are derived from that with different chemical processes. With this strategic point to have inside own raw material supply this is important. What you also see is that this also helps balancing the economic success of the company because sometimes when the results of the other businesses units are not so great, then you can see, that oil and gas has a big amount in adding to the economic success, but also the other way around if the prices are low for oil and gas, on the other hand the special chemicals can go up there is also a balance. Then you have a big sector which is called agricultor solutions ,this is a big part classical crop protection, materials pesticides, herbicides, but on the other hand also biotechnology, plant-biotechnology. You know that in Europe this is a very critical point ,and for example last year BASF took the consequence and said ok they have all relocated the whole plant- biotechnology business to the USA because there it is much better because they have better circle standards to really follow this research, because here you have very much hurdles to take and also the public view on biotechnology is very critical.’ Making a certain USA market is better than in Europe? Yes. For example in Europe you have always if you want to have this kind of where you have trails in a field to put outside then the engeneer is coming and destroy these fields for example. Or it is also a really big effort to get and allow to have such trials there. This is a really big issue in Europe and in the USA the market is much more open for that. People accept that much more and it is easier to follow the research and development there. And then you have a part which is called functional solutions, there for example they make catalyst not only for cars but each chemical process needs most of them need a catalyst to make chemical reactions work and they have BASF a whole business unit which is specialized on developing and selling catalyst for different types of chemical reactions. Also intern BASF company decides or needs a catalyst they can buy it from themselves but it is also sold extern to other chemical companies. Then you have construction chemicals for example there one point is that you have additives for concrete and one of the important things one for example when this highest building of the world in Abu Dhabi when this was build they had to think about a concrete when they want to use it high up it has to be florid for a long time but then when it is there it has to be hard very quick and for example BASF is producing ingaevones which
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helped this to modified the concrete so you can work with it a long time and then it is get hard. It does not dry too early or it does not dry too hard. If you want to laid trials then we have kind of glues where it is possible to make corrections when you have laid the trails if it is not straight you have a chance to rework it without having to destroy the trials to make it new. These kind of things are there. And coting this is everything you need to produce a coting including also the pigments there. Then you have the basic chemicals over here which is like the anorganic if you have assets for example really basic chemicals which are used different industries. Intermediates this is the part where chemical stuff which is then used in another process again. It is not an end-product it is an intermediate product which goes to other steps of the production process. And then you have the plastic units which is very interesting because you have things which you maybe know. BASF was the one who invented Styrofoam. This very light material is used to isolate buildings. They have very different when in the summer therefor it is against noice and other products are against loosing energy. Then they have very light materials for example for cars to build cars more lightly if they do not use so much fuel. These kind of topics are there. You have in the end the performance product segments here where again very different business units are connected together and one of this is care chemicals and care chemicals are steps closer to what we are doing here not the last step but these performance products means that there is always chemical products which help to make other products better more efficient or make also production processes more efficient and I think some which are easy to understand is for example nutrition and health where we produce food ingredients for example which makes it easy to bake a cake or which makes the whole process of inducing food easier so that a cake or a pizza is like it should be in the end so these kind of things. But also so called functional ingredients for food for example to lower your cholesterol level or things like that. These are not pharmaceutical products but there in between nutrition and pharma but there are also pharmaceutical ingredients produced in this but more things to make pharmaceuticals work for example that a kind of tablet stays as a tablet and that it goes into your stomach only as the things inside only release in your stomach. These kind of things which makes the product performance of other products work or better. Inside this part there is the care chemicals organization and care chemicals are now all about personal care which means your hair, your skin but also home care so cleaning, services, cleaning your clothes. This is inside of this business unit then. Here where you are now in this offices in Monheim. We have the head core quarter for the business management for personal care in Europe. Specific for Europe, specific for personal care not home care and it is the head quarter for the European activities for personal care. This building here only have offices. We do not produce anything other than ideas. This is the whole marketing people here for this activities. You have some of the development people there they are not really connected directly to a lab because labs are not here. Then you have the sales people, the whole financial experts which make the controlling and accounting, customer service people, communication people here which are function around the business are located here for the head quarter for the European head quarter. And then we have very close by in Duesseldorf, Holdhausen the big production side which is located on the premises of Henkel because in the past what we are now has been a part of Henkel and it was then sold to private investors and was under the name of Korknes there are on the market for around 11 years and then it was bought by BASF. This is our history here the local history which makes
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this connection to Henkel and because you do not that easy put a plant part from one side to the other. These stays there and we use infrastructure there together with Henkel and other companies there are also other companies there. This is really the biggest production side for European personal care activities. It is an important side for us. And there production for all those products we have inside personal care. In this presentation you have more information to each of the segments. Also with some figures about sales. There is a regional chart for sales and also for the habit and you see that Europe for the BASF group is the most important region 56% of the sales are made in Europe. Then the next one is North America with 20% and then Asia with 18% and other regions like South America, Africa, Middle- east make only 6% . ’ Do they make it together the 6% or separately? Together. Add this up and call it the rest. You have the big regions and the rest. It is really historically that BASF was founded in Germany and then grew around the world but it is always easier in your circle because it is easier to grow in your country, it is closer, the regulations are more similar, the people interact the market is easier to understand so I think it is natural to grow in your country. For which year it is these charts? These charts are always for 2011, for 2012 we just have the results for the half year and you could get this but the relationships we made like this. This is no surprise. What we have Europe is the most important market and it will stay one of the most important markets but there is definitely the goal to grow in Asia specific and also in these other regions like Africa, Middle-east and everybody says that these are the growth regions of the future as well so for every industry. Is that rising through the ears till now or for the other countries not for Europe? I think so but for example you have here the plus that means plus to the 2011 you see for example that the sales in Asia specific grew from 2010 till last year here 40% and here for those South America, Africa, Middle-east plus 15% but also North America grew a lot and even Europe grew a lot but what everybody is clear about it is that the growth rates in Europe will not be so high in the future because these markets are so called mature markets that means the potential is already exploited when you want to grow in one of these mature markets you always have to have a very cool new product innovation which is really new for people and then they would maybe buy this one instead of another which they already used. Where else these other countries here the market itself is growing, developing. People have much more needs where they don’t have a product in the past. It is more difficult in Europe because people have everything already. So to make you want something more there have to be a lot of marketing.
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Could the competitors be also a reason? Yes, it is also competitive market because BASF have some brands which are end-products and consumer brands some for example this Styrofoam set this is a brand from BASF we sell it directly to end-consumers as well or some of these construction chemicals or in the coting there is a brand for example Glasurid which is a BASF brand which you can find in a store. The other products are only sold to companies which are then put it into their products and then you buy as an end-consumer this products and then you have competitors and the endconsumer never see if its BASF or competitors. This is also a price driven thing and also innovation. When we go to the personal care market it is very much about what do you want to have on your hair, anti-break hair claim then you have to prove this is true and then you have really hard competition the other chemicals companies which are often offering the same. So this is there and one objective for growth in Europe or in this mature market is to have the better innovation so new things and the other thing is to be in quality, price, services better than your competitors to get some of them market share. But there is not so much growth in itself. In Europe most of the people not everybody has already a high level of consume what could grow. Depends on these cycles which are there so if there is much intensity in constructing new buildings we will also have our share with selling to these markets but if there is no building activities around we cannot sell anything. This European crisis at the moment is also hitting us. Then there are more charts here about the sustainability approach this is tricked by the point that we say ok this challengers and chemistry can do a lot to solve problems here if you look at energy consumption or insolation materials then there is a connection to do something or in the plant biotechnology area there are seen future potentials to help make nutrition of people easier or better. We have some more information about the innovation which is in here the spending for research and development are here on this chart. The main message is that it is a lot of money which goes into a research and development and this is so not going up this figure is going up every year. This is one of the most important things for the company to reinvest. As we learn in school that if you want a company to make a good research you definitely have to put a lot of money in it. This is really a thing where you have to find a good balance between making your researchers giving them the resources with money and time to think on things and develop things but on the other hand you are there and you want to have products ready developed to go into the market and make them successful. The main question is what the customer wants and we are already to do it we have to do it in a specific time. This is really the point. For example in our area for personal care we say we feel a good innovation can only be seen when it has success in the market. Just to have a good development idea make new good molecule which has interesting properties could maybe be a success university. This maybe may not be a success for us because we only can count on it
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when it has success in the market when people want to buy it. Then there are some figures about innovation as well and there are some awards. It makes you proud if someone noticed we did a good job. Then we can have a look at chemicals. Care chemicals its again different business units here. We were already describing it here. Here its personal care for Europe. I will skip the rest here. The vision which is here behind this business is always we help the customers because we do not sell to the end-consumer to be more successful in improving everyday life but providing safe innovative profitable and stainable products and solutions. There is again a brought portfolio of products which goes from hair care like shampoo or conditioner, hairspray to sun care products. We are really one of the most important producers of the filters for the sunscreen. Then we have color cosmetics, we produce pigments and we have the body care or facial care we can put this together so that means that everything you put on your skin to make it smooth and young and nice. Then we have oral care like toothpaste, mouthwashes and the deodorant area. The two last ones are the smaller ones but in all the other ones we have really one of the biggest producers of ingredients for these markets segments and all in all BASF personal care is the market leader the world wide market leader for personal care. There is something about the organization the point which you already see is we have this BASF with all these different business units which have activities in different markets segments and these are organized in legal entities for example we are here from the business prospective we are responsible for personal care in Europe and so we have personal care in the US for example as well. But we have a legal entity here which is the GmbH for German lob in other countries you have other organizations there and this is called the BASF personal care and nutrition GmbH this is our organization unit here. This for example includes Monheim as the office headquarter for personal care in Europe. The side in Holdhausen which has productions for personal care but also for home care and also for the cotings divisions. It is not only one business side but this unit here is responsible to manage this as well and for example another production side in the near of Ulm is also belonging to the GmbH this is a historical thing. But they don’t belong to the care chemicals division they belong to the performance chemicals which is the same division there but it is another business unit with another president which is heading it. We have this kind of interactions all in all levels for example and this is so called matrix structure. This is really a point which makes it a little bit complicated when for example about this job I have here this is communication responsibilities on one hand for the side really local for Monheim and for Duesseldorf so everything goes around there with the neighbors crisis management if something happens. It is really local. Then we have the responsibilities for the European business communication for personal care and then I have also connections to the central units which is dealing with communication from the BASF group for example they are the ones who prepare this kind of material and work on communicating the business strategy of BASF or give us guidelines on how to explain this sustainability approach or these things there is a central communication unit which is also influenced on my group here and then we have also connections to for example the people from the other business units which are located also in Duesseldorf so there are not here but they have their headquarter for example in Ludwigshafen or in other cities and they have connections to us. When it comes to research and development for
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example there is also a central research and development unit in Ludwigshafen and we have some colleges from them which are delectate to outside because we are one of the bigger ones and important ones and have people from the central development unit working here on side but they do not belong directly to personal care. They belong to the central unit research and development but they have to really interact with us because they are here to give their input and insides to all the development activities we do for the personal care market here on side. We have a lot of connections and interdependencies and this makes the whole organization very complicated. What goes as a general economical specific do you see in your company your product services and to short, medium and long-term for example one market share more customers and which direction should your brand develop? When we look at the BASF book there is clearly define strategy about focusing on these areas where we can bring forward innovated solutions for the stainable future. This is the frame work here and the goal is to be innovative to get more market share. This is all over the world and when you look at personal care for example it is the same thing here but it is not much about energy savings but in particular we have something to share there for example we look at the sustainability of our products and for example we look at the raw materials we use to be sustainable there who is more renewable raw materials. We want to make biodegradable products which are not harmful to environment. We want to make products which can easily be processed with low temperatures so that we do not need that much energy to make the products at the end. This are also many things where we can say we can offer a benefit also indirection of sustainable future even inside the personal care sector which is kind of more airloxes thing. On one hand we see the growth there about innovations we see our goal there to be sustainable and also we see that we have growth markets there as well because not all over the world it’s a habit to take a shower every day. There is potential for more selling products to these kind of markets. Do you have a sign external marketing companies? Yes. We have an agency which helps us here to develop the messages, to develop the motives, the look and field of how we want to present ourselves in market. You also have your own marketing department here? Yes, right. This is only supporting us as an agency but we have also our own marketing people and inside the communication unit we have market communication experts. What media do you use for your advertising or have you already used one? We are really concentrating on so called trait press that means we do not go to general interest media or in newspapers. We only go to the trait media like home personal care magazines or cosma, or euro-cosmetics. These are special magazines for the cosmetic markets.
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You focus more on businesses then end-consumers? Definitely, BASF as a group trying to get more recognition also for influence public. Not everybody in this field needs to know BASF. But people who make decisions who are important in politics and something like this they should know it. But this is definitely not a focus for us as communicators or in the business. We only focus on where our customers so these producers of cosmetic products and this is via those so called trait magazines. How were your first trends and do you set your strategy on this trends? Yes, if you look at the personal care we had this historical chance now as well that the former Kogness business was bought by BASF. BASF so far was also having personal care business but not so big and with this equisition they really became now the biggest producer in the world and now they also needed to work on who we are what is our profile, what are our strength. When we went into the analyzing this we came up with a scripture which says when we look at BASF personal care we see that we have two main pillours of strengths. One is this science excellence which hopes the BASF group has. So much researchers which are really doing good work resources enough to develop this whole science excellence is one of these strengths. The other thing is consumer embassy. This means we say we only go business to business. We never go to the end-consumer himself. We understand him and we feel it is really important to understand this end-consumers to make the right products or to develop in the right direction to make our innovation in the end market success. When we came up with our analysis this was done last year when this equisition happened or one year after the equisition happenend. First we had all this organizational stuff and then we could concentrate on what is our message in the market. These to strengths combined together are making us unique. We did allounge a brand to cover these personal care activities in the market world wide and this a global brand which is called care creations. Care creations does really go into this two strengths and says that we draw every idea for our products in people life. This is the main claim which is inspired by life. What kind of communication issues occur between departments? How do you exchange your information between the different production places or even within here? Do you have meetings here on a regular basis or do you have video conferences between the different cities? When you look at this “Personal Care & Nutrition GmbH”, which is connecting Illertissen, Düsseldorf and Monheim into one legal entity, we have a management board which is responsible for that. They have regular meetings. They have to tackle all questions which go on a kind of regulatory or legal background because they have to cover this GmbH as an organization. This is for example safety standards of the site. The laws for the safety standards have to be clear. Then we have tax issues for example because this GmbH has to give taxes to the local city. So this is one organizational point. Then we have this responsibility for “Europe Personal Care” as a business unit. For this business unit we also have to connect with the other countries inside Europe because we are here in Germany but also in Italy, France, Spain, etc. So there is a connection between the people in the different organizations, for example via telephone conferences. Today there is also a site manager meeting. That means there is one
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person at each from these production sites in all these countries in Europe with the responsibility to run the site with all these technical matters and also with the logistics around it. These guys meet face to face today. But the main language is English, right? Or do you have specific people who speak like Italian or French? Yes definitely. The organization also for the managerial stuff is mixed. There are a lot of Germans because this is historical but it is really mixed. So they come from each country, in the European organization from the European countries but in this organization there are also people coming from Asia. This is really international. The common language is English but many materials are as well in German because there is such a big German community inside the organization. What are advantages/disadvantages of the company’s organizational structure? It is that you have so many different players in the game. You have to be informed, you have to align with things to go forward where decisions have to be made together and so this is really a challenge to get all these people together. One example from communication again: When I wanted to inform our local people here about the apprentices. We have six different professions that you can learn inside this company here in Düsseldorf and Monheim, for example an accountant, chemical lab or technicians. Then we make this announcement to the local press that we have young people starting this apprenticeship, so learning this profession. When I have this thing I have to check this with my division which is the Care Chemicals Division. We are the Personal Care Europe but then there is a higher layer which is Care Chemicals. I have to check with the local management. I have to check with the people who are responsible for HR communications inside BASF. And I have to check with the central communication department of BASF in Ludwigshafen because they want to be informed about everything which is going to the Press. So this is a lot. How do they organize these meetings? I think the most communication goes via e-mail. This is very important. Then we also have phone calls. For other information stuff we also have an Intranet where only employees can access. I have some newspapers for the locations as well. Talking about the employees, how much freedom of decisions do employees have in the company? It depends. There are a lot of frame work and guide lines which are coming from the central departments which are experts for these things. Then you have to live within these rules and frame work. It depends on what kind of information or topic is there. For example, you want to get an investment, which is higher, then you have to go to many instances to get the approval and to get really the money. It is also a big topic, all compliance topics, that means BASF is really keen to be on the safe side with all the compliance issues, so that nobody is bribed or bribing some other people.
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If your employees do something right or wrong, do you have any rewards and warning? Not so special. One thing which is a Human Resource thing or a leadership issue where you say if someone is doing bad things, he gets a warning and if he gets more warning, kind of official warnings, then he can lose his job. It is a legal system, not company specific. But this is only for severe faults. If someone just makes a mistake you would not get this. Many of these things which are not severe really depend on the leadership style. Then you have the possibility to get a reward. Every employee has a set of target setting and it is called “employee dialogue” where you talk about the goals you have for the year. You will also talk about what is good in your relationship and what is bad. You get a reward with money. So you have an incentive system. One of the things that are most interesting for us is what is a daily routine in the company? Many, many meetings because of this complicated structure. But this is more inside the BASF organization than in other companies. This needs a lot of effort. These are a lot of meetings from different perspectives. The other things are analysis like if you want to steer a business process you need to have analysis a lot which is a point where people complain and say “I need so much time to put in all those data for analysis, I could spend this time with my customers”. But this is also a point which is really important. It needs a lot of effort to bring together all those data which then make it possible to steer the business. Are there huge differences between the countries or is it the same system? The system is the same. What BASF also tries to do is to make this more equal for all of the units in the different countries. Where do you think the company will be in 10 years? When you look into the past you see there is a strong potential to grow and I hope that this will continue. With this strategic approach to say we really want to tackle the highest challenges we will have in the future, I think there is also good potential. That is a point where I say it will grow but then, from my point of view, I would say maybe there is also coming a critical point where you cannot steer such a big organization effective enough anymore. It needs so much effort to do that and to keep this all under one roof. Do you think to create new products for different markets? If I speak for Personal Care, definitely yes. For example, in the emerging markets we have in Africa or India, we have other strategies because there are people bound by big shampoo flask but they would buy small amounts because it is more expensive to them to effort this. So we go into small amounts where there is a product which has a good performance but does not have so many ingredients which are very expensive or do very special things with your hair like super condition or so. There it is more important to have a nice feeling and a good perfume. So this is definitely different. Or for example in the skin care area you have very different sensorial expectations from people. So like in the colder countries people like heavier lotion which has more fat to feel protected. In countries, where it is warmer, they
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would like more a light lotion where they do not feel that they are sweating. So we try formulations on Asian hair which has totally other properties than European hair. Nowadays everyone seems to strive and to sell more and more for earning big profit. How do you do that? As I explained, we are really focusing on innovation which is needed in the market, which has a market success, where we really find the needs of people. What is the core competence of the organization? When I am talking about the “Personal Care”, as I said, it is the combination of science excellent and on the other hand these aspects of sensory, of understanding what people want also what kind of feeling they want on their skin. So this all matters. Our next question is: What is the added value that the organization offers to its clients? But you said the innovation and the healthy products. Yes and in this combination I say this is unique. How are important decisions made in this organization? By the managers in the specific units? You have project teams that work on a solution for an issue and then they make their proposal to the upper management. The upper management decides belonging on the importance of the project it has to go very high up or it stays in the lower level and decisions can be made there. Then the information about that is cascaded down to the other employees. How would you define the leadership style in this organization? We are in the process where we just find out how this is because we are so young after this integration process. But what we really strive for is a visionary leadership style which is like a partnership style where it is possible also for an employee without a high position to give ideas. How would you describe the organizational style of management? It is mixed as everywhere. The vision is: Working together, also encourage people who have no managerial position, to get their opinion and their input and be motivated by that. Because then in the end if people can work together like that you have more motivated people who give more input and make successes possible. If people just do their job “9 to 5” it will not be so efficient. But it is mixed. You get people who have this kind of qualities and people who haven’t.
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So in this part you have ups and downs? Yes, definitely. But it depends on the person who has this position. This is i think a development which is inside BASF and it is also around in other companies. The importance of leaders and their leadership style for the success of the company is now seen and everybody is working a little different on how do you get to the perfect leader. It’s about the supervisor and what he wants from his people and how he interacts. There you have people who feel that it is more efficient for them to just give the people the task. “Do it until tomorrow no questions” or if they say “I want this done because I feel this is important” and then you can also ask the question “I would say could we do it different, this is better”. This really depends on the personality of the people who are there. We now just start with this ideas and now hire people who fit in this picture. But there are managers in their position for over 20 years already and maybe they do not have this kind of approach, others have. It’s not a matter of age. Don’t misunderstand. It depends on the personality and you have some people who are very close to this ideal and others who aren’t. And you can’t just fire them ecause maybe they have good skills and are experts. What types of skills are important for the success of the business? This is always what you can read in every book. You have to be open-minded, be motivated by yourself. They not just need to think about more money. Does your unit need to be more creative? Innovation is one of our strength. Then you also need to look for innovative people. But we hire people from different backgrounds. A lot are chemist or physicians from university but then we also have people who come from economic background or even from social background. We saw that you offer jobs for students. And you say that they don’t need to have specific knowledge. Do you offer the education about the company later? If we hire a person for a specific position there will be a kind of description for the professional background of this person. Sometimes this bothers or it’s not so specific. Sometimes it has to be a university degree but it’s not special to be chemist. Sometimes we look for people who have already worked on their job for several years and have experience. This also depends. It’s a mixture. What they all get when they come aboard the company they get seminars and education about the system. If people from Fontys would apply for student jobs it wouldn’t matter that we don’t have the specific knowledge in praxis yet, right? This depends. For some position we would always look for people who have already professional experience, worked for some years in a special field. Sometimes this gets very specific: like someone who has experience with hair care products in Eastern Europe. So: chemistry or also marketing background from a consumer goods company for 2 or 3 years. So: very specific. Sometimes the people think this would be the person you need. But
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sometimes we also hire people directly from the university and say there is room for development here and they can make their experiences here and what we just need is someone who can work scientifically because he learned this at university, also the possibility to talk another language, has the right mind set which we would like and then it’s not necessary to have a special background. But this really depends on the position. Would you hire people who are very good in their job but don’t speak German? This is possible but what I heard from BASF: they always would say that they always have to learn German if they are located here. It would not be preconditioned but they expect you to learn it afterwards. What are you most concerned about regarding the quality of the key staff? Also in the background of how you improve the quality of the staff working here. In example seminars from the company itself or externally? This is an important topic. This is one of the topics where BASF does regular internal surveys with the employees. And this is one of the weaknesses. People say always there is not so much possibility for employee development. So there has been set up a senior project. Which means when there is an issue which is that important for the company and people see if we have to do something here and bring something foreword and get a movement, they establish this senior project which means that they are heading this project with the board members. This one is for example the employee excellence project. It was set up a year ago. And they brought together a big project team which now works on how we can improve employee development inside the company for people who come aboard newly or people who are already there but want to go to another level. This is a point where BASF sees that they are not as strong as they want to be. But now they kicked of these activities to get better. But here is already a lot. If you are an employee you can choose from a catalogue of seminars. This is already there to educate you further. But somehow people always complain that it’s not enough or not targeted enough. It’s not a point only to have a seminar but then also to be promoted to another position if you took something. It’s a thing on your own with the support of the company to get more experience or skills but what can you do with it inside the company? Is there the possibility to get a promotion to another position to have international experience inside the company? All this questions are tackled inside this project. Do you have team buildings? Sometimes for example for newcomers there is a big workshop in Ludwigshafen where they explain the new people about BASF as a company and what they are doing and offering. On the other hand each unit has to think about their teambuilding: For example for this location in Monheim we have a summer festival. Where people could bring their families and they had a nice summer party on an area nearby with music and food and drinks. Thank you very much for the information You are welcome
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