Cargill Presentation - March 2.ppt

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  • For the past few years, and this is the topic of today’s discussion, Cargill has undergone a strategic transformation that is playing itself out as I speak. We are in year three of a 10 year plan that is known as Strategic Action. It was birthed as Strategic Intent and converted to Strategic Action earlier this year to give it more ooomph. It coincides too, with the introduction of a new brand identity, the first new logo for the company in 36 years.
  • We’re a diverse company in many corners of the world, but we’re united by our vision. That’s to be the global leader in nourishing people. Our mission is to create distinctive value. Our approach is to be trustworthy, creative and enterprising. Our performance measures are: Engaged employees Satisfied customers Enriched communities Profitable growth
  • (NOTE: Builder slide…. Need to advance for each point after grain in your cereal and oranges in your juice) Cargill is working to provide distinctive value to our customers. Our Health & Food Technologies group develops and markets science-based, health-promoting ingredients for food and dietary supplements industries worldwide. Men’s and Women’s bread - We have teamed up with French Meadows Bakery to supply the soy isoflavones they are using in their Men’s and Women’s Bread. Sport drinks - Our H&FT group has developed Trehalose, a unique sugar that helps the body to absorb calcium which we are using in our energizing sport drink. Soy Protein - Our Soy Protein Solutions group has developed a high-performance breakfast beverage that incorporates six different ingredients produced by Cargill, and energy bars that contain 13 grams of protein per serving. NUT-NOTS - In response to the rising cost of macadamia nuts, Cargill's Wilbur Chocolate business has introduced NUT-NOTS(TM) Macadamia Nut Extenders. Formulated to harden to a nut-like texture when baked, the oil-based extenders are flavored to closely imitate the real thing.
  • Restaurants and food retailers virtually anywhere in the world look to Cargill not only for the highest quality product, but also for the most innovative solutions in sourcing, reducing risk, designing and marketing food. Cargill is an integral partner to Outback Steakhouse known for its steaks, attentive service or famous “Bloomin’ Onion ®” appetizer. Cargill’s chefs have worked with Outback to develop a marinade for steaks that will help provide a ‘softer bite’ preferred outside North America. We were also able to provide them with the expertise of working within Asian regulations for imports. Additionally, Cargill’s Fontina Foods is working with them to develop a proprietary spice for mashed potatoes. When Outback came to us and asked us to supply the steaks for their volunteer effort to serve our troops in Afghanistan, we willingly agreed. Cargill supplied enough steak filets to serve 13,000 American service men and women at two bases. The event generated an enormous amount of goodwill among the troops who were hungry for some home cooking.
  • On the technology side, we’re producing natural plastic from corn. We have a joint venture with Dow Chemical to form Cargill Dow Polymers. This woman is wearing clothes made from polylactic acid -- PLA -- which was developed by Cargill. It's made from corn. “Natural plastic” is what the newspapers call it. Initially we were interested in this product’s ability to biodegrade. But a couple of years ago someone from Dow called it "one of the most versatile and exciting new polymer platforms ever seen in the plastics industry.” Cargill Dow has been recognized for their innovation. They received the 2002 Presidential Green Chemistry Challenge, Alternative Reaction Conditions Award, and were named the 2001 Technology of the year by the US Dept. of Energy.
  • Cargill has has formed strategic account management committees for our key customers such as General Mills, Walmart, McDonald’s and Kraft. We will focus our resources on what will make our strategic customers most successful and deliver innovation and results because our customer’s success IS our business. Other key customers include: Applebees Coca-Cola Nestle Outback Steakhouse PepsiCo Rich’s
  • Another example of traction on our journey is the level of operational excellence we’re achieving in safety. Working in more than 1,000 locations around the world, Cargill employees achieved a record safety index of 1.7 in fiscal 2002. These accomplishments are all the more significant, given the number of people and facilities that came to Cargill from acquisitions in the past two years. It shows the power of a safety mindset: combining a shared belief that all accidents are preventable with the right tools and resources to achieve success.
  • Cargill Presentation - March 2.ppt

    1. 1. Nourishing Ideas Nourishing People
    2. 2. Cargill at a Glance <ul><li>Cargill Founded </li></ul><ul><li>1865 </li></ul><ul><li>Grain warehouse in Iowa </li></ul><ul><li>Core Capabilities Developed </li></ul><ul><li>Risk Mgmt </li></ul><ul><li>Supply Chain Mgmt </li></ul><ul><li>Global Mgmt </li></ul><ul><li>Core Value Established </li></ul><ul><li>Trustworthy </li></ul><ul><li>Creative </li></ul><ul><li>Enterprising </li></ul><ul><li>TODAY </li></ul><ul><li>$59 Billion+ in Gross Sales </li></ul><ul><li>Over $1 Billion in Net Earnings </li></ul><ul><li>Net Worth >$9 Billion </li></ul><ul><li>97,000 Employees in 1000 Locations </li></ul><ul><li>Core Behaviors </li></ul><ul><li>Customer Focused </li></ul><ul><li>Innovative </li></ul><ul><li>High Performing </li></ul><ul><li>Integrated Food Products and Food Service Company </li></ul>
    3. 3. Geographic Presence North America 37% of net worth 50,889 employees Latin America 16% of net worth 15,123 employees Europe/Africa 36% of net worth 15,763 employees Asia/Pacific 11% of net worth 15,186 employees
    4. 4. Strengths of Cargill’s Businesses <ul><li>Reputation for integrity </li></ul><ul><li>Financial soundness </li></ul><ul><li>Knowledge of the food system </li></ul><ul><li>Building for long-term success </li></ul>
    5. 5. Culture & Behaviors <ul><li>Ethics/Guiding Principles </li></ul><ul><li>Total Quality </li></ul><ul><li>Food Safety </li></ul><ul><li>Customer Oriented </li></ul><ul><li>High Performance </li></ul><ul><li>Innovation </li></ul><ul><li>Engaged and empowered work force </li></ul><ul><li>Customer/Consumer Insight </li></ul><ul><li>Community Involvement </li></ul>
    6. 6. Changing Market Environment <ul><li>Agri-food Industry faced with significant changes and challenges </li></ul><ul><ul><li>Increasingly complex business environment; faster pace of change </li></ul></ul><ul><ul><li>Customers/competitors consolidating </li></ul></ul><ul><ul><li>Greater reliance on outsourcing/more sophisticated suppliers </li></ul></ul><ul><ul><li>Pressure to deliver top line growth through new product intros vs. product extensions </li></ul></ul><ul><ul><li>Shifting power to consumers (health, wellness, taste, convenience) </li></ul></ul><ul><ul><li>Margin pressures; over capacity </li></ul></ul>
    7. 7. Corporate Strategy Guidelines <ul><li>Private ownership </li></ul><ul><li>Focus on agriculture and food </li></ul><ul><li>A+ credit rating </li></ul><ul><li>Operating managers </li></ul><ul><li>Grow our competencies </li></ul><ul><li>Maintain basic beliefs </li></ul>
    8. 8. Year Four of a 10-Year Plan <ul><li>Strategic Action </li></ul><ul><li>“By 2010, Cargill will be the recognized global leader in providing our agricultural and food customers with solutions that enable them to succeed in their businesses.” </li></ul><ul><li>-Warren Staley memo, February, 1999 </li></ul>
    9. 9. Our Plan – Strategic Action <ul><ul><li>10 year journey, long-term perspective, but short-term urgency </li></ul></ul><ul><ul><li>Internal education: explore, discover, create, deliver </li></ul></ul><ul><ul><li>Cross-organization collaboration and transparency </li></ul></ul><ul><ul><li>Restructuring and aggressive cost management </li></ul></ul><ul><ul><li>Re-focus our portfolio on Ag/Food (exit Rubber, buy Agribrands, form Food System Design) </li></ul></ul>Relationships Agri-food chain as our center of gravity Transactions Broad Diversification Solutions Commodities Customer Needs Capabilities
    10. 10. Corporate Business Unit Focus Employee Focus Collective
    11. 11. Source: Cargill Strategic Intent Presentation, June 2000 Three Areas of Strategic Activity Cargill will provide Food Chain Customer Solutions in the following areas: These new areas of activity would need to be incorporated into Cargill’s existing businesses. Basic Nutrition Building Blocks Customer Solutions Supply Chain Management Food Applications Nutrition & Health Existing Cargill Food Chains
    12. 12. Women’s and Men’s Bread with AdvantaSoy TM Innovative Solutions Energize Sport Drink with Trehalose NUT-NOTS TM Soy Signature Bar Performance Breakfast
    13. 13. Outback Steakhouse
    14. 14. The world's first man-made fiber from 100% annually renewable resources. A fiber that not only touches your skin but also touches your soul.
    15. 15. Focus on Our Strategic Accounts General Mills
    16. 16. Cargill reached a safety milestone Cargill’s safety index measures the frequency and severity of work-related injuries based on the number of hours worked. It decreased to a record 1.7 in fiscal 2003. Success Story - Safety
    17. 17. Supply Chain Management The Customer Satisfaction/ Efficiency Paradox March 2, 2004
    18. 18. Grain Distribution Example Distribution Raw Material Production Raw Material Logistics/ Storage Processing Manufacturing Customer En d User/ Consumer Processes/Organization Technology Materials/Cash Information Risk Management <ul><li>Grain originated from country </li></ul><ul><li>Transported through elevator system </li></ul><ul><li>Exported and distributed to the customer </li></ul>Supply Chain Optimization Product Assurance New Product development Raw Material Input
    19. 19. Grain Processing Example Distribution Raw Material Production Raw Material Logistics/ Storage Processing Manufacturing Customer En d User/ Consumer Processes/Organization Technology Materials/Cash Information Risk Management <ul><li>Grain contract grown and originated from country </li></ul><ul><li>Transported through elevator system </li></ul><ul><li>Processed into food ingredient </li></ul><ul><li>Distributed to food manufacturer </li></ul>Supply Chain Optimization Product Assurance New Product development Raw Material Input
    20. 20. Fully Integrated Meat Example Distribution Raw Material Production Raw Material Logistics/ Storage Processing Manufacturing Customer En d User/ Consumer Processes/Organization Technology Materials/Cash Information Risk Management <ul><li>Specialty formulation fed to animals in feedlot </li></ul><ul><li>Animals tracked through feedlot to slaughter plant </li></ul><ul><li>Processed to product specific specifications </li></ul><ul><li>Distributed to further processing facility </li></ul><ul><li>Distributed to grocery or food service channel </li></ul>Supply Chain Optimization Product Assurance New Product development Raw Material Input
    21. 21. Grain Distribution Discussion Distribution Raw Material Production Raw Material Logistics/ Storage Processing Manufacturing Customer En d User/ Consumer Processes/Organization Technology Materials/Cash Information Risk Management <ul><li>Grain originated from country </li></ul><ul><li>Transported through elevator system </li></ul><ul><li>Exported and distributed to the customer </li></ul>Supply Chain Optimization Product Assurance New Product development Raw Material Input Satisfy customer’s expectation of ‘guaranteed free of’ at low cost
    22. 22. Grain Processing Discussion Distribution Raw Material Production Raw Material Logistics/ Storage Processing Manufacturing Customer En d User/ Consumer Processes/Organization Technology Materials/Cash Information Risk Management <ul><li>Grain contract grown and originated from country </li></ul><ul><li>Transported through elevator system </li></ul><ul><li>Processed into food ingredient </li></ul><ul><li>Distributed to food manufacturer </li></ul>Supply Chain Optimization Product Assurance New Product development Raw Material Input How to respond to customer dissatisfaction as a result of new technology implementation?
    23. 23. Fully Integrated Meat Example Distribution Raw Material Production Raw Material Logistics/ Storage Processing Manufacturing Customer En d User/ Consumer Processes/Organization Technology Materials/Cash Information Risk Management <ul><li>Specialty formulation fed to animals in feedlot </li></ul><ul><li>Animals tracked through feedlot to slaughter plant </li></ul><ul><li>Processed to product specific specifications </li></ul><ul><li>Distributed to further processing facility </li></ul><ul><li>Distributed to grocery or food service channel </li></ul>Supply Chain Optimization Product Assurance New Product development Raw Material Input Satisfy consumer’s demand for safe, low cost meat
    24. 24. Thank you! Jenny L. Verner Vice President Supply Chain Management Cargill [email_address] 952/742-5034

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