Sustainability Thinking Pays Off; New Framework Drives Game-Changing Ideas presented by Michael Huthart - ADVA Optical Networking.

1. Sustainability thinking pays off
New framework drives game-changing ideas
Michael Huthart, June 17, 2015

2. © 2015 ADVA Optical Networking. All rights reserved. Confidential.2
Content
• Who is AVDA Optical Networking?
• CSR in ADVA pre-2014
• Get in the game ADVA!
• New Way of thinking – 10 dimension model Baseline
• Post-mortem after Baseline
• Fixing the weak spots - Stakeholders Engagement Example
• Fixing the weak spots – Circular Economy Example
• The Game Changing Challenge
• So where did we take it?
• Public recognition - rewards

3. © 2015 ADVA Optical Networking. All rights reserved. Confidential.3
ADVA Optical Networking
Richardson Atlanta Munich Meiningen Berlin Singapore Shenzhen
Headquarter
Office
Representative
Mobility Data Centers Cloud
ADVA is a global provider of fiber optic infrastructure products and services

4. © 2015 ADVA Optical Networking. All rights reserved. Confidential.4
Culture of Continuous Improvement & Growth
Our History
• Public company (FSE: ADV, TecDAX)
• Founded in 1994
Our Performance
• 19% revenue CAGR since 1994
• 2015 revenue to exceed 350M EUR
Our CIP Culture
• Rooted in TL9000 framework
• Global ISO9001 Certification (2006)
• Global TL9000 Certification (2009)
• Global TL9000 Re-Cert (annually)
• We’re constantly optimizing internally via
ADVA Efficiency Engine, Lean, 6-sigma, etc
Our People
• 1498 person team at year-end 2014
Our Innovation Strength
• 700 R&D engineers (50% of staff) at
year-end 2014
• up 15% per year on average over the
last 4 years
Your trusted partner for speed and innovation

5. © 2015 ADVA Optical Networking. All rights reserved. Confidential.5
CSR in ADVA 2010
• We had a mix of good and bad
• We had no cohesive framework
• We had to learn to share
• We had great programs hidden
• We had no public ‘face’
wandering
no ‘face’

6. © 2015 ADVA Optical Networking. All rights reserved. Confidential.6
CSR in ADVA 2010
• By end 2010 we had a
pretty good idea of what
we needed to build
• It was a BIG list!
• Things like…
Building cross-functional teams
Nurture Local Volunteer’s
Developing Supplier Code of Conduct

7. © 2015 ADVA Optical Networking. All rights reserved. Confidential.7
Fast Forward to 2013 – the 5 pillars
• By then our house had a foundation – the 5 pillars

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Fast Forward to 2013 – huge momentum

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Get in the game ADVA!
• But still, at the end of 2013 we were told to get serious
about Sustainability or potentially be replaced
• While our program had matured, it still lacked structure
and cohesiveness
• It was a wake-up call for ADVA – we needed a more
comprehensive approach

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New Way of Thinking - 10 dimension model BASELINE
• We opened our doors.
• We engaged and learned
a more comprehensive
approach.
• We received clear
feedback on strengths
and gaps.

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Post-Mortem after baseline
• We didn’t have the right team – needed more horsepower
and wider reach
• We had complete blind-spots
• We had to recommit ourselves to learning about blind
spots and developing programs around them.

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Stakeholder Engagement Example

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Who are ADVA Stakeholders?
• ADVA Stakeholders
customer community employeesuppliershareholder analyst
+

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How do we typically engage them?
customer
community
employee
supplier
shareholder
analyst
Customer QBR’s, Regional ADVA Symposiums, Industry Symposiums,
Trade Shows, Annual CSAT Survey administered in-person, GRI Index
Local focused outreach to preferred charities, ADVA open house events at
bigger sites, ADVA-driven involvement in regional environmental topics
Shareholder meetings, Annual Report, Quarterly Investor Roadshow,
Regional ADVA Symposiums, GRI Index
Supplier Lifecycle Management Process, Quarterly Business Reviews,
Process Quality Audits, CSR & Sustainability Audits, GRI Index
Global Management Meeting, Quarterly Vorstand Town Hall Meetings,
Workers Council, Monthly Executive Reports, Employee Sat Survey
Shareholder meetings, Annual Report, Quarterly Investor Roadshow,
Regional ADVA Symposiums, Analysts Day, GRI Index

15. © 2015 ADVA Optical Networking. All rights reserved. Confidential.15
But, Sustainability dialog has been limited
customer
community
employee
supplier
shareholder
analyst
Customer QBR’s, Regional ADVA Symposiums, Industry Symposiums,
Trade Shows, Annual CSAT Survey administered in-person, GRI Index
Local focused outreach to preferred charities, ADVA open house events at
bigger sites, ADVA-driven involvement in regional environmental topics
Shareholder meetings, Annual Report, Quarterly Investor Roadshow,
Regional ADVA Symposiums, GRI Index
Supplier Lifecycle Management Process, Quarterly Business Reviews,
Process Quality Audits, CSR & Sustainability Audits, GRI Index
Global Management Meeting, Quarterly Vorstand Town Hall Meetings,
Workers Council, Monthly Executive Reports, Employee Sat Survey
Shareholder meetings, Annual Report, Quarterly Investor Roadshow,
Regional ADVA Symposiums, Analysts Day, GRI Index

16. © 2015 ADVA Optical Networking. All rights reserved. Confidential.16
Let’s change that going forward
• Develop a Strategy
• Move away from top-down towards collective voice
• Institutionalize dialog – collect the inputs and feed back

17. © 2015 ADVA Optical Networking. All rights reserved. Confidential.17
• Stakeholder announcement and Survey on
Sustainability.
• Feedback to Stakeholders of aggregated
results.
• Annual GRI reporting.
• External GRI assurance.
• Annual standalone Sustainability Report.
• Frequent public website updates on ‘About
Us’.
Develop a Strategy on Stakeholder Engagement
• Let stakeholders know Sustainability
is a strategic initiative for ADVA.
• Collect stakeholder direction how
they want us to progress the topic.
• Return a readout of the consensus
direction we aggregate from them.
• Show them how their direction
results in future goals.
• Institutionalize collecting stakeholder
direction.
• Institutionalize reporting of our
results.
Stay in constant
dialog with ADVA
Stakeholders on
how we should
drive
Sustainability in
ADVA.
Mission
Key Objectives
Key Initiatives
Set strategic direction with the voice of the Stakeholders

18. © 2015 ADVA Optical Networking. All rights reserved. Confidential.18
Move away from top-down
customer
community
employee
supplier
shareholderanalyst
Survey 1
Survey 1a
Long-standing
CSAT Survey
Long-standing
Employee Survey
Continue 1a annually
Integrate in ESS annually
Integrate in CSAT annually
Continue 1 annually

19. © 2015 ADVA Optical Networking. All rights reserved. Confidential.19
Institutionalize Dialog
• Annual CEO Statement
• Annual GRI Index
• Every-other-year GRI External Assurance
• Annual Standalone Sustainability Report
• Constant updates to public website About Us

20. © 2015 ADVA Optical Networking. All rights reserved. Confidential.20
Circular Economy Example

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ADVA’s first full LCA - 2012

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CE Best Practices Exposure
• ADVA sought and received training on CE Best Practices

23. © 2015 ADVA Optical Networking. All rights reserved. Confidential.23
CPMR’s
Routers
Bringing to light what we were already doing
Refurbishment
• We’re taking back the BT Routers that have
either been cancelled or ceased from BT.
• We wipe off circuit information, test and
check operating status.
• Approx 200 units per year from one BT stock
location alone.
Re-Use Olympic Refurb Project
• Program in place for the kit used in the
Olympics. CPMRs and SFPs. The process offers
BT…
• CPMR – Test, replace accessories, clean and
test, accessories clean and/or replace.
• ADVA supplied the packaging to BT to return
these units to ADVA.
• To-date we have completed 152 x CPMRs and
201 x SFPs.
• Creative Customer Programs bring value to customer and environment

24. © 2015 ADVA Optical Networking. All rights reserved. Confidential.24
Game Changing Challenge - Pitches
• Pitch 2 Radical ideas:
• 1) Network Design 2) ADVAnced Logistics
• Saw Long-term benefit Oh, let’s go do this NOW!
x-Haul
X
Y

25. © 2015 ADVA Optical Networking. All rights reserved. Confidential.25
Game Changing Challenge – Real Benefits
Real Customer Benefits
• Saves 300,000 miles/year
• Saves 13,000 hours/year
• Cuts 750 tons CO2 /year
• 300% ROI
• New chapter in our relationship

26. © 2015 ADVA Optical Networking. All rights reserved. Confidential.26
So where did we take it?
We moved from high Bronze (Red line) to high Silver (Blue line)
• Major improvements in
1 year
• Won Game Changing
Challenge

27. © 2015 ADVA Optical Networking. All rights reserved. Confidential.27
Don’t be afraid to jump in – there can be a payoff!

28. info@advaoptical.com
Thank you
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