AkzoNobel is a truly global, high-performing paints and coatings company with a proud heritage which can be traced back to 1792. Our world class portfolio of established brands is trusted by customers around the globe and we continue to be guided by a strong set of core values – safety, integrity and sustainability.
Since 2017, our strategic focus has been on delivering our Winning together: 15 by 20 ambition, which has positioned us among other leading players in the industry. Ultimately, our goal is to take our rightful place as a frontrunner, both in terms of size and performance.
This ambition is reflected in our new company purpose – Pioneering a world of possibilities to bring surfaces to life – which was developed with input from a broad range of employees and other stakeholders. As we look to accelerate on the next phase of our journey, our new Grow & Deliver strategy is all about building on the strong foundation we’ve now established.
From 2021 onwards, we will pivot towards growth, while delivering further profitability improvement. To help us deliver what we want to achieve, we’ve updated our behaviors framework to guide a new way of working. The fundamentals remain the same – passion for paint, precise processes, powerful performance and proud people. Our key behaviors have now been more clearly defined to help drive further success (see visual below).
With sustainability as one of our core values, we strive to be the leader in our industry by empowering people, reducing our impact on the planet and consistently innovating to deliver the most sustainable solutions for our customers. That’s why we call our approach to sustainable business “People. Planet. Paint.”
We’re well placed in the €130 billion paints and coatings industry, with a balanced geographic presence and a strong portfolio of brands, with leading positions in most segments. This offers multiple opportunities for growth.
For example, we have a significant presence in Asia Pacific – where we currently generate around 29% of revenue – and all market segments. We’re the leader in the fast-growing powder coatings segment, which currently contributes around 13% of revenue. Other segments also offer exciting growth opportunities, such as our decorative paints in South America and – driven by a shift away from single use plastics – packaging coatings.
Strategic mandates – assigned per segment and region – are used to provide clear direction for each of our businesses, including relative priorities for growth and profitability improvement. These strategic mandates, which helped to drive a step-change in performance over the last three years, have been updated for 2021 onwards.
We’re passionate about customer needs and have a customer service mindset. Commercial excellence is all about putting in place more customer focused, data-driven, commercial processes. This will help to fuel our growth.
Innovation is also fundamental to our success (see the Accelerating our innovation chapter). Having been pioneers since 1792, we know what it means to go beyond when it comes to providing customers with quality solutions – how to understand and anticipate their needs. Our industry-leading Paint the Future innovation ecosystem is a great example of how our pioneering spirit is helping us to continue pushing boundaries.
We have a solid platform for adding to organic growth through targeted acquisitions. Clear capital allocation priorities, and a strong balance sheet, underpin a disciplined approach to conducting value creating acquisitions, aligned with our strategic mandates.
Delivering performance improvement
Several initiatives started during the Winning together: 15 by 20 phase of our journey will also continue in the future, including ERP and application integration, as well as improving end-to-end processes. These initiatives provide the strong foundation on which our Grow & Deliver strategy is built.
The next phase of our strategy requires an evolution of our operating model, moving from functional excellence in silos to driving cross-functional collaboration and becoming even more customer focused.
Margin management demands strong profitability analysis, combined with predictive margin management and pricing excellence. This will ensure we maintain variable margins throughout the cycle.
Creating a world class supply chain requires more efficiency and effectiveness – also in planning processes – to meet customer needs with superior service levels.
Product management is necessary to deliver the right products to customers and win in the market, at the most competitive cost for the company, with less complexity and increased collaboration with our suppliers.
Optimizing our manufacturing network will be organized around three models to serve customer needs – simple and efficient; managed complexity; agile and adaptive.
Seamless business processes will be effective and cost competitive, allowing greater focus on what matters most.
It’s now time for AkzoNobel to become the frontrunner. Our strategy is to Grow & Deliver, as a high-performing organization, pioneering a world of possibilities to bring surfaces to life.
Welcome to our future!
Operating income is defined in accordance with IFRS and includes the relevant identified items. Adjusted operating income excludes identified items.
Identified items are special charges and benefits, results on acquisitions and divestments, major restructuring and impairment charges and charges related to major legal, environmental and tax cases.
Includes Central America.