To earn the right to grow, the Group first needs to prioritize margin recovery. The aim of the Accelerated Improvement Program, which will run until the end of 2015, is to improve the Group’s profitability, to reduce complexity and to increase focus. In 2016 and beyond, priority will gradually shift towards expansion and profitable growth. The goal is to realize the full potential of market leadership by 2020.
The Accelerated Improvement Program is the Group’s vehicle for profitability and focus. It was launched in October 2013 and includes five initiatives. In short, the program aims to increase the operating margin to at least 10 percent in 2016 by improving the mix of products and brands sold and reducing the cost of products sold. The program will be finalized in 2015 and will deliver full financial impact in 2016. In 2014, the Group’s operating margin increased by 1.9 percentage points to 7.2 percent.
The Group’s competitiveness depends on the ability to drive and respond to customer needs. As the Group gradually shifts focus to profitable growth beyond 2016, the organization will have an even stronger end-customer and market focus. The uniqueness in the breadth of the product offering will remain, however, paired with an increased focus on the differentiating factors for success in each end-customer segment, aiming for market leadership by 2020.