AMWAY MOVING FORWARD Luke Nieuwenhuis Global Strategic Planning
AMWAY MOVING FORWARD Luke Nieuwenhuis Global Strategic Planning Growth Through Innovation 2012
GGC 2012 – Focus • Enterprise Strategic Direction • Enabling Sustained Distributor Success • The Many Facets of Inspired Leadership Growth Through Innovation 2012
GLOBAL STRATEGIC PLANNING PRIORITIES • Strategic Alignment • Balanced Growth • Enterprise Operating Model Growth Through Innovation 2012
STRATEGIC ALIGNMENT – OUR FRAMEWORK Vision & Purpose: What we seek to do Values: What we believe and how we behave GTI Strategy: Roadmap for sustained growth Strategy Statement: Our competitive game plan Strategic Pillars: Building blocks to create alignment Market & Functional Plans: Clarify strategies and implementation Operating Model: Operating Principles: Measures: Optimizing how we work as a global enterprise Guide how we design the operating model Specific, aligned outcomes of our progress Growth Through Innovation 2012
GTI: 2012 KEY INITIATIVES Business Opportunity 1)Implement the business opportunity marketing plan 2)Optimize the 4 levers of the compensation plan 3)Training to build distributor competencies Growth Through Distributor, Customer, Consumer Experience Products & Brand Management Business Excellence 1) Successfully launch e. Spring in China 1) Enterprise Strategic Operating Model 2) Global launch of All. Plant Protein Powder 2) Focus on Supply Chain 2012 SOM initiatives 1) Enabling Technology – Digital tools 2) Segment engagement strategies: Leaders, new distributors, Gen. Y 3) Artistry Restage 3) Increased investment in Innovation 2012 Go-To Market strategies 3)Human Capital Planning
ENTERPRISE SOM GREATER CHINA SALES/DR MARKETING HR GLOBAL STRATEGY SUPPLY CHAIN LEGAL R&D IT FINANCE Growth Through Innovation 2012 ASIA PACIFIC AMERICAS EUROPE, INDIA & AFRICA
GTI: KEY BUSINESS INDICATORS 2010 2011 2012 Enterprise Sales $9. 6 B $10. 9 B $11. 7 B Distributor Renewal 50. 8% 52. 4% 53. 5% Operating Income % 16. 5% 16. 4% Productivity $1079 $1179 $1220 Direct Selling Sales $9. 0 B $10. 3 B $11. 0 B Sponsoring 4. 09 M 4. 13 M 4. 23 M Engagement 57. 6% 57. 5% 58. 0% Engagement Count 5. 2 M 5. 3 M Actual Market Share 9. 7% Net Favorability 27% Proj. 2010 Proj. 10. 4% 11. 0% 32% 35% Growth Through Innovation 2012 Actual 5. 1 M 2011 Proj. 2012 Proj.
1991 Last time ALL Amway top ten markets experienced growth during the same year Growth Through Innovation 2012
GROWTH PAST, PRESENT & FUTURE $13 B Market Sales $10. 4 B Sales from New Markets (1990 -Present) Distr Cost $7. 8 B Sales from Mature Markets (Prior to 1990) $5. 2 B $2. 6 B Actual Projected 1966 1991 Year 2007 2014
Projected Enterprise Sales by LRBP Period $16 B LRBP 2012 -2014 LRBP 2011 -2013 LRBP 2010 -2012 $14 B 13. 5 12. 4 11. 7 $12 B 10. 2 $10 B 9. 9 11. 8 10. 4 9. 5 $8 B All sales figures are presented in 2011 exchange rates 2010 2011 Growth Through Innovation 2012 2013 2014
1 During this LRBP, Amway is projected to become the world’s largest direct selling company Growth Through Innovation 2012
GTI Taking the long view.
GTI: A CHANGING WORLD 7 in 10 Consumers in emerging markets would take action to support social purpose brands. 500 Facebook has over million active users who spend over 700 billion minutes per month on the site. 40% India has the largest Gen. Y population in the world. In an increasingly transparent world, 70% trust consumer opinions online, while 90% trust their network of friends. By the end of the next decade, the part-time workforce will grow to about 40% of the employee market. Rising from corners of the globe are 42 economically energized pockets of growth that we call “emerging markets”.
GTI: A CHANGING WORLD How well placed is Amway to succeed? How can we best support our business owners in an uncertain world?
GTI: 10 Year Plan • Understand the drivers of change that impact Amway and our distributors • Develop greater clarity in Amway’s strategic choices • Refine framework for strategy development within our pillars • Validate (or challenge) existing long-term plans
GTI Taking the long view.
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