Developing cultural change Together The cultural development process

Developing cultural change. Together. The cultural development process at Deutsche Bahn DB AG Corporate Culture Office HZ July 2015

What is Company Culture? Cultural Change at DB 1

Culture is the amount of a society‘s unwritten rules, which apply as the „right“ kind of thinking, feeling and acting 2

Company Culture roots in deep assumptions and mints the employees‘ behaviour among each other as well as structures and processes Company Culture Observable Behaviours, structures and processes Values and Norms Not observable Ground Assumptions 3

Company Culture appears in a lot of aspects of daily work and mints the companies‘ perception from the outside Company Culture Company image Proces ses Structu and res n tio ica n mu om C Personal proactivenes s & responsibility/ Observeable Handling cha ta Rules and s nge … Premises Not observable ndards Leaders So part cialners hip … hip Coll abo ratio Werte und Normen, ungeschriebene Regel assumptions, norms, Grundannahmen values and unwritten laws 4 n

Company Culture is the critical factor for longlasting company success „Culture eats strategy for breakfast. “ Strategy Peter Drucker „I define culture as the sum total of everything an organization has learned in its history in dealing with the external problems, which would be goals, strategy, how we do things, and how it organizes itself internally. “ Edgar Schein Structure Culture 5

What is Company Culture? Cultural change at DB 6

Cultural change is a critical component of our DB 2020 strategy: We want to do more to improve employee satisfaction Vision Sustainability dimension To become the world’s leading mobility and logistics company Sustainable business success and social acceptance Profitable market leader Economic 1 No. Strategic directions 1 Customer and quality 2 Profitable growth Top employer Social 10 Top 3 Cultural change/ employee satisfaction Eco pioneer Environmental 1 No. 4 Resource preservation/ emissions and noise reduction

Corporate culture is the key to success – only satisfied employees can promote customers satisfaction “Culture affects everything that is important: the satisfaction of our employees, our public image, our attractiveness as an employer, the loyalty of our customers and our employees, our productivity, performance, innovation and our role as entrepreneur. ” Ulrich Weber, Member of the Management Board for Human Resources

Our cultural change is based on open dialogue - questioning, listening and participating to build a shared cultural vision

We held five Conferences on the Future, brought the dialogues to the regions and are intensifying our efforts on a local level Five Conferences on the Future, one for each of the following groups: 4 management levels (KFK/OFK 1, OFK 2/3, LFK, BFK) and staff members 14 Regional Dialogues on the Future and one International Dialogue on the Future in Barcelona Two events, each with up to 300 executives and staff members in attendance, were held in each region Three Dialogues on the Future on a regional level outside of Germany Staff members and executives from all business units in one country/region Dialogue at a local level Executives with their teams/units

In January 2012 we held the first International Dialogue on the Future in Barcelona to bring the dialogue to Europe Two issues were particularly important: collaboration across DB’s business units and a common vision n “Is the board considering measurements to encourage better collaboration between business units? ” n “Are there any plans to do the Dialogue on the Future on a national level, like the conferences in Germany? ” We combine our efforts to reach our common goals n “Will there be further plans to share information within countries to understand DB vision and strategy? ” n “How do we communicate the DB vision effectively after this meeting? ” n „To know each other can finish the fear to share clients and info. ” n “Together we can get there! – The question is what exactly is “there”? ” n “In conclusion: We find this conference very positive. ” At DB, we all share the same vision

The results of the cultural analysis and the feedback we received at the Conferences provide us with a clear vision for our change: People in focus! We want an agile Organization, with self-confident employees, who feel valued for their activities, act loyal towards the company and work with enthusiasm for Deutsche Bahn and our customers. Leadership Improving the quality of leadership/ approachability and openness of executives/stronger inclusion of staff members Personal responsibility Encouraging an entrepreneurial spirit/ more flexibility in decision-making at the local level/giving others room to make decisions/having the courage to decide Cooperation in the spirit of partnership, including across business units/ integrity, respect and appreciation in our day-to-day interactions Communication Developing a culture of dialogue and feedback marked by openness, a spirit of trust and constructive criticism/ encouraging transparent and direct communication

Our understanding of cultural development: continious integration, questioning and working on changes STRATEGY DB 2020 ECONOMICS SOCIAL AFFAIRS ECOLOGY 6. 1. Retaining and Exchange: Storytelling, Best Practice, exchange, rewarding, e. g. DB Award and networks Analysis Cultural analysis, Employee Satisfaction Survey Cultural Change at DB 2. 5. Changing: Implementation of activities, that have been idnetidfied by the employee satisfaction survey and ist follow-up workshops Open Close Biennial Rhythm through Employee Satisfaction Survey Adjustment / Reflection of Focus topics 4. Qualification: Qualificationand Inspiration of leaders, employees and multiplicators Büro Unternehmenskultur (HZ (2)) 13 Evaluation and Communication communication of results, Follow-up workshops 3. Dialogue and Mobilisation: Conferences on the Future, Dialogues on the Future, Culture Dialogue Picture, Workshops on the Future

To implement changes on site, the cultural change needs to happen on different levels – everyone can contribute Corporate level Board of Management Holding functions (Strategy, HR development…) Corporate Culture Office Local level Regional Level Pace setters Active Managers Regional representatives Active Employees Regional HR-network Division level Change Agents / Projectleaders Division Boards 14 HR-development/ Communicators

The Dialogue continues with three Dialogues on a regional level outside of Germany (Wroslaw, Amsterdam, Manchester) Objectives of international dialogues on the future: n Continuing direct dialogue between business units and with participants outside of Germany n Developing understanding of each others, understanding DB's vision and strategy, understanding the cultural change process n 4 th Int. Dialogue on the Future, Manchester 25 -26 November 2014 with 300 participants from UK (host: DB Arriva) § 3 rd Int. Dialogue on the Future, Amsterdam 13 -14 November 2013 with 300 participants from Netherlands and Belgium (host: DB Schenker Logistics) § Strengthening the sense of belonging and togetherness within DB and promoting better cooperation between the business units active within a region/country § 2 nd Int. Dialogue on the Future, Wrocław 14 -15 February 2013 with 300 participants from Poland (host: DB Schenker Rail) § 1 st Int. Dialogue on the Future, Barcelona 17 -18 January 2012 with 300 participants from all of Europe (host: DB) Deutsche Bahn AG, Ulrich Weber, 4 September 2014 15

The Dialogue on the DB Future in Poland was a successful kick-off to strengthen collaboration between business units outside of Germany Dialogue on the DB Future in Poland n 14. /15. February 2013, Wroclaw n Two days with evening event n Organized by DB Schenker Rail Polska n Hosted by the CEO of the business units in § Wrocław n n Poland (DB Schenker Logistic, DB Schenker Rail, DB Arriva) 300 participants – executives and nonexecutives –representing all business units in Poland Members of the Management Board of DB Group and of the businuess units as guests Information and intensive discussions about DB’s strategy, DB’s culture and cooperation within DB Workshop “Knitting the DB Net” as a strong symbol for cooperation

Please take the initiative. Thank you very much! The Corporate Culture Office is glad to help. Contact us at: unternehmenskultur@deutschebahn. com