Letter from the Chairman & CEO
WHAT WE ACHIEVED IN 2006
Fixing Operational Problems
We have continued to work on fixing the deep-seated operational problems in a number of specific businesses and progress was made in many of them during the year.
One example of this is UK Washroom, perhaps the most complex performance improvement programme we are undertaking. The first stage involved separating the washroom business from the linen and workwear activities, which were then closed. The second stage was integration of the former Rentokil and BET washroom operations – run separately since BET was acquired ten years ago – to build a new washroom business different from either of those it is replacing. Thirty branches have been closed and we now operate from 25 locations with plans to reduce to 20. You can read more about this on this page.
UK Pest Control is another example of how we are tackling operational problems. Despite its leading market position, this business had suffered for some time from an erosion of customer contracts as a result of inadequate service performance and a one dimensional approach to winning new customers. A new management team is addressing these issues by using service knowledge and customer focus, combined with efficient delivery, to retain and win customers. Click here to get more details on this and the benefits we expect to gain.
Significant restructuring has also been carried out in the French textiles business. The new structure centralises the management of processing plants while retaining profit and loss responsibility at branch level. Sales management has been bolstered in an endeavour to improve sales productivity. The centralised management of processing should lead to a better approach to plant investment and capacity utilisation.
The three businesses in these examples together account for over 15% of total revenue from continuing operations and their success is therefore critical to the overall success of the company. In each case, a significant amount of organisational change is taking place affecting a large number of people in many different locations. To avoid the risk that the change programmes will not be executed as well or as quickly as anticipated, there are detailed plans in place which are monitored closely to ensure we can correct any deviations in an effective and timely manner.
