Letter from the Chairman & CEO
WHAT WE ACHIEVED IN 2006
Building and Developing Our Team and Culture
The culture and the commitment of management and staff are extremely important to the success of the group. These are not easily measured and it is difficult for shareholders to appreciate the degree of improvement. However, without progress in these areas our overall success is impossible.
Our ability to recruit and assimilate a large number of new managers into a complex, fast moving environment and then retain them is of utmost importance to achieving our strategic and operational goals. Great emphasis is therefore placed on both recruitment and reward to ensure we have the right people and are able to keep them. We are delighted with the response of existing and new staff who are motivated by the scale of the challenges we face.
Many changes have been made to the company’s senior management team and the influx of new people – together with the commitment of those who have been with the group for some time – is slowly bringing about a change in the culture of our company. We are leaving behind the inward focused, risk averse culture and moving towards a high performance, outward looking, innovative ethos.
Cultural change is being effected through strong leadership and by creating a climate where people are empowered to make decisions about their businesses and their careers. To do this, we must support our current leaders and in 2006 we introduced a group-wide leadership programme which provides our people with the tools to develop their skills. However, developing today’s leaders is not enough; we must also identify and recognise the potential of future leaders. A talent management process, also introduced in the past year, is enabling us to understand better the performance and potential of our people so we can make the best use of these for both the business and each individual. There are more details about these programmes in the Corporate Responsibility section which details some other workplace initiatives designed to enhance the working lives of our people.
Ensuring that rewards and incentives are aligned to the aims of the business – and ultimately the interests of our shareholders – is a key element of encouraging strong performance. We have introduced a performance review process to enable us to link reward and performance for all the group’s managers, some 2,000 people. Shareholders approved a new long-term incentive plan for the top 500 or so senior people at the 2006 AGM, further information on which is provided in the directors’ remuneration report.
As well as changes in operational management, there were a number of changes to the board in 2006. As mentioned in last year’s annual report, Ron Spinney and Paul Mason stepped down from the board in May and we reiterate our thanks to them both. We were pleased to welcome two new non-executive directors, Alan Giles and Peter Bamford, who joined the board in May and July respectively. We are delighted with the contribution they are already making to the board.
