Here’s How Saint-Gobain Achieved Success Rapidly by Optimizing Their Integration Strategy
Saint-Gobain designs, manufactures and distributes materials and solutions which are key in the construction industry. Its solutions can be found in everything from buildings, transportation, and infrastructure.
They provide comfort, performance, and safety while addressing the challenges of sustainable construction. Saint-Gobain is one of the leading performers in this industry and has achieved success very quickly by optimizing the way in which it integrates information.
“Saint-Gobain is evolving in a fast-changing market environment which can be a source of substantial growth opportunities, provided we are sufficiently close to our markets and sufficiently agile,” said Chairman of Saint-Gobain, Pierre-André de Chalendar. “We are launching an ambitious transformation plan, 'Transform and Grow' based on two pillars, an in-depth transformation of the Group's organizational structure and an accelerated portfolio rotation program.”
Saint-Gobain has accelerated its transformation by launching the ‘Transform and Grow Program' – a new organizational structure with five reporting units designed to align the business more closely to its target audience, increase agility and empowerment, and enhance synergies through simplification.
Saint-Gobain has also introduced an additional portfolio review to be performed within the framework of the new organization. The new structure is expected to deliver around £250 million in savings – in addition to the current cost-saving programs in place.
“In addition to the organizational review, the Group has accelerated its portfolio rotation, and is on track to divest businesses representing sales of at least €3 billion by the end of 2019 for around €1 billion in value, resulting in a positive impact of around 40 basis points on the operating margin,” said Saint-Gobain in a press release. “More than 10 companies of various sizes across all sectors are being actively prepared for divestment and three significant processes have already been launched.”
The five reporting units which make up the new initiative replace the three business sectors and 14 delegations which made up the company’s former management structure. This allows for a much more agile structure which has the resources and flexibility to leverage new competitiveness enhancing opportunities – including digital transformation and more streamlined decision-making processes.
In tailoring the business model to specific markets, areas, and groups it allows Saint-Gobain to accelerate in profitable growth. The streamlined management structures will result in a leaner organization and a smoother run business, which will ultimately benefit the customers and the bottom line. By fully focusing on what customers want and their experience when engaging with the brand, Saint-Gobain can develop and grow alongside them and introduce and adapt solutions at each step of the project.
“It will put our teams in an ideal situation to fully leverage our portfolio of solutions in each country and our market synergies for the benefit of our customers,” said Vice President of Saint-Gobain, Benoit Bazin. “We are also setting ourselves ambitious financial targets for this transformation, including €250 million of additional savings thanks to a leaner and more efficient organization contributing to an overall improvement of more than 100 basis points in our operating margin by 2021."
The new organizational structure which has been introduced means that new personnel have had to join the team at Saint-Gobain in its research centers, including designers, data scientists, and sociologists. Combining the knowledge and experience of these different experts will enable the brand to better understand its audience and empower it to introduce new practices such as design thinking.
This has enabled Saint-Gobain to spearhead its own digital transformation and is allowing it to continue growing as one of the top companies in its sector.
Transform and Grow
The main task of research and development is to provide active support for the company through targeted research projects which spark innovation around processes, products, and systems.
A secondary task involves preparing for the future through strategic, cross-functional programs. This is where the ‘Transform and Grow’ aspect of the innovation really comes into its own. These programs are linked to previously identified focus areas which allows Saint-Gobain to organize skills common to the group's various activities and improve its ability to develop key technologies.
Saint-Gobain is achieving success rapidly by optimizing its integration strategies and forcing itself to come up with new ways to provide better customer service. Targeting its marketing and introducing new programs such as ‘Transform and Grow' will help them to become more successful and expand even further into the digitalization of the building industry.
“Saint-Gobain has some real strengths, including robust markets, strong industrial capabilities and capacity for innovation, a portfolio of solutions tailored to market trends and developments and, above all, the expertise and commitment of employees around the world,” says the company website. “How can we take full advantage of these assets to improve our competitiveness and unleash growth? That is the challenge we face and the purpose of this transformation plan.”
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