BASF: Even stronger focus on profitability and customer benefit
BASF is adding to its successful strategy. In future, the world's leading chemical company will:
- concentrate its capital expenditures even more heavily on its most profitable business areas;
- focus its innovations and business models even more closely on the needs of its customers; and
- tap into new market opportunities offered by technological change in the fields of nanotechnology, materials science, energy management technologies and biotechnology.
"We have analyzed our strategy to date in detail and have come to a gratifying conclusion: BASF set the right course in the past. In order to be even better able to meet the challenges of the future, we are now adding three new elements to our proven strategy," said Dr. Jürgen Hambrecht, Chairman of the Board of Executive Directors of BASF Aktiengesellschaft.
Focusing resources on promising business areas
In the future, BASF will focus more closely on its business areas that show the most promise in terms of market attractiveness and profitability when deciding on new investments. The most important criterion for investment decisions will be a key performance indicator: EBIT after cost of capital. Using this tool, BASF wants to ensure that its profitability meets the returns expected by the capital markets.
"Our goal is to earn our cost of capital on average over an economic cycle - plus a premium on it too," said Hambrecht. "We want to grow profitably. In the past, we have mainly focused on growth, but in the future we want to place even greater emphasis on profitability."
Involving customers at an early stage of the innovation process
BASF wants to focus even more closely on its customers and potential customers when thinking and acting. This starts right at the beginning of the innovation process, which is aligned with the concrete needs of customers and win-win cooperations. BASF's goal is to become more firmly integrated in its customers' value chains and thus create competitive advantage for both partners. This includes offering offer both market-driven innovations as well as innovative business models.
"In the past, we already placed great important on efficient cooperations with our customers. In the future, we want to further improve our positioning as a reliable partner for long-term, competitive solutions. We believe that true success is always mutual success," explained Hambrecht.
Technological changes offer new market opportunities New areas of knowledge such as nanotechnology, materials science, energy management technologies and biotechnology play a particularly important role in BASF's strategy. These are the areas from which the company expects the most important impulses for the chemistry of the future.
Jürgen Hambrecht particularly stressed the potential offered by biotechnology: "This area offers opportunities that we need to use together with our customers. We can open up new possibilities for value-adding growth through innovative solutions for the food industry, animal nutrition and agriculture."
Striking design for a strong brand
BASF will introduce a new corporate design starting in March 2004. This will involve new colors and design elements as well as a new logo. "BASF's future strategy is a coherent combination of proven strengths and new elements - it's an evolution, not a revolution. And that is exactly what we want to show with our new design," said Hambrecht, presenting BASF's new corporate design.
Other news from the department business & finance
