Group strategy

Our strategy, based on a clear ambition and outcome, is to sustainably double the group’s intrinsic value every four years, which means that we need to be forward-looking in how we approach our business.

The group has pivoted its portfolio towards defensive, relatively asset-light and cash-generative industrial sectors, based on a business-to-business (B2B) operating model.

Barloworld is an industrial holding company with a clear value creation strategy for a sustainable future

 

Purpose

Inspiring a world of difference, enabling growth and progress in society

VISION

We create enduring economic and social value for our stakeholders by building businesses that serve industrial customers

AMBITION

Sustainably double the intrinsic value created every four years Deliver top quartile shareholder returns
Drive profitable growth
Instil a high-performance culture


WHERE WE COMPETE

 Industrial Equipment and Services:

Offers earthmoving equipment, industrial services and power systems that enable a large array of mining, construction and power solutions for our customers through deep relationships built on trust

 Consumer Industries:

Provides large businesses with the ingredients essential to the manufacturing of, among others, food and beverages, paper, pharmaceuticals, building materials and adhesives

HOW WE CREATE VALUE

 Excellence in B2B emerging markets

  • We build enduring relationships with businesses based on our understanding of their needs.
  • We consistently deliver to customers in challenging and adverse conditions.
  • We manage business risks through the cycle and have the patience to deal with volatile markets.

 The Barloworld Business System (BBS) gives us a competitive edge

  • We drive performance by transferring and integrating our proprietary BBS into acquisitions.
  • Continuous improvement as a performance culture to create value through high performance and operational efficiencies.
  • BBS is a distinctive way of working that aligns leadership style and culture to create value.

 Value accretive portfolio management

  • We obsessively focus on value in managing our businesses.
  • Aligned to strategy, we actively reallocate resources to where the tailwinds lie and out of businesses with headwinds.
  • Anchored in analysis and conviction, we actively manage our portfolio and successfully extract value through integration.

 Fix and Optimise

We continued to deliver on our strategic lever of fixing and optimising our existing business portfolio to ensure we extract its full potential.

Our focus will remain on reviewing areas of the business with low operating performance and implementing the various disposal and corporate actions intended to simplify the group’s portfolio.

 Active Shareholder Operating Model

The role of our Corporate Centre remains one of an active shareholder operating model. This is a key component of our managing for value model and focuses on:

  • setting strategy and driving transactions through a centralised mergers and acquisitions (M&A) function
  • a centralised management team and the deployment of leadership and talent to the best suited opportunities within the group
  • monitoring, measuring and rewarding performance that contributes to the achievement of the group’s strategic priorities
  • allocating organisational resources to support performance and deliver on strategy, including responsibly allocating these in terms of our overall strategic objectives and by using BBS
  • responsible corporate citizenship and ethical and effective leadership that ensure socio-economic and environmental outcomes that meet stakeholder expectations.

 Organic and inorganic growth

As we near the completion of our identified portfolio changes, future growth is being actively considered, in line with our identified strategic growth segments, investment guardrails and capital allocation framework.


Strategy 2020

PEOPLE DEVELOPMENT

The business has 239 people enrolled in apprenticeships, internships & learnerships as well as 124 young people who benefited from the Young Talent Programme.

THE YOUNG TALENT PIPELINE
Participants in the Barloworld Young Talent Pipeline include apprentices, interns, those on our graduate programme, chartered accountant (CA) trainees, bursars and artisans who are prior learning (ARPL) candidates. At a group level, 12 candidates were offered external bursaries to further their education. During the year under review, 124 people participated in our Young Talent Pipeline programme. Barloworld Head Office had five new CA trainees joining the Young Talent Pipeline programme this financial year, with two trainees completing the programme and one candidate securing permanent employment at Barloworld Equipment. Good traction was achieved on the programme overall, with 11 CA trainees participating in the programme, with four in Year 3, two in Year 2 and five in Year 1.

THE BARLOWORLD BUSINESS SYSTEM (BBS)

The effective execution of our group strategy has necessitated the design and implementation of a repeatable and scalable high-performance business system to increase the competitive advantage of our portfolio of businesses and enable the achievement of our vision and ambition.

Accordingly, the BBS, which anchors its business excellence pillar on a methodology based on the lean principles of the Toyota Production System (TPS), was launched with the guidance and support of experienced consultants.

WHAT IS THE BBS?
The BBS is a structured business operating system that enables a high-performance culture of both continuous improvement and business excellence to delight our customers and sustainably create value for our stakeholders. Our purpose is to defy limits by delivering breakthrough performance and results for Barloworld and our stakeholders.

THE KEY PILLARS OF THE BBS PHILOSOPHY ARE:

  1. Respect for people, including society and the environment

Continuous improvement.

THE KEY PRINCIPLES OF THE BBS:

  • The customer defines value
  • Value to customers must be delivered on demand and right, first time
  • A new way to evaluate and improve existing processes, removing waste and defects
  • It demands that we standardise and document 'today's best-known way' of running a process
  • Drives the ambition to continuously improve on a daily basis
  • Mutual respect and shared responsibility enable higher performance
  • Individuals go through a deep personal learning experience by 'learning as we do'
  • It brings in new ways of working through innovation and embracing new business models
  • Drives a change in leadership style and culture in the organisation.
Strategy 2019

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