a picture tells a thousand words

12 best practices September, 2010

1.4 Leaders reinforce strategic priorities

STRATEGIC ALIGNMENT

2010

the difference is in your hands

The President kicks-off the yearly

strategic alignment meeting

(around 450 people)

Leaders, not the OSM, conduct

alignment meetings and workshops

We include our targets in all our strategy maps

2.3 Targets identified for all measures

And our main corporate targets (algorithm)

are ever-present:

•  T-shirts; or •  Emergency exits!

Corporate – with the contribution of Business and Support Unit leaders – defines the strategy:

3.1 Corporate contribution for strategy defined

Auto

General Insurance

Life Insurance

Guarantee & Credit

HR

IT

Admin & Fin

Legal

Audit & Internal Control

Market & Sales Network

Distribution Channels

Long-Term Strategy Map Short-Term Strategy Map

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3.2 Enterprise scorecard guides business units

Long-Term Corporate BSC

Short-Term Corporate BSC

General Insurance

Life

Guarantee & Credit

Market & Sales Network

Distribution Channels

SBU STRATEGY MAPS & SCORECARDS

GO TO MARKET STRATEGY MAPS &

SCORECARDS

3.3 Enterprise scorecard guides support units

Auto

Long-Term Corporate BSC

Short-Term Corporate BSC

General Insurance

Life BSC

Guarantee & Credit

HR

IT

Admin & Fin

Legal

Audit & Internal Control

Market & Sales Network

Distribution Channels

SBU STRATEGY MAPS & SCORECARDS

GO TO MARKET STRATEGY MAPS &

SCORECARDS

SUPPORT UNIT STRATEGY MAPS & SCORECARDS

We communicate in multiple ways:

•  Campaigns •  Business cards •  e-learning •  Training •  Games/ Contests •  Posters •  Videos •  Intranet •  Workshops •  Live presentations •  Etc.

4.1 Strategic awareness created

4.2 Personal goals aligned

ESTRATÉGIAS Diretoria

Área

STRATEGIC FUNDAMENTALS

ENVIRONMENTAL ANALYSIS

COMPETITIVE STRATEGY

SHORT-TERM OBJECTIVES

BUSINESS AND SUPPORT UNIT OBJECTIVES

AREA ACTION PLANS INDIVIDUAL TARGETS

LONG-TERM OBJECTIVES

A thorough process has been put in place to create two thousand seven hundred (2,700) personal scorecards, which sustain the whole performance management system.

PERFORMANCE MANAGEMENT

SYSTEM

All individual goals and action plans are inserted in a system to verify

progress and evaluate performance

4.3 Personal incentives aligned

Variable pay is distributed depending on corporate, unit and individual performance:

CORPORATE 60%

UNIT 40%

Senior Executive

CORPORATE 30%

UNIT 30%

PERSONAL 40%

Line employee

A joint catch-ball process for setting strategic and budget targets:

5.1 Budget is driven by strategy

President sets key goals

Each Business Unit leader sets

his/her key goals

Target Setting Workshop

Finance Updates Budget

OSM Updates Strategy Maps

Input from headquarters

(Spain)

• SWOT Analysis • Environmental scanning • Performance check

A commitment to excellence with Six Sigma, with concrete results:

5.4 Process improvement aligned to strategy

Trai

ning

M

illio

n

1st Wave 2nd Wave 3rd Wave Total

Executives

Learning to learn

ROI and Savings

5.6 Strategic performance information guides decision making

Initially separate systems, now an integrated information technology solution for all strategic and performance management needs:

All information stemming from

strategy maps and BSCs is updated and

available on-line

Analysis, comments, emails, updates are tools commonly used to keep the information system

alive

Personal objectives and development plans are also

managed in the system

5.7 Strategy reviewed on regular basis

A complete governance model to facilitate decision-making:

•  What: strategy review

•  When: once a month

•  Who: top leadership

•  Why: verify progress on main goals (algorithm)

•  What: operational review

•  When: once a month

•  Who: each business and support unit

•  Why: verify operational performance

•  What: operational/strategic review

•  When: quarterly

•  Who: each business and support unit

•  Why: strategic view of operations