People and Culture
Central to achieving our ambitions is the creation of a culture and environment that empowers everyone to reach their full potential to achieve the best results. We enable our people to execute various ideas to increase engagement and performance. We aspire to create a sustainable culture of high performance whilst at the same fostering an open and inclusive culture in order to attract, motivate and retain a highly diverse workforce that reflects the communities in which we operate and gives our people the right opportunities for career development and personal growth in a safe and attractive working environment.
Kendrion initiated its strategy for 2016-2018 based on the ‘Simplify, Focus, Grow’ pillars in May 2016. The related aim is to deliver sustainable profitable growth for the business. In 2018, additional simplification measures were introduced, specifically in our Passenger Cars business unit. These measures include the creation of a dedicated centre of excellence for sound, software and electronics in Malente, Germany. Furthermore, an organisational transformation and restructuring programme was designed pursuant to which a functional Automotive group will be established in 2019.
Kendrion updated its Corporate Social Responsibility programme, which specifically includes ‘Social and Human Capital’ as one of the three CSR pillars of long-term value creation, in August 2018. In order to further emphasise our dedication to ‘Social and Human Capital’, a solid target framework supports the Social and Human Capital pillar of long-term value creation. Focus areas of the Social and Human Capital target framework include key topics such as health & safety, diversity and inclusion, company culture and community connection. Please refer to the ‘Sustainability’ section for more information about our Corporate Social Responsibility programme.
Employee engagement and culture
Offering the opportunity to provide and receive feedback is imperative to maintaining an engaging work environment. This is why the employees of all the operating companies were invited to participate in the Kendrion-wide employee satisfaction and culture survey during the year under review (while in 2017 only a selection of Kendrion’s major operating companies participated in an employee and culture survey). Going forward, we will repeat the Kendrion-wide employee satisfaction and culture survey at regular intervals, also with a view to allowing benchmarking of data for comparison purposes across the Kendrion organisation.
74% of our employees took part in the survey in 2018. The overall employee engagement score was 7.0 (on a scale of 10.0). Our employees provided feedback on what they appreciate and find challenging about working at Kendrion. People are committed to contribute to the successful contribution to the company strategy. There is room for improvement with respect to communication among teams. Necessary action is and will be taken at the appropriate levels (global, local and department-based) to ensure our employees feel their feedback is being followed up.
Talent management & learning and development
Developing the capabilities needed to successfully enable an organisational transformation is a matter of great importance. A resilient talent pool with engaged and talented employees form the foundation for growth and innovation. We consequently do our utmost to attract and retain talent and provide learning and development opportunities, with the aim of creating a sustainable culture of high performance. We are continuously building a solid pipeline to ensure effective succession management for our most critical management positions by mapping candidates and undertaking reviews of internal and external candidates’ suitability, readiness and required development for candidates for management roles. Our web-based talent management and succession-planning tool facilitates the monitoring and review of internal candidates.
As part of our efforts to develop our people, we advocate the principle of internal mobility and aim to fill vacancies with internal candidates. Internal moves are considered beneficial to the development of our people by providing them with new and challenging opportunities, while at the same time keeping knowledge within the organisation. The percentage of vacancies filled with internal candidates was 30% in 2018.
Our overall employee turnover rate was 20% in 2018. The retention rate of our leadership talent was 86%.
Together with the Rotterdam School of Management, we developed a Leadership & Performance Programme that comprises three modules designed exclusively for Kendrion. The modules of the Leadership & Performance Programme focus on themes such as understanding and improving performance within the context of the market and industry in which Kendrion operates. The Leadership & Performance Programme also constitutes an important platform for exchanging experience among senior management and further expanding collaboration among operating companies. Kendrion’s Leadership Team (consisting of Kendrion’s 30 most senior employees) participated in the third module of the Leadership & Performance Programme in 2018, after having completed the first and second module in 2017.
We encourage the advancement of young talent to management roles in our business. The Kendrion High Potential programme is our global learning and development programme and provides our talents who have the potential for management roles with access to various learning modules. The High Potential programme offers development opportunities that match business and individual needs (such as strengthening of personal competencies). A new group of talented and ambitious employees started the High Potential programme in 2018 and participants of this group are expected to complete the programme in 2020. In the Kendrion-wide employee satisfaction and culture survey in 2018, our employees stated that they have good opportunities to develop.
Diversity and inclusion
We believe in the strength of a diverse workforce and the importance of our management teams reflecting the diversity of our employee base. Diverse and inclusive teams make our organisation more innovative. Having the right mix of people in the right jobs, with the right capabilities, encourages better decision-making and helps us to grow our business.
As part of the Social and Human Capital target framework, we have made it a priority in our Corporate Social Responsibility programme to further advance diversity across our organisation by training and developing senior management on various aspects of diversity and inclusion and organising Kendrion-wide diversity and inclusion initiatives.
Kendrion’s workforce comprised 37 nationalities (2017: 38) employed in 10 countries in 2018. 51% of our workforce is female. We have a healthy balance of nationalities and gender across the organisation as a whole. However, the percentage of women in senior management positions at Kendrion’s operating companies is relatively low. We continue to actively strive to recruit more women for senior management positions.
The remuneration framework is designed to create transparency and fairness in the structure of both fixed remuneration and variable remuneration. Kendrion offers its employees attractive remuneration packages that are in line with industry standards and the local market and are based on job-specific requirements.
Works councils or employee representatives have been appointed at Kendrion’s largest operating companies in Germany, Romania and Austria, which are involved in a wide range of employment, health & safety and social matters, in accordance with local labour legislation. Approximately 75% of all Kendrion employees are represented by these works councils and employee representatives. Approximately 68% of the employment contracts in Germany and Austria are governed by or follow the collective bargaining agreements for the metal industry in the country concerned.
Talent management and recruitment
Kendrion’s new organisational structure also requires a different balance of skills and competences throughout our business. This is both a challenge and an opportunity as we compete for talented people in a tight market where there is a shortage of skilled engineers and other specialists.
Kendrion’s recruitment initiatives include a regular presence at job fairs of technical universities and other relevant institutes. We also conduct targeted PR activities, aimed at promoting Kendrion as an attractive employer. A substantial number of students began their apprenticeship or course of study at Kendrion in 2017.
Kendrion has continued to professionalise its Human Resources processes, including the completion of the implementation of a web-based talent management and succession-planning tool.
Kendrion advocates the principle of internal mobility and aims to fill vacancies with internal candidates. Internal moves are considered beneficial to the development of Kendrion employees by providing them with new and challenging opportunities, while at the same time keeping knowledge within the organisation. In 2017, the Human Resources teams were able to fill over 30% of vacancies with internal candidates.
Training and development
Training is key to both recruiting and retaining the right people and to maintaining a strong and solid position in a competitive market. To ensure that Kendrion employees remain fully committed and aligned with the strategy and to provide our employees with opportunities for professional and personal growth, Kendrion’s operating companies offer a wide range of internal training courses. Kendrion aims to ensure that employees receive the right training for their current positions and for positions employees may be able to occupy in the future. Several new training courses were added in 2017, and where appropriate, existing training courses were adapted to ensure continued alignment with Kendrion’s strategy.
A new Leadership & Performance Programme was introduced in 2017. This Programme was developed jointly with the Rotterdam School of Management and comprises three modules exclusively designed for Kendrion. Kendrion’s Leadership Team (consisting of Kendrion’s 30 most senior employees) participated in two modules with the remaining module to be offered in 2018. The modules of the Leadership & Performance Programme focus on themes such as understanding and improving performance within the context of the market and industry in which Kendrion operates and are aligned with the rationale underlying the ‘Simplify, Focus, Grow’ strategy. The Leadership & Performance Programme also constitutes an important platform for exchanges of experience between the (senior) management and for further expansion of collaboration between the operating companies.
Kendrion also offers a three-year modular training programme (Kendrion High Potential Programme) specifically designed for talented and ambitious employees with potential for management roles. A group of eleven high-potential employees graduated in 2017, and a new group of high-potentials will commence the programme in 2018.
At Kendrion, we believe in the strength of a diverse workforce. Diversity promotes better decision-making and the exchange of intercultural experience and ideas. We aspire to recruit the right mix of people for Kendrion as a whole, as well as for each department, taking into account competences and skills, gender, nationality, background and other factors. However, diversity is not a goal in itself, as Kendrion always strives to appoint the best and most suitable person for the job.
In 2017, Kendrion’s workforce comprised 38 nationalities employed in 10 countries. Fifty% (50%) of our workforce is female. Across the organisation as a whole, we feel we have a healthy balance of nationalities and gender. However, the percentage of women in senior management positions in Kendrion’s operating companies is relatively low. Kendrion actively strives to recruit more women for senior management positions through various initiatives, including proactive and regular contact with universities and the organisation of internal events, all with a view to further improve the balance of gender diversity in senior management positions. These initiatives contributed to the appointment of a woman to the Management Team as well as additional appointments of women to the Leadership Team.
Kendrion promotes the formation of a workforce and management that reflects the composition of the local population as closely as possible.
The remuneration framework is designed to create transparency and fairness in the structure of both fixed remuneration and variable remuneration. Kendrion offers its employees attractive remuneration packages that are in line with industry standards and the local market and are based on job-specific requirements. A bonus scheme has been implemented for senior management that is based on Kendrion’s financial performance and on certain individual non-financial performance targets. These also include CSR targets.