Dear Shareholders and Business Partners,
The 2020 financial year presented each of us with major personal and professional challenges. As the pandemic took on almost unimaginable dimensions, its effects demanded adjustment and change at every level – including the management of the company. Throughout this process, the well-being of our employees has always been the top priority.
Given these conditions, we are very satisfied with what has been achieved. Overall, we were able to lead KSB successfully through the crisis. Although order intake and sales revenue declined compared with the previous year, we secured our earnings thanks to a strong second half and numerous cost-cutting measures. At the same time, we drove forward the strategic and organisational realignment of the company and invested in projects for the future.
At the heart of the realignment was the CLIMB 21 strategy project, which sees us focusing on those markets which we expect to deliver sustainable, profitable growth. To this end, we have divided our business into three Segments – Pumps, Valves and KSB SupremeServ – which have different orientations but share a common goal: outstanding customer satisfaction. The Pumps Segment focuses on the General Industry, Mining, Energy, Building Services, Petrochemicals / Chemicals and Water markets. Responding flexibly to the demands of these markets and speaking our customers’ language helps us ensure that our solutions are tailored to their needs. We have also consolidated the organisation of the Valves Segment and set up clear responsibilities and new structures. We anticipate that this will enable us to exploit the market potential of our valve products much more effectively. With KSB SupremeServ, we have continued to advance the strategic orientation of our service business. KSB SupremeServ is built on a quality promise which underlines our aspiration to set us apart from the global competition through superior customer satisfaction. This customer-focused corporate strategy is starting to bear fruit in all six Market Areas in the Pumps business, as well as in the Valves and Service Segments.
Hand in hand with CLIMB 21 goes the GRIP 21+ project. Within its scope, we are mapping the business management processes of the new organisational structure, thus paving the way for market-driven management of the company.
Sustainability remains a strategic focus
Sustainability has been an indispensable pillar of our business activities – ever since the company was founded 150 years ago. We have been an active member of the UN Global Compact since 2010, and defined nine measurable CSR goals in the 2019 reporting year which we continue to pursue consistently. A core objective is to significantly reduce our CO2 emissions. At the turn of the year 2020/2021, we switched completely to electricity from renewable sources in Germany.
Digitalisation as a driver of growth
The COVID-19 year, too, saw progress in the digitalisation of products, processes and services. As part of the digitalisation of our sales processes, the first countries went live with an innovative online shop, opening up new sales channels. In terms of products, we have expanded our KSB Guard family – which offers online monitoring of pump operation – for use in waste water and explosion-proof applications. Last but not least, the bandwidths of our IT network have been massively increased. This enables us to support growing demands for mobile working options while putting in place infrastructure for the increasing digitalisation of our processes.
Corporate culture as a differentiating feature
A motivating, forward-looking corporate culture is an essential asset in the battle to recruit top talent. This was a key argument behind last year’s move to again invest considerably in activities designed to strengthen our corporate culture while promoting a sense of belonging and team spirit within the company. Pandemic-induced lockdowns required us to place a special emphasis on virtual events to help employees globally to connect with one another and stay up-to-date. New digital communication formats were used to promote informal exchange between staff. This was further endorsed by digital after-work initiatives and a proactive presence on social media.
Anniversary year 2021
We anticipate that the consequences of the pandemic will continue to dominate the first half of the year at least. Nevertheless, we expect sustained improvement in business performance worldwide towards the end of the year. This allows us to look forward with confidence.
The year 2021 will mark the company’s 150th anniversary – an event which we look forward to with pride and some ambitious plans. The anniversary motto “People. Passion. Performance.” describes what makes the company successful: The commitment of our employees, the passion they invest in their work, and their exceptional willingness to go the extra mile for our customers – qualities upon which we can build today and in the future.
Dr Stephan Timmermann, CEO