PALFINGER Strategy

Strategy

The consistent implementation of its strategy has facilitated PALFINGER’s growth over previous years. The three strategic pillars – innovation, internationalization and flexibility – will therefore remain the priorities. They are now supplemented by PALFINGER 21st, a unit for innovation and business models of the digital age. This strategic development follows the vision of designing the future of lifting solutions together with the Company’s customers.

The objective is for PALFINGER to achieve and/or maintain a leading position in the global markets. PALFINGER aspires to be one of the top three players in all product and customer segments. In line with achieving a global balance, approx. one third of the consolidated revenue is to be generated, in the medium term, in each of the three regions EMEA (Europe, Middle East, Africa and Australia), North and South America, as well as Asia and Pacific, including CIS.

The development of the Group is achieved through organic growth as well as through acquisitions, greenfield investments and joint ventures. Each expansion step is based on a conscientious review. Before a decision is made, economic factors such as revenue, return on assets and market potential, as well as common strategic issues such as working conditions or the observance of fundamental rights are considered.

In pursuing its objectives, PALFINGER updated its three time-tested strategic pillars – innovation, internationalization and flexibility – in 2017 and supplemented them with PALFINGER 21st. The four pillars are underpinned by relevant financial and non-financial performance indicators. The planning and implementation of these pillars are carried out taking account of significant issues defined on the basis of a materiality analysis.

TOGETHER WE ARE SHAPING THE FUTURE OF OUR CUSTOMERS' LIFTING SOLUTIONS

STRATEGic pillars

The three strategic pillars – innovation, internationalization and flexibility – have facilitated the global, profitable growth of the PALFINGER Group in previous years and will be consistently pursued in the future as well.

To allow for a prioritization of the challenges and opportunities of digital transformation, this time-tested strategy has been supplemented by a fourth pillar: PALFINGER 21st stands for new core competences, new approaches, new products, services and business models in the digital age.

PALFINGER’s employees and the shared values of respect, learning and entrepreneurship are central elements in the implementation of this vision. PALFINGER will put its customers at the heart of all endeavours, even more so than in the past.

Together with them, PALFINGER will continue to identify new requirements and develop efficient solutions. Together we are shaping the future of our customers’ lifting solutions.

Innovation

is the result of our passion for the permanent enhancement of our products, processes and organization. Innovations ensure PALFINGER’s market leadership and open up new fields of application that broaden the base of the business. Innovation is the foundation that will enable PALFINGER to maintain its global market leadership in the future. It confirms PALFINGER’s commitment to being the technology leader and service champion among the suppliers of lifting solutions. Innovation also comprises all activities and objectives in the field of digitalization and new technologies. With innovative digital solutions, PALFINGER will offer its customers new, enhanced and more suitable products and services. PALFINGER is continuously striving to improve its products and services as well as its internal processes and the organization. In this regard, the end customers and their needs are PALFINGER’s highest priority. The strictest standards of safety and operation are observed or enhanced. Regular surveys of end customers and employees on the subjects of innovation, turnkey products and smart solutions support PALFINGER’s global innovation strategy.

internationalization

ensures that our customers on all continents receive products that conform to market standards and provides our Company with maximum independence from regional economic fluctuations while simultaneously opening up new areas of potential growth. Internationalization enables PALFINGER to be and to remain the preferred global partner in the lifting industry. In the medium term, this leading position is to be reinforced through acquisitions. The objective of generating one third of the consolidated revenue in each of the three large market regions (EMEA, the Americas, Asia and Pacific, and CIS) confirms the targeted global balance of business operations. With its own enterprises and strategic partnerships, PALFINGER maintains close proximity to its customers and can offer them the best solution in each particular case. In regions where PALFINGER does not yet have a strong presence, there are plans for expansion in the medium term. This is primarily true of China and the global marine business. Based on its global and local know-how, PALFINGER is striving to identify and develop innovative solutions for local requirements and needs. In 2017, priority was placed on the integration of the companies acquired in previous years. In particular, the acquisition of the globally operating Norwegian Harding Group in 2016 will remain on PALFINGER’s agenda for a while. The cooperation with SANY in Asia and with KAMAZ in Russia/CIS was successfully intensified. Nonetheless, in 2017 PALFINGER kept a lookout on the market for international strategic acquisition opportunities to expand its strong international position.

flexibility

allows us to meet all market developments by quickly adjusting our resources and capacities, thus also safeguarding the success of our business in times of high volatility Given the volatility of the markets and trends, the enhancement of flexibility has become critical for PALFINGER’s success. It enables the Group to maintain and increase its profitability. The importance of enhanced flexibility applies to all sites and processes as well as to the organization itself, in other words the entire value creation chain. In addition, strategic development programmes such as PALFINGER Process Excellence make a valuable contribution to increasing the flexibility of processes and the organization in the long term.

palfinger 21st

is the umbrella term describing the preparation of new developments: new core competences, new approaches, new products and business models, particularly in connection with digitalization. Organizationally, the strategic pillar PALFINGER 21st was defined as a separate unit promoting digital ideas and innovations in an open and flexible manner. The unit directly reports to the CEO and is involved with new – and sometimes disruptive – developments, and thus ensures that, in addition to the successful business of PALFINGER, new things can be created. All of this is based on the willingness to try out new ideas quickly and accept mistakes when they happen. In 2017, PALFINGER expanded its cooperation and partnerships both with young innovative businesses and with established institutions. Cooperation with start-ups of the digital world will make it possible to utilize synergies. Thus, external perspectives supplement the Company’s internal innovation competence. Crucial success factors in this field are not only partnerships and cooperation projects but also digital training and the ability to create numerous ideas. A big step was taken in 2017: PALFINGER became a partner company in Central and Eastern Europe’s largest business incubator weXelerate in Vienna. This gives the Company the opportunity to cooperate with and/or invest in promising innovative start-ups. With PALFINGER 21st, tomorrow’s products and services are to be created with the help of a profound understanding of the customers’ needs. The various group-wide development programmes and strategies promote this approach. PALFINGER is committed to being a trendsetter, also when it comes to new technologies and processes.

Organization

Since 2010, PALFINGER has taken a regional approach in its organizational structure. The business areas have been given a large degree of independence in order to enable them to meet the requirements of the individual markets in an ideal manner. Not only does this support the internationalization of the Group, it also makes it possible to focus more strongly on increasing the flexibility of all processes. In this context, special emphasis is placed on strategic projects that promote the further development of the PALFINGER Group. PALFINGER provides reporting broken down into the management-relevant segments LAND and SEA as well as the HOLDING unit. 

VALUE MANAGEMENT

The value enhancement achieved by the PALFINGER Group is first shown by operating profitability and revenue increase. The medium-to-long-term success is measured by other indicators such as capital lockup, the health of employees and environmentally friendly business operations. The value creation structures and the PALFINGER brand are the basis for the business.

PALFINGER regularly measures its group development progress and value enhancement by means of financial and non-financial indicators, which were adapted and supplemented in 2016 as to their relevance and now encompass the following:

value creation

PALFINGER looks at value creation not only within the Group but also along the entire value creation chain, which means that opportunities and risks are analysed under a holistic approach: from the raw materials to the use of the products by the end customers.

Through its global orientation, PALFINGER can better utilize available capacities. The focus is on existing and future customers as well as on corporate responsibility. Local value is created together with central centres of excellence.

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