On the Threshold of Tremendous Growth
Alcoa continues to invest in high-growth regions and innovative, revenue-enhancing technologies. As we look forward, we are on the threshold of new opportunities and strong growth.
Driven by megatrends like urbanization, population growth, and environmental stewardship, we believe that global demand for aluminum will continue to grow. At the heart of this growth is a renewed emphasis on the importance of close customer relationships.
We leverage growth in the following four primary areas of concentration:
- Spurring and facilitating profitable growth across and within business units;
- Aggressively developing market transparency and codifying our commercial competencies and capabilities;
- Encouraging market- and customer-centric research and development; and
- Driving multi-tiered market messaging.
It is critical to support our globally dispersed commercial organizations, which have profit and loss accountability in our decentralized structure. While this decentralized structure gives us a high degree of agility in serving unique markets and customers, one ongoing dilemma is that it can present organizational barriers. These barriers can restrict the sharing and leveraging of data, marketing tools, intellectual capital, products, and the easy cooperation that breeds cross-business solutions.
In response, our diverse and multi-disciplined Growth & Market Strategy Team has adopted architecture, expertise, and an entrepreneurial outlook to provide a structured approach to marketing across our global operations. Our efforts are especially tuned to four key markets: aerospace, defense, automotive, and commercial transportation.
The team focuses its efforts in three primary commercial areas:
- Market sector teams;
- Market and customer transparency; and
- Internal cultural communications and external marketing communications.
Market Sector Teams (MSTs)
Our three market sector teams—Aerospace, Defense, and Ground Transportation—bring together our global marketing capabilities to focus on particular sectors where our value propositions are compelling. They operate across business units where we have a historic and significant presence.
To accomplish their tasks, these teams:
- Create, interpret, maintain, and distribute best-available market sector intelligence;
- Identify growth opportunities and drive development of new offerings that provide clearly differentiated value propositions to our customers;
- Provide counsel in the creation of key account plans;
- Develop market sector strategies and marketing communications plans; and
- Surface those growth opportunities that are not captured by the current business structure.
In short, these teams join capabilities from across our businesses in new ways so our customers can better leverage the breadth of capabilities within Alcoa. They help our businesses uncover and sell more advanced solutions that are profitable for the company, creating highly focused, systems-oriented solutions. They work at the forefront of the Alcoa Advantage—the notion that the combination of businesses and assets within Alcoa is greater than the sum of its parts—every day.
Market and Customer Transparency
The concept of transparency has become fundamental to how we manage growth.
We have business relationships that, in many cases, date back to the origination of our customers and their products. However, this depth of knowledge cannot be an advantage without a management method and tools that place this insight in front of the right Alcoa employees at the right moment. The concept of systemic knowledge management of our customers and market needs is what is referred to as customer and market transparency.
The elements of transparency are broad and touch on such topics as customer need, economics of applications, customer loyalty, financial data, and the innovation pipeline. We pull from many informed sources—our scientists, engineers, commercial teams, and manufacturing operations— to gain customer insight that leads to more precise solutions for customers.
Speed is the key to differentiation, and our transparency processes seek to eliminate waste, unproductive work, and oversight to continuously improve our offerings to the customer.
Through transparency, we anticipate the future marketplace and create and/or evolve the products our customers need to succeed. As a strategic material and component supplier, we succeed with our customer partners one application at a time.
In 2012, we launched an internal online community that standardizes, centralizes, and displays a wealth of key customer and market information for our major markets. Data are used for both business planning and internal reporting purposes, and the site continues to grow and evolve based on regularly solicited customer feedback.
Transparency also extends to our customers and their diverse teams. We are committed to deep, collaborative, and technical relationships with our strategic accounts that enable faster, more accurate design-trade studies that are backed up with world-class supply. Our key account management seeks to harvest the benefits of our transparency and insights of the market sector teams to support our customers’ successes and our own growth. In a sense, the key account management process is the synchronizing of transparency between our valued customers and us.
The tools and culture of transparency are a company value that supports our growth, customer relationships, and employees.
Alcoa Commercial Advantage
We launched an aggressive initiative in 2012 to identify, codify, and perpetuate best commercial practices across the company. This global, wide-ranging, collective expertise that we call the Alcoa Commercial Advantage touches numerous facets of commercial activity, including opportunity identification, pricing, marketing communications, and talent management.
The Alcoa Commercial Advantage places customer-centric practices at the forefront of each business. It is overseen by a diverse and experienced team of commercial leaders, assuring both strategic and practical acceptance and adoption.
Full rollout will take place in 2013.
Culture and Communications
To perpetuate and sustain a business culture that drives market growth, we are continuously communicating pointed, interesting, and motivational stories about our employees.
Our growth community portal site employs brief video features, print stories, audiocasts, and interactive graphics to highlight the best growth activities found throughout Alcoa. Content is refreshed weekly and archived for ongoing reference.
Our communications focus on successes as well as lessons learned, enabling the broader commercial organization to learn from itself and stay current and vibrant, leading to a more sustainable organization.
Consistent with our four-market concentration, the Growth & Market Strategy Team led Alcoa’s marketing communications activities in 2012. This helped us better synchronize our cross-business-unit messages to more clearly communicate the Alcoa Advantage.
One example of this was visible at the Alcoa Defense exhibit at the Association of the United States Army Annual Meeting and Exposition in 2012. Reynobond®, Reynobond with KEVLAR®, and air-cleansing Reynobond with EcoClean™ aluminum building products were built into the booth and/or prominently displayed and marketed.
Net Promoter Score
Achieving customer loyalty is the objective of every company. In 2012, we continued to enhance and implement the Net Promoter Score Program across all business units to assist in achieving this goal.
Our overall Net Promoter Score has steadily improved over the four consecutive years we have been in the program, and the number of responses and the response rate have steadily increased.
The objectives of the program are to:
- Provide trustworthy and actionable feedback regarding our customers’ experience and loyalty;
- Mobilize our organization to improve the customer experience by focusing on taking action and driving change; and
- Help us achieve business outcomes (retention, repurchase, and referrals) and grow our business units.
We used the Net Promoter Score survey tool to determine a baseline score measuring client satisfaction. Surveys were translated into 23 languages and sent to more than 20,000 customers across the globe. The responses are being used to assist our business units in building their Net Promoter Score Programs and identifying and solving customer issues.
In 2012, the team introduced to the business units new services that included:
- Hands-on best practice consulting and solutions facilitation, which led to customer supply chain process improvements; and
- Enhanced internal analysis, which enables more focused and precise learnings for the businesses.
In 2013, the Alcoa Net Promoter Score lead team will continue assisting our businesses in transforming data into problem-solving protocols and measurable, value-adding actions. The team also will provide more businesses with deeper customer insights through partitioning analysis.
We offer eBusiness processes and tools that create a competitive advantage through reduced transactional costs and improved customer service. Primary platforms are AlcoaDirect®, Alcoa.com, and direct customer systems integration.
Connecting with our customers electronically is a key element of our growth strategy. These digital linkages provide customers faster, 24/7 access to the information and services they need to conduct business. From a sustainably perspective, they also eliminate administrative paperwork, lower travel and other costs, and improve productivity.
Our collaboration solution inside AlcoaDirect is a point of differentiation for our businesses, and they are increasing their use of this tool.
Like our customers, we also reap benefits and competitive advantages through the use of eBusiness. These include:
- Cost savings and productivity gains, since customer service employees spend less time on routine administrative tasks;
- Growth through existing and new customers who prefer the ease and convenience of transacting business online;
- Greater customer retention;
- Increased customer value by bundling knowledge and services unique to Alcoa; and
- New technology for customer connections that are leveraged to all business units at little or no cost.