Daimler-Benz News from June 13, 1995

Daimler-Benz
streamlines headquarters

Schrempp: Headquarters
must generate tangible benefits

Stuttgart/Germany, June 13, 1995
The Board of Management of Daimler-Benz AG will introduce an more efficient, slimmer structure at the Group's headquarters in Stuttgart, thereby continuing the process underway since 1993 which has created leaner hierarchies and shorter reporting channels at the nerve centre of the Daimler-Benz Group.

The new structure will be in place as of the beginning of July. "The Group headquarters will exercise a managerial role only where this generates tangible benefits", explains Juergen E. Schrempp, Chairman of Daimler-Benz since May 24, 1995. "Only those areas which promote the competitiveness of our business units will be kept on at our headquarters."

Targets for the newly structured headquarters, which will operate with a smaller staff, are a clear assignment of responsibility, transparency on the cost front and faster decision-making. The headquarters will concentrate on organisation of the Group portfolio, management of resources and finances, personnel and technology and on representing the Group worldwide.

In the Group headquarters, only 300 employees will remain. Depending on the final implementation, this process might involve shedding up to 200 jobs. Employees whose jobs are affected will either find new opportunities within the Group or other socially acceptable solutions will be found.

The functions at present attached to the headquarters (for example legal consultancy or financial and tax consultancy) will be kept on and offered to the head office and the four corporate units at competitive costs. In addition, operating Services and the training center Haus Lämmerbuckel may possibly be given independent legal status and will increasingly be measured against external competitors. Daimler-Benz research will to a large extent become an independently accountable entity. Competitive mechanisms will be introduced in this sector and, in the next three years, productivity will be increased by 30 per cent.

"This step will further improve our competitive position and costs", stated Schrempp. "The Group headquarters must be measured by the same standards of performance as the operative sectors. A dynamic, small and efficient headquarters will function as a role model."

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