Annual Report 2011

Our strategy
Our mid-term target and priorities

We aim to reach an EBITA margin above 5.5% mid-term – a new peak for Adecco. In 2011 the EBITA margin was 4.0% and improved 10 bps compared with 2010. The target was set at the beginning of 2010, after having increased the share of the higher-margin Professional Staffing business to above 20% of our total revenues. Moreover, we used the recession in 2008/2009 to structurally reduce our cost base. In the meantime, Adecco Group revenues developed very well with two consecutive years of double-digit growth. While we faced headwinds on gross profit, due to the business mix and reduced government subsidies in France, we have done an excellent job on the cost side since the upturn. From today’s perspective, we are fully on track to reach our targeted profitability level mid-term.

The strategic focus of Adecco Group’s management is on Retention, Information Technology (IT), Professional Staffing, Segmentation, Solutions and the Emerging Markets.

  • Retention: Retaining our own employees is essential in building successful long-term relationships with both clients and associates. A better, longer-lasting relationship with our clients and associates is a competitive advantage both from a revenue and also from a cost perspective. The regularly conducted Great Place to Work® survey on the job satisfaction of our own employees gives insight into how we can offer and enhance an attractive working environment.
  • Information Technology: Optimising our IT processes, through further consolidation of data centres, front office systems standardisation and the reduction of applications, as well as a common Group-wide web platform, is an important strategic priority for the Group’s management. The investments in IT are aimed at enhancing our cost leadership position. Additionally, we invest in our web presence to remain at the forefront of the emergence of new delivery models such as social media networks.
  • Professional Staffing: Already today, Adecco is the global leader in Professional Staffing worldwide, but it remains an essential part of the Group’s strategy to increase the share of revenues generated from Professional Staffing. This segment, with higher growth and margin potential, accounts for approximately 30% [1] of the global staffing market. Mid-term, Adecco aims to raise its share of revenues generated from Professional Staffing. Demand for higher-margin Professional Staffing, where penetration rates are still significantly lower than in the General Staffing segment, will be driven by scarcity of talent and higher wage growth for qualified personnel.
  • Segmentation: Optimising the segmentation of our client base and increasing the efficiency of delivery models, especially in General Staffing, was a strong focus in 2011 and will continue to be firmly in our sights also in 2012. We aim to increase business with retail and medium-sized clients, to better diversify the business mix.
  • Solutions: As the world’s leading provider of HR solutions, Adecco considers the continuing trend towards Workforce Management Solutions, including Managed Services Programmes (MSP), Recruitment Process Outsourcing (RPO), Vendor Management System (VMS), and Career Transition and Talent Development Solutions a major opportunity to differentiate its service offering. Large multinational clients increasingly seek to outsource their HR processes and with our global footprint and extensive know-how of local labour markets, Adecco is ideally positioned to take advantage of this trend. Our comprehensive Solutions offering is unique and a key competitive advantage.
  • Emerging Markets: The Emerging Markets offer immense untapped growth potential for the staffing industry. Penetration rates of temporary staffing services are still at very low levels. The highly dynamic economic activity and the move of production and growing investments into the Emerging Markets by multinational corporations are the main growth drivers for our business in these markets. During 2011 we opened offices in Vietnam and FESCO Adecco, the joint venture in China established as of January 1, 2011, had already more than 125,000 associates by the end of the year. The rapidly growing Emerging Markets remain a strategic focus for us.


[1]Adecco estimate.