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Excellence program 2019 – 2021

We are streamlining our administration, sharpening the roles of services and regions, and simplifying procedures and processes as part of our ongoing Excellence Program. Customer-focused operating divisions, cross-functional service units and regions as well as a lean Corporate Center are the cornerstones of the new organization.

The ongoing Excellence Program is expected to contribute €2 billion to EBITDA annually from the end of 2021 onward compared with baseline 2018. BASF expects a reduction of a total of around 6,000 positions worldwide until the end of 2020. This decrease results from the organizational simplification and from efficiency gains in administration, the service units and the operating divisions. In addition, central, functional and regional structures are being streamlined in the context of the announced portfolio changes.

Excellence program 2019–2021
  2019 2020 2021
Annual EBITDA contribution (Run Rate) €0.6 billion €1.3 – €1.5 billion €2.0 billion
One-time costs in the respective year €0.5 billion €0.3 – €0.4 billion €0.05 – €0.15 billion
Category  
Operational excellence Measures focused on production, logistics and planning
Leaner structures Personnel cost savings; reduction of 6,000 positions targeted globally by end of 2020
Innovation R&D cost reduction via focusing budgets
Simplification Increased process efficiency, e.g., in procurement
Last Update July 29, 2020