INVEST PROGRAMME

At the heart of our new strategy is a commitment to deliver improved performance, specifically in the four areas detailed below. The engine for this is our INVEST programme, designed to spread best practice across the Group and ensure effective management of a large number of localised initiatives. Under this programme we are training over 1,000 project leaders and have developed an Intranet-based tracking system to enable managers to monitor projects and share expertise on a transparent Group-wide basis.

Customer Development
Developing closer relationships with our customers is an essential part of our drive to improve business performance. We need to develop a clearer understanding of the key issues affecting our 165,000 customers, manage those relationships more effectively and deliver continuously on their expectations. To achieve this, our customer development team is engaging with every business to improve their planning, sales processes and customer information systems. As well as a focus on strategic accounts, we aim to raise our capability in all customer relations by driving best practice across the businesses and removing barriers to cross-selling.

Service Delivery
A key to customer satisfaction is the development of world-class services and service capability. This would strengthen and expand the nature of our customer relationships and provide high quality earnings. To drive this, the service initiative team is building a Group-wide network of experts. It has benchmarked best practice internally and externally to create a model encompassing technical support, call centres, spare parts logistics, field operations, dispatch and service sales and marketing. The businesses can use tools such as research, benchmark references, training modules and detailed process maps to improve existing services. New services already developed include a partnering between Invensys Energy Solutions and Powerware to provide services for the commercial building sector, and Powerware's enterprise monitoring.

Project Management
We know that we can increase profit margins by delivering consistently what we promise, on time and to budget. Project management champions have been nominated across the Group and the team's assessment tool will enable us to gauge our management of all projects. Four areas will be addressed immediately: correcting under-performing projects, placing each project under the stewardship of an accountable senior manager, improving bid and tender management, and preventing informal changes to project scope. Longer term, we will develop consistency in project excellence through training and mentoring packages for hundreds of project managers.

Lean Supply Chain
We believe that the fastest way to achieve savings is by reducing inventories and identifying commodities that can be sourced on a Group-wide basis. We have completed a review of our £2.6 billion spend and 20,000 supplier base. By August 2002 we will have over 60 sourcing teams, with strategies for the Group's main commodities. Our hundreds of 'black belts', specialists in improving performance, will be tackling problem areas and spreading the lean initiatives that were previously successful but did not achieve universal impact. In time, supply chain management throughout the Group will be continuously benchmarked in an effort to drive improved business performance and the spread of best practice.