Reorganizing our global production

Our products are available in more than 100 countries around the world. The market conditions here can vary greatly – from their legal framework right up to patients’ and customers’ specific culturally-defined needs. Since it was founded, Fresenius Medical Care has successfully accommodated these differences with a differentiated product portfolio and a decentralized company structure. Production and key areas along the production chain such as product quality management, strategic procurement, and supply chain managementSupply chain managementManagement of all tasks along the supply chain, ranging from supplier selection, procurement and warehousing to the transport of goods to customers with the goal of improving efficiency in the value chain. have so far been largely the responsibility of the individual regions.

This strong regional presence will continue to give Fresenius Medical Care an important competitive edge, because local differences still influence our product business. The fact that we are aware of these creates trust in our Company – an important prerequisite if we not only want to offer products in a market but also open our own dialysisDialysisForm of renal replacement therapy where a semipermeable membrane – in peritoneal dialysis the peritoneum of the patient, in hemodialysis the membrane of the dialyzer – is used to clean a patient’s blood. clinics there. At the same time, chronic kidney failureChronic kidney failure (end-stage renal disease, ESRD)Permanent failure of the kidney (terminal kidney failure) resulting from slow and progressive loss of the kidney function over several years. Since the renal function cannot be recovered, the patient has to be treated with renal replacement therapy, i.e. kidney transplantation or dialysis. Chronic kidney failure is accompanied by long-term complications such as renal anemia, hypertension and other cardiovascular problems, as well as bone disease, loss of appetite and malnutrition. is becoming an increasingly global problem, bringing markets closer together in the long term. The number of dialysis patients is growing worldwide, accelerated by the aging population in richer countries and greater affluence in poorer ones. Obesity, diabetes and hypertension – typical precursors of chronic kidney failure – are on the rise in all parts of the world, as are concomitant diseases such as cardiovascular conditions. Governments are committed to offering their populations new and better treatment methods, but at the same time face the challenge of growing health costs, regardless of their stage of development.

These developments do not affect our basic objective to improve patients’ quality of life with the help of innovative technologies and high-quality products. However, they do add weight to one decisive factor – costs. In the long term, customers worldwide must be as satisfied with the price of our products as they are with their features so that they continue to buy them as their product of choice and we remain the market leader. We have been continuously improving our processes in individual regions for years to ensure that our products and services are as cost-efficient as they are high-quality. In the future, we intend to make even better use of this potential. For this reason, we created the Global Manufacturing Operations (GMO) division in the year under review and appointed a Member of the Board responsible for it.

In January 2010, GMO took over the task of centrally managing all major areas of the Company related to our product business. This basically means that our expertise in the areas of production technologies and processes, quality management, strategic procurement and supply chain management will be closely coordinated across all regions. The purpose of this is to:

• further increase the efficiency of our processes,
• better manage risks, and therefore costs,
• improve returns on our invested manufacturing-related capital.

The section below shows how we break these targets down into tasks and activities.