Measured in terms of net sales, our Hardware business grew by 7% over the reporting period to €1,346 million (2006/2007: €1,254 million). This business stream thus accounted for 58% of total net sales, the same as in the preceding year. There was a substantial rise in sales of high-end systems such as, e.g., multifunctional ATMs and automated checkout systems (Glossary) .
In the light of worldwide cost pressure and competition, Wincor Nixdorf set up its own global production network some years ago. This allows us to respond rapidly and flexibly to market requirements. The production network includes our German sites in Paderborn and Ilmenau as well as our locations in Singapore, Shanghai (China) and São Paulo (Brazil). Within this network, our German factories continue to act as the suppliers for higher-end mechatronic components and for recycling and deposit systems.
Efficiency and quality also lie at the heart of our manufacturing systems. During the year under review, for example, we commissioned a new painting unit at our Paderborn site. This new facility meets the highest environmental and manufacturing standards. In February 2008, we moved into the new building complex at Ilmenau, where we develop and produce reverse vending systems and the related software. Sales, customer support and service for this business are also managed from here.
We expanded our production site in Shanghai back in 2006/2007. During the year under review, we strengthened it to prepare for the production of ATMs, especially for the Chinese market, in addition to other products for the retail industry. However, Singapore remains the hub of all our activities in the Asia/Pacific/Africa region and acts as head office for production in this market.
Wincor Nixdorf has organized its global production network on a decentralized basis according to the “local for local” principle. As far as possible, our production sites in Singapore, Shanghai and São Paulo cover the requirements of their own markets themselves. Where this can be achieved through process innovation, this also applies to our German production sites and deliveries to Europe. The “local for local” principle allows us to respond more rapidly and flexibly to customer needs and, as a result, to take greater advantage of growth in different regions. Another benefit is that by increasing the level of production and purchasing in local markets we can diminish the impact of currency fluctuations.
In fiscal 2007/2008, we made further progress in the standardization and optimization of processes at all our sites. The introduction, for example, of a uniform global IT manufacturing control platform enabled us once again to boost productivity. We also made further improvements to our worldwide supplier management system and to the planning and control of purchasing volumes and site capacities. At the same time, Wincor Nixdorf has started to introduce lean production principles at all its sites.
Net sales for Software/Services climbed 9% in the fiscal year to €973 million (2006/2007: €891 million). This business stream covers all the service-oriented elements of our portfolio: the sale of software licenses, providing advice to customers on all aspects of new solutions (Glossary) and on-site implementation and integration (“Professional Services” (Glossary) ). It also includes all those services (Glossary) whose purpose it is to assure the smooth, cost-efficient operation of our customers’ installed IT systems.
The proportion of total net sales accounted for by our Software/Services business remained at the same level as the previous year on 42%. The substantial increase in net sales demonstrates the ongoing expansion of services. The fact that its share of total sales remained stable is due to equally strong growth in our Hardware operations.
Wincor Nixdorf successfully expanded its position as a leading innovator in the Software business:
In the banking segment, it was particularly our Retail Banking Solution Suite (ProClassic/Enterprise) that met with the greatest interest. Its role is to bring together the main retail banking processes (sales and marketing/service and support) into channel, IT integration and customer areas, and to control overlapping processes. The banks benefit from the simpler and faster integration of sales channels (Glossary) and improvements in the analysis of data from other channels. In the retail segment, the year under review saw the redevelopment of our TP Application Suite (Glossary) , now equipped with many new functions to support the standardization of processes throughout the value chain – from logistics to the checkout – and across national boundaries.
No software without implementation: Wincor Nixdorf’s integration services also performed well over the last year and we are keen to expand this area significantly in the next few years alongside our consultancy business.
Our Services division maintained its unbroken upward trend, driven by buoyant performance in the banking segment. Here, the biggest and fastest-growing area in terms of business volume is Product-related Services (Glossary) . In general, these involve contracts extending over several years for the installation, maintenance and repair of customer systems.
Wincor Nixdorf’s Managed Services (Glossary) involve our taking over the running of specific tasks within a customer’s IT infrastructure. This reduces the overall burden of operating its installed IT base and helps to optimize its business processes. We were particularly successful in this field with our standardized service packages. These include network-based remote monitoring, inventorization and software distribution.
Outsourcing (Glossary) , our most comprehensive service and one that we provide, above all, to banks, involves our taking over part or all of the running of branch-level IT infrastructures and applications, including self-service devices and networks. This means we are responsible for the technical and operational processes related to ATMs and for the control and monitoring of the cash cycle – in short, the entire running of self-service applications and their infrastructures. During the year under review, we further expanded our activities in this field in Germany and the United Kingdom (see also “Banking segment”).
The technological basis for the control and delivery of our entire service portfolio is the “eServices Platform.” It lies at the heart of the remote monitoring and control of customer systems and devices, guaranteeing stable and consistently high-quality processes. It records any disruption centrally, automatically initiates the appropriate action and resolves the issue following a standardized procedure. In addition, the customer can monitor the operational status of its systems at any time via a portal as well as checking their availability through reports and obtaining information on current inventory levels.
With regard to our Logistics services, during the year under review we set up a rollout (Glossary) center in Germany that is also intended to support other European countries in the future with major rollout projects. Over the same period, our new logistics center in Singapore also commenced operation.
Net Sales Split: Hardware and Software/Services. €m
