Our Group Organisation
CRH is organised into the following segments: Europe Heavyside, Europe Lightside, Europe Distribution, Americas Materials, Americas Products and Americas Distribution. In addition, the businesses acquired from Lafarge S.A. and Holcim Limited were reported as a separate segment in 2015., These segments are supported by a lean Group centre. This Group structure is designed to facilitate growth in a balanced and sustainable way, consistently and over the longer term.
For over four decades, we have employed continuous improvement programmes which enable us to build better businesses and generate enhanced returns. Our organisational structure and culture facilitates local initiative, as we seek to provide a national service with a local touch.
As we have grown in scale over the decades, performance improvement across the Group has been boosted by the sharing of experience, technologies and ideas. The scale of the Group also facilitates margin improvement and earnings growth.
Our Balanced Business
Building a balanced portfolio is a core constituent of our philosophy and a key determinant of value creation for CRH. The Group is a broad-based building materials business that is diversified with many products, geographies and sector end-uses. We are a multi-product company and the breadth and depth of our product range differentiates our positioning relative to peers in the industry.
Maintaining a balanced portfolio enables the Group to take advantage of differing demand cycles. Diversification also opens up a greater number of opportunities for acquisitions, while having vertically integrated businesses creates potential for synergies and operational leverage.
In a cyclical industry, we seek to minimise the impact of varying demand patterns by maintaining a balanced portfolio of materials and products to serve a wide customer base in the three key demand areas of residential, non-residential and infrastructure, and to both new-build and repair, maintenance and improvement construction categories.
An Experienced Management Team
People are the heart of our business and today the Group employs 89,000 people at approximately 3,900 locations around the world.
Strong leadership and talent management are key characteristics of CRH. Led by a highly experienced senior management team, CRH has a considered strategy that targets talent identification, nurturing, and succession planning.
To ensure we source the best available leadership teams, our managers come from three very different streams:
- Internally developed operating managers who have room to grow and develop
- Highly qualified finance and development professionals and business builders with vision who are sourced externally
- Owner-entrepreneurs who have joined with their companies and who have much to offer the wider Group
We believe that by developing a number of pools of talent, we ensure a healthy mix and depth of skills, with a wealth of experience and know-how, from managers who have managed through previous different economic cycles.
A Track Record of Performance
CRH’s business model has played an instrumental role in the consistent delivery by the Group of industry leading returns through the cycle. In the period 1970 – 2015, CRH has, in euro terms, delivered a formidable compound annual Total Shareholder Return of 16.1%.
Through the extraction of inherent value in newly acquired businesses and a focus on delivering organic performance improvement in existing businesses, our commitment to building better businesses is a key component of our value creation model.
Our operations benefit from this active philosophy of continuous improvement:
- Key performance metrics are applied across the Group
- Financial control is exercised through rigorous annual budgeting and reporting processes
- Monthly results are examined by Divisional management and critiqued at Group level
- Full year performance is regularly reforecast under prudent accounting policies
- Benchmarking to ensure leading practice in production, distribution and administration
By leveraging the scale of the Group, benefits accrue in the areas of procurement, merchandising, selling prices, category management, distribution and IT. Through the sharing of knowledge, ongoing people development, optimisation of our networks, operational leverage and utilisation of the Group’s financial strength, we can deliver greater value from our businesses.
The Group provides guidance, support, functional expertise and control in the areas of performance measurement, financial reporting, cash management, strategic planning, business development, talent management, governance and compliance, risk management, sustainability, health & safety and environment.
A Unique Acquisition Model
Over four decades, CRH has successfully employed its tried and tested acquisition model with a focus on adding small to mid-sized companies that complement and add value to our existing portfolio. On occasion, larger and/or step-out acquisitions are made when the value proposition and strategic rationale are compelling.
Many of our core end-markets in mature economies remain fragmented or relatively unconsolidated and will continue to offer acquisitive growth opportunities in the decades ahead. Our acquisition model will also support the creation of new value and growth platforms in emerging economic regions, such as those in Asia.
Growth is achieved by
- Allocating capital to growth platforms in core business areas
- Building leadership positions in regional markets
- Acquiring and growing value-creating businesses
- Investing in new and more efficient production capacity
- Product innovation and development of new markets
- Creating platforms for future growth
CRH’s strategy and business model is built around the principles of sustainable, responsible and ethical performance. The Group’s organisational culture is rooted in a daily commitment to core values of honesty, integrity and respect in all of our business dealings.
CRH believes that combining these principles and values with best international practice, promotes good governance and provides a platform for the business to deliver superior returns over a sustained period of time, while also being sensitive and responsive to stakeholders and the environment in which we operate.
CRH has therefore placed sustainability and corporate social responsibility at the heart of its business model, strategy and activities worldwide.