36 Heineken N.V. Annual Report 2004 Report of the Executive Board Operational Review Geographical distribution of personnel in numbers O Personnel and Organisation In 2004 the average number of employees employed increased from 61,271 to 61,732. Within Heineken, there is a clear balance between the Human Resources policies which are developed centrally and applied across the world, such as performance management, and those which are local ly developed and implemented according to the individual market situation and legislation. The global Human Resources agenda for Heineken in 2004 was driven by the need to shape our business into a high-performance organisation and develop a challenging and supportive culture, two key objectives of the 'Taking Heineken to the Next Level' programme. Leadership development We implemented a number of new initiatives in the area of leadership development in 2004. One is a new leadership competency model that defines behaviour expectations from all senior managers at Heineken. The model takes Heineken's company ambitions and values as a starting point, and translates these into the leadership behaviour required from senior managers. These leadership competencies then serve as the basis for selecting and developing potential candidates for senior management positions throughout Heineken. In the future, selection for positions will depend as much on experience and track record as on leadership competencies. Management development We completed an extensive review of the systems for performance management, succession planning, developing and rewarding Heineken managers and we re-designed the recruitment and development process for senior managers. This review led to a set of uniform HR standards and procedures which will be launched globally in 2005 in order to improve the clarity, transparency, consistency and fairness of our career development approach. We see these as important factors in fostering a merit-based culture within Heineken, a culture that rewards and advances employees according to tangible, measurable achievements. Under the new system, employees will receive clear feedback on their performance and on their stated personal and professional ambitions. That will give them the opportunity to take more of a lead in steering their own personal development. Human resources systems In 2004, following Heineken's common systems IT strategy, an integrated system for the main HR processes, was developed. The development was done in close cooperation with and between our operating companies. This avoids future IT development costs for HR and through standardisation of definitions and data structures, provides a much better basis for consolidation as well as for internal and external benchmarking. The first implementation took place in November 2004. Between 2005- 2007 other operating companies will follow. Western Europe (excluding Netherlands) 18,009 Central and Eastern Europe 16,844 Africa and the Middle East 11,565 Americas 5,606 Netherlands 4,885 Asia Pacific 4,823

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