Revolution Work Transformation
From the Personal Harbor
  of Jim Hackett
The Road to Six Billion and Beyond
The Six Growth Strategies Illustrated
Information for Our Investors
Steelcase Offerings Around
  the World
Financial Highlights
MD&A
Consolidated Statements of Income
Consolidated Balance Sheets
Consolidated Statements of Changes
  in Shareholders' Equity
Consolidated Statements of Cash
  Flows
Notes to Consolidated Financial
  Statements
Report of Independent Certified
  Public Accountants and
  Management's Responsibility
  for Financial Reporting
Directors and Executive Officers




We expect our investments in research and development to yield more new products that seamlessly blend furniture, architecture and technology.


Research generates knowledge; knowledge yields innovation.


Are these expectations realistic?

Our track record suggests that they are.


A successful leap.

The Leap™ chair that debuted in June, 1999, is the most successful new chair introduction in the company's history.


New task light outshines all rivals.
The best new products contain proprietary, patent-protected technology. The Leap chair is one example; our new Canopy™ task light is another.


It's a "world's first"
Huddleboard™ products, our personal, portable whiteboards that help people on the move record, display and transport information. They're the first of what will be a family of knowledge management devices.

The Footnote™ table and L'attitude™ chair, two award winners from Brayton International.

Frisco enables European knowledge workers to shift and change their workstation to suit the task at hand.

A key component of our e-Steelcase strategy involves using the Net to enable boundaryless sharing of information and ideas between Steelcase entities around the world.
   
  An agreement with KiSP, Inc., gives Steelcase ownership of an Internet-based tool kit and access to its developers. We've used both to create online links between our customers and their dealers.  
  Thanks to e-Steelcase, dealers, designers, engineers and plant managers everywhere can exchange policies, processes, procedures and ideas almost instantly.  
  Our global dealer network gives Steelcase something others are investing millions to create: the ability to effectively fulfill orders and provide ongoing customer service.  
  e-Steelcase lets customers get what they want in "Internet time."
A Pathways® configuration engine lets them do in minutes what once took hours...with 100 percent accuracy. Visual specification tools support our entire product line (90,000 style numbers!).
 
  An increasingly diverse product portfolio enables us to compete in new construction, renovation and emerging growth markets, as well as reach new customer segments within our traditional markets.


Interior architectural products enlarge our market.


Rapid technological advances spawn office building renovations that create new markets for our products.

 

Emerging growth companies constitute a $500 million market opportunity.

     What do we offer these markets?
Extraordinary flexibility: "living walls" that move and whose heights and surfaces can be changed again and again, as well as floors, lighting and furniture that can be reconfigured easily, quickly and affordably.
Leap wins new customers.
22% of Leap sales were from new customers.


Turnstone attracts new customers.
Our Turnstone® brand products are designed and priced to appeal to people at fast-track, cost- conscious companies who value speed, convenience and price.
turnstone
Pathways (path'wys), n.1. a portfolio of interior architecture and technology products, furniture and work tools that enable designers to create work environments that offer exceptional flexibility, affordability and user control. 2. an innovation that transforms an expense (conventional work environments) into a productive asset.
THE ROAD TO SIX BILLION AND BEYOND Acquisitions completed in the past two years not only added to our revenues, they also added to our capabilities. Ventures and alliances pair our capabilities with those of other industry leaders.

*The $576 million would have been $750 million had these acquisitions been part of Steelcase for the entire year.

  

More than revenues... capabilities.
The companies that became part of Steelcase added to our capabilities. For example, Strafor (France) and Werndl (Germany) strengthened our dealer network and our product portfolio everywhere.

Clestra Hauserman brings a variety of reconfigurable wall products to our Pathways® portfolio.

We have formed a new venture, the Steelcase Surfaces Partnership, comprised of DesignTex and J.M. Lynne. Both provide textiles for any application.

IDEO
We also work continuously with our partner IDEO Product Design to enhance our portfolio. IDEO people helped design the Leap chair, the Detour™ family of teamworking products for Metro, and the award-winning Kart™ chair for Vecta.
Appliance Studio Alliances, too, are a key component of our plans. We are currently working with The Appliance Studio and others to co-develop technology-enhanced furniture products. Hewlett-Packard is a founding sponsor of the studio. A new venture,
a new market opportunity.

Workstage™, a new venture with Gale & Wentworth, a leading real estate developer, offers firms a chance to lease or buy Pathways outfitted office space at attractive rates.
  The market for office furniture outside the U.S. is large and growing, thanks to the worldwide growth in knowledge workers. And we are uniquely positioned to take advantage of it.


Our international revenues alone would put us among the leading office furniture companies.


Its sales are approximately
$32 billion, and the U.S.
accounts for only 39% of it.

  

Our infrastructure is in place overseas.
21 manufacturing facilities
4,500 employees
400+ dealer locations
We can offer products that reflect local cultures in local currencies at competitive prices.


Case in point.
Our fastest growing seating line in Brazil, Easy, is locally developed and manufactured.


An international leap.
Leap is now being manufactured in France as well as the United States, and sold throughout Asia and Europe.
Information, expertise, products and services flow in every direction.
Steelcase dealers everywhere work with one another to meet customers' global needs. Designers, engineers and plant managers everywhere exchange equipment, processes, procedures and ideas. Order fulfillment is seamless worldwide.

A N   I N T E R N A T I O N A L   C O L L E C T I O N
gives Steelcase dealers in North America a variety of attractive new products to offer their customers

How we intend to take full advantage of this network.

1. 2. 3. 4. 5.
By providing our dealers with superior products that attract new customers. By providing Quick Delivery programs that enable dealers to serve customers who "can't wait." By providing training programs that enable dealers to offer integrated interior solutions. By providing financial services that enable our dealers to offer customers a variety of financing arrangements, including leasing. By providing secure online connections that enable our dealers to order, track and bill products and components... and global order fulfillment so they can take better care of their international customers.
6.
By providing programs that enable our dealers to engage prospective customers in their communities.

HotHouse
HotHouse seminars help executives turn their offices into "breeding grounds for innovation."

Our business-to- business strategy could increase our dealers' revenues by as much as 12 percent.
  The Steelcase Dealer Network is the industry's largest and most capable...and an important competitive advantage.
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We intend to increase sales to current customers by continuing to offer them new products and services that help their people work more effectively.
$17 billion

Increasing seating, storage and wood penetrations to the same level as systems (26%) adds a billion dollars in revenue.
   Special Delivery!
Our Quick Delivery programs — which let buyers choose from 9,000 products that are available within 12 days — also expand our reach. Now people who "can't wait" don't have to.
A popular leap.
Leap was a hit with existing customers, too (they purchased 78% of all Leap chairs sold).
Sharing our wealth of knowledge.
Offering our customers access to our knowledge often prompts them to think about their space in new ways — as an asset, not just an expense.
STEELCASE FINANCIAL
New services make it easier for customers to get what they want.
Quick Delivery programs, leasing alternatives and Workplace Performance evaluation tools, to name three of many.