17 February 2015
LAUNCH OF BALFOUR BEATTY'S TRANSFORMATION PROGRAMME - BUILD TO LAST
Balfour Beatty, the international infrastructure Group, has launched its business transformation programme, "Build to Last". This programme will drive continual improvement across all businesses, to build a global Group which generates substantial shareholder value and maximises returns by optimising the value of an integrated Balfour Beatty.
In its initial phase, Build to Last will target bringing each business unit to industry-standard performance levels by focusing on four key areas:
· Lean - Deliver rapid performance improvement by strengthening financial controls and transparency and simplifying the organisation with detailed indirect cost reduction plans, plus the launch of the My Contribution productivity initiative (metric: operating profit and operating cash generation)
· Expert - Ensure the attraction, retention and development of key employees and sub-contractors by investing in training and talent to enhance engineering, project management and delivery capability (metric: engagement survey)
· Trusted - Strengthen the successful execution of projects and services through disciplined stage-gated bidding, contracting and risk review processes (metric: customer satisfaction)
· Safe - Prioritise safety at all levels and for all employees, sub-contractors, customers and communities (metric: zero harm).
A number of steps have already been taken across the UK and the US to give the programme rapid traction, including:
· Creation of the Build to Last programme office with UK and US workstreams and a benefits tracking system
· Following strengthening of the Board, new appointments to the senior leadership team in targeted areas, including IT, commercial and project execution, and business process re-engineering
· Alignment of all leadership incentives to key programme goals
· Consolidation to leverage key UK functions to remove duplication and improve efficiency, resulting in significant reduction of layers and cost (subject to consultation) in areas not related to front line delivery
· Rollout of a cash generation drive through planning and training to project level in the UK and the US
· Detailed procurement initiatives commencing with key suppliers and areas of direct and indirect spend, with the potential to deliver meaningful and growing savings over time
· Streamlining the Group property portfolio to reduce costs.
Further details on the programme and an update on progress will be provided at the Group's Preliminary results on 25 March.
Commenting on the launch of Build to Last, Group Chief Executive Leo Quinn said: "The Group's recent trading makes it imperative to gain early momentum in our transformation plans. Whilst further challenges remain, there are clear opportunities to achieve improvements in cash generation and profitability in the near term.
"Balfour Beatty has great strengths across its portfolio - not least in its Investments division, where recent transactions underline the ongoing ability of this business to create value. I continue to believe all our operations should achieve industry-standard performance against what appears to be a beneficial market environment.
"Longer term, we will shape a Group with leadership in key markets, driving best-in-class performance from a platform of strong capability, leaner processes and robust execution."
ENDS
Analyst/investor enquiries:
Anoop Kang
Tel. +44 (0)20 7216 6913
[email protected]
Media enquiries:
Dominic Cheetham
Tel. +44 (0)20 7963 4235
[email protected]
Notes to editors:
Balfour Beatty is a leading international infrastructure group.
With 36,000 employees, we provide innovative and efficient infrastructure that underpins our daily lives, supports communities and enables economic growth.
We finance, develop, build and maintain complex infrastructure such as transportation, power and utility systems, social and commercial buildings.
Our main geographies are the UK, US, Middle East and South East Asia. Over the last 100 years we have created iconic buildings and infrastructure all over the world including the London Olympics' Aquatic Centre, Hong Kong's first Zero Carbon building, the world's biggest shopping mall in Dubai, the National Museum of the Marine Corps in the US and the Channel Tunnel Rail Link.
