Strategic Development Programmes
Improving profitability and the cost-effectiveness of projects
One of SRV’s main strategic goals is to improve profitability. This will be achieved through the more prudent selection of new projects, that is, by limiting participation in weaker margin tenders and increasing the share of developer-contracted projects. SRV has a number of large projects underway in which the company is involved both as an owner and as a builder. These projects include shopping centres in Russia and REDI in Kalasatama.
At the beginning of the strategy period, SRV started up numerous internal projects focusing on issues such as boosting efficiency in procurements, improving plans, shortening the construction phase and improving the management of additional and alteration works.
To reach the profitability target, SRV must improve its project margins. At the beginning of the strategy period, SRV started up numerous internal projects focusing on issues such as boosting efficiency in procurements, improving plans, shortening the construction phase and improving the management of additional and alteration works. The objectives set for the management of additional and alteration works were achieved and the new operating model introduced in 2017 has been integrated into day-to-day work through the operations system and management.
SRV has also sought solutions to improve profitability in the construction process. For instance, the company examined increasing the use of prefabricated elements, enhancing efficiency in the foundation engineering phase, parcelling out projects and implementing work in two shifts, which was tested out on numerous sites, for example in REDI and Niittyhuippu, in 2017. It is estimated that well-planned shifts can shorten the construction time significantly, which has a direct impact on the project margin.
In future, the improvement of profitability and project cost-effectiveness will focus on promoting the efficient use of the operations system, the management of resources and expertise, further development of procurements and design steering, and the strengthening of a culture of high performance.
Providing an unbeatable customer experience
Customer experience is the sum of all the experiences that a customer has through various encounters with SRV. SRV aims to provide the best customer experience in the business, and thus every encounter must go so smoothly that the customer is prepared to recommend SRV to others. Encounters are emphasised in all operations, whether when meeting with homebuyers, in long-term customer relationships with pension and investment companies or when a homebuyer first moves into his or her new home. The customer service process for consumer customers has been enhanced by means such as inviting tenants to become involved early in the process, even before construction is started up, honing the segmentation of customers, and even more carefully assessing issues such as what homebuyers want from their homes in the future. Work will continue with the systematisation of the identification of future customer needs. In addition, SRV will make an even more concerted effort to improve the customer experience of corporate customers.
SRV aims to provide the best customer experience in the business, and thus every encounter must go so smoothly that the customer is prepared to recommend SRV to others.
SRV measures the customer experience regularly using the NPS (Net Promoter Score) model. For instance, information is collected from homebuyers after the deal is made, when they are moving and upon the completion of annual repairs. SRV asks them about issues such as their satisfaction with the apartment, SRV’s operations in general, the work of the salesperson, the success of alteration works and quality of basic interior decoration materials. SRV’s full-year NPS for housing weakened in 2017 and was 28 (2016: 41). In 2017, business construction projects also adopted the measurement of customer experience.
Harnessing digitalisation and new technology
SRV utilises digitalisation and new technologies in, for instance, project development and design, building systems, construction site management, communications and marketing, and the products and services provided by the company. The aim of the strategic development programme is to systematise the use of digitalisation and adoption of new technologies.
At SRV, digitalisation is particularly evident in the use of information modelling in the project design and construction phases.
At SRV, digitalisation is particularly evident in the use of information modelling in the project design and construction phases. Information modelling is employed in project management, the inspection and harmonisation of plans, cost accounting and schedule management, procurements and the planning of logistics and work.
Three-dimensional modelling can be seen on worksites both in the form of illustrative printouts and on the displays of mobile devices. The final 3D model combines both scale architectural, structural and HVAC&E plans and required special plans. After the construction stage, the model can also be used by the developer in managing the property.
Accelerating the digitalisation and technology programme and utilising new digital tools and channels in operational development will be continued. Digitalisation is becoming an essential part of everyday activities throughout the organisation.
In 2018, the company will focus above all on the further development of Smart Life functions and services. These services will be tested in practice for the first time at REDI, where residents will move into the first residential tower, Majakka, in spring 2019. The company will also continue to step up both the digitalisation of process management and the use of information modelling as part of ordinary development of operations.
Building future growth
Urbanisation is not only one of the strongest megatrends, but also one of the major driving forces of change in Finland today. Even the Helsinki master plan is based on the forecast that the city will have about 860,000 residents (growth 35 per cent) and 560,000 jobs by 2050. Accordingly, there is a great need for new housing in the growth centres of the Greater Helsinki Area. As prices of homes in growth centres have risen and stricter bank regulation has made it more difficult for Finns to obtain mortgages, there is a need above all for more affordable housing designed for different purposes in the growth centres.
A growing number of municipalities have an ageing building stock on their hands, but less money and resources to maintain them or erect new buildings. Likewise, more day-care centres and schools will be needed in growth centres. It is expected that the focus in public service construction will shift even more strongly to privately financed construction and lifecycle building. In this model, the service provider takes responsibility for project design, construction and maintenance over a long contract period (typically 15–25 years). This is a new type of project for SRV, but it is a good fit for operations under the SRV Approach and its role as part of SRV’s business will be developed further going forward.
In addition to housing, the public construction model and the shopping centre market, new business opportunities are being explored and studied, for example in the fields of energy self-sufficient construction and care home construction.
In recent years, SRV has developed and implemented a number of innovative shopping centre projects in both Finland and Russia, and new opportunities for changing shopping centres into experience centres are continually being pursued. In addition to housing, the public construction model and the shopping centre market, new business opportunities are being explored and studied, for example in the fields of energy self-sufficient construction and care home construction.
Sustainability is an authentic part of day-to-day work
SRV’s work to develop its sustainability programme and operating models since 2016 has reaped results. The company aims to ensure that its sustainability efforts provide optimal support to the realisation of strategic objectives and provide more tools to enable business operations to thrive in an ever-more demanding business environment. The company also seeks to be an innovative and continually evolving professional in sustainability issues.
The company also seeks to be an innovative and continually evolving professional in sustainability issues.
Thanks to the steps taken in recent years, sustainability has become an authentic part of day-to-day work at SRV that supports business operations. Sustainability is thus no longer treated as a separate development programme, but as part of ordinary operations.
Adhering to management principles and processes
Management and compliance with processes have been an integral part of SRV’s operations since day one, applying to both the company’s own personnel and cooperation with subcontractors and partners. Adhering to management principles and processes was designated as one of the strategic development programmes in 2016, the beginning of the current strategy period, in response to business needs. Ever-larger projects and the greater number of SRV employees and partners call for even more systematic management. SRV also did a great deal of work on these issues in 2017, such as by organising management training for senior executives and project managers and by further expanding the operations of the SRV Step Academy, which was developed to meet SRV’s own training needs. All in all, 270 people participated in Step Academy courses in 2017.
Ever-larger projects and the greater number of SRV employees and partners call for even more systematic management.
In 2017, SRV largely achieved the targets that had been set for adhering to management principles and processes for the entire strategy period. For this reason, the development programme itself will be wrapped up. However, management and supervisory work will ensure that day-to-day work will adhere even more closely to management principles and processes. In addition, efforts to strengthen SRV’s culture of high performance will be transferred under the development programme for profitability improvement.
Since 2015, SRV has been measuring overall personnel satisfaction using the PeoplePower index*. SRV’s employees, who number just over 1,000, are on average extremely satisfied with their workplace and SRV was one of the Finland’s Most Inspiring Workplaces for the third time running. The company intends to rise into one of the top companies. Delightfully, the personnel survey response rate rose to 82.1 per cent and the results across the board were clearly higher than the norm for salaried employees.
* The PeoplePower®index is a benchmark used by Corporate Spirit Oy. It measures factors such as commitment, leadership and performance.