Industrial Capital

DIGITAL TRANSFORMATION

The OHL Group is aware that both society as well as businesses are immersed in a transcendental technological revolution, specifically, in a digital revolution. In the foreseeable change that digitalization is destined to bring about, the Engineering & Construction sector will encounter excellent opportunities for improvement and will be able to substantially increase its quality and efficiency.

For this reason, the Group is undertaking a process of transformation with the goal of becoming a cutting-edge company in its sector in terms of digitalization. Accordingly, the Group has launched its Systems Master Plan 2016-2020 designed to promote the digitalization of the value chain of each of its areas of activity. In this context, the Group is organizing its efforts along four main lines of work.

IMPLEMENTATION OF BIM AS THE AXIS OF DIGITAL TRANSFORMATION

The OHL Group considers that BIM (Building Information Modeling) is the paradigm for developing the digitalization of the construction sector.

Bim method
INFORMATION EXPLOITATION WITH BIG DATA AND DATA ANALYTICS

The main project in this sphere revolves around the implementation of a platform for the integration of data from multiple sources originating from the entire value chain of the Group, which will enable an analysis of the information on all of the projects and operations of the Group’s divisions in all of its geographical areas and the decision-making in real time.

The OHL Group applies the most advanced technologies for improving its value chain

The sources of information include both internal sources, that is, the Group’s own information systems, as well as external, such as the information originating from third parties, with particular attention to the information generated in the social networks in relation to the company’s projects.

Likewise, the platform will make it possible to consult and extrapolate the results of the operations performed in the past for their use in future projects and also for analyzing client satisfaction with the projects performed, the management of the infrastructures under concession and the services provided.

The platform will therefore serve for enhancing OHL’s competitiveness and its capacity for offering greater added value to its clients.

The OHL Group applies the most advanced technologies for improving its value chain.

OHL Group advanced technologies
INTELLIGENT MANAGEMENT SYSTEMS FOR CONCESSION INFRASTRUCTURES
Monitoring of Unique Structures (MES)

Intelligent systems have been developed in the area of concessions that cover the entire value chain of their operations, ranging from the dynamic management of tolls through to the characterization in real time of traffic, making it possible to prevent congestion and even to project pavement maintenance and replacement.

A significant aspect to be noted in this context is that the operations are supported on their own geo-referencing systems with 360º images that enable the optimization of maintenance tasks.

The Monitoring of Unique Structures (MES) stands out in the context of the Group’s digital transformation process in the scope of the Internet of Things (IoT).

INTEGRATION OF THE INFRASTRUCTURES AND MUNICIPAL SERVICES WITH THE SMART CITIES

The Group’s plan is based on connecting its management platforms to the “Smart Cities”, in such a way that its own operations will be synchronized with the demands of the cities it services.

MONITORING OF UNIQUE STRUCTURES (MES)
The Monitoring of Unique Structures (MES) stands out in the context of the Group’s digital transformation process in the scope of the Internet of Things (IoT)

The Monitoring of Unique Structures (MES) is significant as a complement to these lines of work and as a part of the Group’s digital transformation, in the scope of the Internet of Things (IoT). OHL has a high-precision automated system that enables the control and monitoring in real time of eventual movements that could occur during the construction or the operation of “Unique Structures” such as landmark buildings (Torre Espacio), tunnels (the tunnel on the M-111), dams, bridges or heritage structures (Centro Canalejas).

Through the application of advanced simulation systems in its projects, OHL is capable of predicting the impact of certain infrastructures, for example, how a project can alter the transit of vehicles and/or people in its immediate surroundings.

This solution makes it possible to assess the impact of operations in urban areas on the local citizens, thereby enabling the proposal of solutions to mitigate such impacts.

Américo Vespucio toll road. Chile.
Américo Vespucio toll road. Chile.

QUALITY MANAGEMENT AND CLIENT CARE SERVICE

  • Since its creation, the Group has been applying the principle of continuous improvement in its products and services with the aim of generating competitive advantages and of providing a quick response to the challenges of the markets in an environment of accelerated change
  • OHL manages quality process by process, treats the associated risks and works through an integrated management system
  • The reference used by the Group for its quality management consists of the principal international standards demanded by its clients in each sector, such as the ISO 9001, EC marking, Cristal and AAA. Moreover, it has obtained external certification in those markets where this is recognized as an added value

All of the Group’s employees and collaborators accept the commitment to quality in their work through OHL’s Code of Ethics and Policies. OHL, in turn, provides the training, the resources and the technology necessary for offering the best service.

Dialog and client and user care service are maintained on an ongoing basis in the form of meetings, handling of claims and satisfaction surveys.

Other stakeholders, such as government agencies, analysts and investment groups are attended to by using a variety of channels of communication through the Internet, including specific e-mail addresses.

All of the claims received from clients and users are processed by means of the same channel through which they were received, and the necessary traceability is maintained.

The duration of the process and the measures for providing a solution depend on the type of claim, although the Group maintains a commitment to continuous information on the degree of progress of the claims lodged.

Also, the assessment of satisfaction is carried out by means of a range of resources: interviews, questionnaires, market analyses, extension of contracts and services and new awards.

All of the business areas have procedures adapted to their particular activity for the necessary client and user care service, which enable them to meet their obligations and to improve the services contracted.

CSR STRATEGIC PLAN

Strategic Lines in Quality 2016-2020

  • Treatment of non-quality, as a control and efficiency improvement tool
  • Management of claims, as a degree-of-compliance indicator
  • Client satisfaction, as an indicator of market trends
2016 OUTCOMES

The OHL Group manages its quality in all of the countries where it operates and holds certificates from 10 external entities of recognized standing, including: SGS, TUV Rheinland, BV, LRQA, BSI, Stavcert, Acert, Certicom, AAA and E-Cristal.

Monitoring and control activities: 97% of sales.

74% of sales certified. The remainder of the business activity refers to markets where certification is not demanded by clients.

Close to 1,500 quality audit days, 14% of which were carried out by certifying agencies and clients and where no serious noncompliance was detected. Moreover, the increase in internal audits in Mexico is significant, more than 950 with respect to 2015, for the purpose of improving the control of the application of the quality management system.

The staff equivalent with quality duties declined 16%, linked to the decline in activity.

Average rating on the client satisfaction index; 8.4 out of 10. The country with the best score was Colombia (9.3), followed by Mexico and Peru (9.0). 94.5% of the end-users considered themselves as satisfied and 92.1% would recommend working with the OHL Group.

The number of claims handled totaled slightly over 11,000* (2.9 claims per million euros of sales). 92% were settled within the established time limit. The average period of time for resolving complaints was 11 days.

* Figures from Concessions in Mexico and from Services in Spain are not available, due to the revision of the methodology used.

MAIN QUALITY MANAGEMENT INDICATORS

  • Business & Sales
  • Staff
  • Quality audit
  • Claims
  • satisfaction

Volume of Business with quality certification. OHL Group (%)

Volume of Business with quality certification. OHL Group (%)

Volume of quality-certified sales 2016. Countries. OHL Group (%)

Volume of quality-certified sales 2016. Countries. OHL Group (%)

Volume of quality-certified sales 2016. Divisions. OHL Group (%)

Volume of quality-certified sales 2016. Divisions. OHL Group (%)

Staff equivalent with duties in quality management. OHL Group

Staff equivalent with duties in quality management. OHL Group

Staff equivalent with duties in quality management 2016. Countries. OHL Group (%)

Staff equivalent with duties in quality management 2016. Countries. OHL

Staff equivalent with duties in quality management 2016. Divisions. OHL Group (%)

Staff equivalent with duties in quality management 2016. Divisions. OHL

Quality audit. OHL Group

Quality audit. OHL Group

Quality audit in 2016. Countries. OHL Group (%)

Quality audit in 2016. Countries. OHL Group (%)

Quality audit in 2016. Divisions. OHL Group (%)

Quality audit in 2016. Divisions. OHL Group (%)

Average claim response time in 2016. Divisions. OHL Group (Days)

Average claim response time in 2016. Divisions. OHL Group (Days)

Claims 2016*. Countries. OHL Group (%)

Claims 2016*. Countries. OHL Group (%)

Claims 2016*. Divisions. OHL Group (%)

Claims 2016*. Divisions. OHL Group (%)

Level of client and user satisfaction 2016. Countries. OHL Group (Out of 10)

Level of client and user satisfaction 2016. Countries. OHL Group

Level of client and user satisfaction 2016. Divisions. OHL Group (Out of 10)

Level of client and user satisfaction 2016. Divisions. OHL Group

SUPPLY CHAIN

Key procurement indicators of the OHL Group

Key procurement indicators of the OHL Group

SUPPLY CHAIN MANAGEMENT

The Code of Ethics, the Anticorruption Policy, the Responsible Procurement Policy (and its Responsible Procurement Manual) and the Procurement Standard regulate the management of the supply chain of the OHL Group

The Code of Ethics, the Anticorruption Policy, the Responsible Procurement Policy (and its Responsible Procurement Manual) and the Procurement Standard regulate the management of the supply chain of the OHL Group.

The divisions and corporative areas of OHL manage their purchasing autonomously by applying the requirements established in the Procurement Standard approved in 2015, which establishes the principles and standards to be met by the management and provision of services on the global level.

The Procurement Standard has been transposed for each of the divisions that have so requested, to adapt and complete it according to their management particularities and types of purchases.

Procurement Management Tools

Procurement Management Tools

The Group uses computer tools for enhancing control and optimizing processes. The Computerized Procurement System (SIC), developed in-house initially for Construction, has been extended to other procurement centers. In the second half of 2016, the adaptation of the system was completed for Concessions, Services and General Services.

Both in Concessions and General Services, the system has been fully implemented while in Concessions, it has been finalized on the central level and in Autovía de Aragón, with the objective of extending its implementation to all of the countries except for Mexico, which uses another ERP.

Industrial uses the Smart Materials Plan, related to SAP, which is the most adequate and most widely used system in its sector.

In the context of contracts, a clause has been included with respect to compliance with the company’s Code of Ethics and to knowledge and observance of the 10 Global Compact Principles, at all of the procurement centers and in practically all of the countries. In 2016, a more detailed clause has also been included on human rights for the contracting of security firms.

Likewise, the type-approval requirements to be met by suppliers now include the condition of not having been handed down a final court judgment due to noncompliance with one or more of the 10 Global Compact Principles in the last three years.

During 2016, OHL continued the tasks for implementing an online document recording tool for the process to be followed for the type-approval and classification of suppliers and subcontractors, capable of facilitating the search with global quality coverage, and of increasing transparency and traceability in the processes.

This tool, which is horizontal across all of the divisions of the Group, will make it possible to save time and costs in the processes for the analysis and validation of documentation, will increase legal certainty and will enable the performance of remote audits for ensuring that the Group’s principles are included.

All of the risks in the supply chain are taken into consideration as part of the procurement process, through country-by-country risk matrices prepared by the category managers. In the 2016 financial year, risk matrices were prepared in Construction procurement for 58 projects in 17 countries.

Following the successful completion of the type-approval process, the suppliers considered as most critical are analyzed according to the Third Party Due Diligence Process. In the 2016 financial year, the process was initiated in Construction at the end of the year. An analysis was made of 9 critical suppliers in Chile, Mexico and Colombia, with satisfactory results.

Procurement Diamond Award

The OHL Group has been selected as the winner of the “Procurement Diamond Award” in the category of Innovation, placing second in the category of Transformation in the Procurement Function, for its implementation of an innovative procurement management model.

The award was granted by the Spanish Association of Procurement, Contracting and Supply Professionals (AERCE).

(More information: Good Governance_ Control and Risk Management_ Due Diligence Process)

Other significant developments
93% of the purchases of products made by the General Services Department during 2016 were classified as environmentally friendly

OHL Construcción has defined the new procurement function based on the priority category purchasing model. This model is based on the specialization of the purchases of products and activities that involve a significant impact and the generation of synergies on the domestic and the international levels. The implementation of the model has enabled an optimization of costs in excess of 30 million euros in 69 projects during 2016. According to figures on the second half of the year, savings of 11% on the initial cost have been calculated.

Another outstanding practice in the year was the effective consolidation of the tool called Procurement Category Management Schedule -C4- in Latin America and Europe. This new tool is based on an initial planning of all of the purchases of all of the Division’s projects and will enable greater visibility of the purchases and a search for synergies in the projects taken overall.

Green procurement

The 93% of the purchases of products made by the General Services Department during 2016 were classified as environmentally friendly.

Collaboration with the IDB: ConnectAmericas Program

ConnectAmericas Program “Made in the Americas” aims to establish a connection between major companies and local suppliers.

ConnectAmericas seeks the collaboration of local LATAM companies with major firms for the improvement of their processes and, in this way, to increase their competitiveness. This will facilitate their development and, in turn, will generate more jobs and greater economic growth in the region.

In the case of OHL, the program has enabled it to diversity its supply chain. By the end of 2016, this collaboration had commenced for projects in Chile, Peru, Colombia and Mexico.