The six strategic development programmes selected for the strategy all play a key role in realising the strategy. During the first years of the strategy, however, one programme will take precedence over the others – improving profitability and cost efficiency of projects.
The profitability and cost-efficiency improvement programme addresses the root causes of profitability. The operational focus in the coming years will be on operational planning and process development as well as on securing resources. Also the efficiency of capital use is one of the main principles in SRV’s operations.
SRV is pursuing better profitability by leaning more on its strengths, i.e. on own development projects and developer-contracted projects, and by focusing only on growing urban centres. Geographically, this means that operations will focus more strongly on the Helsinki metropolitan area and on a few other big cities in Finland, but even there, with a focus targeting the areas where traffic, people and services converge today and in the future. One of SRV’s most important criteria in land acquisitions of recent years (and in land acquisitions to come) is the project’s location in a traffic hub.
SRV is already one of the biggest builders of housing units in the Helsinki metropolitan area. The company’s spearhead projects are located in Helsinki’s Kalasatama district and in Espoo’s growth centres. Of the nearly 6,200 housing units SRV has built during the past five years, more than 4,200 are located in the Helsinki metropolitan area, and it currently has close to 1,900 housing units under construction. An additional 3,500 housing units are in the development pipeline in the upcoming years, and SRV’s goal is to build as many as 15,000-20,000 new homes over the next 10 years.
The higher degree of added value of own development and developer-contracted projects brought on by business expertise gives them a higher profitability margin. Also project size is seen as having an impact on their profitability. That is why the order backlog is steered towards bigger projects, but at the same time also towards more efficient and smaller housing unit sizes.
SRV’s management principles are based on a Management triangle: Results – Customer – Work community. Good management of the work community enables a superior customer experience and results. Success is built on satisfied customers and satisfied employees. In Corporate Spirit’s Most Inspiring Finnish Workplaces survey, published in early 2016, SRV ranked 11th place. The excellent result provides a great foundation for the development of management principles.
The work done to advance compliance with management principles and processes includes e.g. the publication of 10 management theses that encourage the entire work community towards a more open, results-driven and committed work performance.
In tomorrow’s operating environment, sustainability will play an even bigger role in competitiveness. SRV’s goal is to be known for its sustainability. Construction-related decisions have a broad impact on the environment, on communities, and on the lives of many people. SRV takes a long-term approach to project development and works in a responsible way with its stakeholders to build a sustainable future. Today’s built environment is home to tomorrow’s sustainable society.
Sustainability and the development of it have always been issues important to SRV, and its significance will be amplified in the future. We see sustainability, first and foremost, as an opportunity, because by operating in a sustainable way we can develop our business over the long-term while simultaneously responding to stakeholder expectations.
Our goal in 2016 is to define and create a sustainability programme and operating model that align with our new vision and strategic objectives. At the same time, we will develop our reporting to meet the EU Directive on the disclosure of non-financial and diversity information, which takes effect in 2017, and the requirements of international norms. We have already started the work with an extensive analysis of the current situation and with a stakeholder survey and by mapping industry practices.
A superior customer experience is one of the three points of the triangle, together with Results and Work community. Without satisfied customers, there is no success. Customer experience is emphasised in all our operations, whether it’s the customer buying an apartment, or our long-term relationship with e.g. pension and investment companies, or internally as we work as one team.
Achieving a superior customer experience requires the contribution of every link in the chain, and above all, anticipating customers’ future needs. The customer feedback we have received – the positive and negative – is vitally important for the continuous development of our operations. SRV’s current and future projects offer an excellent foundation for offering our customers a new kind of living experience. The piloting of lifestyle services is especially visible in the REDI project and in our Living Lab implemented to develop future housing concepts. The REDI model apartments realised in the Living Lab offer a unique opportunity to develop services in collaboration with our customers.
An essential part of creating a superior customer experience is the measuring and development of internal processes. We will develop our measuring tools and feedback channels and we’ll improve communication and dialogue opportunities between our customers and SRV.
Digitalisation is visible everywhere – including in the daily operations and strategies of companies. At SRV, digitalisation means, first and foremost, leveraging new kinds of technologies in construction processes and daily work as well as in the services and solutions for customers and stakeholders. 3D-modelling has been replaced with 4D-modelling at many of our construction sites and the adoption of Smart Space concepts is further improving project management. Digital tools and channels are a routine part of daily communications and marketing, and they are being further developed to support the creation of a superior customer experience, among other things. Digitalisation also plays a key role in identifying and developing premises-related services – and especially so in the REDI pilot project.
SRV is pursuing future growth in three areas in particular: 1) Segment-specific development of housing concepts 2) Development and conceptualisation of a public construction model 3) Growing shopping centre operations in Russia and Finland.
For example, the population in the Helsinki metropolitan area is projected to grow from a current 1.4 million people to 1.8 million by 2040, which will mean more than 30,000 new homes. The development of housing concepts aims to respond primarily to the housing needs of ordinary Finns. In public services construction, it is believed the focus will shift increasingly towards life-cycle construction and alliance models, where the public operator’s role moves from constructor to long-term tenant. At the same time the constructors’ responsibility will expand from construction to the management of a building’s entire life-cycle. Furthermore, alliance and various kinds of PPP (Public Private Partnership) contract models will increase.
SRV has operated in Russia throughout its existence, for almost 30 years. In the coming years we will pursue growth primarily in the shopping centre project and shopping centre operations, a market that will continue to see significant growth. In recent years SRV has successfully built resources for shopping centre operations in St. Petersburg and Moscow, and the goal is to leverage the expertise even further, e.g. in shopping centre operations, in development of the existing shopping centres, and in planning and construction of future shopping centre concepts.