Telstra: Australia’s
1 brand
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Januar y 2017
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EXPLOSIVE progress in challenging times Deloitte and Apple
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EDITOR’S COMMENT
TELSTRA AT THE TOP HELLO AND WELCOME to 2017’s first edition of Business Review Australia! We kick off by taking an in depth look at the country’s number one brand, Telstra. Jess Shanahan explores why the company has risen in the ranks over the course of the past year, surpassing those at the top for 2015. Also in our front of book section is an examination of Apple and Deloitte’s pioneering new partnership, while the top 10 offers guidance on some of the best hotels to stay in for business and leisure in Sydney. Beyond this, our company reports this month include exclusive interviews with PwC, Orica and Melbourne’s Victoria University. We hope you enjoy the read. Please add to the debate via @BizReviewAU
Enjoy the issue! Tom Wadlow Editor tom.wadlow@bizclikmedia.com
5
CONTENTS
F E AT U R E S
ORICA
PROFILE
PROFILE
06
32
06 A clear path to the top
TECHNOLOGY
Apple and Deloitte
transforming Australian businesses
16
TOP10 LIST
00
Headline for the article
24
Hotels in Sydney
46
Victoria University
C O M PA N Y PROFILES MINING 32 Orica
SUPPLY CHAIN 46 Victoria University
CONSTRUCTION 60 PwC
60 PwC
A
PROFILE
CLEAR
path to the
OP
Telecommunications brand Telstra has been named as the most valuable brand in Australia by Brand Finance, with an increase in brand value of 37 percent despite only increasing revenues by 3.6 percent
PROFILE
THE INDEX OF the 100 most valuable Australian companies is calculated using the Royalty Relief approach. This formula involves estimating the likely future sales of a brand and calculating a royalty rate that would be charged for the use of the brand – if it were not already owned. Telstra has topped this brand league table with a 37 percent increase in value since 2015, where it sat in 10
January 2017
second place. This is a testimony to the growing strength of the brand, especially considering its revenue only grew 3.6 percent over the past year. Responsible for Australia’s largest mobile network, Telstra provides 17.2 million mobile services, 7 million fixed voice services and 3.4 million retail fixed broadband services across the country. Telstra’s origins go back to 1901 when the Postmaster-General’s
TELSTRA
“TELSTRA PROVIDES: 17.2
Million
7
Million
3.4
Million
Mobile Services
Fixed Voice Services
Rretail Fixed Broadband Services
ACROSS THE COUNTRY” – Mark Crowe, Brand Finance Australia managing director 11
PROFILE Department (PMG) was established by the Commonwealth government to manage all domestic communications. In the nineties, the Australian Telecommunications Corporation was incorporated, the company that would eventually become Telstra. The domestic trading name of the company was changed to Telstra in 1995 to distinguish the company within an increasingly competitive market. During this time, Telstra aimed to stay one step ahead of its competitors, something it continues to do to this day. Although probably best known for being a mobile network, Telstra offers so much more to its customers, from
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broadband to cloud collaboration. Over the last year, Telstra has undergone a huge rebranding exercise to position itself as a technology brand rather than simply a telecommunications company. This incorporates the mobile, broadband and television services it is famous for as well as business services such as voice-over IP (VoIP), online video and managed network services. The rebrand could be responsible for bumping Telstra to the top spot when it comes to brand value. Simply by dropping the ‘elstra’ from its logo and leaving the ‘T’ behind in a fancy new colour scheme – the colours varying
TELSTRA
depending on what kind of service you’re after – has brought the branding right up-to-date. The brand is positioning itself as a technology company that is empowering people to connect, not just in Australia but all over the world. It is presenting the wonder and magic of technology as a solution to a wide range of common problems but also the joy it can bring to its customers. This value-adding approach is a huge leap from its previous focus on hardware, channels and systems. Instead it’s focusing on what it can bring to the lives of consumers and businesses through its services and products.
In May 2015 Andrew Penn was appointed Chief Executive Officer, having previously served as Telstra’s Chief Financial Officer. He’s already acknowledged the changes that need to be made in the company’s customer service department and while phones are now being answered quicker than ever before, he believes the key to a successful company is making sure customers don’t even need to call in the first place. Penn spoke at a business lunch in mid-2016 saying: “Have you tried ringing Uber or Facebook’s call centre? You find that they don’t really have one. They are offering 13
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TELSTRA
an experience in such a way that it is intuitive, it makes sense, so you don’t actually need to contact anybody afterwards.” The major repositioning of the business puts it more in line with some of those tech giants and there’s already a heavy focus on pushing this new brand further into the rest of the world, particularly into Asia. Brand Finance’s report also showed Telstra has gained 35 places, ranking it at 110, in the Global 500 showing just how rapidly it is set to grow. Because the Brand Finance index looks at the value of the company in the future, it’s safe to say that the rebrand is propelling the Telstra in the right direction. Mark Crowe, managing director of Brand Finance, says: “Taking the top spot is testimony to Telstra’s brand strength, which has driven the significant increase in value despite only a 3.6 percent increase in revenue. This has led to brand value as a proportion of enterprise value, increasing from 13 to 18 percent. The percentage increase in brand value was the equal highest among the top 20 global telecom brands.
Telstra’s ranking in the global telecom sector rose from 22 in 2013 to 15 in 2016.” Compared to other telecoms brands Telstra scored highly in the areas of people, familiarity, recommendations, satisfaction and forecast margins. Crowe added: “Increasing competition from SingTel-Optus and Vodafone Hutchison, especially in the mobile sector, points to the need for continued investment in the Telstra brand both locally and overseas, in order to maintain its value and strength.”
TAKING THE TOP SPOT IS TESTIMONY TO TELSTRA’S BRAND STRENGTH, which has driven the significant increase in value despite only a 3.6 percent increase in revenue – Mark Crowe, Brand Finance Australia managing director 15
TECHNOLOGY
How Apple and Deloitte are
transforming
Australian businesses Giants in their respective fields, Apple and Deloitte are ushering in a new chapter for innovation Written by: A L E X YO U N G
APPLE AND DELOITTE recently announced a partnership that will transform the way Australians do business. With the need for innovative solutions growing ever pressing in an increasingly competitive and globalised business environment, solutions such as these can make all the difference. The partnership will enable forward-looking companies to quickly transform the way they work. This will be achieved in two key ways – through streamlined hardware use and through an innovative new product the two majors worked on together to develop.
Strategic advice Deloitte is creating the first ever Apple practice which will see over 5,000 strategic advisors dedicated to helping business integrate and maximise the potential of the iOS system, specifically focusing on power management, ease-of-use, and security through iPhone and iPad. Leaders from a variety of businesses will be able to exploit this new knowledge-base, particularly those working in retail, field services, R&D, inventory management, and back-office systems.
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TECHNOLOGY
“iPhone and iPad are transforming how people everywhere get work done. And through this partnership, we’re able to help even more businesses tap into the incredible capabilities that only the Apple ecosystem can deliver” – Tim Cook, Apple CEO
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January 2017
Unique solutions Apple and Deloitte are also working on developing a completely new service offering. Deloitte Consulting’s EnterpriseNext solution is designed to help clients take advantage of the iOS ecosystem of hardware, software, and services in the workplace. Customers will be able to exploit the diverse, next-generation capabilities afforded by Apple’s ecosystem through rapid prototyping and timely, impact-assessed planning. Punit Renjen, CEO of Deloitte Global says: “We know that iOS is the best mobile platform for business because we’ve experienced the benefit ourselves with over 100,000 iOS devices in use by Deloitte’s workforce, running 75 custom apps. “Our dedicated Apple practice will give global businesses the expertise and resources they need to empower their mobile workforce to take advantage of the powerful ecosystem iOS, iPhone, and iPad offer, and help them achieve their ambitions, while driving efficiency and productivity.
TRANSFORMING AUSTRALIAN BUSINESSES
EnterpriseNext:
EnterpriseNext from Deloitte Consulting will provide businesses with expertise spanning more than 20 industries, and offers customers: EnterpriseNext Value Maps for iOS to help them discover the highest impact possibilities for iPhone and iPad within their industries, align their mobile opportunities, and prioritize digital resources
EnterpriseNext Workshops for iOS to quickly take ideas from prototype to custom-built iOS solutions
iOS architects, designers, and engineers—housed within Deloitte Digital Studios around the world— to help produce native apps that integrate with existing business platforms including ERP, CRM, analytics, and HR
19
TECHNOLOGY
“We know that iOS is the best mobile platform for business because we’ve experienced the benefit ourselves with over 100,000 iOS devices in use by Deloitte’s workforce, running 75 custom apps” – Punit Renjen, CEO of Deloitte Global
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January 2017
“As the leader in digital transformation strategy, Deloitte is an ideal partner that brings a team of Apple-dedicated strategic advisors to help clients truly revolutionize how they work using iOS, iPhone, and iPad,” Tim Cook, Apple’s CEO adds: “iPhone and iPad are transforming how people everywhere get work done. And through this partnership, we’re able to help even more businesses tap into the incredible capabilities that only the Apple ecosystem can deliver.” Both global companies in every sense of the word, Apple and Deloitte’s partnership represents a turning point for business in Australia and beyond. Apple’s products have a well-deserved reputation for delivering optimised performance – no matter what industry they are tasked with serving. Similarly, Deloitte’s track record for management consultancy frequently places it in an advisory role alongside governments and world-leading companies. The match could not be better. Now it remains for Australian businesses to test out the solutions in the field and reap the benefits.
TRANSFORMING AUSTRALIAN BUSINESSES
Deloitte in Australia Australian arm of Deloitte is made up of around 600 partners and over 6000 people across 14 dedicated offices across the country, whose footprint also includes emerging markets Papua New Guinea and Timor-Leste. Deloitte Australia achieved record revenues of A$1.530 billion for the fiscal year ending 31 May 2016.
Apple in Australia Apple has a longstanding footprint in Australia and recently ran a week long ‘learn to code’ workshop at every one of its stores in the country
21
TOP 10
hotels in
SYDNEY 22
January 2017
WITH OVER SIX million arrivals to Sydney in August alone, the city has become a corporate and tourist hotspot, and is home to the largest population in the country. The hospitality industry has catered to this increased demand, where competition to remain competitive and offer five star services is as important as ever. Famed for its stunning beaches, gardens, and world-class architectural and cultural venues, Sydney has become one of the most prosperous cities in the world. We take a look at the top 10 best hotels in Sydney according to TripAdvisor. The hotels have all gained 4.5/5 stars and cater for both corporate and tourist travellers, ensuring a first-class service.
LOCATED 3KM FROM Sydney Airport and 4km from Sydney’s CBD, the Meriton Serviced Apartments Zetland is a short walk from several bus stops and Green Square Station, providing vital transport routes to Sydney’s CBD. With complimentary
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high-speed internet, the establishment incorporates over 300 luxury suites, alongside a number of facilities for travellers to relax and unwind, such as a gym, spa, sauna and lap pool, ideal for both corporate and leisure travellers.
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TOP 10
9
WITH CLOSE RAIL links, situated just 200m from Wynyard Station, the historic Radisson Blu Plaza Hotel has undergone a $13.5 million transformation, with over 300 rooms and suites on offer, encompassing modern amenities, such as free wi-fi and corporate facilities. The hotel has inbuilt audio-visual tools embedded within the corporate meeting spaces on offer, with a large number of function rooms which can cater for up to 200 guests.
8 OFFICIALLY OPENING IN 2015, Primus Hotel has become one of the most popular places to stay within Sydney. The 5-star hotel is situated in the centre of Sydney’s CBD, with many cultural tourist spots and transport links on its doorstop. With over 170 rooms and suites which house a number of technological features, the hotel also has free Wi-Fi, 24-hour room service and a business centre, with three boardrooms and meeting rooms on offer. Perfect for both tourists and corporate travellers due to its central location, the hotel incorporates a large restaurant, lobby bar, gym and rooftop pool, situated in close proximity to the hotel’s New York style rooftop, which can house approximately 100 guests, creating a unique space.
7 SITUATED WITHIN A 15-minute walk to Sydney’s CBD and a short walk from Casino Wharf Ferry Station, The Darling Hotel has won a multitude of awards, with a range of accommodation on offer. The hotel incorporates over 170 rooms, in addition to several suites and penthouses, all of which contain floor-to-ceiling glass windows, providing full views of Sydney. The hotel houses an award-winning spa, fitness centre and 25m outdoor heated pool on the fifth level, alongside world-class technologies in the hotel rooms and communal facilities. The hotel is also in close proximity to iconic landmarks, the Darling Harbour and the Sydney Opera House.
SITUATED IN CLOSE proximity to China Town and Darling Harbour, the Meriton Serviced Apartments Campbell Street is the sixth most popular place to stay in Sydney, offering value for money and easy access to Sydney’s CBD, ideal for both corporate and business travellers.
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TOP 10
5 UNDER HOTEL BRAND Ovolo Hotels, the Ovolo 1888 Darling Harbour incorporates full-speed Wi-Fi, in addition to first-class accommodation and services. WITHIN WALKING DISTANCE from Sydney’s CBD, Meriton Serviced Apartments World Tower is one of Sydney’s tallest hotels, with over 100 suites and rooms over 17 floors, containing full floor to ceiling windows that offer stunning views of the city. A range of accommodation is on offer, perfect for families and corporate travellers. Its first-class service has cemented its place as one of TripAdvisor’s top 10 places to stay within Sydney.
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January 2017
4
3 SITUATED JUST 30 minutes from Sydney Airport, Park Hyatt Sydney is situated under Sydney Harbour Bridge and is just 1km from Sydney’s CBD, offering full views of Sydney’s Opera House. Rated #1 Hotel in Australia & New Zealand through the Condé Nast Traveller’s Readers’ Choice Awards 2015, the 5-star hotel has over 150 rooms and suites which are large and spacious, but also offer rooftop suites, containing private terraces showcasing stunning views of Sydney Harbour. Five conference and corporate venues are situated within the hotel, encompassing high-speed internet and world-class technologies to ensure an exceptional service.
2 ALTHOUGH NOT BASED in Sydney’s CBD, the Ovolo Woolloomooloo, and is a short walk to the centre. Also under independent hotel brand Ovolo Hotels, the hotel is ideal for corporate travellers who wish for peace and tranquillity, yet wish for easy access to the main centre and tourist facilities. Many features, such as in room drinks and snacks are included. The hotel incorporates several conference spaces to cater towards corporate businesses who utilise the hotel’s location and private dining facilities. There is also a separate space for guests to socialise, network or undertake corporate activities in the Lo Lounge area.
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TOP 10
1
LOCATED CLOSE TO Sydney’s CBD in Surrey Hills, the ADGE Apartment Hotel has been rated 5 stars, providing boutique apartment accommodation, winning a multitude of awards for its customer service, accommodation and world-class restaurants. Rated #1 Hotel in Sydney by Trivago and the 2015 Certificate of Excellent from TripAdvisor, the hotel has also won the 2016 award for Best Contemporary Boutique Apartments, the ‘Best Design Hotel in the Continent’ by Haute Gandieur Global Hotel Awards, and many more.
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January 2017
With free Wi-Fi throughout the hotel, alongside a mixture of rooms and suites on offer, the hotel encompasses a number of bold styles, accommodating for both leisure and corporate travellers, with graffiti wall art and vibrant colours incorporated to reflect its artistic surroundings. Situated just minutes from various retail facilities and transport links, the hotel is also in close proximity to tourist spots, such as the Sydney Opera House and Sydney’s Royal Botanical Gardens.
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ORICA
GETS MORE BANG
FOR ITS BUCK
AFTER THE MINING BOOM
At the height of the mining boom explosives giant Orica was already looking to the future, optimising its supply chain to better cope with challenging market conditions Written by Adam Turner Produced by Erika Kracer
A
s one of the world’s largest suppliers of explosives, Orica reaped the benefits of Australia’s mining boom as its customers – Australia’s mining giants – rushed to meet the world’s seemingly insatiable demand for coal, iron ore and other precious commodities. At the time, Orica’s customers were primarily focused on security of supply to ensure they could maximise the output from their mines.
As the boom petered out the mining giants shifted their focus to becoming as efficient and competitive as possible, while producing lower volumes to meet waning demand. The flow-on effect of this downturn forced suppliers such as Orica to also refocus their efforts in order to help their mining customers adapt to the new environment, says Steven Lesser – Head of Supply Chain at Orica, Australia, Pacific & Indonesia. “We were following our customers’ performance closely during the mining boom, specifically within the Australian market which was
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January 2017
a major benefactor,” Lesser says. “With the turn in the mining market we knew the needs of our customers would change and we needed to be prepared to handle that change. “First we needed to focus more closely on customer forecasts and how this flowed through our sales and operations planning process. This involves understanding specifically where demand is occurring, so we can more efficiently bring product through the channel without overstocking or having product in the wrong place at the wrong time.” The next step involved optimising the supply chain by finding efficiencies, taking out costs and reducing the size of the organisation. It also included Orica going back to its own suppliers – from its raw materials to logistics such as transportation – to seek support for adjusting to the subdued market. Orica has traditionally relied on a rather linear supply chain but the optimisation process also involves making the most of the
MINING
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Steve Lesser is currently the Head of Supply Chain, Australia Pacific and Indonesia for Orica. Lesser began his career implementing and operating outsourced supply chain solutions across multiple industries and customers for Ryder primarily in North America. In 2001, he moved from third party logistics into running the global logistics program for Borden Chemical (now Momentive and previously Hexion Specialty Chemicals) before transitioning in 2006 to Orica. Over the past ten years at Orica, Lesser has progressed through (a) running the North America end to end Mining Services supply chain, (b) building the Mining Services global supply chain team, (c) launching the planning and logistics elements of the Singapore Hub, and (d) delivering the regional planning and logistics performance for each region across Orica. Lesser is Green Belt certified and Black Belt trained in the Lean Six Sigma methodology. He earned a Bachelor’s degree in Electrical and Computer Engineering and a MBA from Brigham Young University and previously participated on the Supply Chain Advisory Board for the Marriott School of Management. Lesser his wife Danielle, and two of their four children currently reside in Cleveland, Queensland (near Brisbane) after splitting the first nine years working for Orica while living in Denver, Colorado and Singapore.
MINING
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Our offices in Australia, Chile, South Africa and the UK are ready to work with you to improve your supply chain. For more information visit www.igpartners.net.au or contact Glenn Hunt on glenn.hunt@igpartners.net or +61 419 355 753
MINING
flexibility offered by its regional supply chain networks, Lesser says. The business is looking to supply chain innovation as a way to reach new customers, or reach existing customers in new ways. “Typically we would use our traditional plant network to meet most of the needs of one country, but now we’re re-visualising our supply chain and exploring new channels,” he says. “The key is to look at the big picture – in some situations there might be an alternative plant which appears less straight-forward to use but ends up delivering lower costs or other benefits to the overall operation.” Orica didn’t wait until the mining downturn before it started to put
these processes in place. Instead of resting on its laurels it had the foresight to look to the future. The business relies on SAP for Enterprise Resource Planning, along with Demand Solutions planning software which assists with statistical forecasting. At the beginning of the boom the business was already looking at ways to improve its capability, which saw its North American operations implement process integration improvements in its sales and operation planning. This involved centralising procurement to gain leverage with its suppliers, along with embracing the Lean Six Sigma process methodology throughout the organisation. After success in North America,
“With the turn in the MINING MARKET we knew the needs of our customers would change and we needed to be prepared to handle that change.” – Steven Lesser, Head of Supply Chain at Orica, Australia, Pacific & Indonesia w w w. o r i c a . c o m
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MINING
Orica expanded these initiatives globally, leveraging its worldwide networks and improving integration with local supply chain delivery. While Orica’s Australian operations are heavily focused on large mining operations, its European operations are more focused on the construction sector. Centralising elements of the supply chain around procurement and planning has helped in every vertical where Orica operates but the benefits have been particularly telling during the downturn in the mining sector, Lesser says. “That long-term planning meant that these improvements were already in place to help us make
the most of the boom, and they continued to serve us well as we started to adjust to the change in capacity and focus on taking cost out,” he says. “What we’ve learned along the way is that it’s important to get that right balance between a global functional model and a local execution model. “The change in the mining market required us to be even more focused at the local level, improving our execution efficiency and restructuring to have a completely integrated supply chain through the region.” Rethinking its approach to the supply chain also saw Orica move towards bringing in external talent
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MINING
with experience in other industries, diversification opportunities starting with hiring Lesser back in within a specialised vertical like 2006 as Vice President, Supply explosives manufacturing for the Chain based in Colorado. As mining industry, optimising its Orica’s new supply chain initiatives supply chain affords Orica the were implemented globally, he opportunity during the downturn shifted to Singapore to oversee to reach new regions and target the global changes as Senior Vice President, Global Supply Chain. “In that global role I was hiring the talent which started us down this path, bringing in new people with prior experience in other industries – primarily around supply chain change – mapping that experience to our industry,” he says. “This was a shift for Orica, from using – Steven Lesser, Head of Supply Chain at Orica, Australia, more internal talent, Pacific & Indonesia but bringing in that external experience has certainly smaller players which weren’t a helped our efforts to reshape the priority in a high-growth market. supply chain to be more agile and “We’ve always had a mix of large responsive to market conditions.” global customers and smaller While there are limited players, but the decrease in
“Reshaping our supply chain has certainly made that a smoother transition than if we were only geared up to support the major players and didn’t have the ability to effectively engage with the smaller end of the market which is looking for smaller volumes.”
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demand gives us an opportunity to reprioritise and better serve those smaller players,” Lesser says. “Reshaping our supply chain has certainly made that a smoother transition than if we were only geared up to support the major players and didn’t have the ability to effectively engage with the smaller end of the market which is looking for smaller volumes.” One key lesson from the mining downturn is that it is critical for the supply chain not only to operate efficiently but also be tightly
linked to the business strategy. “In a market where our focus has shifted from security of supply during the boom to taking out cost in the downturn, a purely functional approach to the supply chain would have left the business more vulnerable to disruption,” Lesser says. “Instead Orica is well-placed to ride the market back up or to continue to adjust to changes, with an agile supply chain that’s designed to handle whatever challenges the market throws at it.”
MINING
“In a market where our focus has shifted from security of supply during the boom to taking out cost in the downturn, a purely functional approach to the supply chain would have left the business more vulnerable to disruption.�
PROCUREMENT
prowess Written by Sarah Arnold Produced by Erika Kracer
Victoria University has undergone a fiveyear transformation in its supply chain processes, helping to streamline operations and elevate the higher education center to the forefront of sustainability
VICTORIA UNIVERSITY
U
niversity to most people on campus is a place to spend three to four years studying before going on to gain employment, travel or delve into further study. It is an institution to attend while working out your interests in life while meeting people from around the globe. What is not often noted is the operation that occurs behind the scenes to provide a seamless service for these students. At Victoria University (VU) 1,800 full time staff support its 46,000
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January 2017
students across Melbourne, Sydney and international colleges (mostly in Asia). VU is currently celebrating its centenary year and became a university in 1990. It boasts a curriculum that includes both higher education and vocational options. Director of Procurement and Business Operations Juliana Tiong stresses that “Victoria University is a fantastic place to work. People are very friendly; if you can explain the logic behind a change, they will come on board,� she follows.
S U P P LY C H A I N
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VICTORIA UNIVERSITY
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S U P P LY C H A I N
Since joining VU, Tiong has worked on a five-year transformation of Procurement throughout the university. Procurement comprised siloed purchasing activities across the functions of the University. “I was brought in to transform that and centralise it over two phases,” she notes. The first phase involved forming a strategic procurement team to create and implement category strategies for the short, medium and long-terms. This included consolidating purchasing volume, data mining, tendering and negotiations. “This is the strategy part of procurement,” Tiong states. “It had been done in a silo manner by each individual department. This could be an individual faculty or college. They would call a supplier and the product would be delivered.” Some of these ad-hoc purchases resulted in incorrect products, unmet expectations and cost creep. Procurement in VU worked in this way for many years and it was not sustainable. “We could not leverage the suppliers and
therefore could not leverage enough savings. We could not manage the supplier performance appropriately because it had been done in such an ad-hoc manner,” Tiong explains. The first phase brought standardization of tendering processes, redefined policies, procedures, governance and framework, and facilitated clear understanding of spend by category. This resulted in large savings within the first 18 months. The second phase was to centralise, streamline and introduce end to end procurement, with the establishment of the Procurement Centre of Excellence (CoE). eProcurement tools and systems were introduced as enablers of efficiency and reporting accuracy. This brought about streamlined processes, efficiencies, reduced paperwork and improved approval times. This is not the first time Juliana Tiong has embarked upon a transformation of procurement. Previously, when working for defence company Thales, in the Air System Division, she worked on similar transformation. She
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VICTORIA UNIVERSITY
centralised Procurement ensuring ad-hoc ways of purchasing were eliminated by close collaboration with stakeholders, demand planning/ forecasting for greater leverage, and contract negotiation. However, she says: “Coming to Victoria University, the transformation was multiple in size and complexity compared to Thales.” Tiong applied Procurement methodologies such as identification of the “low hanging fruit”, supply and demand strategies and volume aggregation to improve leverage and market interest and leverage. Prior to the transformation, for the same product, the same supplier could be charging a different department within the university a range of prices. The product would be delivered to the same location. Tiong identified such areas of lower complexity, describing them as low hanging fruit. “There were about 30 categories in this area and we started looking at them within six months of the establishment of the strategy procurement team. We started delivering savings immediately through
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Year Founded
1916
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that part of the process,” she says. Following activities for the low hanging fruits, the team targeted the medium and high complexity categories. During the second phase of transformation, Tiong searched for people to actively contribute to this process and be part of the Procurement Hub team. The establishment of the procurement hub led to the creation of a Procurement Centre of Excellence
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for the whole university. Those who previously worked in procurement for departments brought their expertise to the hub. “We have created a shared services function in Procurement for the whole University to use. The Procurement Specialists in the Centre of Excellence will support every need of the University,” notes Tiong. The University has been advancing its technology so students have the best
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access to education, but also for use behind the scenes by staff members. VU is working on a cloud-based solution with IT for ERP systems. “Cloud is not new anymore. Everybody is migrating to cloud. We have been looking at how to make the system more efficient and that is by moving to the cloud,� Tiong comments. Full migration has not happened due to the data security risk. The Procurement, Finance and IT
departments have been working closely together to ensure the transition is smooth. The Procurement Hub launched an e-catalogue as part of streamlining the process. The e-catalogue captures negotiated pricing and approved suppliers. The success of e-catalogue was achieved through collaboration between Procurement, Finance systems and IT. Groundwork included tenders, negotiations, category
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Number of Employees
2,000
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classification, coding and reporting standardization. The e-catalogues has “made it easier having all relevant information captured within the ERP system,” notes Tiong. The Centre of Excellence also drove efficiency in the Procureto-Pay (P2P) process, with invoices streamlined by using consolidated invoices instead of one invoice per delivery. “We now have one invoice a month for multiple deliveries. The right system has to be put in place” states Tiong. Strong partnerships with key suppliers including CISCO and Optus ensure VU has relevant advancements in technologies when available. This is important to the head of procurement. “We are partnering with these suppliers because we want to be active in bringing in new technologies. I would say bring in a new era to Victoria University” Tiong says. These technologies include bringing educational services to students digitally, which involves improving the online portals and streaming lectures and seminars online.
While VU is advancing with technology, it has not neglected sustainability. Between 2006 and 2010, the university decreased its water usage by 75,000 kilolitres in partnership with City West Water thanks to initiatives spanning harvesting rainwater in pools, single flush toilets and installation of water meters. Energy efficient solutions have been implemented; solar panels have been erected on site. A new lighting system works through sensors. All of this leads to the undeniable conclusion that procurement takes sustainability seriously. “When we look at our tender documents and requirements we must think, how sustainable is this?” comments Tiong. The proactivity shown towards sustainability and the transformation of Procurement in Victoria University cements its place as a pioneer for higher education in Australia and further afield, continuing to provide the movers and shakers for the country’s future.
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PROJECT PERTH STADIUM
Western Australia’s highest-profile and most eagerly anticipated project is nearing completion: we look at the role of project management in delivering a complex construction and maintenance contract. Written by John O’Hanlon Produced by Jeff Debicki
w w w.per thstadium.com.au/images-and-video
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I
n 2012 the State Government of Western Australia committed to build a 60,000 seat multi-purpose stadium on a contaminated brownfield site in the state capital Perth, close to the banks of the Swan River. Whilst the site has some environmental and geotechnical challenges for design and construction of the new stadium, it’s location on the Burswood Peninsula with stunning views across the river to the city is postcard perfection. This was the culmination of a long period of deliberation during which different sites had been considered, including the location of Perth’s existing Domain Stadium, also known as Subiaco Oval. The new stadium will be the third largest venue in Australia and, it is hoped, will establish the state and city in the international consciousness where sport and event tourism is concerned, as well as hosting AFL (Australian rules football), and major rugby union and league, football (soccer), cricket and entertainment events. Perth Stadium sits in a surrounding Sports Precinct, which is being
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developed concurrently with the new stadium, and will incorporate cafes, alfresco dining, playgrounds, community spaces and other infrastructure that can be utilised on both event and non-event days. Construction of both the Stadium and Sports Precinct is on schedule to open in March 2018, in time for the start of the AFL season. There has been considerable speculation over which sport may open the stadium, however with construction of the stadium at just over 66 percent complete in early December 2016 there have been no commitments made for an early opening as yet. The contract to build the Perth Stadium and Sports Precinct was awarded via a two stage tender process in which three major consortia participated, Westadium (led by Brookfield Financial Australia Securities and John Laing Investment), Confidem (led by Capella Capital) and Evolution Stadium (led by Plenary Origination and Bouygues Construction Australia). Westadium was awarded the contract in August 2014. The contract model taken to
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market was design, build, finance and maintain (DBFM), which, according to Nadia van Dommelen, a partner at PricewaterhouseCoopers (PwC Australia), is fairly self-explanatory, but within which there’s a lot of expertise required to define the functional, technical, commercial and operational parameters to make the project a success. In November 2012, Appian (which was acquired by PwC in March 2015) secured the Design Development contract, providing design expertise in addition to project management resources supporting the State Project Team, led by the Department of Treasury – Strategic Projects and Assets Sales in partnership with client agency, the
Perth Stadium construction progress December 2016 Courtesy Perth Stadium website
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Nadia Van Dommelen Partner at PricewaterhouseCoopers (PwC Australia)
Nadia van Dommelen is a professionally qualified civil and structural engineer with over 20 years of industry experience focused predominantly in project management of building and infrastructure projects. She has 5 years’ experience in structural design and a further 5 years’ experience working as a project manager for a pre-eminent global construction contractor. labore renis aliquis et ullaboriati consequia sita que dolut ilibusam quatiss itatintis etus dis recesti
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Department of Sport and Recreation. “There was a lot of competition,” she recalls, “because there were not many capital projects of a similar scale in the market at the time that were not already progressed or in an indefinite holding pattern.”
projects are my niche and what I love to do,” says van Dommelen. “It’s an area in which I have specialised, and I’ve been fortunate to gain a lot of experience advising government on the client side, developing project briefs, service specifications and
Enter PwC The project was of interest due to the significant scale and complexity, and to be procured through a public private partnership (PPP). “Complex
guiding procurement and contract documentation for PPP projects.” She is not exaggerating: a professionally qualified civil and structural engineer with over 20 years of industry
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They say a stadium’s reputation lives or dies by its pitch
experience focused predominantly in project management of building and infrastructure projects, she has had a pivotal role advising government in most of the PPP projects undertaken in Western Australia. The first tasks for the team were to review the preliminary work that had been undertaken on the project and consult with the State Project Team in developing a detailed design brief for the project. They also assisted in a thorough risk assessment of the services that were to be considered for outsourcing, such as facilities maintenance, cleaning, waste management and catering, evaluating scope demarcation, interfaces, dependencies and reputational risk. One such service which was flagged as critical was pitch maintenance. “They say a stadium’s reputation lives or dies by its pitch,” says van Dommelen. While she points out that there are clearly other factors,
– Nadia Van Dommelen, Partner at PricewaterhouseCoopers (PwC Australia)
she adds that “players and fans alike are quick to notice if the surface is not fit for purpose”. Maintaining elite playing surfaces in major stadia is a very specialist and complex job, because the structure and roof create challenges in maintaining a microclimate throughout that is optimal for turf health and growth. Rather than risking a long term playing surface services contract, the Project Team, in conjunction with PwC, proposed to treat this and other high risk services, such as asset security and ICT, as a “reviewable service”, whereby the service is undertaken
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as a series of shorter terms which are subject to review at each expiry. This approach allows those services to be brought back in house during the 25 year operating period if the services are not performed to an acceptable service standard. In mid-2017 local turf expert HG Sports Turf will install stabilised natural turf which combines a natural couch grass mixed with rye and artificial grass. This combination provides outstanding stability, durability and a flat playing surface and responds well to regular maintenance. Another innovative aspect of the project has been the level of stakeholder engagement undertaken. “A major aspiration of Perth Stadium
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is to be ‘fans first’ and to ensure it is delivered a user group consisting of a range of sports fans - fans who will use the stadium – was created,” says van Dommelen. A brief was prepared outlining the purpose and intent of a “Sports Fans User Group”, and public nominations were invited over social media, radio and other platforms. Over 450 applications were received from which 30 representatives were selected from a range of demographics and sports to create the Sports Fans User Group. Their input was fed in as the project progressed and is being maintained though the construction process – the first time an exercise
of this sort has been run in Australia, and maybe the world. The notion of a fans user group has been such a resounding success that PwC formed a similar group for consultation on the Western Sydney Stadium project. Multi-purpose A geometrical headache presents itself at multi use stadiums around the world. To accommodate cricket, which is played on an oval or circular field, AFL, athletics or equestrian sports an oval shape is required, and most stadiums are oval or circular. Football (soccer), rugby and many other sports are played on a rectangular pitch. “Accommodating rectangular sports
in an oval configuration is always challenging,” says van Dommelen. “The brief included something quite novel. Instead of restricting the design requirements for viewing to sight lines to the pitch (or C values based on a focal point), it introduced a concept of key viewing elements – the visibility of key areas of the field such as sidelines, try lines and penalty areas to be viewable from the seating for the various sporting uses. Also incorporated was a concept around the extent of obstructions affecting views to the field of play to minimise the proportion of seats that will be built with obstructed views. A Seating Bowl Report demonstrating performance
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w w w.per thstadium.com.au/images-and-video
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PERTH STADIUM HASSELL, Cox Architecture and HKS are the architectural team delivering the Perth Stadium with Westadium/Multiplex for the West Australian Government
www.hassellstudio.com
www.coxarchitecture.com.au
www.hksinc.com
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against these requirements was refining options to arrive at a solution requested at tender stage, and this which optimises outcome and cost. drove optimisation of the Seating Bowl from the earliest stages of design as Safety part of the competitive process. ” To Early in the briefing stage there was accommodate rectangular events, strong support for briefing compliance many options were considered before with the UK’s Sports Ground Safety arriving at the solution of elevating Authority’s (SGSA) guidance materials, the first row of the including the Green lower tier that allows Guide, which is drop-in seating to recognised as be bumped-in right international best up to the pitch wall. practice. “Something The design brings we and the State fans closer to the Project Team are field than is typically very proud of is achieved in an oval the focus that we configuration venue, have placed in the and importantly design on the safety has the effect of all stadium users,” ‘rectangularising’ the – Nadia Van Dommelen, says van Dommelen. venue. Nadia credits Partner at PricewaterhouseCoopers “Designing and this exceptional (PwC Australia) building for outcome to the mass gathering relentless pursuit and persistence is a massive responsibility, and of the Department of Sport and we don’t take this lightly. We also Recreation’s Project Director, advocated bringing the SGSA in as Ronnie Hurst, a keen rugby man an advisor to the project to monitor himself who pressed Westadium’s compliance”. As a result of these designers to keep exploring and initiatives, we strongly believe Perth
Accommodating rectangular sports in an oval configuration
IS ALWAYS CHALLENGING
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Stadium will set a new benchmark for safety in Australian stadia. As construction ends, the Perth Stadium and Sports Precinct will be handed over to the governance agency responsible for managing the project’s transition from construction to operations, VenuesWest, which will in turn place day to day management in the hands of its operator VenuesLive – with Westadium continuing to maintain the facility its future will be secure in a ‘marriage’ of these three entities.
Soon Perth Stadium will be seen as one of the great stadiums of the world: the lessons learned in its delivery, with expertise from PwC, will be a benchmark for future projects. “A key thing we assisted with was to create a clear and unambiguous, performance based brief defining the outcomes to be delivered, so that when it was issued to market the functional, technical, commercial and operational requirements were known and understood. A number of stadium
Perth Stadium and Sports Precinct Courtesy Perth Stadium website
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projects around the world have gone off the rails spectacularly because they have not taken the time required upfront to prepare quality procurement and contract documentation covering the facilities and operations.” This is exactly the service that PwC can provide, van Dommelen adds, to
help set the project up for success. Above all, the State Project Team has been able to keep the stadium’s ‘fans first’ aspiration always in sight, working out precisely how the facility is going to be used and by whom, in the light of those users’ expressed requirements and aspirations.
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