UFI Operations Award 2010 - Fira Barcelona

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UFI Operations Award 2010 presentation for Fira Barcelona, Barcelona, Spain
By: Jordi Estruga, Production & Logistics Manager

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  • Step 1: Analysis and Diagnosis: Barriers identified. To set the foundations for the change, the current processes, organization and costs were analyzed with all the parts involved and supported with the help of a consultancy company, specialized on operations management. Work session during the process analysis The analysis concluded that there were some important barriers to overcome in order to achieve the objectives. Main barriers were: There was lack of indicators to assess the current situation, making it difficult to evaluate the success of cost reduction initiatives. Vertical organization based on departments, not horizontal. This might hinder the efficiency of interdepartmental processes. Responsibilities were unclear and little teamwork. Limited scope in operating strategy and value generation, focusing inside Fira, without considering the process of suppliers with whom we work. Mindset reluctant to change, with a tendency to do things in the manner prescribed and not to question the status quo.
  • Step 3. Make the organizational changes required to implement the improvement projects. One Operations controller was assigned to the area of operations, with a high degree of interaction in the operations department. Participating in weekly meetings, setting of departmental objectives, and review of results. An Operations cost control Committee was established, setting review processes for monitoring the evolution of the different KPI’s. One new Operations planning position was created within the planning team, to lead all the coordinators that planned and budgeted the different shows and fairs. Thus, accelerating their training and development, and empowering them to better work on projects to increase value. One new Operations purchasing position is approved and recruited, being dedicated to support and lead cost reduction projects.
  • Step 1: Analysis and Diagnosis: Barriers identified. To set the foundations for the change, the current processes, organization and costs were analyzed with all the parts involved and supported with the help of a consultancy company, specialized on operations management. Work session during the process analysis The analysis concluded that there were some important barriers to overcome in order to achieve the objectives. Main barriers were: There was lack of indicators to assess the current situation, making it difficult to evaluate the success of cost reduction initiatives. Vertical organization based on departments, not horizontal. This might hinder the efficiency of interdepartmental processes. Responsibilities were unclear and little teamwork. Limited scope in operating strategy and value generation, focusing inside Fira, without considering the process of suppliers with whom we work. Mindset reluctant to change, with a tendency to do things in the manner prescribed and not to question the status quo.
  • Step 1: Analysis and Diagnosis: Barriers identified. To set the foundations for the change, the current processes, organization and costs were analyzed with all the parts involved and supported with the help of a consultancy company, specialized on operations management. Work session during the process analysis The analysis concluded that there were some important barriers to overcome in order to achieve the objectives. Main barriers were: There was lack of indicators to assess the current situation, making it difficult to evaluate the success of cost reduction initiatives. Vertical organization based on departments, not horizontal. This might hinder the efficiency of interdepartmental processes. Responsibilities were unclear and little teamwork. Limited scope in operating strategy and value generation, focusing inside Fira, without considering the process of suppliers with whom we work. Mindset reluctant to change, with a tendency to do things in the manner prescribed and not to question the status quo.
  • Step 1: Analysis and Diagnosis: Barriers identified. To set the foundations for the change, the current processes, organization and costs were analyzed with all the parts involved and supported with the help of a consultancy company, specialized on operations management. Work session during the process analysis The analysis concluded that there were some important barriers to overcome in order to achieve the objectives. Main barriers were: There was lack of indicators to assess the current situation, making it difficult to evaluate the success of cost reduction initiatives. Vertical organization based on departments, not horizontal. This might hinder the efficiency of interdepartmental processes. Responsibilities were unclear and little teamwork. Limited scope in operating strategy and value generation, focusing inside Fira, without considering the process of suppliers with whom we work. Mindset reluctant to change, with a tendency to do things in the manner prescribed and not to question the status quo.
  • UFI Operations Award 2010 - Fira Barcelona

    1. 1. Cost Efficient Operations at Fira Barcelona How to focus on what really counts
    2. 2. Halls 5 & 7 <ul><li>2 venues: Montjuïc and Gran Via </li></ul><ul><li>under expansion with 2 new halls in Gran Via. </li></ul><ul><li>publicly owned company with private management: funded with its own profit . </li></ul>Introduction
    3. 3. Objective <ul><li>Challenges to complete the expansion: </li></ul><ul><li>Reduce current costs and free up resources </li></ul><ul><li>Reinvest these resources in the growth </li></ul><ul><li>Increase the value (better quality & service, less cost). </li></ul>
    4. 4. Analysis and Diagnosis current processes, organization and costs were analyzed and barriers identified <ul><li>Lack of information and appropiate indicators </li></ul><ul><li>Vertical organization, not horizontal </li></ul><ul><li>Responsibilities unclear and little teamwork </li></ul><ul><li>Mindset reluctant to change </li></ul><ul><li>Limited Scope in operating Strategy </li></ul>Analysis & Diagnosis Step 1
    5. 5. Analysis & Diagnosis Barriers and Action Plan Areas to tackle to overcome the barriers identified Information and indicators Organization Value creation Step 1 Step 4 Projects on Value Step 3 Changes in organization Step 2 Select indicators
    6. 6. Establish indicators & new cost information system to measure the effectiveness of the actions and track their results. Indicators Step 2 <ul><li>Implement & exploit Business Intelligence Module (SAP BW) </li></ul><ul><li>Specific Key Performance Indicators (KPI’s) to track results were developed. </li></ul><ul><ul><li>€ /m2 (net) for all cost components </li></ul></ul><ul><ul><li>Comparison: Actual vs previous edition, actual vs plan and vs. Estimated (SAP) </li></ul></ul><ul><li>Specific and measurable Cost objectives were set, and become visible in every department. </li></ul><ul><ul><li>Weekly, monthly, quarter and anual review with all teams </li></ul></ul><ul><li>Cost Deployment. These objectives were linked to variable compensation (bonus) of all involved. </li></ul><ul><ul><li>up to 10-20% of bonus contribution </li></ul></ul>
    7. 7. Make organizational changes required to implement the improvement projects. <ul><li>One Operations controller * was assigned to the area of operations. </li></ul><ul><li>An Operations cost control Committee was established. </li></ul><ul><li>One new Operations planning position was created within the planning team. </li></ul><ul><li>One new Operations purchasing position is approved and recruited. </li></ul>Changes in organization Step 3
    8. 8. Analysis of value understand what value means and execute the projects to increase value proposition . <ul><li>Identify Value added and non value added activities </li></ul><ul><li>Select projects to: </li></ul><ul><ul><li>minimize non-value added activities (NVAA) </li></ul></ul><ul><ul><li>enhance value-added activities (VAA) </li></ul></ul>Projects on Value Step 4 Enhance VAA Step 4.2 Minimize NVAA Step 4.1 Analysis of Value Step 4.0
    9. 9. Select value areas to work Identify main contributors to NVAA Cost Minimize NVAA Step 4.1 Waste management Customer services Set up costs Maintenance Other Energy Cleaning Security Process optimization Human effort * * * * * Projects to develop:
    10. 10. Security cost reduction Reduction of security (including access and registration) <ul><li>Increase productivity through automation </li></ul>Minimize NVAA Step 4.1 <ul><li>New additional supplier </li></ul><ul><li>Adjustment of security and access schedules. </li></ul>Security cost evolution (Reduction index 2009 vs 2007) -38% -17%
    11. 11. Security cost reduction Reduction of security (including access and registration) Minimize NVAA Step 4.1 Self-service laptops Registration confirmation (bar code) <ul><li>Development of optimized registration services </li></ul>based on pre-registration plus onsite fast track system: Pre-Registration Auto Check-in Kiosks
    12. 12. Energy cost reduction <ul><li>Adjusting setpoints to 22ºC (winter) and 24ºC (summer) </li></ul><ul><li>District heating & cooling system </li></ul><ul><li>Energy management system </li></ul><ul><li>Installation of water-free toilettes </li></ul>Light Water Air conditioned Power <ul><li>Redefining the lightning schedules (“venue shutdown”) </li></ul><ul><li>Replacing incandescent illumination by LEDs </li></ul><ul><li>Re-negotiating contracts </li></ul><ul><li>Solar cell panels installed (135.000m2 up to 5 Gwh/year) </li></ul>Minimize NVAA Step 4.1
    13. 13. Waste cost reduction: strategy Exhibition Disposal Waste Eco-design Control Patrols New recyclable materials in sales portfolio Recycling Build up dismantling <ul><li>Reduce generation </li></ul><ul><li>Control of abandoned waste </li></ul><ul><li>eco-design </li></ul><ul><li>add recycled product in sales portfolio </li></ul><ul><li>no free containers </li></ul><ul><li>credit card guarantee </li></ul><ul><li>patrols & penalties </li></ul><ul><li>Increase recycling </li></ul><ul><li>new cleaning process – by material </li></ul><ul><li>new cleaning supplier </li></ul>Materials New procedure and supplier Minimize NVAA Step 4.1
    14. 14. a) Waste composition study (%) Waste cost reduction: actions <ul><li>Reduce generation </li></ul><ul><li>Increase recycling </li></ul>a) Eco-design guide c) Joint initiatives with organizers b) New green products in portfolio b) Selective waste collection points c) Specific treatment per material d) Specific recycling projects (p.eg. Carpet) a) No free containers in the halls (contracted and under control) b) Patrolling+pictures (credit card guarantee) <ul><li>Control of abandoned waste </li></ul>Minimize NVAA Step 4.1
    15. 15. Waste cost reduction: results Results Cost evolution -86% -78% -51% -36% Minimize NVAA Step 4.1 Exhibition Disposal Waste Recycling Materials
    16. 16. Waste management Customer services Set up costs Maintenance Other Summary of projects on cost reduction Minimize NVAA Step 4.1 <ul><li>eco-design </li></ul><ul><li>Patrols </li></ul><ul><li>recycling </li></ul><ul><li>optimization of positions </li></ul><ul><li>standard signage </li></ul><ul><li>less carpet </li></ul><ul><li>frequency optimization </li></ul><ul><li>contract re-negotation </li></ul><ul><li>overheads, ITC, transport, supplies... </li></ul><ul><li>automated office accesses </li></ul><ul><li>access scheduled reviewed </li></ul><ul><li>energy project </li></ul><ul><li>new process </li></ul><ul><li>change of supplier </li></ul><ul><li>frequency optimization </li></ul><ul><li>change of supplier </li></ul>Exhibitions Operational Cost Venue Structural Cost Energy <ul><li>optimization of positions </li></ul><ul><li>new supplier </li></ul>Security Cleaning -38% -47% -17% -16% -16% -34% -73% -24% -33% -23% Results (Reduction index 2009 vs 2007) <ul><li>energy project </li></ul>
    17. 17. <ul><li>Optimization of planning process : </li></ul><ul><li>from coordination of roles, to small team. </li></ul><ul><li>ICT Projects to replace processes based on telephone, fax and photocopies, to web interfaces (faster, less effort and less prone to mistake). </li></ul><ul><li>Externalizing non core processes: p.eg. Warehouse, customs </li></ul>Human Effort reduction by using ECRS (Eliminate, Combine, Reduce and Simplify) E-commerce Supplier portal Footprints (complaints management) Exhibitor online Minimize NVAA Step 4.1
    18. 18. Develop projects to increase value. Enhance VAA Step 4.2 Leverage Items Strategic Items Non-critical Items Bottleneck Items Profit Impact Exploitation of purchasing power Diversify, balance or exploit Volume Assurance Efficient progressing Low High Kraljic Model Purchasing Portfolio management Supply Risk High Low Stand building, logistics Power, rigging Cleaning & waste security Air-conditioning rental <ul><li>Vertical Integration . Firesa and Servifira Project. </li></ul>Exploiting sinergies in the supply chain <ul><li>Kraljic Matrix: to guide the purchasing negotiation efforts. All contracts were re-newed (cleaning, rigging, electrics, carpet, hostesses, security, etc.). </li></ul>Developing new business models, creating 2 joint ventures
    19. 19. Exhibitions Operational Cost Venue Structural Cost <ul><li>Operating costs and Venue Structural costs have reduced in 42% and 21% respectively </li></ul>Overall results Since the start of this program :
    20. 20. <ul><li>Reinvestment of savings has generated 29% additional revenues in new products and services (whilst operating cost has reduced 22% ) </li></ul>Overall results Since the start of this program : Operational Cost contribution Contribution for new services -22% + 29%
    21. 21. <ul><li>The number of complaints in services to exhibitors has dropped above 80% </li></ul>Overall results -83% Reduction index 2010 vs 2007 -77% Since the start of this program : Evolution of complaints in exhibitor services
    22. 22. Objective <ul><li>Challenges to complete the expansion: </li></ul><ul><li>Reduce current costs and free up resources </li></ul><ul><li>Reinvest these resources in the growth </li></ul><ul><li>Increase the value (better quality & service, less cost). </li></ul>Success!! - 42% operating cost + 22% released resources - 21% structural cost + 29% additional business (new services) - 80% complaints in exhibitor services
    23. 23. Cost Efficient Operations at Fira Barcelona How to focus on what really counts

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