Ferrovial - Annual Report 2012


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Supply Chain


Approximately 35% of the suppliers belong to the Services division, 75% of them in Spain. Local suppliers tend to be used in the Services division as well, because of the nature of its activity. This business promotes stable bonds with its suppliers through the creation of framework agreements that strengthen communication and guarantee the purchasing and concession processes.

Ferroser, which operates mainly in Spain, uses Spanish suppliers due to the logistical costs involved, and because of the better service and response capacity. The supplier selection criteria are registered for each case in our purchasing portal, in which all the bidding processes are included. Ferroser implemented a purchasing policy and a mandatory Code of Buyers in 2012.

The rate of local contracts in Cespa, with 46% of the division's suppliers, is 78%.

Amey, Ferrovial's UK infrastructure and public service management subsidiary, considers its supply chain to be an essential element for the provision of efficient and profitable services, with the aim of being its suppliers' "customer of choice". Amey is highly committed to working proactively with its suppliers. It is concerned with protecting the environment and promoting innovation, offering its customers quality products and services that are reliable and respect the highest ethical standards.

In line with Ferrovial's philosophy, the Services Division maintains a policy of supplier diversity and promotes local purchases and contracts, thus supporting the societies where it operates. The Services Division carries out most of its business in Spain and the United Kingdom.

Since 2008, the Management Committee of the Services Division has unified its business with the main aim of increasing synergies between both units and increasing earnings. The Purchases Department was created at the same time to improve purchasing management as part of the integration process of these companies, thus unifying processes and making the most of synergies to achieve improvements in purchasing power.

From then on, the Purchases Department set the following objectives for the NOA (negotiation + optimization = savings) project:

  • Standard processes and support systems for the purchasing function.
  • Implement full traceability throughout the purchasing cycle, from the source of the order to reception and payment.
  • Optimize the authorization process, with information received in real time.
  • Optimize supplier payment monitoring, thus reducing the number of invoices and improving efficiency
  • Improve control of documentation of the subcontracts and agreements within the organization.
  • Obtain savings through improved purchasing conditions by taking full advantage of the volume of business.

The characteristics of the organization and the NOA project made it essential to involve the different areas of the company (finance, quality, and systems), as well as the Purchasing area. The team carried out an exhaustive analysis of all the contracting tools in the organization, in addition to the tools existing in the market.

The foundations for optimizing the procurement system and the Ferroser Purchasing Model were established with the participation of Ferrovial's Systems Department and an external agent.

The main levers for improvement were as follows:

  • Strengthening and reorganizing the purchasing organization model.
  • Unifying and standardizing authorization, procurement and the purchasing process throughout the whole organization.
  • Implementing a standard support system for the new procedure.
  • Establishing a negotiation plan for services and supply activities.
  • Full e-management of the order-invoice cycle.

This design of an efficient purchasing model covers the whole process, from the detection of a need to payment. All purchases above a certain volume are now automatically referred to the new Purchases Department to be negotiated. There is also an online supplier communication portal, for which suppliers must be authorized by the purchasing heads before registration.

Given the diversity of suppliers and the need for local contracting, the Purchases Department has developed a significant centralized negotiating procedure that reduces the number of suppliers of products and services such as safety barriers, painting, signing, prevention of Legionnaires’ disease, elevator maintenance and cleaning products. This has been supplemented by negotiations with local suppliers for fire protection, equipment tools and electrical equipment.

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This is an electronic version of the 2012 Annual Report prepared by Ferrovial, S.A. for its stakeholders, which aims to be complete and accurate. The contents of this version can be checked by referring to the print version. A copy of the print version in PDF format is available to download on this web page