Number 60 Year XI October Construyendo. L atin America. We need to be market makers, not order takers. page 4

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1 Number 60 Year XI October 2011 Construyendo L atin America We need to be market makers, not order takers. page 4

2 Ready to go, because it s now! In numerous opportunities we have communicated through this means to highlight the energy, the passion and the discipline that identifies us as collaborators within the Skanska Group. Skanska, the company that in a few months will celebrate its first 125 years. Facing such an important event, we find ourselves in front of a new starting point: the Business Plan. A Master Plan for all Skanska, for the luster that has just started, founded on the enormous experience we have had successfully concluding thousands of projects. Hundreds of thousands of people have traveled throughout the more than 100 years of the company s history. They have written the story that sustains our present. They have also been responsible for keeping the knowledge and the passion in house. The generations that preceded us are the ones that compel us. On the pages of this story and in the reality of our company there has not been any letting up in the completion of our achievements. No new book starts with a blank page. Rising above is the principle protagonist, which is what unites our passion. Reaching our goals demands from each of us the capacity to anticipate what will come. In moments of crises we need to protect each other, but at the same time we must play to win. It is not enough to play a defensive game. When the world becomes stronger-and it will become stronger-we want to be the first to take action, to maintain our pole position in all the markets and territories where we operate. Now is the moment to go forward, using to the fullest our DNA as leaders, to bring together the best team to win in any terrain. What is our challenge for the next 125 years? To be creators of markets, anticipating our business strategies and attracting the best. To arrive first. Some tracks have already been made. Our arrival in Colombia and entering the Commercial Development business line in Romania are examples of this. The search for greater opportunities on the part of Skanska Infrastructure Development, that in its plans specifically includes Latin America and the strengthening of the Commercial Development Business Unit in the United States also respond to this challenge. Green businesses are crucial to current and future markets. The strategy we have defined to develop products, solutions and green services in our region is also aligned to businesses that provide profitable growth. Make business and learn. This is also what it s all about at the moment. To learn from our experience and knowledge of other Business Units, our Operating Units and from our own colleagues. The baggage of practices that have determined our present during this first stage in Skanska, that we re already celebrating, must flow in territories and business lines. To replicate what we know best is definitely what our clients are looking for. First. Always first. That is our goal as a work team, as One Skanska. To improve what is necessary to always be solid, competent and in this way, comply with our commitment. We re convinced of having what is needed, on the contrary, we could ve never reached this point. Can you imagine our Skanska in the next 125 years? It will be easy to recognize it because we will always be going forward! Let s go, together, towards the next 125 years that await us! Hernán Morano President and CEO, Skanska LA

3 Contents # We need to be market makers, not order takers. 14 A team that builds roads Focus on the client We are looking for a role change, an attitude that will take us one step ahead, to interpret the necessities and opportunities of our clients, to continually guide them instead of only responding to their requests. How do we do this and how do we perfect it? Chile In this edition, the protagonist is the team that is executing the Concesion Vial de Autopistas project in the Antofagasta region. The modifications in Routes One and Five will improve safety in those roads and connectivity between the ports of Antofagasta and Mejillones. 20 Benchmark in business ethics management 26 The Brooklyn Bridge, more than a symbol Ethics Hernán Morano, President of Skanska L A was recognized by the Fundacion Jovenes Lideres, that on other occasions has highlighted as references people like Mario Vargas Llosa or the founder of the World Economic Forum, Klaus Schawb. This is not a recognition to one person but to one company stated Hernan. Projects Skanska USA Civil is in charge of the restoration and improvements to this emblematic construction in the city of New York. Its access ramps will be widened and reinforced, the main bridge will be cleaned and its cables will once again be painted, highlighting its structure. One more example of the leading role that Skanska has in this important market. Construyendo L a t i n o a m é r i c a Construyendo Latinoamérica is a publication edited by the Skanska LA Communications sector for internal distribution. Address: Av. del Libertador th Floor, Olivos, Buenos Aires, Argentina. Acknowledgments in this edition: Carina Cavallo, Contanza Farias, Luis Ladero, Luana Lima, Alejandro Pontarolo, Romina Rico, Renata Samos, Karol Salinas and Karina Valero. Responsible for the publication: Juan A. Saravia Human Resources and Communications Vice President Editor: Milagros Reilly Design: dinamica comunicaciones Printed on FSC paper In harmony with the environment Find this magazine and other publications on Construyendo is a space for everyone, capable of adding the voices of those who make Skanska in Latin America. Because every one of us has something to share, send your suggestions or content ideas for the next publication to the area of Corporate Communications: Construyendo Latinoamérica Nº

4 We need to be market makers, not order takers. To create markets means getting together with the clients and listening to their needs, understand their business and how they think. Only in this way can we reach them with solutions and suggestions to improve their business. Texts Skanska LA The global economic scenario changes according to different variables, some of them unpredictable due to their nature: political changes, social changes and mergers and acquisitions of companies. As a result, companies need to adapt their strategies to these changes and look over their plans. Nevertheless, there are certain objectives that are immoveable. At Skanska, the objective of reaching 2015 with profitable growth and positioning ourselves as leaders in five areas: safety, ethics, human development, green business and risk management, remains intact. To successfully reach this objective, our clients play a key role: they pay for our products, our experience and our know-how. Our current challenge is to get closer, interpret their needs in order to respond with the right products and also add value to their own projects. They expect a proactive and creative attitude from us. Helvi Vaisanen, Vice President of Client Relations of Skanska Finland and a member of the Experts Group in that area expresses it this way We we must create markets and not just take orders This role change is an example of our need and duty to adapt to changes in the market. Our region, the same as the European economy has lived through changes coming from exogenous and endogenous factors. And surely, those external changes warrant continuous analysis regarding our ways to get closer to the clients, to be up to date and, at the right moment, be ready for the next steps. Events on the right path At Skanska LA, the Business Development managers are the ones that have the first contact with a client. Last July in Buenos Aires the new edition of the annual commercial meeting took place. Alfredo Collado, Executive Vice President and member of the EMT gathered colleagues from the region in charge of development and the commercial management for each country with the objective of analyzing the different local scenarios, share problems and solutions and plan business decisions to face new challenges. Among the areas addressed, the following were discussed: The mining sector to look up a relevant space, considering the notable evolution and weight it has in Chile and Peru. Details were given to the needs of those clients regarding safety, labor relationship management, community relations and experience with human resources. The conversation centered on how our company can also have profitable growth in this area. Sharing and debating the experiences of other colleagues from different territories and markets is the answer to the need of a company that needs to learn to be a winner. The search and common practices that may be aligned developing a net of internal contacts was another point of interest. For precisely this, we are driven by the diversification towards new products and clients. The participation of Skanska LA in the Customer Relations Expert Group is another example. In this area different experiences are shared with members of the Skanska 4 Construyendo Latinoamérica Nº

5 Main Article Positioning ourselves one step ahead, arriving on time where we re set our goals and committed ourselves. This is also about being market creators and not simply order takers. world, nourishing from the tools developed by other Business Units that can be applied or adapted to our local markets. The networking with other business units, through the Centers for Excellency that have experience with products that are nontraditional for Skanska LA, like railroads and hospitals is fundamental. The stagnation of the European and North American markets is shifting the flow of investments towards Latin America. Another work group which we are involved in as a regional team is the one looking for the most competitive way to grow in the business of infrastructure concessions in Latin America, together with Skanska Infrastructure Development (ID). Roads and hydraulic and thermal stations are among some of the more interesting projects for developments in the next years. Also analyzed was the opportunity to develop green business, in addition to the environmental services we are already carrying out, going into this new market of generating renewable energy and sustainable buildings. As a first step, our goal is aimed at finding the option that adds green value to the new projects of our clients, especially in the Engineering and Construction areas. Other subjects that were analyzed where related to entering new territories, like Colombia and with the development of new products, like the manufacturing of offshore modules for oil production and treatment in Brazil. To be aware of the dynamics and changes in the markets where we find ourselves and where we look to go in, get closer and inter part the needs of our clients, share experiences and best regional practices, allows us to position ourselves one step ahead, arrive on time where we have set our goal and committed ourselves. This is also about being creators of markets and not simply order takers. Positioning ourselves one step ahead, arriving on time where we re set our goals and committed ourselves. This is also about being market creators and not simply order takers. Construyendo Latinoamérica Nº

6 Testimonials Antonio Antolín and Claudio Lima, the Business Development managers share their experiences with the individual handling of each client that allowed them to generate new contracts and broaden their markets. Texts Skanska LA Photography Skanska LA Antonio Antolín, Business Development Manager, Argentina How do you know and update the information regarding the local market so, for example, you anticipate changes in the strategy of your current and potential clients? To carry out a good market analysis, it is very important to read the economic realities of the country where one is at. What is the status of the local industry, the installed capacity and the possibility for development in the different areas where we expect to work? We must stay ahead and have excellent contact with the clients; this allows us to know their investment plans, strategies used with the competition and their strengths and weaknesses in order to plan and see where our added value is. Knowing our clients allows us to create allegiances, go forward and create our market. In what manner do you approach the clients in order to respond in a timely manner and form to their needs? The success of a company depends on the demand of its clients. They are the protagonists and the most important factor in business dealings. In this market there is a saturation of construction companies, which makes us develop differential criteria to attract and retain those clients that hold no loyalty to brands or companies. Today, one has to make important tradeoffs with the clients. To gain their allegiance we have to stand out. What successful practices would you like to share that you feel could be imitated or applied in other territories of the region? A recent contract was that of VALE PRC. There we had many different activities. First, we had to approach the people who spoke the same language as the company. Afterwards, we had to become known as Skanska in Argentina. We had to earn their trust. It was important to look over the process they had for this project together.being close to them allowed us to learn their need, respond, help and demonstrate we would be there for them. We implemented this trade off and were able to stand out. Claudio Lima, Business Development Manager, Brazil We act robustly in market investigation. We participate in events related to the business and take measures that will help position ourselves ahead of our clients and ahead of the competition. We align our commercial strategies to those of our clients. For example, we value Petrobras business plan at the time of selecting the main projects to be incorporated to the Skanska PEN in Brazil. We are constantly looking to diversify our markets, for example, in the construction of modules for off-shore vessels, in railroad development and highways, etc. We look for a direct relationship, transparent and continuous with our clients and future clients in order to understand their needs in the best possible way. We periodically evaluate the client s satisfaction throughout the projects we are performing and, at the same time propose solutions and improvements that adapt to their demands. After signing the contract with BR Distribuidora for enlarging and modernizing their lubricant factory, we took the initiative to present a business proposal, validating the LEED certification of the client s administrative premises, where great potential for allocating contracts exists. 6 Construyendo Latinoamérica Nº

7 Main Article Five activities to change from being an order taker to being a market creator Understand the market Attract the client Win the bid Comply during implementation Maintain the relationship Market Analysis Initial contact Managing the proposal Five Zeros Follow-up, reports Resource Analysis Relationship management Presentation Excellent client satisfaction Individualized service Strategic Planning Perception management Negotiation Undeniable quality throughout the supply chain Client satisfaction management Commercial Planning Information management Contract Timely, honest and open dialogue Continuous improvements Account Management Opportunity management Options and solutions Repositioning Brand/Image Management Follow through Foresight, proactive attitude under all conditions Capture Client satisfaction Index Global tools that help strengthen our knowledge regarding the client s needs. Global Brand Survey Skanska AB performs a biannual brand assessment in the main markets where we participate. How do we rate in our local markets? Do we reach the levels of the attributes of Knowledge and Passion of our brand? Our brand values, do they differentiate us from our competitors? How are our 2011 strategic communications concepts perceived (Safety, People, Green Business and Ethics)? Are we leaders on these matters? To these and other questions actual clients respond, as well as potential clients, employees, potential employees,governmental entities and assembly members. thus expanding the scope of the business through operations in the different markets. The objective of this space is to build an organized global focus, not only for the way we relate with our clients but also to optimize our relationship among the different Business Units, creating a business culture focusing on the client. Customer Satisfaction Index Currently we are working on the design of an efficient, global evalua- method that will allow us to know Skanska s clients degree of satisfaction through precise information obtained from our operations. Expert Group on Client Relations In this space of global exchange,as professionals, with leading practices to share and the knowledge to debate and propose different requests, Construyendo Latinoamérica Nº

8 A team that builds roads In this opportunity, the protagonist of edition number 60 is the team that is currently carrying out the Concesion Vial de Autopistas project in the Antofagasta region of Chile. Selected by the Minister of Public Works of Chile to perform, along with Skanska ID, the contract, this team will reinforce the region s development plan, improving the safety of its main roads and benefitting a community with improved connectivity between the ports of Antofagasta and Mejillones. Texts Skanska LA Photography Skanska LA

9 Project

10 Project The landscape that envelops each of them, with its open sky and never-ending hues of brown reminds us of the place we are standing: the most arid desert on Earth, the Atacama Desert. From their first footprints Obtaining this contract included an open bid process headed by Daniel Steinhardt and José Vasquez, in which we competed with the leading local and international companies and came out in first place, with the shortest implementation period, without state financing for the development of the works, resulting in important savings for the State. The time frame for the construction project is 43 months and includes engineering development, supplies and constructing 200 km. of roadways. The project, reaching USD 320 M, has 640 collaborators. Paths for walking In the middle of the Antofagasta region, a mining and port area located in Northern Chile, this challenging work is taking place. Fernando Paredes, Project Manager is who greets us in the morning light as he starts the work day, along with hundreds of colleagues, joining us in traveling to the different stops of this project, that has as a peculiarity the dozens of kilometers between them. The landscape that envelops each of them, with its open sky and never-ending hues of brown reminds us of the place we are standing: the most arid desert on Earth, the Atacama Desert. Fernando Paredes, Project Manager. The first part has been successfully completed and it s our first pride as a work team: we have concluded the engineering development phase. We are 10 Construyendo Latinoamérica Nº

11 Ministry of Public Works, Chile Railway crossing. finalizing the earthmoving phase of the new lane on Route 1 as well as the traffic detours required. There is still a lot of road that needs traveling. It will not be until December of 2012 that the broadening of Route 1 will be available for service. Meanwhile, the works on Route 5 are planned to be completed by September of Taking into account that the primary economic activity of the Antofagasta region is mining, producing more than 65% of the Regional Domestic Product, Route 5 is crucial for cargo and passenger travel to the large minefields. Route 1, by connecting Antofagasta with the port of Mejillones will become an entry and exit point for the mining sector and energy projects since it greatly reduces the times between the port, the city and the airport. As what happens with all Skanska projects, the safety issue is a crucial and critical aspect that one faces every day on the job Unfortunately, Route 5 has been called The highway of death because of its high fatality rate. The construction of the second lane, along with the traffic control and safety elements we will provide will surely help to revert this regrettable situation states Fernando. To develop a project with Zero Accidents is an important challenge and now Osvaldo Contreras, CSMA Manager in Chile is who adds his testimony: Creating and sustaining a safe work space is a task we face at the beginning of every work day. The prevention tools are our guides and as a team we work together to be aligned and convinced that we can perform our tasks in a safe manner. Working in heights and safety management are our permanent focus points. Here we have a total of 350 teams, including trucks, vehicles and machinery. The training and sensitizing activities, along with the prevention tools make up a crucial part of the work in this area. And to also respond to the quality standards of our company, the project is developed using the Integrated Management System model of our Business Unit Taking into account the direct relationship and repercussion these works have with the communities where they are being developed, safety will not be the only added value they provide the region. In this project, the Sustainable Management Plan has been put in place in order to avoid a sharp environmental impact in the construction process. This makes itself present in our Is in charge of managing an extended infrastructure built through the 123 years of its existence: a roadway network of 80,443 kilometers, of which 22% is paved and 2,500 kilometers belong to urban and interurban expressways,35 sprinkler systems that are able to contain 4 billion cubic square meters of water, an airfield network with 12 airports in the main net,13 airports in the secondary net and 100 small airfields, with an annual traffic of 10 million passengers,1,517 rural drinking water systems that take care of the needs of a population of 1,510,180 inhabitants and 226 kilometers of a rain water network developed on a national level. It also responds to 4,800 fishermen who work the 150 most productive fishing coves in the country. Source: Construyendo Latinoamérica Nº

12 Project let us completely satisfy our client so that they may entrust us with other projects that will help provide a better and safer infrastructure in Chile. infrastructure design, with the reuse of waste water and waste separation in our procedures as well as reducing the water used in compacting and recycling rock material. These and others are the alternatives we offer the client, like the option of sustainable buildings for the current operation adds Fernando, describing the Green angle of the project. The team is made up of experienced collaborators and the know-how gathered in previous projects in Argentina and Chile, for example the El Totoral and Monte Redondo wind farms as well as new collaborators to the company that belong to the communities surrounding the project. Fernando takes on his first challenge with Skanska LA and showing his pride ends the conversation by saying: This diversity allows each of us to contribute their experience and technical know-how, mutually enriching our practices and points of view. The respect for the perspective and contribution of all the collaborators is crucial for the efficient development of the team. Autopistas Antofagasta Is a very important challenge for the Skanska Group, especially complying with the contracted deadlines. I am convinced that we have the knowledge and the passion to successfully accomplish it. This team could not be better, and the project is based on that fact. I hope that together we can completely satisfy our client, so that we may be entrusted with additional projects that will help provide a better and safer infrastructure in Chile. We want to stay in the region and this is our wager: sustainable business through time. At sunset, with a superb and awe-inspiring sun that manages to cover the immensity of the place reminds us it s time to leave. Fernando s team gathers to take some final pictures, which will only be the last ones of this trip. Many more photos will be taken and will help complete, with images, the story that Autopistas Antofagasta has began in the first 125 years of Skanska. Technical data Total extension: 200 km. Two lane extension: 115 km. Lane improvements: 200 km. Service roads in the urban sectors of Antofagasta Railroad overhead crossings Overhead intersections with the main roads Bus stops and walkways Lighting along the main areas of Route 1 and 5, along with signage throughout the roads SOS emergency posts throughout the roads General service areas in the Baquedano sector and on Route 1 Toll plaza on Route 5 Skanska Infrastructure Development (ID) Skanska ID is the Skanska Group Business Unit that has as its main objective to develop infrastructure projects and the world leader in PPP (Public Private Partnership.) It operates in the Nordic countries of Central Europe, United Kingdom, United States and Latin America. 12 Construyendo Latinoamérica Nº

13 Imagine a lumberjack who works very hard and hardly has time to sharpen his saw. Stephen Covey, in his book The seven habits of highly effective people he refers to sharpen the saw as one of the essential habits to be highly effective. Take a vacation; take a break dedicated to rest. Leisure and pleasure is self-renovating. It is sharpen the saw in order to return to work in a more efficient manner. Are you already planning this year s vacation? Construyendo Latinoamérica Nº

14 Letter from Johan Karlström Dear colleagues, In our Business Plan we have promised growth and we will grow, but we are not moving forward quickly enough. Competition is fierce and recovery is slow in most of our markets. To gain speed we must be more open and go out on the market and meet the clients. For some years we were occupied with our internal structures and processes. As a result we are now profitable and financially strong. We are leading in the green and safety sectors and are a role model in business ethics. We have world-class expertise in a number of areas. Now we are ready to tell our story, ready to go out and sell. This is the key and the strategy set in our aggressive new Business Plan for Profitable Growth. This means we have to be more active in the pursuit of projects. New contacts create new opportunities. Seeing the clients is the top priority. Helvi Väisänen, VP Client Relations in Finland and member of our global Expert Group within Customer Relations, puts it this way: We need to be market makers, not order takers. Being a market maker means seeing clients and listening to their needs, understanding their businesses and how they are thinking. Only in this way can we come up with solutions and suggestions that will improve their business. I found that there is substantial interest in our Green expertise. And when I meet with public authorities, I often find great interest in our capabilities, for example within PPP. In these contacts I am like a match-maker trying to connect the right people and units. The internal efforts in recent years also reveal that we have to increase learning and become a truly learning organization. We can do better through joining forces and sharing knowledge. It is time to turn our expertise into new business. It s time to capitalize on our strengths. Why is learning so vital now? Competition is increasingly international and we need to realize that a local team, however good, cannot beat global competition. To gain leverage, we must use our global line up and sharpen our offer! Use your Skanska network or some of our 12 global Expert Groups at OneSkanska where you can find world class expertise 24/7. To conclude: be a market maker and use our global expertise. A learning organization is a winning organization. Best regards. The Radisson Blu Hotel in Gothenburg is a great example of what we can achieve by being proactive. We secured new business, the hotel can expand and the city is happy that we are developing the harbor area. We in SET meet frequently with people who are potential clients. When I recently traveled in Brazil with the Swedish Prime Minister Fredrik Reinfeldt Johan Karlström President and CEO, Skanska AB

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