STRATEGY OUR STRATEGY FRAMEWORK Laing O’Rourke aims to become the preferred choice engineering and construction partner for clients through the perfo...
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OUR STRATEGY FRAMEWORK Laing O’Rourke aims to become the preferred choice engineering and construction partner for clients through the performance excellence of its operational assets, financial resources and human capital in attractive markets and sectors, while at all times maintaining a resolute commitment to the highest standards of safe and sustainable delivery

HONG KONG MASS TRANSIT RAILWAY Work to connect Hong Kong’s metro infrastructure with high-speed connections to mainland China continues with our twin tunnelling and terminus contracts at West Kowloon. When complete, this southernmost link to the 16,000km Chinese national high-speed rail network will provide access for 99,000 passengers a day.


The Group’s activities are underpinned by our unique character. This is described in our vision and values, mission and strategy. Together they form a compelling guide to what our goals are and how we will achieve them. They continue to unite us in pointing the way towards achieving future success that is in the common interest.

We pride ourselves on having a straightforward vision and core purpose. Based on the philosophy and values of the founding shareholders, it is clear, powerful and relevant to the business challenges of today and tomorrow.

LAING O’ROURKE VISION To be the company of first choice for all stakeholders. To challenge and change construction worldwide. To be lean and agile in the adoption of processes to compete with world-leading businesses

• Make

safety personal and work responsibly • Lead by example • Work as one team, listen to everyone

• Find or follow a better way • Deliver on our promises,

aim to exceed • Collaborate with clients and partners

MISSION To become a globally focused and enduring engineering enterprise through our commitment to a culture of excellence plus performance. Focused on: business improvement, engineering excellence, financial performance and human capital management




We will build collaborative relationships – becoming a partner of first choice

We will challenge and change the market by delivering a unique business offering

ENABLING THE ORGANISATION We will enable the organisation by being lean and agile

STRATEGIC ACTION AREAS • Expand in high-growth

• Mandate digital

markets • Develop bespoke sector strategies • Deepen customer relationships

engineering • Integrate EnEx.G • Scale DfMA • Advance direct delivery

Laing O’Rourke | Annual Review 2014

• Optimise business

performance • Grow human capital • Drive safety

and sustainability agenda

Our values are the unifying force for all our activities around the world and are embedded through the culture of our business worldwide. These are the expression of our shared understanding of what we stand for, how we behave and what we aspire to become as an organisation. Our mission provides a clear definition of the future state we wish to achieve. Excellence plus performance defines our delivery culture and is demonstrated in every aspect of the way the Group does business.

The Group Strategic Roadmap (GSR) creates the framework which defines the direction and shape we will pursue over the medium to long term to achieve our mission. This provides a clear mechanism to enable the Board and Group Executive Committee to fully understand the operating environment and prevailing market forces, prioritise objectives and then allocate the necessary financial and non-financial resources to achieve the required state. Our strategic action areas form the short-term steps required to shape the business portfolio in line with our GSR and drive excellence plus performance over the medium to long term. These objectives translate the overarching strategic intent into operational plans that are then delivered by the business units in our two operational hubs.




Laing O’Rourke’s wellestablished vision describes the overall goal and core philosophy that underpin our activities, and are key to the achievement of our mission.


GROUP STRATEGIC ROADMAP Our Group Strategic Roadmap (GSR) defines the direction, shape and delivery culture of the Group over the long term as a globally focused engineering enterprise

Laing O’Rourke is now an internationalised business operating successfully in a rapidly evolving world – a world in which volatile conditions and the changing structure of markets are creating significant new challenges and very substantial new opportunities. Our mission and strategy focus on specific high-value sectors and markets. We employ our vertically integrated direct delivery model to create value for clients and procure competitively to connect and integrate the supply chain. We combine a deep understanding of global building and infrastructure markets with a proven track record in engineering and constructing high-performing capital assets. We have the people and skills to capture value at any point in the client value chain – from development feasibility to operational management.

ALDER HEY CHILDREN’S HEALTH PARK This world renowned children’s hospital is undergoing a radical transformation, and Laing O’Rourke’s imaginative proposal with its joint venture partners recognises the Group’s reputation for healthcare excellence. Over 300 beds and 30 theatres, and extensive car parking will offer world-class medical care in a beautiful park environment. Our modular construction methodology and DfMA strategy have ensured rapid progress to date.


Laing O’Rourke | Annual Review 2014

CLIENTS, MARKETS AND SECTORS We will build closer relationships with our clients in key markets to become their partner of choice, creating more value for them and for us. Our way of working with supporting partners, stakeholders and suppliers is the basis for growing our business and increasing profitability EXPAND IN HIGH GROWTH MARKETS




We will concentrate exclusively on regions and markets with high growth rates and socioeconomic environments that align with our values and delivery expertise.

Dedicated sector leaders will focus exclusively on tracking preferred opportunities and nurturing key client relationships to build understanding externally of our capability and increase our strike rate. Over the next few years, we will build up our capacity to deliver projects in key markets and sectors through organic development, and potentially, in-fill acquisitions.

We will enhance our customer interactions, moving from a transactional nature to one based on trusted relationships.

This level of globalisation will create a broader business base to shield us from economic fluctuations in, or an overreliance on, any one market. We will extend our presence in infrastructure to create a more balanced earnings profile with growing markets. We will increase our footprint in the UK, Australia and Middle East, while seeking to strengthen our presence in Canada and countries with similar economies, where markets are benefiting from a number of economic, social and environmental developments.

We will enhance how we win work with the use of our SCOPE customer relationship management model – sharing knowledge and influencing major projects early, and boosting our presence with more innovative and proactive marketing.



We will differentiate on the basis of technical capabilities in engineering and construction. We will develop a ‘licence to operate’ in selective building and infrastructure sectors on a global basis. We will leverage our talent, significant in-house resources and reputation for delivery. Our strategic focus is based on the pursuit of a varied building and infrastructure client portfolio spanning both public and private sectors to create future market resilience.

Our plan is to target high-margin, complex technical projects that utilise more of our unique business offering (UBO). We will remain disciplined in targeting opportunities and will only commit resources to projects that meet our financial objectives or where we have the potential to build longer-term strategic relationships.


• Secured repeat business with key customers through early engagement and directly negotiated procurement routes.

• Increased presence in targeted infrastructure sectors by exporting capabilities to regions benefiting from the global trend of investment in economic infrastructure like oil and gas.

• Formalised our dedicated sector specialist approach and introduced a clear engagement framework which tracks and measures customer satisfaction with our services.


Financial Performance • EBIT • Order Book • Managed Revenue

Engineering Excellence • Repeat Business • Client Satisfaction • Quality

Business Improvement • Accident Frequency Rate

Laing O’Rourke | Annual Review 2014



UNIQUE BUSINESS OFFERING Laing O’Rourke is an engineering-led organisation with global expertise in delivering major projects. We will consistently construct high-quality complex buildings and infrastructure to budget, on time, safely and sustainably, that exceed customers’ expectations KEY ELEMENTS






The Engineering Excellence Group’s (EnEx.G) principal role is to drive our innovation agenda, creating competitive advantage through the delivery of superior engineering strategies.

Design for Manufacture and Assembly (DfMA) will help revolutionise the process of construction, making it faster, cleaner, cheaper and more reliable. By taking much of the construction activity offsite and into a controlled factory environment we are able to achieve consistently high standards.

Laing O’Rourke has a unique integrated delivery capability, bringing together the people, technologies and processes under one roof to enable a full-service approach. Owning our own supply chain and directly employing the necessary skills helps us reduce the risks normally associated with a traditional delivery approach.

The EnEx.G has four primary roles: external advisory, internal consultancy, research and development, and education.

We will proactively deploy new skills and technologies ensuring that complex projects are ‘built’ twice – once virtually in a digital engineering-enabled environment and then at the point of delivery onsite, ensuring greater predictability of the time, cost, quality, safety and sustainability outcomes for clients. To meet the demand for more intelligent assets, we will create smarter, engineering-led solutions, constructed with a focus on wholelife value and long-term controlled performance, where the digitally engineered model transforms into the asset management system.


• Major Group investments in resources and training to further integrate the EnEx.G and mandate digital engineering on all projects globally.

• Accelerated DfMA deployment across both hubs through greater alignment of our core engineering, manufacturing and delivery business units.

• Developed new component-based propositions to disrupt and advance the traditional construction market approach to delivery.

• Formulated the Specialist Trading Business Group in the UK to deliver productivity gains.


Financial Performance • EBIT • Order Book

Human Capital • Employee Engagement • Training Spend Per Head

Engineering Excellence • Digital Engineering Deployment • Quality • Client Satisfaction • Repeat Business

Business Improvement • Accident Frequency Rate

This unique in-house consultancy integrates seamlessly with clients, partners and project teams engaging at the earliest stages of a project, examining challenges from new angles and seeking out transferable solutions from other sectors.


Our highly automated approach enhances quality and efficiency at every stage – both in the products themselves, which are repeatedly honed to support optimum performance, and in the production process. This optimisation process can also improve the sustainability credentials of our products.

Laing O’Rourke | Annual Review 2014

Through the integration of our core competencies in project management and construction delivery, the specialist knowledge, shared values and level of control we maintain deliver the value inherent in our UBO.

ENABLING THE ORGANISATION We will focus on cost efficiency and cash generation across all our business activities to improve the productivity of the Group and enhance our ability to grow. To achieve this we will recruit, retain and develop the very best people for the job OPTIMISE BUSINESS PERFORMANCE




Our projects, business units and supporting functions will reduce operating costs by removing duplication and activities that do not add value – to achieve zero or negative overhead growth. This will ensure we are continually challenging ourselves to deliver superior levels of performance at an acceptable cost.

The long-term success of our industry depends on its ability to attract the very best talent. We will prioritise investment in our human capital practices to sustain our position as a recognised employer of choice. We will continue to recruit talent across all our development programmes, including graduates, scholars, cadets and apprentices.

Protecting the health and safety of everyone involved in or affected by our operations is, and will remain, a core business value. We will continue to lead the industry by investing to further develop and embed our behaviour-based safety culture to eliminate all accidents from our operations by 2020.

In parallel we will invest in state-of-the-art plant, equipment, services and technologies that enhance our UBO, allowing us to deliver more with less. We will share this knowledge and the associated processes, encouraging the supply chain to adopt and comply with Laing O’Rourke’s policies and best practices. Our DfMA approach will drive up productivity levels, addressing the skills gap in our industry by creating more sustainable careers. It will ensure our people are trained in more futureproofed and exportable skill-sets, deployed in cleaner and safer working environments.

We will derive additional value from our network of alliances with prestigious universities, including University of Cambridge, University of Oxford and Imperial College London. We believe that a strong leadership capability is vital to any organisation, and will work to build the skills of our senior executives, functional leaders and key project delivery teams. Our ‘Guns’ and ‘Young Guns’ programmes are designed to fast-track high-potential employees into leadership roles.

We respect the value of all resources and endeavour to deliver more with less by completing projects quicker and without mistakes. In parallel we will minimise the amount of energy and materials we consume, helping us to comply with sustainability best practice.


• Increased productivity and reduced associated overheads through further efficiency gains in our manufacturing process.

• Invested in and promoted our leading entry-level training programmes to help bridge the industry skills gap.

• Invested in scaleable technology platforms and associated training to support our digital engineering focus.

• Introduced greater consistency in our global safety and sustainability agendas.


Financial Performance • EBIT • Managed Revenue

Human Capital • Employee Engagement • Training Spend Per Head

Engineering Excellence • Digital Engineering Deployment • Quality

Business Improvement • Accident Frequency Rate • Profit Per Head

Laing O’Rourke | Annual Review 2014






CUSTOM HOUSE Custom House will be the only surface station in the central section of Crossrail, and is currently being delivered adjacent to the existing Docklands Light Railway platforms and the ExCel exhibition centre. This £35 million project is a showcase of our DfMA capability, and will be assembled from over 700 components manufactured at Explore Industrial Park.

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Laing Laing O’Rourke O’Rourke | Annual | Annual Review Review 2014 2014

Our progress is determined not just by what we achieve, but the way in which we achieve it. Our success is enabled through a commitment to excellence plus performance encompassing four pillars around which our strategic action plans are aligned






Engineering Excellence

Human Capital Management

Financial Performance

Business Improvement


The Group’s priority is to fully understand the needs of its customers and deliver on its promises through the engineering and construction services provided. Engineering excellence is fundamental to our strategy through extensive deployment of our unique business offering (UBO), embracing the innovative EnEx.G, digital engineering technologies, Design for Manufacture and Assembly methodologies and integrated selfdelivery capabilities, across all our key sectors and markets. Excellence plus in execution means delivering on projects within tight tolerances of quality, time and cost performance in a reliable, predictable and repeatable manner.

Achieving the required levels of excellence plus performance is dependent on the quality and commitment of all employees. It is critical that the Group attracts, develops and retains the best leadership and operational delivery talent in the marketplace to ensure delivery of our strategic goals through the creation of a culture and working environment that inspires our people to give their best.

Financial discipline is of paramount importance to a company’s stability, reputation and future growth. The Group sets stretching but achievable financial performance targets as part of its annual budget planning process to improve performance from both a cost and sales perspective. This creates greater value for clients and enables delivery of appropriate and sustainable returns and complementary capital structures that better reward stakeholders over time. These measures are derived from our consolidated financial statements and include order book, managed revenue, earnings before tax and operating cash flow.

By constantly refining our business systems and processes to optimise assets, capabilities and risk appetite we will create a leaner and more agile business. Through the prioritisation of resources and removal of duplication and wasteful practices, the Group will become more productive and profitable. Our governance framework and Global Code of Conduct set the standards by which the Group will sustain long-term business success.


The extent of our engineering excellence and ability to innovate relative to competitors is a key driver of customer buying behaviour.

Promotion of a meritocratic, learning-based culture where rewarding performance increases productivity and delivers higher returns.

Financial performance determines our ability to sustain our business and reinvest for future growth and development.

Controlling costs and optimising resources increases value creation for the Group and its stakeholders.


• DfMA Quality Acceptance Levels • DE Deployment • Customer Satisfaction • Repeat Business

• Employee Engagement • Training Per Head

• • • •

• Accident Frequency Rate • Profit Per Head

The level of enterprisewide employee engagement determines the degree of understanding of and commitment to the Group’s strategic goals, and hence provides a direct correlation to service levels, customer satisfaction, responsible behaviour and financial performance.

Laing O’Rourke | Annual Review 2014

Managed Revenue EBIT Order Book Cash Balance

Our health and safety performance determines our strength as a business. It is not an isolated measure but one that defines our success in all other areas. For this reason, it is central to business improvement and a precondition of our continued growth.