Interserve is a services, maintenance and building group. We provide services across the whole life of many types of buildings and infrastructure such as hospitals, schools, offices, industrial plant, bridges, waterworks or roads. We offer our services at each stage of the asset lifecycle: we build, we help others build by hiring them equipment, we maintain, we support operations and we replace. Around 70 per cent of our services are delivered into the built environment and 30 per cent to plant and infrastructure.

A common theme throughout our services is that we manage complex environments to enable our clients' businesses to run more effectively. The core competencies that enable us to deliver the services our customers need are:

• Service integration
• Direct delivery and supply chain management
• Productivity improvement
• Development of long-term working relationships
• Driving and managing change

Increasingly our customers wish to buy more services from fewer suppliers. With our breadth of skills and services, we are able to respond to that customer need and to deliver a "one-stop-shop", integrated service. Private Finance initiative (PFI) projects are an excellent example of where the customer wants to work with an organisation that can design, build, operate, maintain, replace and finance their asset. Our ability to tailor our services to meet individual client needs by harnessing expertise from across the Group differentiates us and means that we can achieve growth with existing clients by delivering additional services. For example, in a number of cases we are developing facilities management (FM) services from our existing construction framework agreements.

Interserve's value chain shows how our services support the creation and management of assets throughout their lives and how we add value at each stage. Our strategy is to build long-term relationships, and these can relate to any of the links in the value chain, although our longest contracts are for operational and maintenance services.

Design

Although Interserve's design activities account directly for relatively little of our turnover, they play a key role in our ability to get the best out of an asset across its whole life. A successful project must, of course, be based on a sound architectural and engineering design. Its success also depends on taking into consideration at the outset the specific operational and maintenance issues the facility will face throughout its working life. In addition to the conventional design skills residing in our Project Services division, therefore, Interserve's input to the process incorporates insights from across the Group gained from our extensive, first-hand experience of managing a wide range of facilities across the public and private sectors. In PFI, for instance, our facilities managers produce briefs to bring out design features that will enhance our ability to operate and maintain the assets effectively.

Design is also the principal factor that differentiates our Equipment Services division so strongly in the market. Our formwork and falsework systems form the temporary support frameworks used during the creation of substantial concrete structures, and it is the design, both of these highly engineered, integrated systems and of their application in specific projects, that optimises the construction process and saves time and space compared to traditional technologies.

New Build

Equipment Services' business model is based on the hire and sale of its equipment in meeting the challenges of often demanding infrastructure projects, and our engineering advice in the use of the equipment is offered as part of each hire transaction. So while much of the added value comes from the design skills outlined above, the turnover is directly attributable to the building and refurbishment phases of our value chain, with the majority in the former.

It is also at these stages that we deploy most of our expertise in Project Services; the balance, besides the design aspects already mentioned, is in maintaining operational assets, allowing us to perform a "cradle-to-the-grave" service for the structures concerned. The division specialises in delivering building and infrastructure projects in the UK and the Middle East through framework agreements, PFI contracts and negotiated relationships.  In the UK our approach is to work with our clients in long-term relationships, increasingly through open-book arrangements providing supply chain transparency and demonstrating the added value of our co-ordination, planning and management role.  In the Middle East we work through our associate companies almost entirely on negotiated and/or repeat business contracts to deliver business development and project management in concert with our partners' market knowledge and access to the supply chain.

Refurbish

Many of the abilities we need to manage new-build projects in Project Services are equally applicable to refurbishment, from bridges and motorways to hospitals and offices. In each case we bring together and co-ordinate a range of skills to create or regenerate a valuable asset on behalf of our client.

This is also the link in Interserve's value chain in which our Facilities Services and Industrial Services divisions become significantly involved, the former primarily in the public sector and the latter largely in the private. Often refurbishing a building or industrial plant forms part of the planned management of the asset through its operational life.

For instance, in PFI contracts we undertake to hand over the facilities at the end of our tenure in a well-maintained condition, therefore we refurbish buildings throughout their lives. Similarly, where we manage the ongoing maintenance of complex processing plant for an industrial customer, from time to time we plan and undertake major equipment overhauls involving the tightly-controlled interaction of hundreds of people in a number of different technical disciplines. In both examples one of our key skills is managing the interface with the client and its operations in what is usually a live working environment. Our activities must be planned to run alongside those of our client in a way that minimises disruption while delivering high quality improvements.

Operate

Interserve is one of the leading players in the growing UK outsourcing market and the majority of our services are provided in support of our clients' ongoing business functions. Our approach is to focus on opportunities offering significant long-term revenue streams where we can build a detailed understanding of our clients' operations and generate continuous improvements in their support processes. We add value through integrated single-point client relationships, managing and controlling the interfaces within a suite of services thereby delivering effective solutions to our clients' individual needs. Our preference is for complex outsourcing projects, where our change-management skills, integrated management, direct-delivery capabilities and willingness to structure risk and reward innovatively set us apart from our competitors.

Wherever we deliver operational services, especially in certain hazardous environments, safety and environmental concerns are paramount and the ability to provide effective safety and quality management assurance is a prerequisite.  Our aim is to deliver continual improvement in the knowledge that sustainable safety and environmental performance makes a direct contribution to our success and is a key differentiator on which clients will increasingly base their buying decisions.

We have also developed particular expertise in human resources as we change working practices and organisational culture to align them with our goals and those of our clients. The breadth of our services, not only for a single client but also across several different contracts, enables us to create career opportunities, increase our employees' motivation and develop their skills, to the mutual benefit of the individual, Interserve and its clients. The knowledge transfer that this entails also means that we enhance our ability to identify situations where we can offer additional services and apply best practice. And as the range of services we deliver grows, Interserve becomes increasingly integral to the infrastructure support needs of our clients, which we believe helps to extend the length of our client relationships.

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