Cost Reduction

The mentioned growing interrelatedness of people belonging to different geographic areas inevitably increases communication costs. In particular, in situations of this kind travel and telephone costs can significantly increase, unless there is a rigorous cost containment policy and measures are taken to limit the use of the more costly tools. To this end, the Travel area Travel has drawn up a global policy to standardise and reduce expenses, inter alia by selecting a single global provider. Regular monitoring of travel costs, together with a continuous review of the services of the global provider, helps to keep all the aspects needing improvement, under control. This is made possible by use of the global SAP tool, and thanks to the introduction of a Travel Manager role operating centrally and locally. A further travel policy is the containment of travel between corporate offices, given the large amount invested in virtual communication technologies (VDC, OCS).
Efficiency improvements are underway in telephone communication, mainly aimed at more focussed assignment of cell phones and in any case to reduce traffic. A sharp reduction in the number of recipients worldwide is expected as well as a more structured control over total expenditure through continuous monitoring. Additionally there are agreements
with global providers, aimed at taking the best opportunities offered by the market.

The second line of activity has been development of resources and skills. In order to offer an integrated development scheme, guaranteeing opportunities of professional growth to all employees consistently and uniformly worldwide, a model was developed to offer an attractive strategy of “Total Rewarding”, in which not only the cash element counts, but also a differentiated offer of professional and career development, skill enhancement, learning opportunities, international experience, involvement and motivation, etc.
This model comprises certain ‘transverse’ elements in that ideally it follows the employee’s entire life cycle, from recruitment through all the professional growth phases, through assessment, development, rewarding and internal communication systems.

These include the Global Job System, an innovative and interesting framework for ASTS’s system of roles and responsibilities.

This project originated in the need systematically uniformly and globally to map the entire system of roles, responsibilities and skills populating the new ASTS organisational scenario.
The output of this project for each of the professional families will be:

  • the ‘Family Backbone’, a map of the current jobs;
  • details of responsibilities, mission, competency and skills for each job, known as Work Levels;
  • the Competency Model of organisational behaviours common to all the professional families;
  • the Skill Dictionary of the specific technical skills for each professional family;
  • identification of structured career plans in each professional family;
  • the association of all Ansaldo STS employees with a ‘work level’.

Another transverse element of the integrated development system is the segmentation model, by which it is possible to exploit both managerial potential and more specifically technical and professional qualities, giving equal importance to these two basic elements of our business.
Within the model the “High Potentials” are directed on to a managerial path, with three stages (Rockets, Talent pool, Stars) or to a technical path in two stages (Knowledge Owners and Technical Fellows) according to the individual characteristics of the person that has been selected.

Of the other projects underway, mention should be made of Succession Planning, which has made it possible for the Company to implement a structured approach to the identification of the successors of key managers. To this end we first identified the key positions within each organisation; these positions were then graded for criticality, i.e. how ready the potential successors within the organisation were to play the role. Among the potential candidates priority was given, in terms of future training and development initiatives, to those who are theoretically ready to succeed in the medium term (1-2 years) and have been identified in relation to high-criticality positions.

A new global non-executive staff compensation policy has been drawn up regulating the management of salary increases and bonuses by means of rules common throughout the world starting with timing, fixed for the month of July every year. The process strategy is based on regular rewarding of three main components:

  • individual performance,
  • the weight of the position,
  • local market conditions.

Eligibility for salary review will be conditional on the assessment of the individual’s performance over the previous two years; another essential element will be the placing of his or her salary within the salary scale defined by the importance of his or her position with reference to the local benchmark.

The output from this analysis will be a merit matrix taking two factors into account, viz.:

  • assessment of the individual’s performance over the previous two years,
  • the placing of his or her salary within the salary scale.

The two possible results of the salary review will be a salary raise or a bonus, being a percentage of gross annual salary (“GAS”) differentiated according to his or her grade or compensation band.

In a highly technological industry Ansaldo STS’s ability to innovate and supply excellent systems and services is a key factor for success and future growth. It follows that the development of individual and collective competencies is a strategic objective. In our Company this has been assigned to the Academy, which in 2010 began operating globally to plan internationally relevant training programmes. The Academy has the task of designing courses on the basis of an annual assessment of training needs made by all functions. In 2010 the main projects completed concerned project management and technical and managerial training.
The expected benefits of the activity of the Ansaldo STS Academy will make it possible to standardise the level of competency within each professional family in respect of transverse technical subjects, at the same time aiming to contain costs due to the economies of scale realised by centralisation and rationalisation of common training programmes for all the entities of the Group.