The added value of outsourcing

Outsourcing is a management system which can be flexible when it comes to financing, operations and the length of the contract.

In short, this flexibility can be seen in the way the terms and conditions for the operating of the service are clearly set out in the contract between the local authority and the specialist operating company.

At any time during the contract the local authority may decide to modify the operating conditions of the outsourced service.

Producing water which is safe to drink is the main priority for operating companies. Veolia Water systematizes the certification of its equipment and facilities through independent bodies who guarantee the continuity and safety of its service provision.

In France, the Company has attained conformance to the quality management standard ISO 9001 for drinking water production and wastewater treatment operations.

Attaining ISO 14 001 certification, a voluntary standard for environmental management, is also under way with 148 sites having already attained conformance by the end of 2003.

In total, 80% of the revenue from the operating of wastewater services comes from services which conform to ISO 9001 or ISO 14001.

Veolia Water uses its expertise and technology to optimize the infrastructure that it has been entrusted with by the local authorities.

By optimizing existing infrastructure you can delay or avoid the need to make certain investments.

This was the case in Paris (right bank) where network efficiency - the ratio between the volume of water consumed and the volume of water in the network - has continually improved. In 20 years it rose from 75% to more than 92%.

This improvement has reduced by 330 million m³ the volume abstracted from the natural environment i.e. the equivalent of 2 years' consumption levels.

In an outsourcing contract the parties agree, a priori, on a reference price which is used as a ceiling for providing the service provision.

This approach means there is a strong incentive to optimize the managing of operations and the maintenance of the infrastructure.

This situation actively encourages the operating company to manage in the best way possible and to make productivity gains.

Any productivity gains that are achieved are shared with the local authority as stipulated in the contract.

Research and development teams constantly make sure that from a scientific point of view the operating companies have the means to meet all daily operational requirements such as when incidents of accidental contamination occur.

Based in France, at Maisons-Laffitte just outside Paris, Veolia Water's research center, "Anjou Research", works in close collaboration with its affiliates in Germany, Australia, Canada....

Veolia Water works in partnership with more than a hundred organizations throughout the world.

Those partnerships include ministries, universities and institutions such as the Technical University, Berlin, University of New South Wales, Australia, American Water Works Association Research Foundation, the Global Water Research Coalition, the CNRS, Pasteur Institute, the Water Agencies which supervise the major drainage basins in France, the European Commission...

Veolia Water's research program is co-ordinated with that of the other Divisions of Veolia Environnement, Dalkia (Energy Services) and Veolia Environmental Services (Waste).

Veolia Water's global position guarantees the diversity and quality of its workforce, the men and women at the heart of its services.

Each year more than a million hours is spent in providing training to the Group's employees.

The following principles underpin Veolia Water's operations:

• giving responsibility to local management
• developing talents
• developing a culture that promotes dialogue
• social innovation
• taking specific steps to successfully move from public to private.

There are numerous strategic issues surrounding training:

• constantly adapting employees' skills to businesses which are becoming more and more complex
• guaranteeing health and safety conditions for all staff
• anticipating future needs by training employees in new technologies
• ensuring good quality career progression within the services.

Veolia Water deploys a wide range of tools to meet its training requirements:

• operational training centers co-ordinated directly by Veolia Environnement located in France, Germany, China, Gabon, Czech Republic and Morocco in line with the training policy of the Veolia Environnement Group
• test facilities (laboratories, plants) models, hydraulic modelling, training centers, educational software, CR DOM, computerized simulators (SIMBA® SIMBAZD® PROGRES®), training packs (FORMADEUS, health and safety, water analysis etc.).
• in marketing, sales and customer relations, innovative and imaginative initiatives are relayed back to those on the ground by appropriate training modules in partnership with Campus Veolia Environnement.