As the country's leading rovide of integrated facilities management serbvices, Sodexho Mexico has seen strong gowth in the last few years. Taking advantage of its unique client selection strategy and strong client retention rate, Sodexho looks to extedn and consolidate those gains in the coming years. Peter Krupa reports.
Exploring for oil is a complicated business. So is managing universities, or leading multi-national tech firms. It gets more complicated when you have to feed students, maintain living spaces for employees, or do regular maintenance that can be more like a regular headache.
Take an aspirin: the Sodexho Alliance is here to help. One of the leading companies globally in Quality of Life Services outsourcing, Sodexho’s enormous multi-national network, with 332,000 employees, pulled down $15.6 billion (USD) in revenue in 2006. It was only 15 years ago that Sodexho entered the Mexico market, yet the growth of Sodexho there has been staggering in the last few years as the company expands to all corners of the country.
As Petróleos de Mexico (PEMEX), the state oil company, ramps up exploration, Sodexho is there to provide off-shore services in difficult-to-reach places. Sodexho runs cafeterias, conference centers for corporations, industrial plants and educational institutions all over the country. As business continues to boom for Sodexho, client retention remains one of the highest in the industry. All this, and at the same time Sodexho maintains one of the most comprehensive corporate and social responsibility programs around.
With 2,500 employees, Sodexho Mexico operates in many locations around the country. The company has full-scale operations in the cities of Guadalajara, Puebla, Mexico City, and Ciudad de Carmen, and plans to enter and expand in Monterrey, San Luis Potosí, and Queretaro. Outside urban areas, Sodexho also has many projects servicing remote areas.
Sodexho’s business, at first blush, is a simple concept: provide qualified personnel and equipment to offer services that organizations and businesses would rather not do themselves. This means a lot of personnel, and a lot of different services, such as food or building service. Schools and some large corporations want cafeterias for their students and employees, but running a cafeteria is beyond the purview of those organizations.
Sodexho, therefore, can take charge. Everything from the purchasing of food and supplies to the hiring of personnel to the management to cleaning and operating of the cafeterias – each one can be complicated, and each one is handled by Sodexho. In that same vein, the company also offers catering, housekeeping, and maintenance. Using its experience with hiring and maintaining qualified personnel, Sodexho can offer receptionist and help desk personnel as well.
Not so simple
But though the concept of what Sodexho does seems like a simple one, the execution is not. The company has to undertake the massive challenge of hiring qualified workers, managing them effectively – and keeping them around. In the latter, Sodexho has made significant progress, said Sodexho Mexico President Humberto (HAP) Patorniti. Sodexho’s turnover, he added, is low because of solid benefits, salary, working conditions, and training the company offers to its employees.
One key initiative that Patorniti launched was an adult education program for Sodexho employees to allow them to complete their education.. Every Saturday, the boardrooms turn into classrooms and a group of Sodexho employees selected for the program, which is overseen by the Mexican Secretary of Education, attend in an effort to finish their elementary and high school educations.
Classes for the 18-month program last most of the day on Saturdays, and in 2006, the first group of 15 students graduated. Sodexho plans to expand the program. “A better educated employee better serves our clients,” Patorniti explained.
And when it comes to clients, Sodexho has a special relationship with them as well. The company won’t work with just anyone – Sodexho Mexico’s growth is carefully controlled and targeted, and the company will only work with clients that share its values of social and corporate responsibility, Patorniti said. “More than simply looking for new clients, we seeks strategic partners,” Patorniti said.
In that sense, Sodexho’s growth has always been through word of mouth and through client recommendations. The company started out in the remote southern state of Campeche, providing services to PEMEX facilities in hot, remote areas on land and difficult-to-reach oil platforms in the Gulf of Mexico.
Sodexho then leapfrogged to major cities where it serves corporate clients such as Schneider Electric and Siemens. Sodexho’s own auditor, Pricewaterhouse Coopers, even hired the company after getting to know its levels of expertise. Patorniti calls this “reputation-based, client-driven growth,” and it’s been the focus of Sodexho Mexico’s growth.
Expanding its Portfolio
Recently, that has meant the addition of a predetermined number of new clients per year. Corporate clients that have hired and/or retained Sodexho include Coca Cola, L’Oreal, Pricewaterhouse- Coopers, and Ernst and Young. Laboratories like Novartis, AstraZeneca and Valeant are among Sodexho’s prestigious strategic partners.
With respect to the remote site customers, PEMEX, remains one of Sodexho’s key clients, and will do so in the future for good reason: Oil exploration is up, and PEMEX needs Sodexho’s support. With the country’s largest oil field nearly cashed out, PEMEX must aggressively seek new sources of petroleum, meaning new remote service opportunities for Sodexho.
Sodexho’s client portfolio contains a lot of different companies with a lot of different needs, something that, on one hand, can be difficult to juggle, but on the other hand, speaks volumes of the company’s flexibility and ability to serve a diversified client base. “Our clients are increasingly redefining their own core services to improve efficiencies leaving all the logistical means to the experts – that’s where we come in” Patorniti said. “Our culture defines us as a customer-driven company.”
The success of Sodexho’s customer- driven strategies can be seen in the numbers: Sodexho maintains a 98 percent annual client retention rate. “We work hard to maintain our current high client satisfaction scores because we know we have to earn our clients’ trust every day,” Patorniti added.
A Socially Responsible Company
Yet the customers aren’t the only thing that drive Sodexho. The bottom line is, of course, important, yet the company also puts strong emphasis on its employees and on the society in which the company operates. Worldwide, the company annually receives scores of diversity awards for its efforts towards inclusion of minorities and disabled workers.
Sodexho Mexico has itself received special recognition for its efforts toward social responsibility. Recently, the company was awarded the prestigious Socially Responsible Enterprise distinction from the Mexican Philanthropy Center for the third year in a row. Patorniti said Sodexho was “the first Integrated Facilities Management company in Mexico to earn this prestigious award.”
In terms of its service and professionalism, Sodexho also holds an ISO: 90001:2000 certification, and is, with a doubt, well qualified when it comes to
sanitary standards, Patorniti said. With a strong emphasis on hygiene, food safety, and workplace safety, the company has hired medical professionals to develop protocols and techniques that go beyond industry standards.
“In food safety and safety on the job, there is never enough we can do to ensure the reduction of foodborne illness,” Patorniti said.
Branching out The last few years have seen strong growth for Sodexho. Since 2003 the company has seen 20 percent annual growth, thanks to their strong customer loyalty and excellent reputation. That growth has positioned the company as number one in the remote sites services market and number two in the industrial and commercial services market.
The research and development department, however, never rests, and a two-pronged plan for the next few years has both long- and short-term targets. In the short term, the goal is to consolidate and strengthen the gains made in urban areas where the company currently has a presence. In the long term, the company is looking to expand to other cities. Development projects in the coming years will be targeting the cities of Monterrey, San Luis Potosí, and Queretaro.
Future growth will continue to use Sodexho’s strategy of carefully selecting new clients and putting strong emphasis on personalized service and social responsibility so that the company can continue to have the strong client and employee retention rates that have made possible the company’s recent strong growth. Said Patorniti: “Our resources, time, and energy are directed to constantly improving our products and services to make every day a better day for our clients and customers and the communities in which we live, work, and serve.”