Fira is an innovative operator in the construction business with fast-growing turnover that has reached ca. 200 million Euros. The company develops services that promote a change in the whole field of construction, for example, efficient building pipe renovations which are now completed in a matter of weeks instead of months. Fira efficiently runs construction projects via their project model, using the services of over 2.000 different subcontractors.
To make its operations even more effective, Fira has invested in digital financial controlling and performance management in cooperation with Jedox partner Intito.
“In the last 50 years productivity in the construction business has basically not improved at all, whereas in the meantime it has even quadrupled in other industries. We focus on solutions and services that contribute to the productivity of building and improve the customer experience. For this we need state of the art financial controlling and new kinds of services”, says Kimmo Kärkkäinen, CFO at Fira. “Transparency, trust, and care are values we invest in when developing our services.”
Intito has provided Fira with digital tools for financial planning, budgeting and forecasting utilizing Jedox technology. The use of Excel has noticeably been decreased as planning models have been revised in Jedox. Now the Fira group results can be forecasted accurately.
Fira currently runs approximately 25 active construction sites that employ daily 1,000 to 3,000 workers in total. The operational flow of all resources must be managed efficiently. Kärkkäinen emphasizes careful planning as well as being proactive and being able to react quickly to emerging situations. “A typical project includes over 200 subcontractors. We wanted to improve the financial controlling not only at the construction sites but also for the whole group, and have the ability to make forecasts based on real time data.“
New and Efficient Services
Fira’s turnover has grown from 14 million Euros in 2009 to ca. 200 million today. An incredible achievement by any measure. “We have reached a very strong position in development projects in the construction business”, says Kärkkäinen.
“Pipe renovations take three months on average, but we are able to deliver them in two weeks. We want to be even stronger in creating new kinds of services around construction operations. We develop services for our customers that cover the whole life cycle of their property by using for instance 3D-modelling. We know what needs to be done in each phase of the life cycle of the property.”
Fira established four start-ups in 2016 and the turnover for each of these subsidiaries can also be seen individually. “We are planning a performance based model for subcontractors, which will motivate them to operate more effectively. We are also developing solutions by which contractors can easily report progress in each work phase, using a tablet device for example. We want to have the best field experts working on our projects.”
Pioneer in Group Building
In the Jätkäsaari district of Helsinki, Fira is running a group building project with 88 new apartments. “We coordinate and lead the whole project and are responsible for its execution. We gathered a core team of experts to carry out the project. One of the advantages in group building is cost efficiency. The buyers are founding stake holders and they do not need to pay large mark-ups or taxes related to asset transfer,” Kärkkäinen explains. “We can see the cost structure of the project in detail.”
Fira is aiming to complete the Jätkäsaari-project in approximately 15 months. “We are constantly learning and turning that into new thinking to find ways to accelerate the construction phase. Our aim is to improve productivity so that projects like this can be carried out within 6 months in the future. This, however, is only possible with state of the art digital ﬁnancial controlling and management systems.”
Fira can now plan investments and projects more and more accurately, and asset depreciation is automatically calculated into the profit and loss statements. In addition, the calculation of the work in progress and percentage of completion has been automated for accurate revenue reporting and recognition. “We guarantee to our customers that the cost calculations are accurate and reliable. We select the subcontractors by a tendering process, and it is important that we are able to control the progress of the project in real time”, Kärkkäinen underlines.
Better Control and Transparency With Financial Controlling
Some of Fira’s projects are worth tens of millions of Euros. “We need the financial controlling solutions from Intito as soon as the project starts. The construction site managers can manage projects and follow additions and changes more efficiently. They can drill down to single invoices, and better estimate the progress of the project.“
According to Kärkkäinen, in order to carry out successful projects, it is also crucial to understand interdependencies. “We want to know where the numbers come from. Automation of the financial controlling increases and manual labor decreases. We also want to better utilize the access to the new data.”
Intito’s experts have also been in close cooperation with Fira’s other partners, such as the data storage supplier. The financial controlling user interface is developed to match the needs of the business operations. The development is done with agile methods in week long consecutive sprints that are planned and coordinated together with other development teams.
“Intito has proven to be a very capable and flexible partner, whose experts understand financial controlling as well as business operations. We make fast progress, and at times we need services within a very tight schedule. Intito has been able to keep up with us”, emphasizes Kärkkäinen.
Intito has Produced Digital Tools for FIRA with Jedox Technology:
- To budget and forecast fixed cost and other profit and loss entries
- To plan the financials of the project development and building phases along with the financials of future projects (prospects)
- To plan investments and calculate asset depreciation
- To automatically calculate percentage of completion for revenue reporting