Quit Acting Like A BrokerYoure in the Outsourcing Business

1
Quit Acting Like A BrokerYoure in the
Outsourcing Business! John Englert Kevin Hughes,
SIOR, Colliers Corporate Solutions Kevin
Dollhopf, Hanesbrands October 27, 2006
2006 Fall Professional Conference Charlotte, NC
USA
2
(No Transcript)
3
HbI?Americas best known apparel brands
4
Hanes?A Category Leader
5
Current Production Facility Locations
United States
India
China
C. Am / Caribbean
145 Facilities 17MM SF
6
Current Distribution Facilities
C A N A D A
35 Facilities 7MM SF
M E X I C O
Legend
Size Size between 100k and 400 k Ft2
Size 400k Ft2
Choloma
SIOR October 27, 2006
7
Global Sourcing Regional Hub Locations
ASIA PACIFIC
CANADA
EUROPE
Shanghai
USA
Istanbul
Winston-Salem
Hong Kong
AFRICA
Bangalore
Latin America
S. AMERICA
20 Facilities 2MM SF
AUSTRALIA
SIOR October 27, 2006
8
Retail Outlet Locations
250 Facilities 1.2MM SF
SIOR October 27, 2006
9
Organizational Consolidation
Champion Products, Inc.
Sara Lee Casualwear
Printables
2
Sara Lee Hosiery
International
3
1
9
4
8
5
6
7
Sara Lee Sock Co.
Sara Lee Underwear
Sara Lee Intimate Apparel
Sara Lee Direct
SIOR October 27, 2006
10
Functional Excellence
HbI Real Estate Mandate Design and execute a
real estate function expert in driving corporate
strategies through the land, building, and
infrastructure asset base
11
Organization Chart
12
Operating Model
FIN
Other
Admin
HR
IT
CRE
Govt. Affairs
Legal
13
FIN
HR
IT
CRE
14
FIN
Integrated Services Workplace Solutions Global
Business Solutions Shared Services
HR
IT
CRE
15
CRE
16

• More and more people working in and for
  organizations will actually be on the payroll of
  an independent outside contractor. Businesses,
  hospitals, schools, governments, labor unions
  all kinds of organizations, large and small are
  increasingly unbundling clerical, maintenance
  and support work.

• By Peter F. Drucker
• Sell The Mailroom
• The Wall Street Journal
• July 25, 1989

17

• Companies are no longer just outsourcing. Today,
  they are building global corporate ecosystems
  linking people, processes, and technologies
  across the traditional boundaries of the
  business.

• Outsourcing Professionals take the lead in
  working with senior management to set policy,
  identify opportunities, execute, govern, and
  assure quality results.

18
Outsourcing is Creating
19
Strategy Execution Opportunity!

• Drive growth category and share
• Improve cost competitiveness
• Increase reliability and consistency
• Optimize asset efficiency
• Organize for success

20

• Six Competitive Strengths
• Strong brands and leading market positions
• Focus on manufacturing/selling high-volume core
  essentials
• Significant operating scale
• Strong customer relationships
• Strong, consistent cash flow
• Experienced management team

21
CRE 2000

• IDRC 1996
• Corporate Real Estate Function
• Too tactical, not strategic
• Financial metrics absent
• Minimal cost controls
• Poor alignment with business units

22

• 5 Years Later
• Focus on cost management
• Outsourcing
• Role Confusion

Alignment out of whack!
10 Years Later REEB Alignment Survey
POOR!
23
Real Estate A Business Process-Driven Function
24
RE Expense Clients Value is Space Driven
Disciplined sourcing and aggregated buying will
lead to increased savings
50-75
30-15
20-10
Space
RE Expense
Services
Labor


Strategic business insight, improved RE processes
and better analytics will lead to less and better
utilized space
Collaborative solutions and variable
resources will lead to lower fixed staff costs
25
Value Proposition Outcome Based Performance
Responsive, Enable Change, Flexibility, and
Commitment To Quality
Strategic Impact
10X
Reduce Total Cost of Real Estate, Relentless
Execution
Business Impact
1X
Direct Cost
.1X
Speed To Market, Efficient Process, Customer
Service
Focus Move the conversation from a discussion
around Direct Cost to a discussion about
Total Enterprise Value creation.
26
My Assumption

• you are an expert with experiential knowledge
  of
• Real estate markets
• Real estate transactions
• Real estate negotiation
• Real estate finance and investment theory
• Real estate valuation
• Real estate contracts
• Real estate best in class practices

SIOR October 27, 2006
27
Top Ten Value Propositions

• 10) Provide intelligence about my industry,
  competitors, and company

9) Dont call if you just read it in the
newspaper
8) Be prepared to work with other outsourced
providers, and probably your competitors
7) Know and understand the implications of SOX
6) Your company is as dysfunctional as mine
know the operating model, business it does with
me, and be honest about capabilities
28
Top Ten Value Propositions

• 5) Be an expert, but help me find other expertise

4) Know the boundary of business and legal advice
3) Benchmark and provide metrics, performance
indicators
2) Corporate services real estate staff. Act
accordingly and be responsive.
1) Always act with the highest ethical standards