Cleanaway hits halfway in $100m IT and digital transformation

Cleanaway Waste Management has reached the halfway point in a four-year IT and digital transformation while also putting data analytics to work to optimise its operations and pricing.

Image credit: Cleanaway

The ASX-listed waste management services provider unveiled plans for the transformation, called CustomerConnect, back in 2022.

The program covers both IT infrastructure upgrades as well as digitisation and automation of what it terms its ‘call-to-cash’ process.

As reported by iTnews previously, this appears to be a version of a quote-to-cash or order-to-cash digitisation, covering all steps from when a customer calls to when their invoice is paid.

CEO and managing director Mark Schubert told the company’s FY24 results call that the four-year, $100 million transformation is “at the halfway point”.

“Through this project, we’re upgrading our [IT] infrastructure and digitising our call-to-cash process, thereby creating a foundation for our advanced analytics and AI initiatives, as well as creating a better experience for our customers and our customer-facing teams, he said.

“During the second half of FY24 we completed the first of two releases of CustomerConnect on-time and on-budget. 

“CustomerConnect is due to be completed by the end of FY26 and [is] expected to deliver more than $5m in EBIT [earnings before interest and taxation] in FY26 and more than double that in FY27.”

CustomerConnect is one of several initiatives that fit under a 2030 blueprint that Cleanaway is working towards.

Also within its scope is a fleet transformation initiative, which is data-driven.

“Our goal is to optimise running and capital costs and maximise returns by implementing a data-enabled multi-year strategy that will transform every aspect of fleet management,” Schubert said.

“This includes evaluating the use of third-party providers versus owning vehicles, exploring new in-cab technology, centralising fleet lifecycle management, and incentivising asset pooling when vehicles are not fully utilised. 

“We expect this strategy to deliver significant benefits through and beyond FY26.”

Data analytics projects appear to be active in and benefitting multiple parts of the Cleanaway business.

Schubert said that the commercial and industrial business had seen its yearly revenue rise 7.1 percent in FY24, “with six percent of the variation attributable to price, more than outpacing inflationary pressures, and volume contributing to the remaining one percent.”

“We have been highly strategic with our price increases this year and have leveraged our data analytics capability to implement differential pricing across our customer base,” he said.

“As a result, our customer churn has been lower than it was this time last year.”

Similarly, its healthcare waste business had used data-driven tools to “drive EBIT margin expansion”, while its Queensland-based solid waste operations had “embraced data-enabled tools such as labour dashboards and route optimisation” to improve service levels, “which then enabled price increases.”

Cleanaway reported a statutory net profit of $158.2 million for FY24, up from $23.5 million in FY23. Underlying net profit after tax grew by 14.8 percent to $170.6 million.