Frustrated Executive

5 Reasons for Outsourcing Facilities Management

You are an executive sitting at your desk and have facility management activities within your responsibility but do not have much experience managing these services with your wide expanse of responsibility.  You may not be happy with the way facility or building maintenance is being done in your organization.  You may be happy with the services of your organization but do not know if your organization is actually doing a good job.  You may feel concerned that there may be some potential liabilities lurking out there that may bite you.

This article will help you achieve a better understanding of why organizations outsource (no, outsourcing is not a bad word) to improve the customer satisfaction of the occupants of your buildings and facilities.

Here are 5 major reasons why outsourcing facilities management is beneficial to an organizations building management programs:

(1)     Cost Containment and Avoidance

In this day and age, cost effectiveness is a major reason why organization’s outsource facilities management activities. Once organizations outsource their building management and facilities programs and they set up the right contractual relationship with the service provider they may reduce costs in a number of different ways:

  • Personnel Substitution Savings — Savings relating to substituting your employees with outsourced employees.
  • Labor Optimization Savings — Achieving the correct balance of a site based multi-skilled workforce and outside “per call” subcontracted labor.
  • Process Improvement Savings — Reductions in cost relating to improved work processes and procedures.
  • Building Optimization Savings — Savings relating to the initiation, management  and optimization of the total cost of ownership.

These are the major areas where outsourced service providers save its clients money.  However, for all of these areas, it is important to measure cost effectiveness to monitor progress. For a more detailed information about these areas of savings, please click here.

(2)     Responsiveness and Timeliness of the Work

Many organizations are unhappy with their facilities department because they do not respond to (responsiveness) or complete work (timeliness) to the satisfaction of the building occupants.  This is usually the result of poor scheduling, priority setting, and flexibility to complete work when the work is beyond the capacity of the site based workforce.  In many cases, you as the executive in charge, do not know the extent of this unhappiness until the occupants and users of your facilities organization make a big issue out of it and then this dissatisfaction permeates the organization.  You do not want this to happen.  Your organization in these cases need to design the appropriate cost effective work management process using your or new technology to establish a program to effectively set priorities, properly schedule and complete work.

(3)     Work Quality

If you are getting constant complaints about the quality of work, this is a sign that you may want to make a change.  Poor work quality arises from a number of different reasons.  Inadequate training, using the wrong person or skill set for the work, last of inspection as the work is done and after completion, poor morale, poor work processes are the major culprits to poor work quality.  Sometimes, the quality management program used by your organization is not appropriate for your facilities department.  In many cases, there is an absence of a quality management program.  By having an appropriate quality management program in place, you will feel better that work is being inspected, rework is minimized, and the occupants of the building are happy with the quality of the services they receive.  Popular quality management programs for larger programs are Six Sigma, Malcolm Baldrige, and ISO 9000.  The Six Sigma program is project oriented for making quality improvements.  The Malcolm Baldrige program is management oriented using 7 major criteria areas for improvement, and the  ISO 9000 program is procedure and documentation oriented.

(4)     Flexibility

Many facilities organizations do not have the flexibility to change as the business and facilities needs of their organization changes.  If your organization has employees that do not have the skill sets, positive morale, and will to do an excellent job, it is difficult to demonstrate excellent performance and to continuously  improve.  Knowing that the customer can terminate their contract with short notice, facilities management and maintenance companies are compelled to make personnel changes, stay on top of best practices, and demonstrate cost effectiveness in the services they provide.  The customer, though they may not be actually doing or managing the work, will always be in control of the program and the direction it takes through good communications and reporting provided by the service provider.

(5)     Risk Mitigation

In this complicated world, you, as the executive who is ultimately responsible for your facilities organization, may not understand the inherent risks of the facilities program. Improper management of personnel, lack of documentation and training relating to environmental, human resource  and safety requirements, lack of emergency response training and procedures, absence of critical parts replacements, code violations, and regulatory violations relating to the buildings are just some of the areas of concern that require specialized knowledge, management, and documentation.  Outsourced service providers provide the knowledge, documentation, and management the customer needs to insure that facilities related work is being done properly and that the buildings provide a pleasing, and safe environment for the customer.

Outsourcing Facilities Management Summary

You as an executive who is responsible for the facilities management program, may depend on a few people who have limited experiences to provide the necessary services.  Your program is only as good as the personnel you have managing the work.  Service providers have the experience of working with hundreds of  clients and know how to provide you a customized program taking into consideration best practices and technology.  Also, these facilities organizations can hire your employees and manage and train them to use their customized processes and technology to provide you excellent service.  These employees, in many cases, have overall career opportunities and advancement that cannot be provided by the client organization.