Facility Management and Maintenance Blog

Elevating Your Facility Management Department

Facilities management  departments within organizations that own or lease buildings are an integral part of the strategic direction of the organization.  Too often, top executives don’t consider the importance of facility management when making real estate, capital improvement, or organization and staffing decisions.  In many cases, facility management organizations view themselves as service organizations that will respond according to the strategic moves of an organization after real estate , operational or construction decisions are made with little or no input from them.  Many facility management organizations do not believe that they are strategic to the organizations they serve. This article will provide you, as the facilities manager or executive, some recommendations for elevating the status of your facility management department.

Recommendation 1 — Set Annual Objectives and Goals for Your Department that are Communicated to Executive Management.

Each year, you should meet with your boss to review a number of topics to establish a foundation for performance for the next year.  These meetings are important for setting the course of facility management activities for the year subject to changes during the year.  The results of this annual meeting should contain such items as:

  • Overall goals and objectives for the Department that may cover such areas as major construction and equipment acquisitions installations, environmental projects, energy management goals, budgetary goals, customer satisfaction, benchmarking, human resource development.
  • Once the overall goals are provided, specific goals, objectives, and measures may be  provided for various subset areas such as  finance, operations, customer focus, and goals for each group in your facility management department.

These objectives and goals should directly relate to the overall mission, vision, values, and philosophy of your organization.  Keep in mind that goals and objectives should be achievable.   Top management, if they see these goals and objectives, will know that your organization has an understanding of the overall organization strategy, direction, and productivity needs.  They will be interested in knowing more about the activities and accomplishments of your facility management organization.

Recommendation 2 — Make Your Facility Management Department Accountable and Visible to Top Management by Providing Reports.

You, as a facility manager or executive do,  a great job for your organization but do not or minimally provide high level reporting to management summarizing accomplishments and measurements of performance during the year.  It takes time to prepare these reports and people do not like to “brag” about themselves or their organizations.  However, top managers and executives in organizations need to understand he breadth and extent of the impact a facility management department has within their organizations.  It is in your and your facility management department’s  best interest to provide monthly or quarterly and annual reports to promote management’s understanding of this impact the facility management organization has within the overall organization.

The monthly or quarterly reports will cover such areas as performance to key performance indicators, budget variance performance, issues that need to be addressed, path forward projects, and accomplishments.  By providing this information, you are elevating the visibility of your organization to your boss and he or she can easily realty this information to others.

The annual report summarizes all the significant activities accomplished during the year. Such a report may have such topics as, a depiction of the goals and objectives relating to the past year,  maintenance operations accomplishments, custodial operations accomplishments, landscaping services, energy management accomplishments, environmental activities, safety accomplishments, customer satisfaction surveys and interview results, benchmarking results, budgeting results, capital renewal plan and results, and key performance indicator performance. By including graphs and pictures in these documents, it adds to the appeal of these documents.  A well written annual report provides the top executives of the organization a reference guide as to what is going on.  They may only want to “drill down” to certain areas of their interest but the body of the report indicates that you have covered  everything that is important.

Recommendation 3 — Have Alignment Meetings with Your Boss on a Periodic Basis.

Having bi-weekly, monthly, and or quarterly meetings with your boss provides you the opportunity to go over the report you have just submitted.  Topics to be discussed also include a reaffirmation of your and your department’s roles and responsibilities, a discussion of the needs of the building occupants or the various departments interacting with facilities, readjustments in reporting formats or key performance indicators, initiation and validation of  path forward projects and action item lists.  It is good to send a brief follow up document providing the areas covered from these meetings.

Recommendation 4 — Involve Your Organization with other Departments within the Organization.

Meeting with other Department Heads within your organization on a periodic basis goes a long way to contribute to their satisfaction with your facility management services with respect to their department.  These departments may have unique needs and service requirements that your facility management organization needs to know about and respond to.  Knowing what issues these departments have and your willingness to respond and report progress to them goes a long way for these departments to feel connected to your facility management department.

In some cases, you can meet periodically with these organizations and develop an informal “service level agreement” with them if their needs are significantly different from the needs of the rest of the organization.  Having alignment meetings relating to your facility management organization’s performance with respect to their departmental needs and reporting these results in your reports to your management also elevate the status of your facility management organization.

Recommendation 5 — Provide Extra Services that are Recognized and Valued by Your Organization.

The Facilities Management Department has connections and relationships throughout the entire organization.  Offering to help in ares such as strategic planning, disaster recovery planning management, emergency response, providing input , design and review within the design and construction process, interfacing with the real estate acquisition and leasing process, are examples of activities that can elevate top management’s perception of the facility management department and provides you and the facilities management department a voice relating to the strategic activities of your organization.

Extra services also include providing customer satisfaction results both from surveys and in depth interviews with the departmental users of your services.  Have the respondents attest to their satisfaction with the various types of services the facility management organization provides and their level of satisfaction with specific buildings or areas within the building infrastructure (e.g., elevators, restrooms, kitchenettes, copy rooms, etc.).

Have you or members of your staff join committees and cross functional teams to integrate the facility management program within the fabric of your organization.  Such efforts are seen by top management as contributing to the facility management organizations’ status as an integral strategic or tactical member.

Recommendation 6 — Seek to Improve Your Organization Using Quality Techniques and Programs of Excellence that are Recognized In Your Industry or Profession.

Recognition programs within your profession for you or your facility management organization elevates the status of your department within your organization.  Recognition can come in the form as awards from nationally recognized organizations such as IFMA, Malcolm Baldrige, BOMA, APPA and  others.  Participating in a and reporting successes in quality programs such as Six Sigma, Malcolm Baldrige, Kaizen, ISO-9000 continues to elevate the status of your facility management organization in your own organization.

Implementing these four recommendations will go along way to elevating the status of you and your facility management organization’s status as a strategic player within your organization.  They also, provide your organization  a comprehensive understanding of what the facility management department does and how it integrates with other aspects of the entire organization.  Your facility management organization will be asked to participate and will be the “go to” organization to serve and provide help relating important aspects of the organization’s business.  Implementation of these recommendations will improve the organization’s perception of the facility management organization and will foster more cooperation and inclusion within higher levels of your organization.

Implementing Quality Within Your Facility Management Program

The concept of quality has different meanings for different organizations and many facility management quality programs available make it difficult to determine which facility management quality program is right for your organization.  Some quality programs provide overall guidance relating to operating your business or facilities management organization.  Other quality programs are project oriented or are focused on incremental improvement of your facility management program.  Many quality programs  implemented in the facility management arena fail for any of a number of reasons including:

  • The cost of implementing and operating the quality program exceed the benefits derived from the program.
  • The focus of a particular quality program is not appropriate for the quality program needs of the facility management program and the program is abandoned.
  • Some facility management quality programs require specific certifications that may be difficult to keep up because of  employee commitment or turnover.
  • Many facility management quality programs take a significant amount of time and an employee’s commitment and involvement in the quality program  may interfere with his or her  regular job duties.  In these cases, the quality program may suffer as the employee needs to be focused on his or her primary duties.
  • Results and deliverables from the facility management quality program may not be acted on and this may have a negative impact on the motivation of the personnel involved with the facility management quality program.  In these cases, the quality program deteriorates and is abandoned.

To get started in your determination as to what is right for your organization, these are some useful steps you can take to determine the correct facility management quality program:

Programs For Smaller Facility Management Programs

  • The size of your organizational unit determines the extent of resources you may have to implement a quality system for your facility management program.  Smaller facility management programs can use simple key performance indicator programs that measure key performance areas that must go right to achieve success. Make sure that these key performance indicators relate to the quality performance areas that are deemed important by management.  Once you determine what these key performance areas are (examples are responsiveness, environmental responsibility, safety, cost effectiveness), determine how you can measure success in these areas from  such sources as your work management system, informal reports, customer satisfaction surveys, and benchmarking.
  • In your facility management program, develop an inspection program where supervisors can systematically inspect work and report issues and successes.
  • For certain preventive maintenance work orders, add inspections into the task list so the worker can inspect his or her own work as it is completed.
  • Implement a proactive quality program where supervisors and managers have periodic responsibilities to inspect buildings and infrastructure and to generate work orders to prevent issues and customer dissatisfaction.

Programs for Larger Facility Management Programs

The larger facility management organizations can implement some of the features for smaller programs but also have the resources to implement more formal programs in place to improve work quality.  Here are some facility management programs that lend themselves to larger facility management programs:

  • Six Sigma.  This  is a program  that requires the organization to identify work areas that are candidates for improvement and to use the Six Sigma process to make improvements.  Personnel involved in the program go through a certification program (e.g., Green Belt and Black Belt Certifications).  Improvement is made by continuously identifying and completing projects for improvement to improve facility management performance.
  • Kaizen.  This Japanese (Kaizen means “good change” in Japanese) program is primarily a continuous improvement program built into the culture of the facility management program from the head of the organization to the lowest level worker.   By improving standardized work processes, the program eliminates waste and adds value.   Constant improvement is made over time.
  • Malcolm Baldrige.  This is an overall management program that uses 7 criteria for improving organizational performance including the following excellence criteria overall areas, (1)leadership, (2) strategic planning, (3) customer focus, (4) measurement, analysis, and knowledge management, (5) workforce focus, (6) operations focus, and (7) results.  The program was developed by the Federal Department of Commerce and a number of State excellence programs use the criteria to make excellence awards to organizations that comply with the criteria.
  • ISO 9000.  ISO 9000 is a program that uses eight criteria for achieving excellence.  When implemented in a facility management organization, the program requires a strong process documentation program that the facility management organization uses to “say how and what they are going to do”.  The ISO 9000 Certification program examines these documents and determines whether or not the organization “is doing what they say they are doing”.  The program is primarily used  in facilities management programs that must comply with government regulations and law. This program uses standard operating procedures to govern facility management activities.

Implementing and continuing any quality program will result in improvements in your facility  management organization.  However, be mindful that these quality programs take continuous commitment from your organization.  Once you implement a program, report the results and improvements to management.  Facility management programs have the tendency to “do the work” and not report the successes achieved.  Management must know of these facility management successes which, results in trust and improved credibility within the organization.  Good luck implementing your facility management quality management program!








Facilities Management Issues Reduction Checklist

You are a head executive at your organization and responsible for multiple departments. One of which is the Facilities Management Department and you are having growing concerns about this department as you are experiencing problems and complaints that need your attention.  The following checklist organized by various categories of problems provides a list of preventive and corrective actions you need to implement to resolve these facilities management issues and improve the performance of your Facilities Management Department.

 Lack of Control of Your Facilities Organization

When your organization lacks control, these measures and recommendations will help you resolve facilities management issues relating to a lack of unity of direction, control of facilities related costs, and the level of satisfaction and expectations of the building occupants and visitors.

  • Hold periodic operational meetings with your facilities team to reaffirm responsibilities, identify facilities management issues, discuss path forward projects, establish measureable expectations, and to provide deadlines for deliverable results.
  • If you have not done this, establish budget responsibility to your facilities organization and have them prepare monthly budget variance reports for your review and be prepared to discuss budget performance and variances where appropriate. This will help you identify facilities management issues where budgets performance is poor.
  • Develop informal service level agreements with your Facilities Management Department that delineates the scope of services and delivery expectations.
  • Have the Facilities Management Department conduct an annual client satisfaction survey to rate the occupants’ level of satisfaction with facilities related services and the building infrastructures and areas they use or occupy. Solicit comments from the respondents to develop action plans for resolving relevant complaints and follow up on these action plans.
  • For larger facilities organizations, have them submit to you an executive annual report that contains such items as operational accomplishments by department, client satisfaction surveys, accomplishments in such areas as building maintenance, custodial operations, landscaping, environmental responsibility, quality program efforts,energy, mailroom operations, shipping and receiving, benchmarking with other organizations or through an facilities association such as IFMA, APPA, or BOMA, completed and future capital renewal and improvement projects, and key result performance. You can use this report for forwarding to other executives and departments to keep them apprised of the  Facilities Management Department accomplishments and also to keep the facilities organization motivated to continue to improve.

 Poor Facilities Management Issues

Facilities management issues relating to poor training, inaccurate self perceptions of management style, poor work motivation, and problems arising from not having a back up plan when employees leave the organization contributes to poor productivity and service.  The following actions alleviate and prevent these facility management issues.

  • Require the Facility Manager or managers to get appropriate management training in those areas where weaknesses are perceived is an important factor in preventing facilities management issues.
  • Require the Facility Manager or managers to have a 360 review from their co-workers and employees to get valuable feedback relating to how they are perceived and the bad and good qualities they have.
  • Obtain an outside review of the facilities program and building infrastructure from a qualified consultant who views themselves as proactive and positive change agents and not as auditors out to criticize someone. Such consultants can motivate the Facility Manager and managers to change and to get credit for accomplishments relating to these consulting efforts.
  • As a last resort, if the Facility Manager is not performing, terminate the person but do so in a humane and positive way and solicit a firm that helps these terminated employees find work more suitable to their capabilities. Make sure that the poor performance is appropriately documented before beginning termination procedures.
  • Have a good succession plan in place with internal or external candidates for all key positions in the facilities organization. Such a plan includes training and mentoring programs for the more junior employees who will eventually become candidates for promotion and advocates of best practices preventing future facilities management issues.

 Lack of Responsiveness on the Part of the Facilities Organization

Facilities management issues relating to the perception that the facilities organization is not starting and completing work on time creates dissatisfaction and undermines the perception of the effectiveness of the facilities organization.  The following positive measures will improve responsiveness and timeliness of work.

  • Through your work order management system, measure how long it takes to respond to and complete work orders by type of work priority category. Examples of work priority items are emergency work, urgent work requiring corrective action in one day, routine repair requiring a week to fix, and preventive maintenance. Link monthly performance results to key result areas that will have an impact on individual performance reviews and bonuses as well as reported organizational performance.
  • Sometimes, facilities management issues are due to a lack of critical parts retained on site, slowing down performance. If your organization does not have a critical parts inventory that is updated, a stock-out may have an effect on adequately responding to critical repairs and maintenance.
  • Having an inadequate combination of skill sets with your full-time maintenance staff on site may require additional training to achieve a multi-skilled work force. At least annually, take an inventory of the skill sets needed to perform the work required (i.e., welding, plumbing, carpentry, furniture repair) and determine what specific types of training are needed for your staff. If you have a multi-skilled workforce, sometimes having back-up subcontractors available to do work is a solution if the workload presents a capacity, skill, environmental, specialized equipment availability, or safety issue. Do not overuse subcontractors as “per call hourly rates” are high relative to using the in-house work force. The key is to optimize the balance of in-house labor and subcontractors to insure cost effectiveness.
  • As each facility staff member gets work assigned to them, they must be given a sufficient amount of work orders to accomplish work for the day. This assignment establishes an expectation for them each day to complete work and if not, discuss why the work is not done with their supervisors.
  • Discuss priorities with the occupants who order work. Communicate guidelines to the personnel authorized to have work requested for the different levels of priorities to be used. This will contribute to a positive perception and expectation of the Facilities Management Department with respect to work responsiveness.
  • Have maintenance personnel provide notes to the requesters relating to the status of work including when the work was completed. Sometimes requesters are unaware of that work is completed and may issue a complaint not knowing this.

Poor Customer Satisfaction

Facilities management issues directly relate to the occupant’s perception of the the quality of the facilities related services provided and their perception of the condition of the buildings they work in.  The following measures will help you acquire a better understanding of this level of satisfaction and provides a foundation for action plans to manage and make improvements to work processes and the service levels.

  • Develop a customer satisfaction survey to measure, (1) customer satisfaction relating to various categories of work performed such as plumbing, restroom cleaning, electrical and lighting services, and (2) customer satisfaction relating to various facilities such as the administration building, the library, the recreational room, Building 100, cleanrooms, laboratories, and data centers. Ratings can be on a scale of 1 to 5 for example. Ask for comments in the survey and provide a drawing for a prize for responding. After obtaining results from the survey, develop an “action plan” spreadsheet to track corrective progress for people assigned to follow up. Report the results of the action plan to management is key to reducing facilities management issues.
  • Conduct in-depth interviews with some of the major people in your organization who will have a lot of influence on the overall organization’s perception of the facilities organization. Many times, you will find out that the results of these interviews will indicate satisfaction or dissatisfaction that does not show up on surveys. Again, an action plan should be developed from this feedback. Without an action plan these types of facilities management issues will persist.

Poor Work Quality

Facilities management issues relating to work quality basically mean that there may not be a formal program in place to improve work processes, provide better leadership, report work results, make proactive inspections to identify problems relating to the facilities, inspect work as and after work is completed, or treat facilities personnel properly.  The following are some measures and programs that will help you improve work quality.

  • Have your managers and supervisors conduct proactive work inspections of the facilities and the completion of specific projects. Proactive work inspections reduce the times when the occupants have to submit a work order. Facilities are improved or fixed before the building occupants complain.
  • If you have a large facilities organization, implement quality programs such as Six-Sigma, Kaizen, ISO-9000, and Malcolm Baldrige as a foundation for achieving excellence. Each of these programs have strengths and weaknesses and require further investigation to see which programs are right for your organization. Just make sure that the cost and efforts of implementing these programs do not offset the benefit.
  • Poor work quality also may result in a lack of training which will require on the job, Internet, and/or third party training.  Training promotes multi-skilled, motivated, and promotable employees and solves these facilities management issues.
  • Conducting root cause analysis is another process to identify mistakes, failures, and issues, and to analyze them and to develop methods to minimize these facilities management issues from happening again.  Develop a root cause process and to formalize the process of identifying and analyzing problems and developing processes and training as part of your process improvement program.
  • Document and or flowchart major work processes so employees have an understanding as to what is expected of them.  Accountability is a strong tactic to reduce facilities management issues. Such flowcharts and procedures establish work responsibilities, provide the correct sequencing of work activities, and define the deliverables and results expected. Having a technical library or databases will also be a source of  information readily available for your facilities personnel. Some of this information can be accessed through a web portal reducing the amount of paperwork.  Updates can be made without reprinting volumes of information.

 Poor Environmental and Safety Responsibility

Facility management issues relating to environmental responsibility and safety have become extremely important to organizations providing and receiving facilities related services.  Building occupants are more attuned to environmental issues and can be very vocal when they see environmental issues or problems.  The following measures will help improve environmental and safety responsibility for the employees and occupants of the buildings.

  • Good alignment with your Health Safety, Security, and Environmental Department or personnel in charge of these functions is important to insuring the safety of building occupants, the protection of the environment, and compliance to environmental laws and regulations.  Having alignment meetings with these personnel to define responsibilities, discuss issues, and to seamlessly prevent or solve environmental issues are important.  In the absence of these environmental support organizations, having a third party environmental professional conduct reviews will mitigate risks, minimize regulatory violations, and will support the comfort and safety of the building occupants.
  • Weekly safety meetings should be conducted including presentations and/or videos of safety topics.  Make sure that your employees sign a sheet that they attended these meetings. Assigning this type of accountability is a good strategy to reduce facilities management issues.
  • On the job safety training techniques should be provided to each employee working in situations where safety procedures or personal protective apparel and equipment are needed.  Safety training should also relate to the use of equipment and in some cases, training for equipment operation requires the employee to be certified such as in the use of forklifts and hoists as an example.
  • Consider developing a “Safety Committee” to seek out potential safety issues relating to the building and grounds.  This committee will be used to document the identification and resolution of these hazards.
  • Designating a “safety coordinator” on site either full-time or part-time (as a collateral responsibility) to insure implementation of safety practices may be appropriate.
  • Using third parties to examine or test various aspects of the safety program and building equipment and systems may be useful and in some cases, these third parties are required to inspect and certify safety areas such as fire safety systems, fire extinguishers, food preparation facilities, and gas lines.  Make sure that these inspections are documented and appropriately followed-up on and reported to management.
  • For your facilities organization, a safety manual is a must.  This manual needs to be updated and employees need to read and sign that they have read and understand these procedures.
  • A safety incentive program goes a long way to promote safety and reduce costly safety related facilities management issues.  Relating awards, bonuses, performance reviews that have safety as a component are important parts of an excellent safety program.

Excessive Commercial Liability

Facilities management issues can be prevented if liability is properly mitigated through insurance.  These measures help insure that risk is mitigated through effective insurance coverage.

  • Your organization has an insurance policy that protects your organization from excessive risks relating to loss due to negligent performance on the part of your employees and others on your site.  However, many facilities organizations do not have an effective or any liability clauses in their contracts to subcontractors and when they do have these clauses, the insurance requirements may not match the indemnification and insurance terms and conditions.  Sometimes the the insurance coverages provided by the subcontractors on their insurance certificates do not match the contractual requirements in the your contracts to them.  In a worse case scenario, working without a contract with a subcontractor may negate the coverage provided by the subcontractor on the insurance certificate.  In these cases when liability exists, your organization may need to seek legal proceedings with the subcontractor who may not have the resources to remedy the liability without insurance coverage.  It is important to have an effective contract drawn up by your attorney to insure that  the insurance requirements in the contract match the insurance certificate requirements.
  • Keeping a file of insurance certificates for your organization’s subcontractors is a must to resolve these types of facilities management issues.  In many cases, subcontractors fail to send your facilities organization an updated insurance certificate on an periodic basis and many of the different types of coverages on the certificate have expired.  Keeping a spreadsheet of these certificates including the coverage periods for the different types of coverage is important. Notify the subcontractor before some to the coverages expire.
  • Maintaining an accurate warranty file also makes it easy to seek remedies for correcting problems on equipment and assets.

These are overall facilities management issues relating to how you can improve the organization’s facility management program.  Beyond these issues and remedies, it is important to implement the measures listed above in a positive people oriented way and to provide awards, recognition, and praise when the facilities organization implements these items.  After all, great facilities organizations are completely dependent upon its employees.  Treating people with dignity, positive reinforcement, and respect will provide a foundation for excellent performance ultimately reducing facilities management issues.

APPA Award for Excellence in Facilities

David Cain, Vice President for Professional Affairs, Awards and Recognition Committee for the Association for Leadership in Higher Education (APPA) informed Soka University of America that they received the APPA award for Excellence. The Award for Excellence is APPA’s highest institutional honor, providing educational institutions the opportunity for national and international recognition for their outstanding achievements in facilities management. Facility Services Partners, Inc. (FSP) is the outsourced Facilities Department at Soka University. The award was provided to the University after examination of a rigorous application and visit by APPA.

Malcolm Thomas, Managing Partner for Facility Services Partners, said that the company was;

…honored to serve the University in its role as the University’s Facilities Department (40 employees) and its contribution to the University in receiving this award.

Please see the video of the awards ceremony including an overview of the Soka University Campus and Facilities Services Partners.


APPA Award for Excellence

How to Serve the 4 Types of Facility Customers

Facility executives have multiple customers to serve when performing their responsibilities. These customers have similar and diverse interests that the facilities executive must coordinate to serve the best interests of the organizations they work for.

This article describes the types of customers of facility and building services organizations and how to effectively serve them.

The Building Occupants

The primary reason for the facilities organization is to serve the building occupants. Creating a comfortable, safe, and environmentally friendly environment is important. The building occupants, when they have a need for facilities and maintenance services, want services to be provided quickly. Most service calls relate to being too hot or cold, having trouble with plumbing or lighting. The primary goal of the facilities organization is to provide these services quickly. Building occupants want to be kept informed of work progress and to know when work is complete. The building technician or custodian providing the services needs to communicate this information to them verbally, through the email system, the work-order system, or by leaving an attached note to let them know that work is done. Discomfort and inconveniences must be attended to quickly.

The Departmental Users of Your Facilities Services

The next customer type is the departmental organization within an organization. Depending upon the organization served, this could be the marketing department of a company, the geology department of a university, the sheriff’s department of a city, the pastor’s office of a church, etc. Beyond comfort considerations, these sub-units within an organization may have specific needs relating to cleaning or maintenance. Facilities organizations must have knowledge of what these needs and requirements are and to appropriately respond to them. For larger organizations, an internal services level agreement may be negotiated between the facilities organization and the using department. These agreements clarify roles and responsibilities and determine the level of reporting and accountability needed. When these departments internally pay for special services, cost effectiveness is important to them as well as responsiveness. If the departmental services come from an overall facilities budget, they may not be as cost conscious when requesting work.

The Overall Organization Itself

The facilities organization has a fiduciary responsibility to be cost effective for the overall organization. This responsibility may, from time to time, be at odds with the requirements of the building occupants and the departmental users of facility and building maintenance services. An excellent facilities organization knows how to balance the needs and interests of these different customers within the framework of the facilities budget and the strategic direction of the organization. For example, a company that is growing fast may want quality services provided as fast as possible to be able to increase revenue faster than the incremental cost increases for faster or excessive services. Other organizations may be short on cash requiring the organization to forego some long-term beneficial capital investments and maintenance projects. It is imperative for overall organization to know financial boundaries, organizational cash liquidity, and to optimize cost effectiveness within the constraints of these boundaries.

Your Employees, Subcontractors and Suppliers

Yes, in many ways, the facilities organization must treat its employees, subcontractors and suppliers as customers with dignity and respect. Good communications and relations with them motivate them to go the extra mile to serve the organization when a special need or emergency occurs. The best systems, technology, and programs cannot work without a highly motivated and trained workforce dedicated to the organizations and people they serve. Balancing all these different customer interests in a positive manner, understanding what success factors are important in a given situation and picking the right course of action will go a long way in your organization to successfully serve its multitude of customers.

4 Savings Areas from Outsourcing Facility Maintenance Department

Facility costs are for many organizations, the second largest expense category behind personnel costs. These organizations largely depend on the capability of a Manager or Director who may have experience with a few organizations in his or her career. These managers usually do not have the support at higher levels in the organization because “facilities” is not a core competency of the organization. It is common that annual budgets are prepared and costs for operations, maintenance, and custodial services are passed on as a necessary cost without much scrutiny.[/one_half] In many cases, the manager of facilities has other responsibilities that are not facility related thereby diluting the required focus to have an excellent facility program.This article focuses on a discussion of the following 4 major areas where outsourcing facility maintenance department save their clients money in the area of building or facilities management:

Labor Optimization Savings

Labor optimization savings relate to having the optimal mix of site based employees from the service provider and subcontracted labor. When this balance is not optimal, excessive costs exist. If an organization has a building maintenance and janitorial staff with inadequate skill sets, in most cases, the organization is spending too much for “per call” subcontracted services when the work could have been done by site based employees. Conversely, if the facilities organization is overqualified and does not often use these skill sets because the work does not require it, high cost labor is providing work that could be done by a less expensive employee.

In some cases, your organization may have two or three groups doing similar activities. In these cases, organizational boundaries prevent an optimal use of labor. For example, at a University, there may be a separate housing maintenance group, a special events set-up group, and the regular facilities department providing similar services. In other cases, organizational boundaries between the custodial staff and the maintenance staff may cause work compartmentalization. One group may have a high volume of work requiring overtime while another group performing similar labor may not have enough work. This is costly.

To optimize labor, the right level of multi-skilled labor must be used on site supplemented by “per call” subcontractors who are used for their specialized skills and equipment or added capacity when the workload is beyond the capacity of the site based employees. Facilities service providers provide measurable savings by having the most cost-effective labor provided on the site as needed.

Process Improvement Savings

Outsource facility service providers, because of their experience overseeing and managing numerous types and sizes of facility organizations, have a vast knowledge base of process procedures that can be appropriately customized and used at their client sites. Savings from process improvement may result in reductions in costs relating to site based labor, subcontracting, procurement of supplies, and utilities. For example, adding processes and capabilities to overhaul or maintain boilers, backflow preventers, gas lines, or kitchen equipment may reduce the “high per call” costs of subcontracting. Developing a process for getting water and electric rebates from the local utilities will save money for the client. Developing a process for building automation strategies may result in reductions in energy costs. These are all examples of work process improvements that service providers can offer.

Personnel Substitution Savings

Personnel substitution savings may occur when your employee is transferred to be an outsourced employee working for the service provider. Though there may be savings from reductions in cost from benefits, this is not an area of focus as the outsourced company must be a company that takes great care of their employees by having competitive salaries and benefits.

Major personnel substitution savings come from a reduction in the overhead costs of the employee when they work for the service provider. In most cases, service providers’ billing rates are less costly than the total cost of the client employee when overhead costs are included in the comparison. Overhead costs per employee are relevant costs when seeking to reduce costs in the long run. Companies and organizations with high overhead costs recognize this area of savings. For companies, overhead costs can be found in their income statement for the annual period. Divide this by number of employees in the company and an overhead cost per employee can be computed (Don’t include overhead such as R&D and Sales or Marketing costs) in these overhead amounts).

Facility Optimization Savings

Facility or building optimization is developing and maintaining a plan to optimize capital improvement and equipment replacement taking into consideration the total cost of ownership of the facility assets. This program from year to year must be able to optimize cost based on the organization’s cash situation, growth and strategic needs, replacement, and improvement needs. Capital expenditures may be recommended, reviewed, and decided on by payback, net present value, or internal rate of return thresholds determined by the customer working with the service provider. Measurable savings come from making the right capital renewal and improvement decisions based the correct balancing of paybacks subject to the liquidity situation of the client organization. Facility service providers have programs and capabilities to reduce costs for their client organizations. Many of these savings can be accomplished by your organization. However, if your organization does not believe that it has these capabilities, using a facility service provider may be a viable option for you.

There are many additional reasons supporting outsourcing to a facility provider beyond cost savings.  Please click here for a detailed discussion relating to the benefits that can accrue to your organization through outsourcing.

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.