Running a property portfolio is complex, especially when each site can vary in age, specification and location. There’s a myriad of factors that go into creating a holistic FM strategy and all too easily, delivering this strategy can become overly-time consuming and challenging to get ahead of.
The ability to outsource FM services is nothing new, however, the drivers that make it a strategically savvy decision have. To begin with, outsourcing is no longer seen as getting someone else to do the dirty work. It’s about bringing on board a strategic delivery partner with the expertise, capability and knowledge to drive cost-savings and efficiencies alongside improved service delivery.
Added to this is the leap in innovation that has transformed FM, taking it from a handyman-type role with a bucket and screwdriver through to a sophisticated business enabler utilising advanced data, proactive measures and whole-lifetime building planning approaches.
The benefits of outsourcing are significant, from enhanced flexibility and reduced risk through to increased compliance and access to a skilled and mobile workforce on-demand. It can be challenging to position FM as a strategic contributor to success but the clever use of data alongside a well-articulated strategy of what future success could look like is difficult to argue with.
Stakeholder opinion counts
It’s important to present a thoughtful and well-evidenced business case to support the bid for outsourcing to ensure that all stakeholders are aligned in the decision. There will be many benefits that will be of importance to the business, such as freeing up time to focus on new developments or benefiting from a better geographical spread of skilled manpower. There’s also the art of the possible such as how a new partner may be able to bring better reporting capability or expertise in a specific building type.
Future cost savings may come at an up-front price
It’s important to analyse and understand the full financial impact of fully-integrated FM outsourcing versus in-house arrangements and to have explored where there may be immediate cost implications to gain longer-term efficiencies. It’s not always as simple as assuming that an outsourced provider can do exactly the same as is being done currently but at a lower cost as it could be that the specification for outsourced work may be slightly different or investment may be required in buildings or technology to maximise the future potential of an outsourced partnership. Getting this right, however, including learning curve costs and some risk/incentive pricing guidelines, may show that initially, the true provider costs are equal to or greater than performing the services in-house. It is likely, however, that in the longer-term outsourcing FM will save an organisation money.
Step by Step Guide to Switching Facilities Providers
Keep in mind what matters to the users of your property portfolio
From a flickering light in the lift to a dodgy toilet that just won’t flush, building tenants have little tolerance for the basics that just aren’t right, especially if future major works are planned. There are also increased expectations of what a building will offer, such as high-speed wi-fi, energy-saving fittings and increased security. A strategic partner will understand the importance of your occupant experience and be able to advise you on the right approach to develop your portfolio in an efficient manner whilst still delivering on appeal.
Know how success will be measured
With the increase in smart technology and reporting capability, facilities managers are becoming increasingly knowledgeable about the optimum performance of their buildings and therefore how to link service expectations around quality with reward to an outsourced partner based on performance. Targets can vary across operational, financial and satisfaction categories but increasingly a balanced scorecard model is being adopted as an indicator of performance. These provide a continuous link between controlling costs whilst delivering successful facilities management services.
Strategic outsourcing is not a compromise. It’s a business decision to bring in the strongest possible business support in the same way legal or HR expertise is utilised. And as with any service that is being procured, it’s fair to expect that the highest quality of service delivery will be achieved alongside controlled or reduced operating cost without one being at the expense of the other. Therein lies the beauty of outsourcing facilities management.
In 2014 an FM Buyer Behaviour Survey of Facilities Managers reported that 40% of customers were dissatisfied with their current Facilities providers and looking for new ones. However, 70% were put off approaching new suppliers because of the lack of information about the sales process. These trends continue in 2020.