Facilities management continues to undergo a transformation, and cost reductions remain the driving force of successful strategies. In addition, the recent events surrounding the massive facilities disruption to building use and the notion of essential versus nonessential businesses reveal major problems remain in companies trying to do more with less. As explained by CIO.com:
“With scores of commercial real estate enterprises active across every global market, the need to manage and maintain buildings better has never been a more pressing concern. FM has long been a behind the scenes operation, hidden from the limelight yet toiling hard to provide an essential service within tight budgets.”
The only way forward lies in understanding the high costs of disruption, how data-driven facilities management overcomes obstacles, and the application of advanced resources to better manage all assets.
The High Costs of Facilities Disruption Are Growing
Disruption in facilities management remains a highly subjective issue. Depending on the value of business and channels used, disruptions can amount to millions in losses per day, and paired with the risk of legal action, final expenses for a disruption could swell into the billions. However, the high costs of disruption are limited by the ability of facilities to respond and mitigate such risks. Again, the value of visibility becomes the determining factor in whether costs will skyrocket or simply change to reflect changing business strategies, which are applicable to both remote-work and in-person environments.
Data-Driven Facilities Management Lets Staff Do More With Less
A data-driven facilities management strategy helps organizations achieve operational advantages. For instance, operational advantages include automation of repetitive routines, smart workflows that react intuitively to changing circumstances, and less asset downtime. Since staff can focus more on their duties and not figuring out what to “do first,” overall costs of labor and resources decline. Moreover, data-driven resource management adds a layer of complexity to budgeting decisions. Instead of relying solely on budget restraints to make decisions, managers can now glean contextual insights to understand the most valuable improvements to make, avoid unnecessary expenses, and make existing systems smarter. The goal is to avoid replacement if the current system can be made smarter without the high costs of complete replacement. Obviously, exceptions exist, but only through data can managers determine which facilities disruption improvements and exceptions are most relevant.
Tips to Reduce Costs and Drive Value Across All Facility Activities
How much is facilities management worth? According to McKinsey & Company, the global market for both in-house and outsourced facilities management will surpass $1.9 trillion by 2024. Outsourcing accounts for more than half of the total value of operations, and the trend will continue. Furthermore, the growth of new service capabilities, such as project management through emergency services, has increased the attractiveness of outsourcing. Obviously, outsourcing is the keyway to derive more value and lower costs, but added measures to achieve those goals include these tips:
- Recommission facility assets with smart, IoT-enabled sensors.
- Implement a newer, centralized CMMS to manage work orders.
- Complete recurring vetting of field service vendors to avoid poor performance.
- Enable scalability of the field service vendor base through diversification of partnered providers.
- Use data to measure performance of assets and workers.
- Create an evolving asset management playbook for navigating turmoil, including facilities disruption caused by public health emergencies, weather-related disasters, and more.
- Integrate, or more commonly interpreted to mean unify, facilities management systems with a preferred vendor, taking advantage of the single pane of glass in facilities management, including vendor and customer portals, as explained by Buildings.com.
Apply the Tips to Reduce Costs and Meet the Challenges of Facilities Disruption Now
For years, we have discussed the idea that facilities disruption is ripe for disruption. The topic usually referred to the need for more technology to disrupt traditional approaches to managing assets and people. Now, disruption is really a misnomer for the unprecedented Black Swan Event of COVID-19. Managers must know the risks of failure to gain visibility and how data-driven processes are the ultimate way to do much more with less through such challenges.