In the struggle to win contracts and be the best, new and evolving benchmarking processes might be key to gaining the edge says Gary Barbour at Autonomous FM
A benchmark, in layman’s terms, is a standard or point of reference against which things may be compared. And benchmarking is widely considered a crucial business tool.
In business, benchmarking is about comparing processes and performance metrics (quality, time and costs), whether internally between divisions, teams and sites, or externally against other companies and industry best practice. It’s a competitive world and organisations are fighting to win business by being the best. Benchmarking helps clients to understand how successful a company is at delivering its services, which in turn enables informed and considered decisions.
The service sector, in particular, should not underestimate the value of benchmarking. Without it, how can you ensure you are getting the best value from your providers, whether in-house, outsourced or a mixture of both? Benchmarking allows both facilities managers and FM service providers to honestly measure where they sit within the industry, based on success and performance as opposed to turnover, reputation and company size.
Internal benchmarking is another form of measurement, although it’s important to understand its limitations. Understanding the ins and outs of your own business only shows half the picture. You also need to look at what’s happening outside. It’s easy to fall into the trap of assuming you’re uniquely offering a style and service that’s not only bespoke but also the best value, based on comparisons with your performance on old projects or contracts. But at the end of the day, your competitors might be doing it cheaper and faster.
PROVE YOUR WORTH
Business decisions can be ruthless and, particularly in the world of facilities management, often comes down to cost savings. While making sure you’re the best at something is important, especially when you’re providing a service, it’s worth remembering that the decision-makers on the client’s side will be thinking hard about cost. So it’s important to be able to back up your worth, and benchmarking helps provide this tangible evidence. It also inspires a competitive approach.
But while cost is one of the most important factors to benchmark against, it should not be the sole focus. Other factors matter – such as quality and delivery.
External benchmarking allows you to determine how you’re performing in comparison to competitors and market leaders. But how do you determine what data will give the most useful results? The growing volume of data available at our fingertips can seem overwhelming, leading many service providers to fear benchmarking rather than exploit it for the useful tool it is. And it’s true that obtaining like-for-like information that’s reliable and easy to compare is a challenge.
European Standard EN15221-7, Guidelines for performance benchmarking, states: “Financial comparisons can be an appropriate basis for a benchmarking process as quantitative data are often more easy to reach and more easy to relate to than qualitative data. Historically most benchmarking in facility management has focused on this kind of ‘hard’ data. However, what one can learn from quantitative data may be limited. This standard therefore tries to establish performance benchmarking as a data comparison method to support development and learning processes through some types of qualitative knowledge sharing.”
Before beginning any benchmarking exercise, or building it into your business or service model, you need to establish: what process or service you are looking to benchmark; what your key performance metrics are (cost, quality, time); which providers and areas you are looking to benchmark; how you can collect the data on performance and practices; how you will analyse the data and identify opportunities for improvement, and if and how you can adapt and implement the results of the benchmarking, ultimately deciding on any reasonable goals.
What if benchmarking moved towards an (almost) live solution, as opposed to the current retrospective model? If we can look at what is currently going on, as opposed to what has already taken place, we are better situated to inform clients and become even more competitive as service providers. Through innovative and emerging FM delivery models and use of ‘big data’, a new form of benchmarking could indeed emerge.
Near real time benchmarking (NRTB) forms part of a new, evolving delivery model for facilities management and commercial real estate. Using independent delivery models and internet of things (IoT) information, the FM provider can begin benchmarking at the point of service delivery rather than six months to a year down the line, as is the industry norm. This new model allows delivery to become instantaneously more efficient, as the benchmarking is ongoing, not merely part of a performance review.
This updated benchmarking model has the potential to monitor performance in line with KPIs in real time. It measures against both contractual KPIs and industry standards. Through the use of IoT equipment, it measures the real-time data at the point of delivery with quality, cost and time comparisons all gathered within the space of a minute. This use of business intelligence (BI) in NRTB means the client is able to view instantaneous benchmarking at any stage they require.
Big data has the ability to enable greater accuracy in benchmarking than ever before. The process should follow a specific pattern of collection (data collection), deciphering (data processing), comparison (data analysis) and solution (data execution).
When we talk about big data, too often we focus on office occupancy and the maintenance elements of a building, but the model can be transposed into any scenario. For example, in terms of cleaning – which forms a large part of a soft FM service – market benchmarking can gather information from multiple contracts, along with industry data and pricing documents.
When an order for cleaning goods or equipment is placed, it can be checked instantly for best value, compared to the market data. Cleaning trends can also be monitored and compared. Additionally, the use of IoT, for example a sensor on a soap or towel dispenser, can determine how often areas are used and whether the costs are comparative with the industry.
The potential depth of data can seem overwhelming, but its benefits outweigh any reservations. The ability to offer clients such an intense array of data can set a service provider contract apart from the rest. If knowing a little about your site, and how and what has worked or hasn’t worked in the past, is useful – then knowing everything about it, in real time, has to be more advantageous and helpful in constructive decision-making.
Big data has the potential to significantly reduce the cost of FM services. By including big data in benchmarking activities, the industry can offer higher quality services, enabling workforces to make more effective decisions and run departments more efficiently. It will also help FMs identify strategies for increasing employee productivity and engagement. As we develop more comprehensive databases and gain new performance insights, these new FM benchmarking results have the power to provide services more efficiently and at a lower cost. This is true at every level of the industry, from the smallest business right through to international corporations.
The NRTB process enables full visibility of services, unique to each customer and contract. It means clients no longer have to wait to see evidence of cost savings and improved performance. By harnessing the power of BI, big data and the IoT, we can finally start to bring about the true revolution of the FM industry.