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Star spangled facilities management

Ameeta Soni, senior vice president of the VFA

Ameeta Soni, senior vice president of the VFA, updates us on the latest trends and key drivers dominating the dialogue on the other side of the Atlantic.

Organisations in the US are increasingly appreciating the strategic importance of facilities. Indeed, facilities costs are typically the second biggest item on an organisation’s balance sheet after the cost of staffing.

Today, facilities managers are expected to understand their company’s business and contribute to the bottom line in various ways. Well-run and operated facilities ensure business continuity and reduced costs as well as improving the productivity, revenue-generating capacity and organisational image.
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It is of the utmost importance to ensure that facilities are at a level of excellence or performance to support the continuity of the business and the mission of the organisation. In the facilities management role, one continually looks at the things that affect an organisation’s entire facilities portfolio in both the short and long term. These include internal factors such as extended hours of operation or funding to address the deferred maintenance as well as external factors like industry standards, government mandates and the risk associated with natural disasters. The International Facility Management Association (IFMA) recommends that facility condition assessments be performed approximately every three years to obtain the Facility Condition Index (FCI) and create a five-year strategic facilities plan.

Some of the biggest drivers for facilities management today in the US are cost savings and building functionality. With budgets being cut and the economy still mixed, every penny counts. Facilities managers are required to manage more square footage with reduced staff while maintaining high levels of performance. The deferred maintenance backlog in organisations across different vertical markets is growing substantially while their budgets are shrinking. This makes it imperative to prioritise the facilities’ needs and have plans in place for the future. Having solid facilities management practices helps organisations to streamline and prioritise spending, based on key categories such as life/safety issues and critical needs using the FCI. Various building standards must also be met to keep buildings in code. There are pressures beside due to the need to comply with federal, state and local governmental regulations.

As society evolves, buildings designed or built 25 years ago are being used for an entirely new set of applications. Maintaining the functional adequacy of buildings as well as the condition of existing buildings minimises the need for large investment to build new facilities. Organisations make portfolio rationalisation decisions based on important demographics, functional adequacy, property condition and projected operating costs. This issue is becoming increasingly significant as a large percentage of the facilities in the US are approaching the end of their planned working life.

Frequently, FM outsourcers such as CBRE, Johnson Controls or Jones Lang Lasalle manage the entire FM operations for one organisation. FM outsourcing has traditionally been more prevalent in the UK but is becoming increasingly popular in the US. It was initially adopted by the corporate sector in the US but is now being implemented in other sectors like education and healthcare as well.

Sustainability is now being addressed for existing buildings in addition to new builds. There are mandatory regulations in place for federal, state and local government facilities. In the corporate world, companies focus on sustainability as part of their corporate social responsibility programmes and public image efforts. In the education sector, it is the students themselves that are driving schools to develop sustainability and green programmes. Organisations have begun to incorporate it into business goals and culture, and many have integrated it into their company strategies.

The extent of implementation varies across organisations and markets. US organisations want to focus on sustainability but to do this, they need to be able to fund these initiatives and find ways to do so. Often, they will start off with certain low cost initiatives and use the savings from these initiatives to fund future green initiatives. Green efforts are currently most focused on the energy initiatives. By focusing on programmes to reduce energy consumption, facilities managers can provide hard savings data to support additional green initiatives and other operations.

Facilities managers add value to their organisations through the increasing usage and efficient management of technology. While more and more companies are looking to software tools for facilities management and capital planning, as data becomes increasingly complex and voluminous. Technology tools can help convert the large amounts of raw data into meaningful information for intelligent decision making.

Facilities managers are leveraging new technologies to address the increasingly complex building systems and controls for the short- and long-term management of facilities. Building Information Modelling (BIM), a new generation of systems and processes, provides a 3D representation of a building and contains database storage mechanisms for properties and all of the elements of the building. It can be used at the design, bidding or construction stages and throughout the operational life of the facility. The most valuable use of BIM for facilities management is the information embedded in the model. With advanced planning and standardisation, the information within the model can be automatically extracted and used to populate the information systems needed to operate and maintain the facilities over their life cycle, eliminating costly and time consuming manual processes.

Mobile tools are making remote facilities management a reality. New mobile apps and remote connectivity are redefining the approach taken by modern organisations. These mobile apps enable both the monitoring and controlling of building systems and other equipment. With remote access, facilities managers can monitor facilities more frequently and easily. This is especially key for the critical facilities. While these new technologies are truly helping people improve operational efficiency, it is important to remember that an easy and intuitive user interface with minimal configuration is critical to the tool adoption and usage.

Thorough training is important to make sure that the FM professionals develop a strong understanding of the most appropriate technologies, processes and tools to get the most out of them. Facilities managers also need to develop business skills to perform the ROI analysis, develop the strategic facility plan and better present the business case to senior management.

Facility Condition Index (FCI)

The FCI is the ratio of deferred maintenance or problem dollars to replacement dollars. It is the most commonly used index in the industry as it applies to assessments and rating buildings in comparison to each other. The FCI provides a straightforward comparison of an organization’s key real estate assets.

A higher FCI indicates the need for higher investment in your assets. An excellent rating between 0% and 5% usually represents newly constructed buildings. For older existing buildings, a 5%-10% range is desirable.

Comparing buildings using the FCI rating enables facility managers to prioritise maintenance activities and capital investments.

Extract FMJ September 2012


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