Deal with the essentials to avoid a mess

Published on Wednesday 3 March 2004 00:00

THE facilities management market in the UK is worth an estimated £100 billion. But while it is clearly a major industry, the fact remains it is little understood by many chief executives and managing directors.

The reason for such lack of comprehension can be attributed largely to apathy. Few, if any, company directors are inclined to concern themselves with such matters as the heating and lighting bills or inquire about the expense of cleaning out the toilets or emptying the bins.

But while facilities management, perhaps understandably, is considered by some to be an unexciting aspect of a business, the fact remains that it deals with essentials and is therefore essential in itself.

If an organisation’s staff toilets run out of toilet roll or the cleaners neglect to empty the bins or the staff canteen runs out of milk, then the organisation’s directors will soon hear about it because, ultimately, it is the basic things in life that matter most.

While the directors who recognise this fact might be few and far between, those that do reap the rewards through a content and productive workforce and a correspondingly healthy bottom line. And according to a recent survey, facilities represent the second highest expense for most companies after payroll - a finding perhaps not entirely divorced from the fact many directors choose not to concern themselves with such "trivialities" as facilities management.

Like all essentials, the provision of facilities is generally taken for granted and its true value is only recognised on those occasions when such provision falls below an acceptable standard or is intermittently absent. And because it is by definition a non-core activity, most organisations of any magnitude will outsource responsibility for their facilities.

Such outsourcing contracts are often substantial - with values running to hundreds of millions of pounds - and the typical scenario is that while an initial figure is agreed for the delivery of the facilities, the organisation will then seek to make savings on that figure over the term of the contract through setting challenging targets for the facilities provider to meet.

The challenge for the contractor, then, is typically to downsize its operations and to become more efficient without inflicting damage on the organisation throughout that process. That challenge is almost impossible to meet without a sophisticated information management system enabling the measurement of performance and highlighting those aspects of the service that require attention or the identification of areas where cutbacks might be possible.

Fortunately, the latest generation of internet-based knowledge management tools enable both suppliers and organisations to continually measure and manage their operations in real-time, so that directors will be able to share information simultaneously among a number of locations to a number of users, thereby facilitating collaboration, transparency and the transference of knowledge.

Such a performance measurement tool is invaluable in that it can provide directors with pertinent, valuable, accurate and timely information at their disposal as and when they require it and upon which they can base informed decisions.

This is because a sophisticated web-enabled knowledge management system can effectively filter information, hone in on particular aspects of an organisation’s operations and assist in the identification of particular issues that need to be addressed. A key factor in the value of such a system is the unprecedented degree of dynamism it is able to deliver.

Consequently, directors would be well advised to reconsider their regard for facilities management. While it may be viewed as the least sexy side of operations, it is, nevertheless, an essential part of all firms - and choosing to ignore essentials invariably proves to be an expensive mistake.

• Frank Cullen is a director at g2 Business Services and former managing director of ntl Scotland