Top 5 Facilities Management Challenges, PART 5

Posted by TIm on October 10, 2009
Stored in Blog

This week we will look at the 5th and final Part of our series on the Top 5 Facilities Management Challenges. tim 155x199 Top 5 Facilities Management Challenges, PART 5

Today we are going to look at the NUMBER 1 challenge (to see the first 4 parts…go to our BLOG. As a reminder, the research we are quoting from was published by Corrigo, Inc who specializes in work order and time tracking solutions. There article lists the Top 5 Facilities Management challenges based on a survey they conducted of over 1,200 companies.

Challenge #1 SAVING MONEY

#1 for this year was, without a doubt, saving money. When asked how they would like to accomplish this objective, the responses of facility managers tended to be grouped into one of three general categories:

Call avoidance
“I’m not sure how many unnecessary service calls we’ve paid for this year,” said one facility manager, “but the number is greater than zero and that’s too many.” The logical first place to look for repair call savings is in avoiding them altogether – or
at least as much as possible. One way companies are doing this is through the implementation of self-help systems. Clients at remote facilities can access basic troubleshooting information before sending out a work request, and managers at central operations can intercept work requests that most likely can be dealt with internally. “Our managers were always calling in with the complaint “The ice machine is broken,’” said one facility manager for a large franchisee operation. “It became just about a weekly routine – I would say ‘Hold the phone near the machine,’ and when I didn’t hear the compressor – which I just about never did – I told them politely, ‘OK – now I need you to go behind the machine and plug it in.’” While this doesn’t represent an automated self-help system, that is the idea behind them, and it’s a good idea!

Warranty work management
This category represents low-hanging fruit for the facility manager looking to save money – do not pay for work that is under wa rranty . As simple as this sounds, tracking the warranty coverage on the large number of complex assets and equipment is a complex task. But the cost of a management system can often be returned to you several fold just by knowing what is covered by warranty and not paying for repairs when you don’t have to.

Price control
While planned maintenance work, by definition, can be budgeted with some degree of accuracy, and prices can be prearranged for regularly scheduled services such as janitorial and landscaping, it is also possible and highly recommended that facility managers set pricing guidelines with their reactive repair vendors. Just because repair work is unpredictable and unscheduled does not mean that you don’t have control over it. Establishing prearranged pricing with your all your vendors, including not-to-exceed limits that require your authority to over-ride, gives you a level of control over the unpredictable nature of facility/blockquote>

SUMMARY FROM SURVEY
Facility Management may be considered a cost center, but it also holds tremendous potential to impact a company’s profitability. A dollar saved by a facility management team goes directly to the bottom line. Which is why cost savings is the bottom line concern for facility management professionals.

What Facility Managers are Doing:
• Avoiding unnecessary repair costs through client self-help systems and knowledge bases
• Flagging all assets and equipment under warranty to prevent unnecessary payment
• Establishing and monitoring not-to-exceed pricing agreements with vendors

COOL CONVERSATIONS APPLICATIONS

1. How many times in this past year have you called a vendor to address an issue to later find out it was the wrong vendor and you had to call someone else? Did you have to pay both companies even though the first vendor was the wrong one? We have witnessed this scenario far too often. “We have stained ceiling tiles so it must be a roof leak,” is a claim of church leaders that is repeated far too often. While a leak in the roof is a possibility, it could also be a plumbing leak or a fire sprinkler leak or an HVAC condensation drain/pan leak. In order to know who is the right vendor to call so that you only pay for the RIGHT service, your facilities team must be able to recognize and evaluate these issues and make a determination based on that evaluation. Now, I am not suggesting that you (or anyone for that matter) will get it right every time, but if you can reduce your service calls by even one, that is real dollars saved.

2. Warranty calls can be a real irritant…particularly if you have vendors that do not want live up to the warranties they committed to provide. But as above, prudence and diligence to understand what labor and materials are under warranty can save the church real dollars. Warranty items are not just associated with new construction or new equipment, although that is the most common. Most labor performed on repair services should have some level of warranty unless expressly agreed to otherwise in writing. When a vendor gives you a quote and you agree to use their service, ask them to include their warranty provisions on the quote that you both sign. GET IT IN WRITING!!!! While verbal warranties “might” hold up in a legal battle, written is always better and gives you the documentation to enforce the warranty with that vendor or possibly their suppliers/manufacturers. Don’t just give in and pay for warrantied work because it is too much of a hassle. There may be emergency situations where you have to involve another vendor to remedy the situation, but keep records or your attempts to resolve the issue with the warranted vendor as well as your costs from the performing vendor and work to collect these funds after the emergency has passed. Again, these are resources that God has entrusted to us…do not take them lightly.

3. NTE…not-to exceed agreements with your vendors will protect the church from unforeseen expenses and will also expedite repairs for those items that fall within the NTE. So, how does an NTE work? As you secure agreements with vendors.. preferably repeat vendors…establish a threshold that you are willing to give them the latitude to make repairs or perform service within a certain dollar range. For example, you might establish a NTE of $500 for your HVAC contractor. If you have a service call because the A/C in the children’s wing is not working, then the HVAC vendor can come to the site, evaluate the issue and proceed with the corrective measures as long at is if under $500. BUT…if it goes even a dollar above the NTE, then they would need to come back to you for approval before proceeding, otherwise they are working for free. This will allow the church to determine if this is the right course of action or if additional pricing from other vendors should be considered. Using this approach can save you time (by not having to evaluate each item under the NTE) and money (by not being surprised by an invoice you were not expecting so you can determine if the cost is applicable before it is performed).

CONCLUSION: I believe that in today’s economy (frankly it should be in EVERY economy because we are stewards of something that does not belong to us) we are looking for ways to save money. Sometimes we can not see the obvious items that will allow us to be more efficient and effective. The principles addressed in this segment are right in front of us. These are not rocket science, but they do require several things:
1. Understanding of what costs we are incurring
2. Tracking and maintaining records of items covered by a warranty
3. Being diligent to document warranties for all work when applicable
4. Establishing processes and procedures that will save you time and money through an NTE process

We trust that you have found this series a helpful tool as we all work to become better stewards of the things entrustred to our care.

If you are coming to WFX in Charlotte, please come by booth 1205 and visit with us. We will be demo’ing our new Room/Space Scheduling Software. We believe that this will be the Easiest-to-use Scheduling software ANYWHERE