Companies can’t afford to neglect the facilities management category. While the influence of facility operations on the overall success of an organization vary depending on the industry, certain problems can arise regardless of this category’s role. For example, the level of service can become inconsistent, the scope of work might have reduced or expanded, and overlap among suppliers and their services can occur.
All of this leads to a bloated category where your spend will inevitably sneak up higher than you–and certainly any board member–would ever want. If you’re in this predicament, then you’re likely looking to source new suppliers to help get things back under control. But where do you start? Like any other category, sourcing for facilities management can be challenging. Here are the steps involved that will help you through your sourcing efforts.
1. Determine which areas Are most important
The first step in sourcing facilities management is to get organized. It is here that you will determine which subcategories you will review and take into consideration for sourcing new suppliers. It could be janitorial services, commercial landscaping, waste management, or whichever area you decide is important. But you’ll want to prioritize them based on which one has the biggest impact on overall operations. The following elements should be examined to help you prioritize:
- Existing contracts
- Total cost of contracts
- How critical the service is to operations
Next, look at primary reasons that necessitate change. For example, it could be consolidating certain services if they’ve become too decentralized and spread out over too many properties and suppliers.
2. Establish A Baseline
The data you collect from determining which categories you will focus on will help you establish a baseline. Depending on which categories you will be sourcing, this could be fairly simple as there will be an abundance of relevant historical data to pull from. However, other areas may prove to be more difficult.
Since many of the suppliers managed under this category are very service-centric, it can be a real challenge to collect the data needed to give you a solid baseline. Labor hours and/or materials costs are often not tracked, and without this data it’s difficult to forecast the savings you’re trying to achieve. If you’re in this situation, not all is lost. You can develop your own methodology for calculating the savings you’re after, or you can request that all suppliers provide line item invoices for more detailed information so you can then revisit the data next quarter or in six months to establish your baseline.
3. Category Management
Once the sourcing is completed and you’ve awarded contracts to new suppliers your focus will be on managing facility maintenance category, including maintaining contracts and supplier management. It’s important to have the right resources available to effectively manage the category moving forward. Your options here include investing in facility management software or hiring a third-party management company. Either way, proper, ongoing management of this category is essential to prevent it from getting out of control.