0042087 FM 402 - TASKS PDF

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Understanding Facilities Management Strategy

A Facilities Management strategy workshop is scheduled to take place in order for the Facilities Management team to gain an understanding of the need for, and jointly develop the Facilities Management strategy. The briefing paper is to be circulated to all team members prior to the workshop. It will enable the team to identify and coordinate the delivery of the agreed actions identified during the development stage with a commitment to personal and professional development. With this in mind, it will assist in the promotion of staff morale and relationships through recognition and award, and personal development. The following Facilities Management criteria will be covered: 

How a Facilities Management strategy is developed and how it relates to the organisation.

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Risk profiles in different organisations and how they influence strategy.

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How to monitor progress and how the results can influence the strategy.

How a Facilities Management Strategy is developed and how it relates to the Organisation A good understanding of the organisations business plan and defined strategy, showing the vision and the mission of the organisation, is the foundation for developing the Facilities Management strategy and how it is to be supported in the short, medium and long term. It must take in to account the needs and the demand for services and how best to meet them. The strengths and weakness of the organisation as well as the external opportunities, also threats must be identified. The Facilities Management strategy must make goals that attain the mission and thus reach the vision. It must be reviewed regularly to ensure that any necessary adjustments are made to continue giving excellent customer service. To understand the development of Facilities Management strategy and relationship with the organisation the following must be taken in to account: Objectives of the Strategy

The Facilities Management strategy needs objectives to aim for, in an organisation. These could be to provide a: 

Safe and secure working environment in support of the internal clients.

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A building and space that is fit for purpose.

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Range of FM Support Services that meet business needs to ensure core business is effectively and efficiently supported.

1.1 Key components of the Facilities Management strategy including its drivers, measures and objectives In order to develop a strategy, one must first know what a strategy is and in what ways to effect it. As such, a strategy can be defined as: What is strategy? “A strategy is a plan of action designed to achieve a particular goal” In this case – the goal of the Facilities Management Strategy is an action plan specifically produced to have a beneficial effect on the function and business success of the organisation and is tailored towards and aligned with the overall business strategy. Ultimately, the goal is to be better than our competitors are.1

What is FM “Facilities Management is the integration of processes within an organisation to maintain and develop the agreed services which support and improve the effectiveness of its primary activities”. 2 1

http://en.wikipedia.org/wiki/Strateg

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http://www.bifm.org.uk/bifm/about/facilities

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There are three main aspects to consider when defining a FM Strategy, they are, the premises, building operations and support services. A good understanding of the organisations business plan and defined strategy, showing the vision and the mission of the organisation, is the foundation for developing the FM strategy and how it can be supported in the short, medium and long term. It must take in to account the needs and the demand for services and how best to meet them. The strengths and weakness of the organisation as well as the external opportunities, and threats must be identified and analysed using the SWOT analysis. (Strengths, Weaknesses, Opportunities, Threats). Another method of analysis is PEST, (People, Economical, Social and Technological) – to be addressed when thinking about strategy. The FM strategy must make goals that attain the mission and thus reach the vision of the company. Regular reviews are to take place to ensure that any necessary adjustments are made to continue giving excellent customer service.

In order to understand the development of a Facilities Management strategy and relationship with the organisation the following must be taken in to account: Future Thinking This involves analysing and projecting what the future needs of the business are. Is it expanding or consolidating, opening new levels and diversifying or branching out? What will the future requirements of the organisation be?

Strategic Intents Fully understanding the key strategic themes within the business will inform decision making during FM Strategy planning. The Vision

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Communicating the vision to all levels and employees as to where the organisation is heading and its future intent allows the company to set goals.

Aims and Objectives The aims are about the long-term business targets and future goals. The objectives are the ways in which these aims are to be achieved. Drivers We also need to be aware of what is driving the Facilities Management Strategy. These drivers are internal and external, factors which are forcing the decision making process early on in the strategy planning stages, all of which must be taken into account: Internal Drivers 

Budgets – Have they been carefully planned or guessed? How much funding do we need to apply the strategy to the business?

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Types of property – How is the space within the property utilised? Is it working at full potential or does the strategy need adjusting? Does the company need to move to a more suitable location?

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Attitudes – Management, Staff and services employees all need to be aware of how the strategy affects the core business. Do attitudes need addressing or changing and is there a communication process in place allows this?

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Policies – Being aware of company policy and how it affects business.

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Legal Position

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Product/Sector – Depending on which affects what type of services we use and how the strategy is best suited to portray the company image.

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Organisations Strategy – The vision, mission, goals and objectives.

External Drivers 

Legislation – is the company complying with current legislation? Are we aware of changes? 0042087 Page 4

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Economics – Is the company aware of the state of the current global financial market?

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Competition – Are we in touch with other businesses in the same sector and how our performance is compared to theirs.

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Mergers and acquisitions – Are we in a stable business position or are we about to be bought out? Do we need to bring other business on side to improve our market position?

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Entering new markets – Is the company in a position to diversify, expand and grow?

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Costs of commodities, materials and supplies – Can the company afford to pay for services and supplies or do changes in cost require a change in FM Strategy?

Measures A number of measures can be taken to ensure that the FM Strategy is functioning as planned and aligned with the company strategy, these include internal and external measures and can be viewed as measurable targets and outputs: Internal Measures 

Monthly audits and returns

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Energy consumption data

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Measure accidents and incidents

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Employee retention

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Meeting waste targets

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Customer feedback

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Complaints

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Productivity

External Measures ISO 14001 is an internationally accepted standard that sets out a framework of essential elements for putting an effective Environmental Management System (EMS) in place. The standard is designed to address the delicate balance between

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maintaining profitability and reducing environmental impact. With the commitment of the entire organization, it can enable you to achieve both objectives. 3

Certifying your company's environmental management system to ISO 14001 means that a third party, such as the British Standards Institution (BSI), has assessed it meets the requirements standards. .4

Objectives

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http://www.bsigroup.co.uk/en/Assessment-and-Certification-services/Management-systems/Standards-andSchemes/ISO-14001/ 4

Course notes

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The objective of the FM Strategy is to produce a safe and secure working environment that is fit for purpose and is functional. The FM strategy will be in line with the business strategy and provide direct support to the business needs which adds value to the company. 1.2 The Importance of the Strategy to the Facilities Management Function Having developed a Facilities Management strategy in accordance with the direction of the organisation, the risks are manageable. The strategy gives direction for the Facilities Manager to achieve his goals, targets and objectives. It also gives indicators for whether they are achieved, and allows progress to be tracked and measured. The strategy can also assist in evaluating the need for improvements and changes in training staff, purchasing new equipment and sourcing new contracts thus giving extra value to the business. The strategy is likely to have a direct impact on the real business (client) customers. The strategy should include direction to the FM operation, allowing department tasks and objectives to be devised according to the SMART acronym. 

Specific.

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Measurable, Meaningful, Mission

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Achievable, Attainable, Agreed

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Realistic, Results orientated, Rational, Relevant

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Time, (Time bound & focussed)

A point to note when setting objectives is that we must be ethical and environmentally responsible at all times (SMARTER).5 By communicating the Facilities Management Strategy across the organisation it will educate the end-users, raise the FM profile and let others see us as more professional. Understanding the strategy gives a benchmark and indication of performance level requirements. It provides something to perform against with measurable outcomes.

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Course notes

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Our FM contractors and suppliers will be able to tailor their services to meet the needs of our new Facilities Management Strategy. One important aspect of establishing the FM strategy is that the resourcing of services can then be determined. Typically the resource strategies are:

In-house – where the organisation takes the responsibility of providing the services through directly employed staff across the whole service provision. The In-house team will be matched to the organisation or functionally with specific areas of responsibility across the service range depending on types and numbers of services required and the structure of the organisation itself.

Outsourced – Where various options are available: 

Single Service Package – This is a single separate contract for each service. One contract for cleaning, one for catering and one for security etc.

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Bundled – where the services are grouped under one contract. In this case, cleaning, catering and security could all be bundled under one contract. Bearing in mind there will be other contracts for building services.

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Total Facilities Management – where an outside agent is contracted to provide and run all the service needs of the organisation.

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PPP/PFI – Government and organisational partnerships where the private sector finances are used to achieve potentially better value for money.

1.3The Relationship Between Organisational and Facilities Management Strategies The FM strategies must align with that of the organisation in both its core and noncore business. The core business of the organisation is the dealing with the primary operations such as manufacturing and delivering. The non-core business is dealing with the supporting activities which enable the primary operations to function. In order to align the FM Strategy we must consider people, technology, product and processes and quality. The alignment must start with the mission and vision of the

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company with input from the business and the customer which gives an overall business strategy. From this, the FM strategy can be made and aligned.

In his 1985 book – Competitive Advantage, Michael Porter introduces a generic value chain model which identifies primary and support activities and how they relate to a wide range of organisations. 7

The model also shows how the support functions of an organisation are working in parallel to support each other function across the business. This clearly shows the need for cooperation and understanding of the Facilities Management Strategy throughout the whole organisation if it is to operate at full potential. The Facilities Management Strategy should align up, down and across with the strategic plans of the business – including core and non- core areas.

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Course notes

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http://www.netmba.com/strategy/value-chain

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2.1 Risk Profiles in Different Organisations Risk is as much about seizing opportunity as it is about limiting downsides and uncertainties. It is about exploring advantages and disadvantages of change management to enable swift and informed decisions that deliver competitive advantage, increased value and other benefits. Organisations will deal with risk in differing ways depending on the sector and the level of risk it takes. Risk Appetite The meaning of risk appetite is your view of risk, /your FM attitude toward the risk that you are willing to take so if you are risk hungry you like to take risk. you see this as an opportunity to take, the company forward ,where risk Averse you see risk as a threat ,something to stay away from as it may damage the company or the policy that you are trying to work to.

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http://en.wikipedia.org/wiki/Value_chain

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Risks can be categorised into two types, pure risk and business risk:

Pure Risk includes: 

Physical acts of nature – flood, storms, earthquakes

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Technical equipment failure

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Personal injury or illness

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Social issues – theft, vandalism, violence

Business Risk includes: 

New or changing technology

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Social change – customer expectations, legal claims

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Economic impact , policy and regulations

Each sector is subject to these risks in varying amounts but it depends on which sector the company is operating in as to how the risks are managed. All risks to the business will be recorded in a risk register but they first need to be identified. Business Impact Analysis (or Strategic Risk Assessment) will identify pure and business risks within an organisation by:

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Analysis of historical data and looking at what has happened to local organisations in the past.

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http://www.pwc.com/gx/en/banking-capital-markets/pdf/risk_appetite.pdf

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Study of technological risks i.e. systems and human errors.

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Analysis of the local environment and how operations have affected the local community for example transport, manufacturing processes and hazardous material storage.

SWOT can also be used to identify potential risks to the organisation by analysing the risk and evaluating the probability of the threat. All risks can be accurately assessed for prediction of events and outcomes. After which risks can be evaluated, recorded, managed and regularly reviewed. Once risks have been identified they must be dealt with, depending on the organisation and sector will influence how this happens. An organisation may be risk hungry in which case some risks could be seen as opportunities, others may be risk averse and take significant measures to avoid risks at all costs. Either way once a risk is thoroughly analysed there are only four courses of action available; Transfer – Reduce – Avoid – Keep. Public Sector The public sector such as a local Council will try to eliminate risk wherever possible as It accounts will be released on a yearly report this report is open source and can be viewed by any member of the public. Always trying to achieve best value for money, the public sector has little or no tolerance for risk so the Public Company will be Risk adverse. Private Sector The risk profiles of both Public Limited Companies and Private Limited companies such as British Telecom and S Tel Private Limited have to conform to recommendations in the Turnbull Report10, which states that: 

They are expected to have a robust system of internal controls to protect the assets of the company and investments of shareholders.

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They must review the controls yearly.

http://www.icas.org.uk/site/cms/download/res_page_spira_Report.pdf

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Have an evaluation of the business risks on a regular basis. The private sector remains flexible and can react quickly to change. Due to this, more back up plans will be in place with contingencies and reserve money. So the Private company is very much risk hungry.

Not For Profit Not for Profit organisations such as Oxfam depend on external funding, whether donations, fundraising events, to survive. The reputation of the not for profit organisation is very important. A not for profit organisation exists for the good of people and if it has a good reputation then people will be more incline to donate larger sums of money as the public will want to see its donations going to the charity not on posh decor. However, if in the case of a crisis and the organisation falter, then donor ship will reduce. So the not for profit organisation is very much risk adverse. The Facilities Management strategy must run in conjunction with that of the organisation in both its core and non-core business areas. The core business of the organisation is the dealing with the primary operations and the non-core business dealing with the supporting activities, which enable the primary operations to function. 2.2 Ways in Which the Risk Profile Influence the Facilities Management Strategy Risk is a function of the probability of the harm actually occurring and the severity of its consequences. It can be managed in different ways depending on the type of organisation that is being dealt with whether it is in the Public, Private or Not for Profit. It also affects the organisation sectors, i.e. Education, retail, manufacturing, etc. Factors to be taken into account include: 

Impact on business productivity, goals that have been set by the organisation.

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Compliance, legislation must be met within all three sectors.

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Local environment. 0042087 Page 13

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Governance – Turnbull Report in the private sector which infor...