Monday, November 17, 2008

Growing Importance of Corporate Social Responsibility

There is an increasing emphasis on what is now generally labeled “CSR.” This emphasis takes many forms, including shareholder and external stakeholder interests, increasing legislative requirements, and corporate desire to do (and receive credit for doing) “the right thing” for the environment. But CSR goes far beyond the bounds of environmental interests, although that is where its original basis is found.

Green is good business. Whether their focus is construction, operations, technology, or any of the other competency areas, FM’s and the product and service providers who support them have gotten the message and are acting positively. This was not always the case. In the early days many FM’s tried to look the other way, fearful that “Green” would be just another fad. Many simply didn’t want to deal with it. Reality, however, has a way of changing our perspective. When Green moved from being a fringe agenda item to being a centerpiece of boardroom conversation priorities changed. That change came about because leaders were successful at doing two things – communicating the bottom line benefits and positive societal impacts of Green; and nurturing the grass roots support of the ideals, ideas, principles and purpose of the movement. Green is now seen as a societal and moral imperative and has the unwavering support of a growing critical mass, enjoying large corporate support because it has healthy implications to the “Triple Bottom Line.” Importantly, the pathway to Green offers lessons learned to other societal issues.

“Social Accounting” is a term FM’s should become familiar with if they aren’t already. Familiar with, comfortable with, and competent at, one suggests. Social Accounting refers to the ability to apply meaningful measures to the impacts of corporate social policy. While relatively easy to do when talking about energy reduction and the like, it may be harder to do when talking about other policies. Indeed, debate about the motivation and benefits of some policies may cloud the issue. For example, if a company decides to include a day care center in a new facility is that a decision driven by a desire to do something good for the workforce, the environment, or the company? The answer, of course, is that it is good for all three. Concrete information can be easily developed to support each case. Hours saved commuting to/from childcare, reduced carbon footprint, and improved staff morale and productivity are all measureable and verifiable. And that is the key – measure and verification. Data, facts, understanding, and wisdom are the elements of driving and sustaining change. FM’s have a responsibility to all of their constituents to be able to quantify the societal implications of corporate policy and initiative in real life, meaningful, and actionable terms.

Monday, November 10, 2008

Operating Budgets In Tough Economic Times – To Be or Not To Be A Cost Center

Most businesses these days are facing economic uncertainty. Financial prudence, always important, is especially so in difficult times like these. Businesses that are market driven need to read those conditions and react quickly and forcefully – there is no question about that. However, a rush to act can lead to a mistaken strategy which will have its own consequences.

One strategy I have seen contemporaries opt for when the budgets get tight is to convert to a cost center business model. I much prefer indirect charging methodologies because they have one huge advantage – they let me make value choices.

When operating as a cost center the facilities organization is limited in its ability to create enhanced value. You can do only what customers pay you to do, and they are likely to ask you to do less, thereby stranding resources you depend upon. Life is tough, and sometimes tougher.

I much prefer a model that gives me control of my budget and allows me to make strategic decisions. In fact, I believe tough budget times offer business leaders one of their premier opportunities to make a difference. This is an opportunity to be a thought leader, to suggest paths and strategies that others have not thought of, to demonstrate your strategic value to your internal customers by presenting creative solutions and options to help them solve THEIR problems. You can only do this, of course, if you actually understand their business. But assuming you do, having control of your budget allows you to create value for them and for your own organization. Yes, budget control numbers will shrink even in non-cost center environments. The difference is that you get to decide how to allocate your resources.

One of your most important contributions to the enterprise is in knowing your customer’s business, looking over the horizon, and creating options that protect and help them before being asked. In other words, by being proactive, responsible, and leading through assumed entitlement.

It’s much easier to do, and a lot more fun, when you hold the money.

Sunday, November 2, 2008

Alternative Workplace Strategies

In previous posts to this blog I have mentioned the growing importance of Alternative Workplace Strategies (AWS). While not every organization will be a good candidate for aggressive AWS promotion, many are. Any business that is mainly consultative or application based has opportunities to utilize AWS to its advantage – but it is not without its challenges.

One of the most obvious benefits is reducing the real estate footprint, and therefore, a major cost component (usually the second highest behind labor). Easy to say, not always easy to do. Aside from the costs and hurdles associated with transitioning to a AWS profile, stranded lease commitments being one example, there is also the need to establish new routines, revise policies, and hard wire new ways of doing business into the system.

Despite these issues, however, Alternative Workplace Strategies are becoming more common. There are a couple of reasons for this shift. First, younger generations of workers understand that there are fewer of them than older generations that are now exiting the work force. The laws of supply and demand are in effect, and they are using them as leverage. AWS and Corporate Social Responsibility rank 1-2 when Gen X and Y workers are asked how they decide between competing job opportunities. Secondly, the continuing shift to an information and service based economy in tandem with the growing sophistication of remote access technologies is increasing the proportion of the work force which can actually do its work outside of the traditional office.

Not surprisingly, one area of current interest in the AWS community is developing metrics that prove the performance of the system with objective data. Some standards are beginning to emerge, such as

  • Days worked at home
  • Home/remote office configuration
  • Cost of deployment
  • Productivity measurement
  • Reduced space and occupancy costs
  • Worker’s Comp claims (risk management)

When designing and implementing alternative strategies, there are a few things to keep in mind:

  • Design incentives that are driven by AWS metrics
  • Technology must be able to monitor performance
  • Remote workers should be willing to give up dedicated office space
Importantly, think about the personality and character traits that enable a worker to be successful working remotely from other associates and supervision. Working from home or other remote sites may require a different personal “wiring diagram” for employees than more traditional arrangements. At the same time, socialization among staff will always be important. AWS programs require that you be more intentional about creating these opportunities.

One of the largest and best known global CRE service firms operating in the Los Angeles market is a prime example of successfully implemented AWS strategies. They have several hundred staff members working in the metropolitan area, yet their real estate footprint is only 10,000 sq. ft. Think about the competitive advantage that represents the next time you are tempted to dismiss AWS as just another business fad.