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FM & Beyond
Thoughts on the Practice of Facility Management and Life
Sunday, December 30, 2012
Monday, October 29, 2012
FM Providers Have Changed, It’s Time for RFPs to Change As Well
This week's article comes to us courtesy of Ron Segura, President of Segura Associates. Ron's expertise in helping clients evaluate and improve their FM services is well known in the industry. As you read his article think about your own RFP process and the expectations you have of your service providers. Are the two in alignment?
Ron Segura |
Once
upon a time a janitorial company was a janitorial company. Firms in those days
didn’t think to venture into integrated pest management or landscaping
services. But today it’s a different story, and comprehensive facility
management (FM) is the name of today’s game.
Clients
now expect FM contractors to bundle services such as landscaping, integrated
pest management, sustainability, HVAC services, general repair work, and more.
A
cleaning company that does not want to grow continues offering a narrow scope
of services. But FM service providers with an eye toward the future uncover
ways to provide multiple services either in-house or through strategic
alliances with other service providers.
By partnering with a pest management company or an HVAC firm, FM
contractors can offer multiple services and pass on cost savings and
efficiencies to their customers.
While
FM contractors are providing more services than ever before, RFPs from clients
have yet to catch up. Often RFPs include specs cut and pasted from RFPs the
client found on the Internet. Sometimes these specifications include outdated
information or processes that are cost prohibitive to provide. These poorly
thought out RFPs box the contractor in, making it difficult or even impossible to
provide the services the customer really wants.
"Too
many well-intended managers are pressed for time and put together RFP's based
on what they believe to be a ‘universal’ standard -- the cut and paste
approach,” says Richard M. Fineo, MCR, director of development at DTZ-a UGL
Company.
He
continues, “Often times an old bid, or even a neighbor/colleagues bid, will
appear to save the responsible party time in the preparation of the RFP and
seem sufficient. The problem with this is that the specifications, which should drive the costing become an ‘approximation’ of what is called for -- a sort
of ‘wink and nod’ at what is really needed.”
There’s
little continuity when RFPs are put together this way. There may even be
contradictions within the specifications themselves. For instance, the RFP
might specify monthly stripping and waxing, but the industry doesn’t strip and
wax anymore, it strips and finishes (or coats) the floors. This is also no
longer done on a monthly basis because it’s not cost effective and there’s no
need to with today’s more effective products. Those issuing the RFP falsely
believe that in order for floors to look good, they need to be stripped and
refinished each month, but what they really require is a solid floor
maintenance program.
If
FM contractors try to adhere to these RFPs, their cost estimates may be higher
than the client wants. Or they may cut corners to come in at a lower price,
and then the client isn’t getting the services they really need.
“If
there was EVER a good time to bring in a consultant, it is during the critical
RFP preparation stage,” Fineo adds. “Adherence to the RFP will become the
strongest evaluation tool, and if it does not truly reflect the needs, wants
and expectations of the person issuing the RFP, and ultimately the award of
service, then the entire process is flawed.”
There
clearly is a need to change the entire RFP process and to reduce the window of
time needed to move through to the end where a bid is awarded.
A
few years ago Stanford University revamped its RFP process with extremely
positive results.
The
first step of their process was to pre-qualify service providers to narrow the
field of qualified bidders to a list of ten. This list should include companies
with solid reputations and weed out those with less than stellar ones. Once
these companies have been identified, the bidding agency should send out
correspondence stating their intent to go out to bid for these services and
request FM contractors to supply company information or marketing materials
that demonstrate their interest in the work and their capability of carrying it
out.
Those
FM providers that respond are then afforded an opportunity to give a half-hour
presentation on predetermined topics. Stanford allowed potential bidders to
talk on four things: sustainability and their company involvement in this
initiative; communication processes in place; technologies and products used in
the performance of duties; and the transition process used to set up new
accounts.
These
presentations are evaluated by an RFP team, which might include a
representative from the facility management department, the site manager who
directly receives complaints or concerns from occupants, a quality control
person, an outside service provider, and possibly a contract administrator or
financial representative.
After
the presentations, the RFP team scores the results and narrows the field of
potential bidders to three, with the incumbent as a fourth. Many times the
scoring methods used in this process utilize complex matrixes that dilute the
evaluation until it becomes labor intensive and mechanical and decisions are
based solely on price. Stanford kept the process simple and scored presenters
from one to five on their green program, transition plan, training program and
communications process.
It
is then and only then that these firms would have an opportunity to bid on the
RFP. The advantage is that instead of having 10 companies submitting bids,
there are only three and these companies are prequalified to do the work.
Before
providing the narrowed field of FM providers with an RFP, the RFP team will
have reviewed its specifications and adjusted them as needed. The
specifications will provide adequate information on building statistics and
cleaning frequencies and reflect whether or not there will be a need for green
or sustainable services. Stanford’s team combed through its existing
specifications and found their current provider was not addressing some areas.
These areas had been an issue on an ongoing basis and a cause for complaints.
They adjusted their RFP to address these issues to better reflect the services
Stanford required.
RFPs
must be specific. If there are sustainability concerns, for example, the
specification should list the goals the agency wishes to reach. Do they want to
be LEED certified? Do they hope to use greener chemicals and cleaning
processes? Is recycling important? How much do they hope to divert from the
waste stream? Is saving water or energy a goal?
"Any
good RFP also allows for input on the part of the bidder, an opportunity for
the responsible bidder to go beyond the RFP and advise as to new methodologies
and efficiencies that could potentially save money and improve performance,”
adds Fineo. “This is an opportunity for free advice. Why wouldn’t you ask for
it? It can be an indicator of whether or not your RFP respondent will become a
true 'partner' or just a contracted service provider.”
And
herein is another advantage of working with fewer bidders in the RFP process.
There is an opportunity to work with them more closely to ask for advice and
pick the brains of these experts. A good service provider will seize this
opportunity to point out concerns within the specs, such as the need to strip
and wax floors monthly.
Ask
tough questions of those applying for the job, adds Fineo. "I welcome RFPs
that include questions about recent losses. What have YOU (the vendor) lost
recently, what was the reason and what did you learn from the experience?” he
says. “I've landed more than a few contracts by being able to articulate the
lesson, albeit painful, of an account that ended with a cancellation and how
our approach in the future would include the lesson learned.”
Price
is important but not the only thing, Fineo stresses. "Very often the
responses to an RFP will be reduced to a matrix of the financial piece -- and
little else,” says Fineo. “If the one and only goal of the company providing
the bid is saving money, an unfortunate position to be sure, this should be
made clear from the onset. If instead, the bids are honestly going to be
evaluated for value that includes experience, innovation, sustainability, and
of course financial value, etc., you can see the special importance attached to
an RFP that reflects these desires and concerns.”
If
companies truly desire FM contractors to bundle services, their RFPs need to
reflect that. Developing a bidding process similar to the one used by Stanford
can help companies get the services they desire at a price they can afford.
Ron Segura –President of Segura & Associates is a Consultant who assists
its client’s in analyzing outsourced and In House cleaning programs, and assisting in the
development and leadership of the RFP Process.
Website: rsegura@seguraassociates.com
Monday, October 22, 2012
The Shift from Service Provider to Integrated Alliance Partner
As end users become more sophisticated in
their operations they understand through experience the real advantages of
optimizing product delivery processes.
It is natural that they should want to extend those advantages to key
services, both provided and received.
Supply Chain Management (SCM) is often thought of as a manufacturing
discipline, which it indeed is. Today,
however, SCM principles are being adapted to the services side of business as
well, with rewards and dividends to both sides of the provider / end user
relationship.
For many this is a fundamental change
requiring acquisition of new skills, knowledge, and mind sets. These folks must learn to walk first, but
getting up to “business speed” cannot take too long. Others have the requisite skills and knowledge
but need to extend them to new areas of their business. In both cases, overcoming ingrained cultures
running counter to the initiative is paramount and something that should be
thoughtfully done.
Across industries and market sectors companies
are looking for service providers who want to partner with them at new
levels. Whether the end product is
machinery, financial services, a new building, or operational in nature;
optimizing the delivery process is now a holistic agenda that encompasses all
required resources.
What Is
Driving Business Integration?
For starters, better educated and more
demanding customers. As organizations
improve internal management systems and mechanisms they develop new
intelligence about themselves, their competition, customers and yes, service
providers. Business intelligence is a
greater differentiator now than ever before.
Process improvement, Six Sigma, metrics programs and other initiatives
of their ilk are changing the way we understand and organize our work. As that intelligence matures it begins to ask
new questions, test new ideas, and probe for new advantages. Extending that intelligence beyond the
boundaries of your own organization by challenging business partners to match
it in their domains and align their processes with yours is a natural next step.
Competitive intensity has increased in recent
years, partially the result of economic stress. Focused by the need to survive some
companies have pared away non-core businesses, reduced or expanded offerings,
or taken advantage of opportunities to expand and grow. Behind all of these strategies is a single
imperative – succeed when others do not.
The oft-quoted exhortation to “Never let a good crisis go to waste” has
been taken to heart. These activities amount to a reshaping of business, each
incidence an opportunity to streamline processes. Many companies have gone after these
opportunities with zeal and more often than not they challenge their business
partners to match them stride for stride.
Customers seek to minimize the number of
business relationships they must manage.
Their goal is to lower the amount of management friction that is applied
to the business of doing business. As a
result, strategic business alliances often form in which multiple businesses
collaborate in competition against other alliances. It’s not just your company competing for
business anymore, it is your alliance competing against other alliances. That means each alliance partner has a vested
interest in each partner’s business performance; and it motivates alliance partners
to plan, act, measure, and communicate in similar fashion. You cannot do that when your processes,
standards, and tools are different.
Fulfillment of customer requirements has
always been the primary business purpose - it has not always been the primary
business activity. Although SCM began as a manufacturing discipline, business
in general is moving from a production-based model to a fulfillment-based
model, improving business speed and alignment.
The foundational principle at work here is that of connectivity,
creating networks of entities that share business intelligence and act together
in synchronized fashion. As this model
moves further down the chain efficiencies and advantages are increased to the
advantage of all in the network.
Inherent in this model is the recognition that individual firms depend
upon resources controlled by others in the network.
Integration
Tools
Deployment of secure and integrated
information technologies across the customer – provider alliance enterprise
enables process synchronization and speeds the flow of information. In classic terms, such seamless operating
protocols make pulling resources vs. pushing them possible, thereby avoiding
stranded investments for inventory, space, and management systems at each level
of the alliance.
Common measurements and language are critical
elements. Each partner in the alliance
may elect to retain measurements they feel are uniquely important to them but
which are not relevant to other partners; all partners, however, should adopt
common measurements and language for tracking and reporting enterprise
activity. If, for example, the
customer’s five most important Key Performance Indicators (KPI’s) are expressed
as cost per end unit or cost per revenue unit, then the alliance partners
providing support services to the customer should provide measures of their
business that feed into the customer’s metrics in similar fashion and language.
The human part of the equation requires
specific attention. The degree of
transparency required can be a challenge.
Sharing business intelligence and allowing visibility and integration of
key processes may be a new dynamic for some.
Employing managers who have a collaboration orientation, are comfortable
working with a range of technology systems, and who understand process design
should be a priority for any firm engaged in an alliance business model. Linking compensation to alliance performance
strengthens the leverage towards implementation of cross-enterprise best
practices.
Information
is the Currency of Integration
Integrating and managing the supply chain
seeks to assure that the right part shows up at the right place, at the right
time. The goal of services integration
is to speed information to the point of need exactly when needed, thereby
enabling the deployment of services in the most efficient manner. The opportunity to integrate services to the
level discussed here is enabled primarily by technology and information
systems. Information becomes knowledge,
and knowledge becomes wisdom. Wisdom,
when acted upon correctly and speedily, becomes advantage.
Condition-based service management systems
proliferate today. I get an email from
the car dealership with an appointment date and time when it is time for an oil
change in my vehicle; not based on distance driven or elapsed time but on the
actual condition of the oil and operating conditions of the engine, and on the day
of the week and time of day I prefer based on the history of previous visits. Sensors communicate automatically when set
parameters are reached, triggering a process that results in my pulling into a
service bay. In building management an
exact parallel occurs when an outsourced HVAC maintenance provider is
dispatched to service a unit by automated sensors linked to intelligent
building systems. This model can be
applied at multiple levels, even to stocking paper for copiers. The fact that cloud computing largely
eliminates the cost of deploying these technologies is speeding their adoption. Service vendors lower inventories, redeploy
capacity, and reduce costs. Customers
have greater visibility, can forecast more accurately, and have more control
over cash flow.
The philosophies behind service chain
integration are not new: Deep integration of business processes by alliance
members who are invested in each other’s success, who are intensely
customer-centric, who trust each other and accept accountability, who are
driven by a desire to achieve process excellence, and who share business
intelligence willingly. When merged into
a cohesive operating system each becomes a force multiplier for the others,
improving service quality, cost and efficiency.
Wednesday, October 17, 2012
Are Productivity and Email Mutually Exclusive?
I recently worked a major development project and found that the 600+ emails a day were completely paralyzing me, and I knew I wasn't alone. I announced that I was implementing a new policy of "Planned Neglect." Essentially, I said "I will look at emails first thing in the morning and in the evening, no more than thirty minutes each. If you have a crisis that I absolutely must participate in then come see me or call me. You know where I am and you have my numbers. Use them."
As a result I discovered that,
- My ability to focus concentration on the most important matters and tasks increased dramatically
- My productivity and value contribution soared
- The quality of personal interactions improved
- People respected and even cheered my stance, and
- I enjoyed the project and life a whole lot more
This was not me running away and hiding from the world. I did not limit my accessibility to the team, in fact I improved it. Lesson learned? Some day email will go the way of the Dodo Bird. Until then it needs to be managed, as does any other good tool that turns into a time killer.
Your productivity and value quotient are the most important assets you contribute - protect them.
Thursday, September 20, 2012
Destined to Live the Good Life in Zambia
As a project manager in a corporation I work on a wide variety of projects. All are important, most are enjoyable experiences, and all connect me with new people. But no project in my personal history has captivated me like the Destined to Live the Good Life Orphanage project in Kitwe, Zambia.
The story is only at the beginning and far from complete, but already an inspiring one. It is a journey as they say, one that will evolve over the next several years. Pastors Deborah and Steve Powell have been traveling to Kitwe for seventeen years, and founded the orphanage several years ago. With no facility they placed children in host homes to provide security and nurturing. In the summer of 2010 they were able to open the first phase of a facility with thirty residents. The emotional, spiritual and intellectual growth of these children, aged three to fifteen years at the time, has been breathtaking. With the security and education provided by the orphanage they have gained new confidence and a new vision for their future. And that is what it is really all about, isn't it?
About three years ago I proposed an alternative way of constructing the orphanage. At this point it appears that the development will be more traditional, but that is not the point. That initial thought motivated investigation, new enthusiasm, and a series of new connections. It was the beginning of a journey that is leading us to a place none of us imagined.
Last Monday afternoon I joined Deborah in presenting the vision, mission and goals of the orphanage and project to the design studio class at the University of Southern California (USC) School of Architecture. Under the much appreciated auspices of Professors Alice Kimm and Eui-Sung Yi, the studio class has adopted our project for the semester. The end deliverable will be a set of master plans for the continuing development of the orphanage.
It was an amazing experience. While funding for the development remains a goal, we see USC's engagement as evidence that we are moving in the right direction. Future plans include completion of master plans and construction documents, a field trip to investigate site conditions, and pre-construction activities leading up to development. When complete the initial phase of the new development will support one hundred residents with housing, education, a medical clinic, and the ability to be partially self-supporting through agriculture and trade.
A key goal of this project is to create a new model for developing orphanages. A model that is simple yet which provides high quality services. A model that is affordable in order to improve financial stability. A model that engages and teaches local townspeople, giving them new skills and helping them improve their lives and future. A model that can be duplicated by many people in many places.
In early work the students have been investigating similar types of projects in similar climatic and economic environments. Understanding how to design facilities and systems that are relevant to context, supportable by local workers, sustainable both environmentally and operationally, and which further the goals of the orphanage is an important goal of this research effort. What they have developed in the short time since the start of the semester is striking.
There are several things to be learned even at this early stage of the project. Good ideas often take time to mature and require faith to proceed. Good ideas attract good people, who then adapt the vision and help make it better than it was. Good ideas create positive change, and a new future.
Destined to Live the Good Life. It doesn't get much better than that, does it?
Stay tuned for periodic updates as we progress.
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