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Considerations for Outsourcing Arrangements

Refurbishing services should invariably be performed by specialists, whether or not FM is outsourced. One of the top three reasons that organizations choose to outsource FM services is to benefit from the expertise provided by specialist suppliers. However, even outsourcers find it necessary to engage separate specialists from time to time, which is why many advocate selecting the best-of-breed provider for each service rather than bundling services. In some cases, members of the FM service team may have some rudimentary refurbishing (aka touch-up and repair) skills. But, the vast majority of these organizations do not have the requisite expertise on staff to do it properly, because:

1)      Refurbishing is not core to their day-to-day jobs, and

2)      Refurbishing is not something they have done frequently enough to gain sufficient knowledge of best practices to perform these specialized tasks cost effectively.

Many have advocated the use of the Balanced Scorecard for facilities performance measurement, including experienced professionals and consultants. Even the International Facilities Management Association (IFMA) bases its “Approach to Strategic Management” on the Balanced Scorecard.

“Cost is still the predominant focus of FM operations, but the industry is maturing and there is now a growing awareness of how facilities can actively support or actively disrupt the performance of people at work.”

In general, the Balanced Scorecard has become a widely used holistic framework that provides real insight into an organization’s operations, finances and drivers of future performance while assisting (and often guiding) overall strategy implementation. Going beyond the achievement of purely financial goals, the Balanced Scorecard encourages management to think more strategically and systemically about a range of targets and measures of business performance. The chief value of the Balanced Scorecard is to ensure that none of the four quadrants (below) either totally dominates or is entirely omitted from management’s agenda.

1)      Financial: To succeed financially, how should we appear to our shareholders?

2)      Internal Business Process: To satisfy our shareholders and customers, what business processes must we excel at?

3)      Customer: To achieve our vision, how should we appear to our customers?

4)      Learning and Growth: To achieve our vision, how will we sustain our ability to change and improve?

Adapted to the context of Facilities Management (FM), a suggested four quadrant framework would be represented as follows:

1)      Financial: How is the FM function managed in terms of value for money?

2)      Internal Business Processes: How efficient and effective is the delivery of FM services?

3)      Customer: How do the facilities users see us?

4)      Learning and Growth: How does the FM function continue to improve in itself and to assist the core business?

It is difficult to clearly identify and quantify the specific financial impact that office appearance and the office environment may have on productivity. However, those firms that have deployed the Balanced Scorecard have seen a correlation across all four quadrants and clearly understand the value delivered to the long-term viability as well as the bottom line by maintaining an attractive, clean and healthy environment.


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