by Nicholas Mirisis — Originally published in the March/April 2017 issue of FMJ
Transparency and accountability, combined with the pressure to produce and perform more efficiently, are realities that organizations across every industry are facing more than ever today. As demands have increased, so has a reliance on technology solutions specifically designed to meet them.
In the world of facility management, that’s meant turning to cloud- based operations management software as the standard for optimizing operations and workflow.
As the technology transformation has evolved and become a linchpin for successful operations management, another reality has come with it — a deluge of data. But greater demand for increasingly granular analysis and reporting means that individuals from all levels of operations and maintenance management are starting to use data in a more insightful and actionable way. The timing is right, as data can help enable facility professionals to streamline, automate, control, audit and improve operations.
Business Intelligence: Taking Data to the Next Level
In recent years, organizations have begun looking for ways to leverage data even further. As systems, sensors and the Internet of Things churn out more metrics, leaders are increasingly turning to business intelligence tools to not only generate data, but to help transform that data into consistent processes.
Operations software systems enable facility managers to gather, sort and analyze data for insights about what happened in the past. Business intelligence applications within those systems then leverage data across the enterprise, helping to connect it in meaningful ways that facilitate business analysis and improve best practices. With reporting and analysis tools, business intelligence gives organizations greater insight into operational metrics and provides answers to questions such as:
- What’s working?
- What isn’t?
- Where are inefficiencies to weed out?
- Where are efficiencies to replicate?
- What are the correlations between business processes and outcomes?
Using visual tools such as dashboards, spreadsheets and charts, business intelligence applications make data easier to analyze, understand and use to make better decisions. Many platforms offer access to an enterprise-level view of data in real time for executive management, equipping them to develop programs and processes more efficiently and accurately.
The continuing transformation of facility management data through business intelligence is one in which information becomes knowledge, and that knowledge can then be used to drive improvements across the business. A mandate to achieve greater efficiencies runs throughout organizations, which means employees at all levels are increasingly turning to data to show they’re complying with regulations and being good stewards of taxpayer and corporate funds. This type of data is also key for justifying staffing levels and capital investments as well as improving operational efficiencies and identifying under- or over-performing operations.
Leveraging business intelligence metrics helps strengthen organizations’ long game, too. Data helps future-proof organizations by enabling them to play offense against oncoming trends that threaten to impact operational efficiency and production.
One trend facility managers are facing is a projected decline in operations professionals in the workforce. Over the next 10 years, the Sloan Center on Aging and Work says more than 50 percent of facility management personnel will retire. On top of that, fewer students are earning facility management accredited degrees. To combat this reality, data-driven analysis can drive better FM decision-making and greater efficiency through automation, despite declining resources.
KPIs: The Tool for Data-Driven Decisions
Business intelligence, however, is only as accurate, effective and useful as the data upon which it’s built. Key performance indicators (KPIs) hone in on metrics that will provide the answers management needs to make critical business decisions.
KPIs are navigational tools that measure how well an organization is doing against strategic goals and objectives and can vary, depending on organizational goals. The most effective KPIs target areas that will make the most impact in an organization. Because facility management systems compile data from different departments and systems across the enterprise, they streamline and simplify the development and tracking of KPIs.
As an example, one of the top KPIs for facility managers is typically the ratio of preventive work orders to all proactive and reactive work orders. This is important to monitor as a preventive maintenance program can reduce catastrophic failures by 60 percent and decrease cost of work orders by 30-40 percent on average.
Another critical KPI is work hours per employee per week. Knowing the true “wrench-turning time” can help reveal ways to increase productivity and opportunities for improvement in tracking time — such as going mobile so technicians can access facility management systems on their smartphones or tablets. It may also identify and justify the need for additional maintenance resources.
One KPI that frequently rises to C-level attention is the current replacement value and facility condition index. These data points show how much it would cost to replace the facilities in their current state and the percentage of the current replacement value that needs repair/replacement. This helps prioritize spending and informs capital planning.
Using Business Intelligence to Grade Performance
With facility management software systems automating KPIs, monitoring performance can easily slide into an organization’s daily workflow.
A chief operations officer at a 19,000-student school district in central Colorado says that’s what happened when they turned to business intelligence data to improve operations. The operations team meets daily to review KPIs, determine focus and assess progress toward goals. Generating reports and graphs using real-time metrics helps them pay attention to details that give them an accurate picture of performance. Tracking daily progress equips them to take action and make improvements quickly.
For example, with schools increasingly dependent on technology, pinpointing an IT issue becomes a priority when teachers don’t have access to the tools they need to do their jobs. KPIs have enabled them to watch for trends in how long it takes to resolve IT issues. Addressing them quickly improves efficiencies within IT, while at the same time, reducing instructional down time.
Leveraging KPIS with Benchmarking
It’s clear that KPIs give organizations insights that can help improve their operational performance. But organizations risk tunnel vision if comparison and analysis don’t go beyond their walls. Based on results of a recent survey, building owners and facility managers see the value of broadening their view. More than 80 percent of the respondents said that benchmarking their organization’s efficiencies against peers or competitors was important.
Benchmarking performance against peers provides a deeper and wider level of analysis that enables organizations to optimize efficiencies even further. Comparing at a macro level, such as the overall energy efficiency of a facility, for instance, or down to a micro level, such as the life cycle of a heating, ventilation and air conditioning system component, peer-to-peer benchmarking capabilities help organizations:
- Compare performance against facilities of similar size and industry
- Identify operational efficiencies in similar organizations
- Spot trends
- Leverage best practices other facilities in their industry are using to achieve results
As an example, for a large health care system that has multiple buildings and campuses, peer-to-peer benchmarking can help executives see a more enterprise- level view of how its facilities are performing and make decisions about implementing overarching best practices. For a state department of education, benchmarking can reveal how capital and maintenance funds are being used at the local level, help prioritize future funding and even demonstrate need at a federal level.
Benchmarking has become an important tool for the Colorado school district. Comparing data at a micro level enables them to measure how they stack up against other school districts. Benchmarking against districts on a state, regional and national level gives them access to a wider swath of data and peer-to-peer best practices to compare against and learn from. Through access to data from schools from across the country, they can see that they rank in the top 20 percent of institutions nationally in facilities and operations. Benchmarking gives them a framework as they work toward their goal to continually improve to rank in the top 10 percent.
Benchmarking also enables organizations to identify gaps — Are there metrics not being measured that should be? — and assess KPIs — Are the metrics that matter most being targeted when it comes to measuring operational effectiveness and fulfilling organizational objectives? When it comes to justifying budgets and staffing in an environment that demands doing more for less, benchmarking allows facility managers to highlight successes, which helps clear a path to getting what they need to improve operational efficiencies.
Business Intelligence Promotes Teamwork
Business intelligence also promotes a team approach to improvement. When the Colorado school district operations officer began including data-driven recommendations in his operational reports, the financial and educational officers soon followed suit. What began as a push for improvement in facility operations has expanded across all areas of administration, with KPIs and benchmarking becoming part of the culture. Business intelligence helps build partnerships focused on achieving improvements for the entire organization.
At its core, data gets people talking. It solidifies opinions, identifies trends and justifies expenses. When presented with accessible and easy-to-understand data and analysis, key decision makers are more likely to talk about what’s being measured, what’s not and should be, and how to best achieve operational goals. Optimizing operational efficiencies today is about not just tracking operations more effectively, but using the resulting data for internal and peer-to-peer benchmarking — all with an eye on making more strategic data-driven decisions and plans. – FMJ
Nicholas Mirisis serves as the vice president of marketing for Dude Solutions (www.dudesolutions.com), the largest operations management software company in the U.S. dedicated to the education, government, health care and manufacturing industries.
He has 15 years of technology marketing and facility management experience, including leadership roles in a start-up that has grown into a high-growth, capitalized cloud company. Mirisis currently serves on the Board of Directors for the National Business Officers Association and the Consortium for School Networking.