Why Facilities Managers Should be Included in Strategy Meetings
Featured Image

Introduction

Facilities operations and planning have a huge impact on an organization’s performance. For a facilities manager to become a contributing part of the strategic conversation can be a challenge, but that interaction will inevitably deliver advantages that pay dividends.

The importance of strategic planning for facilities managers

Facilities managers occupy what can be a delicate position within their organizations. They oversee a huge company asset that fundamentally affects daily operations, and can either greatly increase or greatly reduce occupant comfort and productivity. However, that asset is often treated as non-revenue generating necessity, rather than as a dynamic and working piece of the company portfolio. In this case, facilities managers will come up against the perception that their strategic insights and goals do not contribute to overall company strategic policy, and instead be relegated to a purely reactive role, investing the least amount of company resources possible to keep the infrastructure barely running. The perspective that a facility manager could bring to executive decision making is lost, and the value that could be gained from a holistic approach to workspace and facilities assets is lost.

Integrating facilities into general strategy

There are a number of steps that a facilities manager can take from an operations perspective to make their voice heard in strategy. The first is making sure to perform the due diligence required to understand the business environment of the parent company along with the perceptions and goals of senior management. It isn’t news to anyone that markets are changing more rapidly than in the past. A facilities manager must understand the positioning and objectives of their company as well as plans that senior management design to make the facilities infrastructure work towards those objectives. Perceptions of shareholders, customers, and competing firms must be understood for the facility manager to properly comprehend the business environment in which their organization exists, with the ultimate goal of aligning facilities strategy to general strategy.

Generating facilities strategy that can be implemented

Once the facility manager has completed that economic observation and analysis, they will be in the position to perform scenario planning; to sketch out various contingencies that may affect operations, and create plans to address them. This practice can help facilities remain nimble should market climate changes occur, and allow facilities managers to react ahead of the curve. Once the facilities manager has observed and analyzed the business climate and created their contingencies portfolio, it is imperative that it not simply sit on a shelf. The facilities manager must monitor and amend their strategies based on actual results, and maintain a dynamic, evolving database of solutions for facilities operations.

Enacting facilities strategy and follow-through

There are various factors that can cause a thoroughly researched, well designed plan to sit idle and never be implemented. The time horizon must be relatively short; plans that require many years to come to fruition are often never enacted. The plan must have a limited number of specific goals with measureable results, and well laid out plans of action. It must include internal and external partners from early on, and have specific, personal performance measures tied to its implementation that are monitored and recorded on an ongoing basis.

The impact of facilities on long-term management objectives

It is often the case that success in facilities is characterized by a lack of equipment or systems failures, which can often go unnoticed. By contrast, problems in facilities can have long lasting, extremely costly and inconvenient impacts on revenue generating operations that jeopardize the bottom line. One common mistake that organizations make regarding their facilities is to automatically invest in the newest software system or device on the market. These new tools can be very powerful, but it should not be assumed that they will solve all the problems that a facilities manager may face. By contrast, it is also an error to continue to operate equipment after its useful life expectation has expired rather than replacing it with the correct item, or of making deferred maintenance a habit rather than an exception. Neither too long nor too short refresh periods on equipment make for optimal operations and it is the responsibility of the facilities manager to effectively communicate this to senior management. Another issue that facilities managers face is poor performance by personnel, whether they are internal employees or external contractors. Paying for due diligence, maintenance and monitoring of facilities systems is a great idea, but only when it is performed by a competent, properly incentivized professional. Sub-par performance cannot be allowed to impact a system as intricate and vital as a company’s facilities.

One example of facilities gone wrong is the Modesto Medical Center, built in 2008 in California, and designed to be the prototype for Kaiser Permanente’s new energy efficient, environmentally sustainable designs across its 600+ locations. This facility has faced numerous problems with most of its systems. The design and due diligence did not reveal that an air conditioning system built to exist in the San Francisco area—using free air cooling—would not function as well in the Central Valley where temperatures reach 115-120 degree Fahrenheit in the summer. This has caused the problem of maintaining state mandated humidity levels in the facility’s operating rooms, a task which was originally intended to be controlled by building automation systems, and now has to be carefully monitored and controlled by building personnel.

Another example is from a contractor, sub-contractor relationship wherein the due diligence for a 47 building facility was completed in 2.5 hours. An over-eagerness to win the contract caused the sub-contractor to inherit a facility which had received no maintenance for the months preceding as the contractor planned to transfer responsibility to another company. As the challenges of the task became apparent, the sub-contractor fell far into the red and began failing to deliver, as the contractor knew they would. Both companies ultimately lost money. This is a classic example of a lack of due diligence and understanding of market conditions.

Conclusion

A facilities manager may face challenges to become a part of company level strategy. The perception of sunk cost and non-working assets can be daunting, but with the correct approach and operational preparation, this challenge can be overcome. Organizations that treat their facilities as a dynamic, revenue generating asset will inevitably be more successful.

Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today’s market participants.