Wednesday, May 20, 2009

Facilities Management...Looking for best practice?

I recently saw a post from someone at a major consultancy, looking for guidance in constructing a Facilities Management RFP. They wanted to understand the major cost drivers so that they could have a successful RFP and negotiation. One comment to this request dealt with location - where would this service be needed - and determined that this was the primary cost driver.

The first thing that struck me was the value being obtained from this seemed like fairly basic stuff. Put that aside for a moment though, and the real issues (according to Howard), in addition to geographic location(s), are: 1) size and scale of account, 2) number of facilities involved, 3) whether you need standard or specialty services, and 4) whether you want to manage the subcontracts yourself or turn it into a managed outsource contract. FM RFP's tend to be very complex and you need to decide whether you want someone who provides it all with internal resources, or acts as a managed service provider of specialty subcontractors. You need to know how well defined are your business requirements and standard operating procedures? Are you looking for a full outsource model that shifts current internal resources outside, a mix of internal and external resources, or just a way to add competition for these services with existing service providers? Do you want to upgrade the technology to perform these services, increase functionality as well as lower costs, or change from your customized processes to standard processes that the outsource provider can define for you (could be a huge value driver)? How long are you willing to commit in a contract, as this provides more time for new suppliers to amortize any up-front investments needed to win the business?

Quite simply, you need to start out with the end in mind (an acknowledgement to Steven Covey's 7 Habits of Highly Successful People). This is pretty basic stuff, and you don't need a Top 5 consultancy with huge overhead structures to tell you how to do this.
Howard Richman