Are You Really Making a Profit in Facilities Management Smart Technology: Part I?

March 16, 2018 Greg Fasullo

Conducting a facility condition assessment is no small task, and Facilities Managers should take care in ensuring its accuracy.

Facilities management smart tech is widely regarded as the go-to solution for transforming facilities management from cost center to profit center. Unfortunately, proving value of facilities management smart technology can be quite challenging, especially for organizations that have not implemented any type of smart technology. Facilities Managers that have not yet implemented  smart building solutions should follow these steps to begin the process of evaluating profitability upon implementation of Smart building solutions.

Understand the Basics of Facility Condition Assessment (FCA)

Any analysis of facilities management smart technology and profitability must begin with understanding the basics of a facility condition assessment. As explained by FM Link, a facility condition assessment is used to identify all essential costs and functions contributing to savings, profitability, and overhead expenses with in the facilities management department. It is a comprehensive evaluation, and all systems must be included with in it.

Focus on Component and Systemwide Assessments

The FCA typically does not focus on opportunities through new technologies, as would be the case with smart building solutions, but it does need to focus on component-specific and systemwide assessments. This means the individual costs and functions associated should be documented on a per-asset basis, up to and including the limits capable with each piece of equipment. If an asset can track its run-time or energy usage, this information can be used in establishing a baseline for the FCA.

Identify the True Costs Backlog of Maintenance and Repair (BMAR)

The maintenance backlog is responsible for some of the greatest costs in facilities management. When a maintenance need arises, if it is put on the backlog and deferred, its cost will multiply upon itself to dramatically increase the final cost of repair. The deferred repair could result in cascading failures throughout other assets and systems. Facilities Managers should look at the existing severity of the maintenance backlog, multiply the initial costs by itself, so a $20 repair would be multiplied by $20 to create a $400 final repair cost. This information should be included in the FCA.

Assess Your Budget and Adherence to It

Facilities Managers must also consider the existing budget of the facilities management program. Document the budget granted for the past 12 months, and compare the facilities management expenditures against the budget constraints. In some cases, the facilities management budget will be less than actual expenses. If so, Facilities Managers will need to include this information in the final report.

Consider Perpetual Versus Temporary Costs in Facilities Management Smart Technology

Depending on the types of systems and services used in your facilities management department, including facilities management smart technologies, identifying the costs associated with facilities management in the FCA must include one-time and perpetual costs. Perpetual costs include the recurring maintenance in facilities management items, such as changing filters, light bulbs, or performing other routine maintenance needs. In addition, the FCA should document and evaluate the cost of all third-party solutions, field service providers, and software vendors, if applicable.

Bring All FM Processes Together in a Centralized System

Establishing proof-of-value for smart building solutions can be among the most complex tasks in facilities management. After completing your FCA, it is imperative to bring all facilities management processes together through a centralized platform or system. Get started with your facilities management platform integration now by visiting ENTOUCH online.

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Are You Really Making a Profit in Facilities Management Smart Tech: Part II?
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