The question of whether or not to outsource your facilities management is a tricky one that most facilities managers face. While outsourcing facilities management has the ability to save your organization money if done correctly, it also has the potential to negatively affect your ROI if you outsource the wrong work at the wrong time to the wrong outside company.
Facilities management outsourcing trends state that around 44% of facilities management is outsourced in the U.S.
While it may seem like everyone is choosing this route before you follow in their footsteps, you need to determine if it’s the right choice for your specific organization. When making your decision, keep the following pros and cons in mind.
Pros of outsourcing facilities management
1. Time and money savings
The vendor you choose will be highly specialized in facilities management infrastructure and facilities services, which means they will already have an effective set of processes developed to best fit your needs. They are prepared with the tools, staff and training necessary to do this, so you can take those expenses off your plate when you choose to outsource. Research shows that outsourcing facilities management services can help you achieve annual cost savings of up to 10-15%, so if you’re looking to stick to a tight budget outsourcing may be a significant benefit for you.
By using an outsourcing provider that specializes in certain aspects of facilities management (such as L.E.E.D compliance or building renovations and building maintenance) you can be sure that they have the core competency and expertise necessary to perform high-quality services. Outsourcing specialized projects is a great way to become more comfortable with the process and vet a vendor, without outsourcing a large number of your facilities management services.
3. Staffing flexibility
It’s important to analyze where your team is excelling and where it needs a little help. If your team is lacking expertise in a certain trade or type of equipment, you can outsource your weakest facilities management tasks, which frees up your team’s time to focus on what they are best at. Trying to learn how to perform a service on something you aren’t familiar with takes a lot of time and effort, so imagine all the core business activities your employees can accomplish with all their extra time.
Cons of outsourcing facilities management
1. Less control over operations
If you have a clear goal in mind for how you want a project to be completed, it’s a lot easier to meet those goals with an in-house team than working with an outsourcing company. Each vendor will determine how he or she wants to deliver their services and handle their personnel, which decreases your control over the processes. Establishing a clear contract built around CMMS KPIs (key performance indicators)-such as cost/energy savings, work order response/resolution time, etc.-can help counteract this risk and let vendors help keep a competitive advantage as they perform the work for you.
2. Lack of knowledge about your organization’s needs
Sometimes a vendor will be unfamiliar with your organization’s processes, equipment, or facilities in general. A clear understanding of these elements is crucial for outsourcing success, so if the service provider doesn’t put in the effort to familiarize themselves with your specific facilities management needs you may want to evaluate different options.
3. Dedication issues
The vendor you choose is going to be working with a multitude of other organizations, so their time is going to be spread across more projects than just your own. While many providers are able to juggle multiple clients, you want to make sure that the vendor you choose is able to stick with your projected timeline. Ask for referrals and gauge customer satisfaction.
How should I go about outsourcing facilities management?
For some, facilities management outsourcing stories don’t show the greatest success. In fact, surveys show that one in four outsourced facilities management services is brought back in-house within two years. So, what makes the other 75% successful? Take a look at our list of do’s and don’ts!
Don’t: Specify your own process for performing maintenance. The vendor you choose already has a list of best practices and if they can’t do the work the way they know best, you won’t see the results you are hoping for.
Do: Specify the results and service provision you expect to see. That way, the providers can use their set of best practices to make sure your project has the outcome you want.
Don’t: Be too focused on price or cost reduction. A cost-savings option might benefit you in the beginning, but in the long run the vendor may put your work on the back burner for someone who is paying more for their services and cause a rise in operating costs.
Do: Weigh the costs and the benefits. You don’t want to spend more money than your budget allows on outsourcing your services. So, make sure you aren’t spending or skimping too much. It’s all about finding that sweet spot!
Don’t: Only outsource short-term, one-off projects. While some vendors can be utilized for these short-term projects, it can be beneficial to use a certain vendor repeatedly. For instance, if you don’t have a full-time plumber you may want to outsource all plumbing tasks with a vendor instead of only using them one time to replace your old toilets with new dual-flush toilets. This way, they become familiar with your equipment and processes, which will benefit you down the road.
Do: Establish a relationship with your vendor. As I’m sure you know, maintenance issues never pop up when it’s most convenient for you. Sometimes, a facilities management team may be short-staffed and will need to call on someone outside of your crew for assistance. Having reliable providers you trust can make all the difference when these types of situations arise, so make sure you foster healthy relationships with your vendor and their team.
Outsourcing facilities management should only be done when it makes your processes more efficient. Make sure you only use a vendor for the activities that your in-house team isn’t excelling at and do the rest in-house.
In addition to identifying work that has room for improvement, identifying seasonal spikes in your labor is a good way to find services to outsource. For instance, if summer is significantly busier for you than the other three seasons, it might make sense to outsource work in those months so you aren’t hiring full-time employees who can’t keep busy the rest of the year.
How FMX can help
With FMX’s robust reporting and analytics, a facilities manager can view where your team is excelling in facilities operations and what areas need improvement. This will help you figure out which services you should keep in-house and which services you should consider an outsourcing initiative to maximize operational efficiency.
You can also look at the number of work orders that have been submitted over a given period of time. So, if you notice that in March and April you have a significant amount of work orders, you can consider an outsourcing company during this time.
You can even track trends related to work order or preventive maintenance (PM) type. For instance, if your facilities management team notices your work order/PM completion rate for plumbing tasks is low due to insufficient plumbing resources, you may want to outsource this specific trade.
Learn more about facilities management software