3 Key Findings for Outsourcing Facility Service Management

time allocation
Do you feel you have to continually manage all the details for the vendors that are contracted in your facility? You are not alone. The major objections to outsourcing services is lack of management, communication and follow through by the vendors. This unprofessional relationship only leads to higher costs for you.

The Primary Reason Integration Will Grow

The phrase, “the whole is greater than the sum of its parts” certainly holds true for the integration of outsourced services. A defining feature of the integrated model is the ability to provide value that’s greater than assembling, combining and coordinating component parts of the outsourced services. Industry professionals who participated in the survey expect such integration of outsourced services across different service lines to deliver a 12% reduction in cost and increased value of 28%. 70% of organizations currently purchase integrated or fully integrated facilities management services, such as the purchase of both hard and soft FM services. That number is expected to increase to 83% over the next 3 — 5 years.

Value of Outsourcing

Save money. Reduce your business operation spending, maximize your in-house employees, and focus on your core business. Reduce your insurance costs and improve your risk management.
Increase productivity. Experts will be performing the services with proper equipment and supplies.

Among all service lines, facilities management services are—and will continue to be—the most highly integrated industry purchase. Johnson controls published a research report in 2013. Participants included 118 senior facilities management (FM) and real estate (RE) professionals from across the globe. The goal of the research was to understand how and why industry leaders plan to purchase outsourced services in the future. There were 3 key findings:

Key finding #1

Expect significant growth in outsourcing

According to the survey, 87% of the responding organizations currently outsource facilities management and real estate services, and the demand for these outsourced services is expected to grow significantly within the next 3-5 years. The growth is likely to occur in both the number of organizations that will outsource service activities and the types of activities that are outsourced.

Key finding # 2

The vast majority will purchase integrated services

According to the survey, 80% of organizations expect to purchase their facilities management service lines as integrated or fully integrated lines within the next 3-5 years. In the survey, integrated service lines were defined as multiple services lines within FM or RE that are purchased from a single supplier who uses specialist knowledge to integrate service delivery, procurement and service delivery management. Fully integrated services also include strategic account portfolio management.

Key finding # 3

More organizations will buy FM and RE services globally

Among the organizations surveyed, less than a third currently purchase facilities management and real estate services on a global scale, though the trend is moving toward a greater degree of globalization. According to the survey, 38% intend to purchase those services globally in the future.

If You Are Outsourcing, You Are On the Right Track

When you consider all the costs in vendor management, your time becomes a significant issue and cost to manage the facility. The obvious additional cost is the time you spend away from your core business, in managing this process and the vendor’s business. What are the options to get back in control and minimize your time? The next steps to take to solve your problem is to have a facilities services Management Company step in and manage the vendor process. Most large companies use this process in order to control costs, streamline the process and take advantage of the facilities services management company’s experience and expertise. Until now there has not been an option for the small to medium size companies to have their own facilities services management company. The costs had been very prohibitive and there were no real options in the market place. In addition, the direction to integrate services is on the rise.

Conclusion

System4 facility services can provide you the ability to manage all your facility needs with one call and one point of contact. You can now take advantage of a management service that only large companies could previously afford. We manage all the vendors, all the contracts, all the vendor compliance and provide you one contact, one phone number, one invoice and one solution for all your facility needs. System4 facility services has been in business for over ten years with locations that cover the entire United States. The management team has been the CEOs of companies in excess of $300 million in revenues. In short, we have the experience and expertise to simplify your ability to manage your core business and your facility needs.

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