Driving the future of integrated FM with innovation

by FM Media
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Opportunities for innovation have never been greater for the facility management industry.

Despite improvements in recent years, FM companies still have opportunities to do more to create innovation – pressures from competition and client demands make it a must for modern day providers.

For ISS the need to be innovative led to the development of an Innovation Program, which is being rolled out across the company, both in Australia and New Zealand.

The Innovation Program has been established to help facilitate the identification and execution of innovations that will have a significant and positive impact on the performance of our services.

ISS Australia's Patrick Vella

ISS Australia’s Patrick Vella

It has led to a cultural shift in how innovation is approached, considered and shared. ISS Australia has a dedicated national innovation manager focused on new ideas to drive the business towards operational excellence.

The innovation manager is supported by volunteer employee pioneers from each division. Pioneers are tasked with defining, determining and educating what innovation is for each division.

They explore and evaluate the company’s database – which is an online catalogue on the corporate intranet of all innovations captured to date. Then the team works with suppliers, the workplace and the broader industry to identify potential innovations and then champion those that successfully progress through an implementation process.

This team approach led to being shortlisted in ISS’s own internal Innovations Fair, which is held annually as part of the global management conference. This ensures each ISS region shares its best innovations to the benefit of others and creates some healthy competition.

Project innovation

Innovation is an important element that supports ISS Australia’s integrated FM offering, which is being utilised by Novartis at the global pharmaceutical company’s efficient new campus at Macquarie Park in New South Wales.

Novartis, which already had a relationship with ISS internationally, selected the Australian arm of the company to provide our integrated FM service at its state-of-the-art, six-storey building last year.

Winning the contract was reflective of ISS’s experience and people-focused FM solution, which supports Novartis’ culture of discovering new ways to improve and extend people’s lives.

Since forming the partnership locally, ISS Australia has focused on identifying opportunities to implement FM innovations at the office building, which sees the Novartis group – Alcon, Novartis Pharmaceuticals and Sandoz – come together for the first time in Australia.

Designed with the principles of activity-based working, and with technology to enable wireless connectivity and follow-me printing, the office offers a variety of work settings enabling associates to choose how they work each day.

Under the partnership, ISS provides a range of FM services, including account management, maintenance, concierge, asset management projects, janitorial, grounds and landscaping, security, waste management, mail room, space management and pest control.

ISS implemented multi-tasked resources and processes across each of our service lines to ensure all areas of the facility were readily available and highly functioning. Reporting is carried out using ISS’s global asset management system, which helps Novartis to benchmark performance across all of its sites at an international level.

Novartis has designed a workspace to inspire creativity and this is evident by the open spaces, natural light and different work setting that allow employees to choose how and who they want to work with every day.

One innovation ISS is already implementing at Macquarie Park is a cleaning excellence model throughout the building that not only results in higher levels of efficiency, but also complements the green design of the facility through lower chemical and water use.

ISS is providing proactive energy management, as the building has a five-star GreenStar and NABERS rating, not only reporting data to Novartis globally, but also implementing initiatives locally to optimise the space for client needs. This means ensuring the building is configured correctly for how it is being used now and in the future.

Integrated solutions

By outsourcing a fully integrated FM service, Novartis benefits from lower overheads and is able to allocate its resources more efficiently.

For example, duplications often occur when a business employs separate suppliers, maintenance companies or cleaning contractors – these individuals have no incentive to work together or share information.

An integrated approach eliminates barriers between these service functions by working as one team, improving effectiveness, motivation and quality of service. It allows organisations to focus on their core competencies, with the reassurance that the integrated FM provider is protecting their assets and people, and enhancing the working environment in a cost-effective way.

[quote style=’1′ cite=”]Without being able to continually innovate its services, the company will experience falling prices and the commoditisation of its offering.[/quote]

An example is how ISS manages the defect liability period of the assets within the building, in conjunction with the project manager. Rather than purely rectifying defects in order to be contractually compliant before the end of the warranty period, the ISS team understands the impact of works, the expected performance of the asset and also the acceptable industry level. The team then coordinates with the client and trades teams, to ensure defect rectification works minimise disruption and suit the client to deliver long-term benefits.

To accommodate for the unique demands of industries such as the pharmaceutical sector, each integrated solution should be custom built, as no two facilities are the same. To build the best model, the integrated FM provider will consider the environment, budget, level of risk, compliance and legislative requirements, as well as discussing any unique requirement.

For ISS this includes considering the implementation of new innovations into the model for the client as an important by-product of the integrated service we deliver.

Cultural success

ISS believes that a company cannot sustain its market share or profit margin over a long period of time unless it is innovative.

Without being able to continually innovate its services, the company will experience falling prices and the commoditisation of its offering.

Despite the fact that the FM industry is relatively new, it has matured quite considerably, especially in the past two decades. The industry emerged from three main areas: property management, property operations and maintenance, and office administration.

Since then it has evolved from an operational non-core business support services function to a strategic position that supports and enhances both the core and non-core activities of the organisation.

To be successful as an innovative company ISS focuses on developing four characteristics: solid innovation processes, an innovation culture, visible innovation champions at all levels, and use of an optimal mix of internal and external knowledge sources.

Additionally, three separate innovation processes should be used to optimise the total innovation potential. These are (1) management of best practices, which involve identifying, collecting, conceptualising and implementing practices throughout the organisation, (2) site level innovation, which are small incremental innovative initiatives close to the customer, and (3) top-down driven innovation that focuses on larger transformational change based on strategic trends in the market.

Modern demands

Even with recent improvement innovation remains one of the top challenges for the facility management industry, something ISS identified in the development of the Innovation Program.

Innovation is an important theme, not only because of increased competition among service providers, but also because it is increasingly a requirement from clients, such as Novartis in Macquarie Park.

In the early days of outsourcing, cost saving was the primary driver behind business decisions to outsource, and was behind most deals. Later, as this trend matured, customers put more emphasis on access to new skill sets, better speed to market for new and improved products and services and, most importantly, on greater innovation. Some deals were struck on a cost-neutral basis or even a higher initial cost, in return for the expected value-benefits from innovation.

Innovation in FM is, however, not as straightforward as it is in manufacturing companies or in centralised service companies, and for many reasons.

First, some of the services within FM are ‘produced’ on the customer’s site with less-skilled people who may not be native English speaking. Second, because it is people dominated, the economies of scale are not as obvious as in a manufacturing industry and hence the margins are often quite low and price competition is often fierce.

Third, cost cutting is most often the primary driver behind the outsourcing of FM. The cost cutting strategies in the client organisations may be positive or negative factors for innovation, as they may either stimulate the initiative for innovation in the FM organisation (by looking at new ways of doing things) or hinder it (by withholding the necessary resources for doing new things).

By providing innovation, and constantly striving for new and better ways of doing things, FM providers can provide increased value and potentially drive down costs for their customers.

Facility management must evolve with customers and the marketplace, so rather than just providing innovative products, providers must search for better ways to deliver services too.

The author, Patrick Vella, is technical services and energy manager for ISS Australia. He is also account manager for Novartis. This article also appears in the June/July edition of Facility Management.

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