Unpacking the "Top 5 Facility Management Challenges"

unpacking

Last week we identified the Top 5 Facilities Management Challenges.  While it is great to identify these challenges, we have had a number of requests from readers to provide some additional information and context.

You asked…we heard you.

The following are practical thoughts and commentary related to these challenges.  While I have concentrated much of my unpack on the “oh too often” under served church facility world, the “unpacks” have a multiple of application to other vertical markets.

> CHALLENGE #5: Vendor Management: Allocating work to the right vendors

UNPACK

1. Having the right vendors working on our facilities is important. Are they qualified? How do you qualify them? Where did you find them? The phone book? Do we know what their fee structures are? When was the last time you explored other vendors? These questions should be examined on a regular basis to ensure that we have the right people serving our facility’s needs.

2. When was the last time you explored the “real” cost of your vendors? The real costs include not only the invoice from the vendor but also include the cost of locating a vendor, scheduling the work, coordinating the work with your facilities scheduled events, overseeing the work, inspecting the completed work, reviewing the invoice, paying the invoice, addressing “call-back” issues with the work, etc, etc, etc. In addition, do you know what the real costs are when you have on-site staff perform certain tasks? It may appear that it is cost effective to have an on-site staff member address certain repairs or tasks like painting or the like. But is it really, or are you only making that leap based on only part of the information? What is the wage of that person? What is the cost of the labor burden/benefits? Do you also provide items such as a computer, vehicle, uniform, etc? How much does it cost to manage that person? Does the simplest of tasks take longer to get accomplished than if it was performed by a paid professional in that trade? It is critical to understand these real costs to determine if you are actually paying more that you realize.

3. Having insurance on all vendors on your site/in your facilities is critical. Not only is knowing that the vendor has insurance is important, it is even more important to have a copy of the insurance certificate and track the expiration dates of each. It is recommended that you obtain a Certificate of Insurance on each and every vendor including General Liability, Workers Compensation, Vehicle as well as an Umbrella rider. This is for the church’s protection from significant expense in the case of a claim as well as potential legal action. Then, you should keep a record of all vendors along with a log of expiration dates. It is recommended that you require vendors to give you a copy of an updated certificate prior to expiration

> CHALLENGE #4: Making changes without having enough reliable data

UNPACK

1. As a general rule…at least from my experience…most churches do a substandard job of tracking the real costs associated with their facilities. While I know some churches that have retained full time professional Facility Managers that have invested in CMMS (Computerized Maintenance Management System) software for the tracking of maintenance issues, repairs, work order management, preventive maintenance and historical data retrieval, most do not. Most churches use a spreadsheet, Post-it Notes or a legal pad, if anything at all. There is no way for you to stay on top of trends or even plan for the future without a deliberate and proactive process for tracking and projecting facilities issues. (I am sorry if that feels like a hand slapping…)

2. Without this kind of historical data, how can we realistically project future year’s budgets? Do we just guess? Do we put enough money in the budget for Band-Aid issues only and then cross our fingers and hope for the best? We would suggest that a more proactive and forward thinking process be implemented into you budgeting process. However, you cannot implement this kind of thinking without clearly knowing the life expectancy of your systems and components or without knowing the real costs of maintaining your facilities.

3. The data that is needed is far more than just historical…it is also real time. How long does it take your team to respond to a repair issue? Do we wait for the trustees or deacons to have a monthly meeting to address these issues? How long is the downtime caused by repairs and how do these times impact our ministries? Do we have systems and process in place to reduce the downtime? In church “speak” we do not often consider the “costs” associate with downtime. If we were operating a hotel and the air conditioning went out or we own a retail store and the plumbing floods the building, we could determine the exact cost that every minute, hour and day that downtime would have on our financial bottom line. What about the “eternal” bottom line for our ministries. Is that not even more costly than the monetary loss of a retail store?

> CHALLENGE #3: Getting more work done with fewer resources

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1. I have seen many churches reduce staffing over the past several years. Most has been in the area of business/financial administration and facilities related staff. This means that the staff left in the wake of these cuts are having to do more…with less. Less budget…less resources…less money. Yet their organizations expect the same level of work to be accomplished or that their facilities remain in the same, if not better condition. This is a juggling act that is becoming very challenging. I have met with several FM’s that are frankly overwhelmed with the level of tactical responsibilities that are now on their plate which robs them (and their organizations) from their ability to think and plan strategically. They have become “firemen” and not managers. If we need firemen…then we can hire them for far less than the cost of a professional FM…so what do we want our administrators and FM staff to really do? Each ministry needs to ask and answer this questions and face the realities and ramifications of their answers.

2.  I am a firm believer of documenting salient discussions and communications. It is far to easy to get busy and not document what was discussed, what was the agreed upon ETA for the work or the anticipated cost, does the vendor have the adequate insurance and so on. Having a system for documenting vendor interaction that interfaces with your historical tracking is critical for the understanding of the issues associated with your vendors; their performance, their costs and their reliability, their insurance.

3. Vendors are going to come and go…particularly in today’s economic environment. What is your plan for interviewing, qualifying and utilizing new vendors? Are you merely going to let your “fingers do the walking?” I like the quote, “Dig your well before you get thirsty.” That applies to this as well. Have a plan as to how you address vendor turn over (or even church members who are doing work that leave the church). Don’t wait until the last minute.

> CHALLENGE #2: Finding ways to extend the life of existing assets

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1. For many churches and ministries, this is a tough truth to grasp. When times get tough, we generally will cut or reduce what may be called the “non-ministry essentials.” This may be staff positions, programs, or possibly functions. The grass may not get cut as often. The IT director is laid off. A decision is made to change your HVAC preventive maintenance from quarterly to bi-annual. Regardless of the item, these are the types of items that get cut first. On the other hand, when we are in an upswing and we are ahead of budget, and have excess cash, most churches do not stop and think about setting up a capital reserve account or reviewing their life cycle cost projects (as if they have those anyway) or increasing the maintenance budget. We immediately think that we should add more ministry staff or look at a new building (even if our old buildings are not well maintained). Again – don’t misunderstand – we need to add staff and add facilities and the like. However, we need to balance that with the need to maintain the tools and resources God has entrusted to us.

2. As I indicated earlier, most churches do not have a good system or process for tracking real costs of preventive maintenance. If you do not track and document life cycle costs and the costs of preventive maintenance (PM) vs. repairs, how will you be able to determine if you are spending too much on repairs? How will you be able to determine if $1,000 a year of PM could extend the life of an asset by say 5 years. For example, if you could spend $1,000 a year to extend the life of a 10 ton HVAC unit (that would have a replacement cost of about $20,000), would that be wise stewardship? But if you are not looking at your assets from that perspective, how will you ever know. I am sure you have heard the saying that “Knowledge is Power.” In this case knowledge if is more than “power”, it is wise stewardship.

> CHALLENGE #1: SAVING MONEY

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1. How many times in this past year have you called a vendor to address an issue to later find out it was the wrong vendor, as a result, you had to call someone else? Did you have to pay both companies even though the first vendor was the wrong one?  “We have stained ceiling tiles so it must be a roof leak.” is a claim of church leaders that is repeated far too often. While a leak in the roof is a possibility, it could also be a plumbing leak or a fire sprinkler leak or an HVAC condensation drain/pan leak. In order to know who is the right vendor to call so that you only pay for the RIGHT service, your facilities team must be able to recognize and evaluate these issues and make a determination based on that evaluation. Now, I am not suggesting that you (or anyone for that matter) will get it right every time, but if you can reduce your service calls by even one, that is real dollars saved.

2. Warranty calls can be a real irritant…particularly if you have vendors that do not live up to the warranties they committed to provide. But as above, prudence and diligence to understand what labor and materials are under warranty can save the church real dollars. Warranty items are not just associated with new construction or new equipment, although that is the most common. Most labor performed on repair services should have some level of warranty unless expressly agreed to otherwise in writing. When a vendor gives you a quote and you agree to use their service, ask them to include their warranty provisions on the quote that you both sign. GET IT IN WRITING!!!! While verbal warranties “might” hold up in a legal battle, written is always better and gives you the documentation to enforce the warranty with that vendor or possibly their suppliers/manufacturers. Don’t just give in and pay for warrantied work because it is too much of a hassle. There may be emergency situations where you have to involve another vendor to remedy the situation, but keep records or your attempts to resolve the issue with the warranted vendor as well as your costs from the performing vendor and work to collect these funds after the emergency has passed. Again, these are resources that God has entrusted to us…do not take them lightly.

The above only scratches the surface related to the challenges FM’s face every day. It is a huge responsibility to be entrusted with these resources. Be Intentional!

Facility Stewardship Binder - Small