By: Ukeme Peters
One of the major areas of contention between Facilities Management Companies and their customers is the demonstration of value. At one time or another in the course of their career, most Facilities Managers have had to prove value to their organisations or customers because in the first place; both parties did not align as to what value would be. At another level, FM customers themselves set KPIs that are supposed to signal that FM is delivering value to the organisation, but most times, even when the KPIs are met, the business still doesn’t seem to be getting value for its money.
In all these situations, both FM service provider and customers are usually frustrated. The customer feels “I am paying for services that have no direct impact on my P&L (profit and loss)” and the FM feels “I have done everything required of me, these customers are just impossible”. This contention is so profound that at the breakout sessions of the 2015 FM Roundtable, virtually all the panels (involving both FM service providers and customers) complained about FM not demonstrating value, and how FM service providers need to begin to develop capacity to show they are not conduit for draining customers’ bottom line. You can download the 2015 FM Roundtable Compendium HERE.
One particular reason this arguments have continued is because FM companies and their customers are yet to get clear definitions for the right Key Performance Indicators (KPIs), and where these definitions exist, they are most times not clear in ways they speak cogently to specific business needs. For example, there are wide varieties among what constitute critical equipment for banks versus what constitute critical equipment for residential apartments. If these are not first identified by both FM companies and their customers and the right KPIs set, a residential building may never be able to appreciate power availability as much as a bank would.
Therefore, before you begin to check if your KPIs in these areas are right and probably set new ones for your FM services, you must be able to ask and answer these three important questions. When you have answered the questions, it is then time to set new KPIs or review existing ones.
The first set of KPIs we want to look at in this article include:
1. SLA Performance: SLA is an abbreviation for Service Level Agreement. It is considered as the first relevant measure to FM leaders because it measures the percentage of works done within the SLA. This KPI is usually measured in percentages, that is: “% SLA PERFORMANCE”. Secondly, it is important because one impact area of an FM service is responsiveness, and customers expect that works request are completed within agreed timeline. The SLA KPI has several variants that all point to the same objective. Some of them include: “% Request fulfilled within agreed SLA”, “% Deviation on Mean Time to Resolve (MTTR)”, etc.
2. PERCENTAGE OF CRITICAL EQUIPMENT AVAILABILITY: This measures the number of hours particular critical equipments are available – up and running such that the users benefit from the service. However, we must note that critical equipment vary from organisation to organisation, and they are usually determined by the business needs of the customer. Each organization must determine its list of critical equipment, according to the terms of the FM contract. This KPI is important because without the availability of essential facilities services, the customers’ FM needs cannot be satisfied, and value cannot be extracted from services paid for.
3. PERCENTAGE OF PLANNED PREVENTIVE MAINTENANCE COMPLIANCE: This KPI is a measure of adherence to Planned Preventive Maintenance (PPMs). It is important because it is indicative of both service delivery as agreed in most FM contracts, and a measure of positive actions towards preservation of the critical assets of the facilities.
4. SCHEDULED MAINTENANCE CRITICAL PERCENT (SMCP): This is very closely related to % PPM Compliance. SMCP simply helps the Facilities Manager choose between two overdue PM schedules and which to give higher priority. You will agree that unplanned maintenance is generally more expensive than planned maintenance, so performing your PMs on time can help avoid any unscheduled breakdowns, repairs and downtime.
5. RECORDABLE CUSTOMER ESCALATIONS: This is a negative polarity measure that reflects the state of your facility, whether or not your customers are satisfied with your service. It means that when the number of recordable escalation is low, the customer is to a large extent, satisfied. On the other hand, having a high recordable escalation shows that the customer is not satisfied and that the FM is not proactive – that is, the FM only fixes the problem after they have been identified and escalated by the customer. This KPI is particularly important to you, if your facility is multi-tenanted.
Final thoughts: we have just explored operational KPIs that can prove that you are delivering value to your customers, and can guarantee your customers that they are getting value from the services you offer. In the next edition, we shall be focusing on other value-adding KPIs, as they relate to key business performance measures such as: financial and customer satisfaction metrics.
