Interserve Press Office | Oct 11, 2012
A cost-conscious, service-led approach to outsourcing facilities management is delivering value but may be failing to achieve the levels of innovation required, according to the FM Market Survey 2012, a new research study commissioned by Interserve and undertaken by Sheffield Hallam University in conjunction with i-FM.
The survey, in which 585 service buyers and providers were surveyed from across the UK, found that most organisations now have clear expectations when they outsource facilities management services, with cost reduction remaining the key driver. Yet innovation in service delivery is only reaching its objectives in just over fifty per cent of cases.
Questioned around their reasons for outsourcing, respondents indicated that financial savings (70 per cent), service level improvements (61 per cent), access to better technical expertise (60 per cent) and risk sharing (57 per cent) all take precedence when choosing a supplier and, the study has revealed that more than 70 per cent of organisations believe they have achieved these objectives in each case.
Innovation, in contrast, is falling short at 56 per cent, with organisations citing internal pressures such as financial barriers, resistance to change and a lack of board level support, alongside issues such as a lack of supplier investment as the main barriers to delivering innovation.
Bruce Melizan, Executive Director at Interserve said, “All business disciplines are under pressure to perform and facilities management in particular is often required to deliver ‘more for less’ in the post-recession economic climate. Over 85 per cent of the respondents in this survey are experienced buyers that have been outsourcing for more than three years; and so it is encouraging to see that organisations are now reaping the benefits of improved cost and service efficiency through an outsourced facilities management model.
“However, there is also a clear expectation that facilities provision should now be delivering much more than cost savings alone; meaning that our industry must ensure it continues to adapt by providing a service that adds value to the client’s brand, business performance and reputation.”
The survey also revealed that:
- Performance pressure is here to stay. When asked to rank objectives in order of likely importance in five years’ time, respondents listed the top five as: value for money, reducing costs, service quality, flexibility of service delivery and added value/innovation.
- Clients and providers need to develop better partnerships. The top three success factors in these relationships are: trust, communication and service quality. Value for money is rated fourth.
- Asked about the current balance of responsibilities in their jobs, well over half of respondents said they spend less than 30 per cent of their time on future strategy with most of their time and effort being devoted to day-to-day and reactive needs. Asked how they would like to spend their time, most are looking for a better balance – with 50:50 being the optimum ratio for the largest proportion.
- The standard three-year contract term is being questioned. Although a third of organisations still opt for this term, almost a quarter are now using five years or longer and slightly more do not apply a standard term for their contracts.
The key findings from this research are available in a report called ‘Facilities management – an industry wide perspective’ which can be downloaded by clicking on the image above or via www.commercial.interserve.com or www.i-fm.net.
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585 individuals responded to the research, undertaken by the Centre of Facilities Management Development at Sheffield Hallam University and partnered by i-FM.
66 per cent of respondents were from the private sector and 33 per cent from the public, not for profit or third sector. Over 50 per cent of respondents work in London or the South of England and 10 per cent outside of the UK. Organisational size was split fairly between those with budgets of less the £550k, those between £500k and £3m, those between £3m and £25m and those with over £25m.
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Interserve's vision is to be the Trusted Partner of all our stakeholders. We are one of the world’s foremost support services and construction companies, operating in the public and private sectors in the UK and internationally. We offer advice, design, construction, equipment and facilities management services for society's infrastructure. Interserve is based in the UK, has revenue of £1.9 billion and a workforce of nearly 50,000 people worldwide.
Commercial website: www.commercial.interserve.com
General website: www.interserve.com
About Sheffield Hallam
The Centre for Facilities Management Development (CFMD) at Sheffield Hallam University is an academic centre of excellence that applies the latest thinking to develop facilities management knowledge, people and practice.
Sheffield Hallam website: www.shu.ac.uk/cfmd
Launched in 1999 as the first source of daily facilities management information online, i-FM’s award-winning service has evolved with the market to meet the needs of a rapidly-expanding and maturing sector.
i-FM's website: www.i-fm.net
To access the PDF documents you need the Adobe Acrobat Reader, which can be downloaded from the Adobe website.