6 ways effective facilities management can reduce costs
Facilities management services support an organisation in a number of ways. Whether it’s keeping executives up-to-speed on the leases, rents and rates of their property portfolio, guiding the course of projects from start-to-finish, or making sure employees walk into a clean, fuss-free environment, FM is a critical difference-maker in many businesses’ day-to-day.
Enabling efficiency and productivity
But one of its key potential advantages is how effective facilities management can reduce costs across a company. With a firm focus on streamlining the processes that keep businesses moving, investing in your FM professionals and CAFM/IWMS software can pay tremendous dividends down the road, enabling organisations to function more efficiently and productively.
Here, we explore 6 key ways that companies reduce costs through constructive facilities management, and identify strategies that can make a positive difference to the bottom line.
How can facilities management cut down costs?
- Predictive maintenance planning
- Optimised space management
- Automate time-heavy tasks
- Enhanced energy savings
- Make employees more inclined to stay
- Tighter project tracking
1. Predictive maintenance planning
Firstly, quality facilities management can result in substantial savings connected to assets throughout an organisation. Teams that rely on reactive maintenance, i.e. waiting for a component to fail before responding to it, will typically see greater costs than those who take a preventive or predictive approach.
This is due to several factors:
- Waiting for components to break before responding increases the likelihood they will need to be replaced, which is often costlier than maintenance over time
- If a component breaks and isn’t spotted immediately, it can continue to drain on resources while not providing any benefit in return
- The failure of the asset may compromise employee safety or make your business non-compliant with regulations, which may incur fines
In fact, according to Reliable Plant, predictive maintenance saves 8%-12% over preventative maintenance, and a massive 40% on reactive maintenance. By scheduling in regular servicing of assets based on your understanding of them, you can reduce the risk of failures and breakdowns and the greater costs these incidents often incur.
Furthermore, consistent maintenance also goes a long way in extending the lifecycles of assets. While an unmaintained HVAC system might go haywire in a few years, one that is well-treated and regularly maintained will likely last several years longer before a replacement is required. Over time, this can drastically drop the costs your company sustains on the asset management front.
To fully benefit from this facilities management cost reduction, it’s essential to have an accurate understanding of the data surrounding your various assets. A sophisticated CAFM/IWMS system like MRI Evolution will be capable of bringing together this information into one central database, which can then be used to schedule maintenance tasks going forward.
By tracking this information within a central database, companies also minimise the potential of maintenance being unnecessarily repeated. While this is less hazardous than performing no regular maintenance at all, it still represents a redundant and avoidable expense.
2. Optimised space management
Another facilities management strategy that reduces operating costs is through effective space management across your facilities. Data from the GSA in 2012 revealed that only 35%-50% of a workspace is occupied by employees in America and Europe between 8am and 5pm. We Covid-19 spurring a movement towards remote working, it’s likely this data has shifted even more dramatically in recent months.
The remainder of this space is doing nothing beyond costing you money to maintain. These costs may not jump off a balance sheet as evidently as procurement costs and wastage do, but these expenses can add up quickly unless they are addressed.
Through a carefully implemented space management strategy, companies can determine better ways to allocate space, dispersing people from more crowded areas and encouraging them to utilise more of the locations across the facilities.
By regaining control over the space available throughout your properties, you can make the workplace more manageable for all involved, discover better ways to work and, most importantly, ensure no money is wasted on vacant locations.
3. Automate time-eating tasks
Collecting asset data on spreadsheets. Checking and restocking inventories. Completing sales invoices and further documentation. In prior years, these tasks would have to be done manually, which was not only extremely mundane for most people, but also incredibly inefficient.
With the sheer volume of tasks that FMs must oversee to maintain the smooth running of an organisation, a manual approach simply isn’t feasible or cost-effective. Instead, it is wiser to reduce costs with facilities management software, that can automate the most time-consuming and tedious tasks seamlessly.
For instance, within MRI Evolution there are modules that can streamline and automate the following and more:
- Stock management
- Quotation management
- Sales invoicing
- Purchase orders
- Asset classification
- Facilities booking
By incorporating CAFM/IWMS software to support your FM teams, you can significantly cut down the time and effort it takes to capture information and react accordingly. This frees up time for your team to devote to duties that require their full attention, rather than something that a well-configured system can do on their behalf.
4. Enhanced energy savings
A fundamental way to cut down costs is by boosting energy efficiency. Not only does this approach benefit the environment, but reducing carbon emissions can over time lead to significant savings without any noticeable drop in performance.
How does facilities management help to reduce these costs? In a variety of ways. It can be as straightforward as recommending and implementing energy-saving light bulbs, double-glazing on windows and enhanced wall insulation within the facilities.
While these will incur an immediate cost, it is an investment that pays back over time on a company’s energy bill. Remember that, according to the EPA, approximately 35% of a building’s energy costs are spent on lighting alone. A switch to energy-saving bulbs can play a big role in reducing that slice of your overall costs.
In addition, due to the push across the globe to be more environmentally-conscious, a stronger stance on energy efficiency has the potential to entitle your business and employees to tax cuts and other incentives.
By introducing measures to consistently monitor and track energy usage, FM professionals can harness that data to make definitive cost-saving measures. These can then enhance assets’ longevity and allow them to perform more efficiently.
5. Make employees more inclined to stay
One of the core goals of facilities management is to make workplaces more hospitable for employees on a day-to-day basis. Whether it’s keeping rooms at an ideal temperature throughout the year, quickly responding to any unsightly litter, spillages or blockages, or providing spaces for some R&R, these are all ways FM contributes to employee satisfaction.
And, the more satisfied an individual is in their working environment, the more likely they will want to remain part of the company moving forward. It is easy to overlook the importance of the quality of the workplace itself in employee happiness in comparison to aspects like salary, incentives and relationships with management, but it does play a big factor.
In fact, a survey by Capital One in 2017 revealed how 52% of employees described their workplace as uninspiring. Too long in an environment like this will gradually impact their overall satisfaction in that environment. This will lead to productivity issues and potentially encourage them to seek greener pastures.
This demonstrates the role that effective facilities management plays in retaining staff and supporting recruitment as well. Considering that the average cost of replacing an employee is estimated to be around £30,000, keeping employees happy is a crucial way that FMs can secure big savings for their company.
6. Tighter project tracking
A final way that effective facilities management can reduce costs is by supporting superior monitoring and time tracking of individuals involved in a project, be that a full-time employee or a temporary contractor.
Our fully integrated Project Management module centralises the management of all aspects of project delivery into one platform, which gives users a birds-eye view over every detail from the beginning through to completion.
This insight into the details of a project helps ensure that major potential cost concerns can be avoided:
- Accurate time tracking means teams can identify any areas of inefficiency quickly and respond to them before they cause significant losses
- The system automatically pinpoints any hazards, allowing these to be mitigated before they have a noticeable impact on the budget
- Contractors and subcontractors’ details can be monitored and verified to ensure no work goes under the radar or is billed unnecessarily
By keeping close tabs on all projects being undertaken, there is less risk that costs will exceed the budget and opportunities can be identified to further increase efficiencies as the job develops.
Reduce costs with facilities management software
As you should now be able to recognise, notable cost reductions can be achieved through effective facilities management. However, in order to maximise the potential of this cost-cutting capabilities, it is important to invest in the right tools to support your FM team.
MRI Evolution, our ultimate CAFM/IWMS solution, keeps complete control over costs and stretches efficiencies further than ever before. Track historic costs, labour loads and regime planning through analytics to spur meaningful cost savings, and optimise team workload to avoid superfluous spending.
For more information on how MRI Evolution can curb the costs of running your business day-to-day, contact our team today.
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