Outsourcing facilities management
- June 30, 2020
- Posted by: Dhivya Srinivasan
- Category: Training
Facility Management as an industry comes up with trends that offer cost savings or productivity improvement opportunities now or could transform organizations over the next decade.
Outsourcing facilities management – How does it work?
Organizations are evaluating their operating model to maximize value creation. Before they outsource facility management to third parties, however, they review the appropriate mix of insourcing and outsourcing based on capability, cost, and coverage. Several factors are altering the equation.
- Growth in outsourcing. Outsourcing has now surpassed 50 percent of the total facilities management market in several regions, including Asia, Europe, Middle East, and North America.
- Industry-based adoption. In manufacturing companies, soft services such as landscaping and janitorial are preferred categories for outsourcing. Hard services such as utility equipment maintenance are typically still insourced. Meanwhile, retail, banking, and other non-manufacturing industries are looking to first optimize their operating model by balancing insourcing and outsourcing. If the benefits they achieved are not significant, some players in these industries have opted to fully outsource facility management.
- Penetration of integrated facility management (IFM). IFMs are capturing increased market share in outsourcing.
- Cost: Is your operating model optimized and peers still have better cost performance?
- Competitive advantage: Does facilities management provide a competitive advantage over peers?
- Organizational capability: Does the company have experienced personnel in facilities management with intrinsic knowledge of the location as well as highly efficient internal technicians that would be challenging for a third party to match?