December 7, 2023

Why Facility Management Outsourcing is the Right Move

Facility owners and procurement professionals are always looking for ways to reduce operating costs. This pressure can cause organizations to have a savings-first mentality without strategically thinking of long-term repercussions. Outsourcing facility management services has become an increasingly emerging trend due to its proven ability to not only be valuable but also a goldmine of savings. 

How are organizations currently managing their facility services? The graphic below highlights the different methods of outsourcing facility management.  

Facility Outsourcing Models

While these other methods do work for some organizations, they can be very time-consuming for facility managers and building owners – which is why outsourcing can be very beneficial. Organizations are seeing the importance of evaluating their operating model to maximize value creation and lower the overall cost of ownership. Outsourcing has now surpassed 50% of the total facilities management market in several regions, including Europe, Middle East, and North America.

Consider Integrated Facility Management Outsourcing

When making a decision to outsource facility management services, consider the benefits of Integrated Facility Management (IFM). Exploring the integration of facilities management and related services is a strategic approach to streamline management and improve overall performance.  

IFM is capturing an increased market share in outsourcing, particularly in North America, where it makes up over 20% of the outsourced category.

Case Study – Integrated Facility Management Outsourcing 

A global financial institution was spending $450 million annually to maintain its thousands of locations around the world. Its fragmented supplier base included more than 10,000 vendors across about a dozen categories. To assess opportunities for outsourcing, the institution undertook a scoping and prioritization exercise, sought to gain greater transparency into spending categories, applied advanced sourcing techniques, and invested in stakeholder management. With the insights gained from this process, the company was able to consolidate its facilities management spending, from dozens of suppliers to just one vendor, while standardizing business processes and service quality. Adopting integrated facilities management helped reduce costs by more than $150 million over three years. 

Source: McKinsey & Company

What Can you Expect from Transitioning to an IFM Approach?

If you’re moving from a primarily in-house service model to a fully integrated facility management approach, the first thing you will benefit from is time. Allowing one experienced partner to manage your day to day means you can focus on other things that are important to your business.  

Other benefits include:  

  • Increased Efficiency 
  • Cost Savings 
  • Specialized Service 
  • Flexible & Agile Teams 
  • Lowers Compliance & Regulatory Risk 
  • Real-Time Facility Data & Insight 

Think of IFM as a partner for savings and portfolio management – one that works closely with you to establish robust governance and compliance, while providing industry-leading innovation and technology, like the standardization of CMMS technology, that further benefit the workflow and experiences within your facilities.  

What’s the Next Step?

Understanding the benefits of outsourcing is just the start. The next step to making it happen is assessing the current state of your facilities. It’s essential to know where you are starting from in order to create a plan for how your facility will reach its desired state.  

Outsourcing Facility Management Services

When assessing your IFM needs, start by conducting a comprehensive evaluation of your current operations and future goals. Identify specific areas within your facilities that require management and determine the level of support needed. Consider aspects such as maintenance, security, cleaning, space utilization, and sustainability goals. 

Engage with key stakeholders to gather insights into expectations and priorities. Assess the scale and complexity of your facilities, taking into account factors like size, location, and any unique requirements. Don’t forget to consider any regulatory compliance or relevant industry standards that the IFM partner must adhere to. 

This assessment phase will be the foundation for developing clear objectives and criteria that will guide your search for an IFM partner. The more detailed and accurate your understanding of your organization’s needs, the better equipped you will be to find an IFM partner that can provide tailored solutions to meet those specific requirements and work with you to achieve a desired state.  

When looking to outsource your facility management needs, it’s crucial to view the process as a partnership rather than just a service transaction. Look for a provider that provides strategic partnership, offers tailored solutions, and demonstrates a commitment to understanding your organizational goals and actively contributing to their achievement. 

Find the Right Service Partner

The right IFM partner will have an established track record and credible references and be able to provide insight into aspects that can further enhance your facility. Assess their ability to adapt to your unique needs and challenges. Look for a partner that prioritizes communication, innovation, transparency, and continuous improvement. 

Ultimately, choosing the right IFM partner involves finding a collaborative ally that aligns with your organization’s values and objectives, contributing to a long-term and mutually beneficial partnership. 

If you are at the beginning stages of outsourcing or ready to engage with a facility management partner, Dexterra can help you. Reach out to us today to learn more.