RFP Magazine

The idea of being processcentric may or may not ring any bells at a real estate (RE)/facilities management (FM) organization.  After all, if the management team is seemingly making the right strategic moves, why fix what's supposedly not broken?

However, executives are well-advised to think again; a process-centric focus is becoming a real value add throughout the industry. Let's see what's behind this "new" direction and how it's re-shaping the way that executives and management conduct their business.

 

Solving key issues.

Three key issues have significantly affected RE/FM operations. One, management has an intense desire for data to make decisions but they rarely, if ever, have any "real" data to work with.  Compounding the problem, the data is usually in multiple forms.  Therefore, it must be translated for others to convert their data into a format fitting their individual needs as opposed to the organization or corporation as a whole.

Two, organizations have too many people doing work the same way that others before them did, executing on RE activities without actually having clearly defined processes. As a result, they are doing the work different ways and defining actions differently, leading to a "worthless ball of data" collected every quarter.

Third, working differently expands the problems exponentially.  Organizations have a revolving door of service providers with different ways of working and different ways of reporting information. This strikes a bad chord, with no cohesive hand-off of data from one to the next when contracts change hands on a set of services.

Yet, give credit to many business-savvy people in RE/FM for doing more than just allowing these problems to go unchecked. For example, there may be an internal push to (1) define their metrics and to (2) attempt the implementation of an integrated workplace

management solution (IWMS). The latter lets them gather data in a cohesive format whereby they can, in fact, make decisions based on that data.However, that promising approach faded when they realized their data was not good because processes were not aligned. Not much has improved in this regard because there are still regional or geographic differences or different organizations have different reasons for how they use space. So, there is no clear understanding of all the nuances for each individual division and how they roll up into the whole.

For example, organizations must have space available in a compressed timeline, based on projections that are often highly inaccurate. Yet, without a real understanding of the true intent of demand, what kind of space will be needed and how the space will be utilized, they are constantly in a fuzzy decision-making mode.

RE is generally behind the curve regarding having too much space or not enough. Why? They work from the business side's projections which are reasonably accurate for the current quarter but, after that, it's mostly gut instinct and not accounting for spontaneous economic forces. So they find themselves making poor decisions when sandbagged by second-rate information. Then, when the business wants space on short notice, getting delivery on an accelerated schedule is needlessly expensive. Without leveraging technology, it's a vicious cycle.

However, getting on the right technological track isn't simple. Organizations typically have 60-80 percent of their budget in committed dollars, but must take action on ad hoc or breakin projects or unwind them while overlaying a technology purchase/implementation and changing their portfolio in order to adapt. At best, management finds itself "between a rock and a hard place."

Defining solution 

Going from unsolved problems to real solutions begins by defining a process-centric organization. For openers, this genre has clearly-defined methods for conducting all activities and a process for strategic planning methodology, including methods for dealing with "unseen" or unknown elements.

Becoming process-centric allows organizations to move from executing on processes to implementing all decisions made in strategic or capital planning. Ideally, this is where workflow management and document management should dovetail so that everyone understands where they are in a process i.e., no surprises. And people on the ground delivering services to end-users must execute on those deliverables in a unified process so that everyone receives the same service level regardless of where they are, whether in Tokyo or Miami. Essentially the objective involves removing all variables associated with how people deliver space. And that is just within the RE organization.  Then the service providers are still delivering across all their clients in multiple industries, none of which may align with a particular organization's processes or employee expectations. So, a process-driven organization understands a workflow is attached to every request, every discrete item, every portfolio action. And they follow that process in order to be most efficient in an appropriate stewardship of the company's money.

Moving to process-driven

When an organization approaches the transition to becoming process-driven, they must make sure not to get ahead of themselves.  Before racing to get new technology and/or a vendor, organizations must define goals and clearly understand what they want to accomplish, their role in the corporation and real estate's role.

With that clear picture, look at all the processes (everything the organization does "cradle to grave").  For example, examine transaction processes, as well as processes for portfolio management, CRM, space management, operations and maintenance.  Annual building processes have to be accounted for, and new work practices must be integrated into the system so that mobility services are delivered to employees in a unified way as they move around. And Change Management is critical to a successful transition.  Nothing less is occurring than transforming the organization's processes from "I do it this way because I always have" to "This is how we all do it now because technology enables us to."

Next, management must go to the market to find the specific technology best suiting the organization's processes and corporate intent. In turn comes the technology implementation, while underscoring to employees and service providers that "These are the new processes, this is how we'll use it and this is the enabling technology" as opposed to the mistaken idea that "technology drives the process." Without the technology being implemented to support the individual or corporate mission, users either ignore or "game" it to work for them differently from others. When that happens, everybody is essentially back to Square 1.

Subsequently, make sure that, by everyone abandoning all offline "tools," there is only a single-source of information for metrics or process- based activities.  Stress that going outside of the processes or doing off-the book  activities  will not be acceptable.  And, in the continuing drive toward uniformity, ensure that all vendors are aligned with delivering services to employees, that delivering space or delivering maintenance is done in accordance with what is expected, that metrics being measured are supported and done in a timely manner. The latter helps guarantee that decisions are made from real-time data, as opposed to what happened last year.

 

What does it all mean?

The preceding observations and recommendations drive home multiple points about enhancing RE/FM organizations,  including:

• The challenge is to not only transform the RE organization; corporate services must be transformed, too, as well as how customers interact and their expectations
• RE services must be delivered at the same time that technology solutions are being implemented. If not, the organization grinds to a halt.  The transition period is critical and the organization's ability to accept the change is key.
• For every 10 seats sitting vacant in a portfolio, one job can be saved. At companies with 1 million sf sitting vacant, hundreds of people are not working because an office building sits there doing nothing. Engineering divisions work to eliminate minute bits of waste from production, so why is routinely wasting millions of feet of space acceptable? Says a real estate expert, "Why not lay off buildings instead of people, through better use of enabling technology and better corporate governance?"          
• Everybody looks at RE organizations from a different perspective, but typically not through the corporate perspective. Peoples' metrics and rewards are based on specific areas. If RE is an obstacle to achieving goals for that area they will willingly have the corporation provide more money for RE because they are not fully accountable. Everyone must be accountable.

 

Case study – High Tech Company

What happens when companies integrate leading edge technologies, forward-thinking work practices and new workplace ideas instead of working the same as always?  Sun Microsystems hit it out of the ballpark.

Worldwide, about 6 of 10 Sun employee worked without an assigned office, yet employee work life was enhanced:

eighteen dropin centers saved employees 90 commute minutes per visit, 157 flexible office buildings earned an almost 80% satisfaction rate, and work-from home not only saved employees two hours  a week in commute time  but increased productivity by 34% and employees gave 80% of saved time back to the company.

Specific to RE, this reduced Sun's RE costs by an eye-opening $350 million -- $67.8 million in one fiscal year alone -- and saved/avoided 7,215 seats.  Additional savings were recorded in fuel, real estate operations, energy and CO2 reduction.

None of this could have been accomplished without a data-driven, process-focused organization leveraging technology to drive efficient portfolio management and enable workforce effectiveness.

Rich Jordan is with Houston-based eBusinessStrategies llc (www.ebusinessstrategiesllc.com)