Benchmarking vs re-tendering

John Brownless, Partner – LitmusFM – explains why benchmarking is a good alternative to re-tendering contracts in the COVID era.

In a post-pandemic environment, facilities managers face significant changes with increasing economic and environmental pressures. And more than ever, they will be reviewing their FM service providers and whether they are part of the ‘new normal’ jigsaw; or not.

Many FM service providers play a decisive and positive roleespecially when they are embedded within an organisation by suggesting, implementing and encouraging the adoption of best practices, technological improvements and alternative ways of working.

Our FM consultants have heard from a lot of facilities managers in the past month or so. The question they have all been asking is – are they getting value for money with their current service providers?

We’ve worked with many organisations over the past 30 years and receive, examine and analyse over £1bn worth of FM solutions per annum.  And when facilities managers ask about value for money, they are not talking about whether they are getting a service as cheap as possible. It’s more centred around a) are the service providers delivering the best possible service that actually works for the facility’s users and b) are services being delivered in the most efficient way.

For many facility managers, it’s difficult to understand if value for money is being received with current service providers compared to other similar settings. But this doesn’t have to be an unknown.

In the past, the only way to understand if value for money was being received was by tendering a service. However, this isn’t always the answer as often there is no issue with the relationship with the service provider; more an issue with the systems, processes or agreed service levels in place.

Tendering often causes a level of disruption – to both workflow and employees. Every time a tender takes place, contracts start afresh and FMs have to allow time while the new service provider gets to grips with the operation, systems and ways of working.  This doesn’t happen overnight. It also has potential to lead to significant disruption for employees at a time where they too have faced uncertainty around their jobs and what the future holds post-pandemic.

This is where facilities benchmarking comes in. The use of benchmarks offers a tried-and-true approach to homing in on the efficiency and quality of both combined and individual facilities management services. Benchmarking helps make informed decisions; decisions that encourage stability and strength moving forwards, as opposed to disruption.

Why Benchmarking?

  1. Market testing: If facilities managers work with the right FM consultancy – which has years of experience, data and knowledge – then benchmarking will ascertain if value is being delivered. We’re not just talking about cost – benchmarking goes much deeper than simply pennies and pounds. It’s critical to the successful management of broader transformational change, including cost management initiatives, re-engineering of business processes and implementing quality control measures. With our decades of experience, we have the most advanced, current and true deliverable, optimum operational benchmark data in the UK FM sector.
  2. Collaboration: In an era of uncertainty, the resounding desire from everyone we’ve spoken to is to rebuild stability. In terms of rebuilding business and also in terms of people and providers. Partnerships that were built before the pandemic and remained loyal throughout the crisis are the partnerships that should be nurtured, not put through a tender. Cultivating long and lasting relationships with service providers brings far greater reward than switching to a new service provider constantly. If both parties work collaboratively and are committed to each other’s success, it’s likely to bring far richer results and innovations in the long term.
  3. Learning: Understanding what others in the sector are doing and drawing learnings and comparisons helps ensure new ways of working are successful and right for an organisation. It gives an insight into what the future working methods could look like and the advantage of foreseeing any potential issues before implementing.

Benchmarking is for all establishments – from those in need of dramatic overhaul to ensure a prosperous future, to those performing strongly and only needing small tweaks to their operation. With all organisations we work with we focus on how a business can be best organised to deliver and execute their facilities or estate strategy more efficiently and effectively.

To understand how benchmarking could benefit your organisation complete our online contact form here.

If you would like to invite colleagues to a group discussion, our facilities management consultants can arrange online meetings through Microsoft Teams or Zoom.

Litmus – doing what’s right, when it matters most.