According to McKinsey, outsourcing services now make up more than half of the total facilities management market in North America, Europe, and the Middle East. Various models exist within the market, and not all facilities management solutions are created equal. The report goes on to say, “Companies that track emerging trends and invest in the right organizational capabilities will be well positioned to reduce costs and increase the impact of their facilities management spending.”
In the face of recent market conditions, integrated facilities management (IFM) — that is, a holistic approach to managing facilities that integrates a wide range of service needs and capitalizes on synergies — has been a rising star. McKinsey reports that IFMs are capturing increasing market share, especially in North America, where IFM providers represent nearly 20 percent of the outsourced category.
But what exactly is integrated facilities management? Read on to learn more about this model and how an integrated approach helps retail businesses achieve greater operational efficiency and cost savings while preparing for future trends.
What is integrated facilities management?
Integrated facilities management, or IFM for short, is one of three approaches to third-party facilities management. These three models can be defined as follows.
- Fully outsourced: In this model, you contract with a third-party facilities provider that manages all your services through various vendors. While this approach can offer strong rate negotiation, it lacks accountability and direct quality management, which can lead to repeat service calls and higher costs over the long term.
- Hybrid: This type of FM company self-delivers some services with its own employees and manages other vendors for the rest. This approach tends to result in some of the same accountability and service quality challenges seen in the fully outsourced model.
- Integrated facilities management: Also known as integrated self-delivery, providers that follow this model use a holistic strategy where one provider fulfills all your facility needs from end to end, with most services self-delivered. By focusing on total cost of ownership, integrated facilities management (IFM) can achieve cost reductions through efficiencies and technology innovations while delivering enhanced service quality.
In the current market, the demands placed on retail facilities management leaders have never been higher or more complex, thanks to:
- A shrinking skilled labor market
- Unprecedented inflation
- Rising costs of energy in tandem with higher energy demand
- Continued difficulties with supply chains
- Increasing sophistication of technology
- Increasing frequency and severity of weather events
- Disruption to the retail industry requiring massive investment in innovative solutions
- Sustainability goals mandated by clean energy legislation
Not to mention, there are the inherent challenges of managing coordination and integration in siloed sectors for facilities that operate on traditional models.
As we’ve seen over the past few years, the only thing we can be certain of in this industry is change — and in most cases, rapid change. An integrated facilities management model brings flexibility, fresh ideas, and an ability to adjust quickly as market conditions continue to evolve over time.
What are the benefits of integrated facilities management?
How can integrated facilities management help facilities leaders meet the demands above while achieving the best balance between costs and service quality? Here are some of the advantages IFM providers bring to the table. Beyond delivering on core traditional facilities management functions, they offer:
Technology innovation and data analytics support
To be effective in today’s environment, facilities teams need to utilize technology effectively to optimize operations. An IFM partner brings advancements that can help you take advantage of the latest industry innovations without having to invest in upgrading internal IT resources and systems. The right partner can help retailers integrate predictive technology, machine learning, AI, and IoT capabilities with their legacy systems, increasing asset uptime, ensuring compliance, enhancing energy efficiency, and optimizing asset management. Additionally, with the proper systems in place, facilities managers can leverage real-time data to fully informed decisions that can be executed quickly and on a remote basis.
Energy management capabilities
With rising energy prices and new clean energy legislation, business and facilities management leaders need an effective energy management strategy to minimize the impact on profitability and meet strict net zero emissions in the coming years. An integrated facilities management partner experienced with energy management services can offer a roadmap and technologies for reducing greenhouse gas emissions and saving energy costs. For example, City’s holistic approach to sustainability, including FM, energy and asset management, and building and engineering services, is proven to reduce retail store energy consumption by as much as 50%.
Building and engineering services
In an effort to stay compliant with sustainability legislation and keep up with rapidly evolving consumer trends, multifunctional collaboration must be achieved to rapidly move remodeling projects, new store development, and store expansions from the planning stages through design, construction, and completion.
An IFM provider with a building and engineering team can offer accelerated project timelines, manage costs, and lower energy use. Providers that boast energy transition and sustainability services (ET&S) can ensure net zero programming, refrigerant management, and other sustainability targets are seamlessly integrated into the design and planning phase and that critical systems are installed correctly.
Disaster planning and emergency support
As the risks of extreme weather events increase nationwide, securing reliable disaster planning and recovery support becomes critical for retail and grocery store businesses who face outsize risks from facilities damage and business losses. In emergency situations, when resources are scarce and in high demand, internal facilities management teams and traditional FM providers relying on multiple vendors are less likely to get timely support. An integrated facilities management provider operating on a self-delivery model with its own team of technicians offer retailers more control over disaster support so they can rapidly execute repairs and get up and running quickly post-storm.
Long-term cost savings
Unlike traditional facilities management providers, which are hired on an ad hoc basis by the hour with costly emergency call fees, IFM companies use a total cost approach which breaks down silos and encourages better coordination, streamlined processes, and improved efficiencies. As a result, savings can be achieved by cutting down on maintenance costs, reducing downtime, and optimizing asset performance. Not only that, an IFM partner can help retail businesses develop a long-term strategy customized to their needs, which can generate even greater cost efficiencies down the road.
|How do you choose an Integrated Facilities Management partner? Read our Guide to Hiring a Facilities Management Company: 10 Things to Know.|
A Disruptive Approach to Facilities Management
It’s important to remember in your search for a provider that not all IFM companies offer the same level of service. While consolidating your facilities management, building, energy management, and other services under one roof is sure to have a powerful impact on your organization, a successful partnership requires a strong relationship built on trust. At City, we offer an industry-disruptive delivery system based on transparency and collaboration, which we believe are key to generating the best results. Learn more about our Integrated Facilities Management services.