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Role of Procurement in the Facilities Management Industry

1536 Procurement Facility Management

Essentially, organizations now firmly believe that sustainability is vital to their business profitability and technology adoption is the quickest way to more client acquisitions and business growth.

It is undeniable that the pandemic disruptions have aided the technology transformation across the board. The Facilities Management (FM) industry has seen many breakthrough innovations and solutions altering the complete ecosystem of its service compositions & packaged offerings. Adding to this, the revised business strategy of all organization has seen or probably been mandating significant attention to sustainability, or more extensively, the overall ESG (Environmental, Sustainability & Governance). 

Essentially, Organizations now firmly believe that sustainability is vital to their business profitability and technology adoption is the quickest way to more client acquisitions and business growth. However, organizations must ascertain their priorities correctly, choosing the proper framework to determine the short-term goals while also providing a clear road map for achieving their audacious but sustainable goals!

With many advocating 'change' being the only constant, facility management professionals, realizing this earlier than others, have embraced technology adoption and practicing sustainability into their bottomless list of job responsibilities. This early adoption benefits the FM fraternity. As such, the organization they serve should also take the lead in including the non-core FM outsourcing functions as a more integral part of their technology to drive sustainable business growth.

With this, the task of the facility managers has become even more vital as they are the ones who facilitate various aspects of services and are the closest to seeing the complete life cycle of a product starting from the conceptualization stages to the eventual user experience!

The cost will remain the driving point for any selection of facility managers. However, the organization's key stakeholders or functional custodians come into play in that delicate balancing act of ensuring the partner selection upholds the true spirit of partnership for more growth-centric collaborations with mutual recognition and rewards.

The balanced scorecard performance evaluation approach ensures the correct cost allocation and selection of core service providers; further augmented by the right technology partners, the cost is w regulated while providing service excellence to ensure customer satisfaction. The resulting impact also considerably minimizes the resource utilization with the right introduction of technology and digitization of services. Sustainable procurement or technology-enabled green procurement is often the missing link in driving the overall balance and, more so, the sustainability across all levels, between the stakeholders, key suppliers, and the procurement teams.

Companies have a unique opportunity to rebuild their business relationships and supply chains emerging from the pandemic with sustainability strategies at the forefront. In this context, green procurement practices require a deeper understanding of product or services requirement accounting for the social and economic impacts of products and the environmental impacts throughout their life cycle with real-time data analytics.

Finding this right balance is very crucial to the overall success of the FM program, as those organizations who have repurposed their business in the new normal will want to bring in more checks and balances in the redefined business environment to remain on course after the pandemic disruptions.  

This calls for meaningful deliberations with all stakeholders and the preparation of a sustainable purchasing program. Speed of sourcing and proper selection is the key success ingredient that is further amplified by adopting the right technology and digitization. Besides this, innovation is another success ingredient that would facilitate sustainable growth contributing to the Net Zero mission signed up by key, more prominent developers and corporates.

It is perceived that innovation is a result of a technology intervention; however, having experienced talents understanding the product's complete life cycle is detrimental to developing a tremendous strategic growth plan. And hence the green procurement program should thrive on bringing about the right balance between talent-driven subject matter knowledge owners and the cost-driven procurement professionals, enforcing forward operating procedures than the age-old standard operating procedures. 

Many new smaller emerging organizations or entrepreneur-driven start-ups have shown great promise. They have led the technology innovation, but it's the equal responsibility of corporates to bring in a much-desired volume of investments for the program's success. Here again, the procurement role is critical in finding the balance between the organization's articulated objectives versus the benefits realized across all stakeholders mix.

The pandemic has altered the users' outlook and expectations, further adding pressure on the procurement role to ensure the sustenance of pre-existing culture and new normal practices while having a solid prevention plan for the forecasted business risks, to remain on course with greener outcomes. The buyer and the suppliers have a critical role in contributing to the overall program, driving the organizations' sustainability initiatives mutually challenging and influencing one another for better and stronger outcomes. The jointly developed procurement strategy is the key to sustainable business growth as we advance, with facility managers leading the discussions while corporates prioritize their expectations & desired outcomes. 


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Rajesh Shetty

Managing Director

Real Estate Management Services

Bengaluru

Been in the Facilities Management (FM) industry for over 20 years, instrumental in setting up the FM businness for Johnson Controls in India in 1999. Following that, was heading an Indian FM Company, wherein among the many credentials, notable one was of setting up of an international office for supporting the FM business of a Global Bank. Been with Colliers since December 2007 and actively involved in expanding the FM business across India both organically and inorganically.

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