Why are we so exposed ?

After another month of interesting activity, I would like to focus on one or two scenario's that adds a little meat to the bone ....

Periodic Inspection Reports (PIR). As most of you will be aware, commercial properties typically carry out PIR's every 5 years. This involves an approved electrician or electrical company attending site, fully inspecting the electrical installation, and then producing a report.

This report will also identify any remedial works required to ensure the installation complies with statutory requirements. The Client then has the responsibility to ensure he/she takes the appropriate action.

This PIR naturally carries a cost, and the remedials will typically be quoted where appropriate.

OK - here's the scenario ....

1. You employ an electrician to carry out a PIR. He/she attends and gives the site the 'All clear' and charges you for the PIR. How confident are you that your site does in fact comply ? You then pay for the PIR inspection and everyone moves on.

2. The PIR above is carried out, and you receive a list of defects and quotes to rectify. How do you know these defect are both genuine and/or need to be actioned ?

Here is a real life example.

Company A were commissioned to carry out a PIR. This PIR was executed together with an 'All Clear' report back in August last year. The Client paid for the PIR inspection and their records were updated for this particular site.

3 months later, an electrical fault was reported, where A N Other electrical company (Company B) was sent to resolve. The report back was that the site was electrically dangerous and did not comply to current legislation. Moreover (without the knowledge that a PIR had been carried out 3 months earlier) recomended and PIR !

Here are the photo's found by Company B on this site after it was given the 'All Clear' ....










As you can see, aside from the knowledge the Client had paid for an inspection that was clearly not executed correctly, there is huge risk of accident, electric shock and operational failure. All of which would have serious financial and well being consequences.

Unfortunately, this is NOT a rare situation, and is happening every day.

Why does this happen ?

As you can imagine, there are a number of reasons, but one major contributing factor is the 'Free Lunch' syndrome. Where Clients force the price down and down, contractors then irresponsibly accept the work, knowing they cannot afford to do the job properly for the money being paid.

They therefore carry out shortcuts (some more dangerous than others). Because the people that are on site are typically un trained in this field, this problem will go un-noticed and un-challenged. This reflects my earlier post why companies in this industry can get away with so much.

How can this sort of activity be avoided or substantially reduced ?

Every Client will adopt and design various processes to control and monitor activity across their estate. However, these processes are rarely forced and in the main are totally ineffective without huge resource.

Some Clients will adopt software and systems to tackle this issue, but again the lack of forced processes and the drain on resource means this is once again ineffective.

There has to be an 'out of the box' practical approach, and surprisingly, no-one has cottoned on ....

Believe me, there is a simple solution, it doesn't cost a penny ! and there is no demand on resource. You simply have to embrace the facility.

The solution is the InformLive Concept. Its about a total solution, not just an IT system.

Summary

In this one instance, we have demonstrated how Clients are paying money for a service they are simply not receiving, and a service that is very difficult to police without huge cost and / or resource.
The reality statement being ... "The Client has little or no control of activity across their estate, and are therefore substantially exposed on a regular basis"

By controlling just this very simply PIR issue, the cost savings and improvemnt in quality work across your estate is phenominal.

Now imagine applying the same control procedures across all other aspects of FM !

Result ...

The Client receives substantial cost savings, he/she demonstrates an absolute knowledge and control over their estate, and it costs nothing to setup, implement and operate.

We will be posting more scenarios over the coming weeks, and each time, showing how these issues can be effectively controlled.

Background of the Author

Before we get into the various tips & tricks regarding this industry, I would like to offer some background information.

Firstly, although I am typically writing this blog, the content is usually driven by a few of my colleagues. You will therefore see from time to time that I switch from 'I' to 'We'.

My working life began back in 1978 and resulted with the completion of an apprenticeship in Refrigeration mechanics. Then moving onto the tools as a refrigeration service engineer for many years working in large commercial and small industrial sectors.

After 10 years, then moved into the office learning the other very important element of the business, and that's when the weight piled on LOL.

From here, I began working with my colleagues in the contracting business designing and delivering large central plant refrigeration systems to most of the blue chip supermarket industry.

Around 1988, the Split Air Conditioning market began to take off in the UK and Air conditioning began to be perceived as the rich mans industry. We then began supplying and installing hundreds of split systems to clients, which then soon evolved into VRV (variable refrigerant volume) multi systems, inverter systems and very energy efficient systems.

Suddenly, the old attitudes from Clients of 'We are only interested in capital costs, as the running cost is someone else's budget' started to change (and about time !). Over the last 10 years, we have seen a marked change in attitudes and company policy ensuring that capital cost and sustainability are appropriately aligned.

Around 1997, I moved into Facilities Management, initially in a small scale managing refrigeration, AC, Electrical and ventilation systems only.

Over the years, this slowly encompassed more and more services and by 2002 we were offering the fashionable 'One stop shop'.

As time went on, like most markets, prices were being forced down by the Client and companies were taking the work just to turnover cash.

However, there was one big difference with FM (and maintenance in general), money could be made very easily ... but WHY ?

Bear with me a moment ...When a Client asks for an Air Conditioning unit to be installed, he tends not to pay until he can see the unit has been installed and is working, and rightly so. But what about FM (and maintenance, or PPM as it's also known) ?

Well it didn't take long for service providers/contractors to realise that they were able to claim the full price and yet do half the work, thus making a healthy profit. This was made possible by the fact the Client could rarely challenge whether the work they had paid for was actually delivered, unlike the air conditioning unit.

From around 2002, Maintenance companies and alleged FM companies began springing up all over the place all taking a piece of this very lucrative pie, and still today, many of the issues above still take place.

As we move into one of the worst financial depressions in our own lifetime, Clients alike are focusing on savings, efficiency and sustainability, which ultimately simply forces a greater demand in reduction of delivery cost. While there are so many ways to to carry out a fraction of the work you are being paid for, each time the market forces the price down, the service provider simply does less work and sustainability diminishes faster than ever before.

I sit and watch both small and large companies continue to acknowledge there is no such thing as a free lunch, and within an hour sit down and order their FREE lunch.

Over the last 3 years, I have jumped the fence from Contractor (service Provider) to Client (or at least working for and with the Client). This has enabled me to have a very clear and true understanding of both elements, and the realisation that neither side of the fence has a true respect for the other.

The reason for all these ramblings is to set the stage for what we believe will be a revolution in FM. We believe we have the knowledge, common sense and tools to set this Industry on the straight and narrow. Over the coming weeks, we will identify numerous scenarios that take place in everyday FM life in an effort to get companies and contractors to realise where this whole industry is going wrong, and then we will ultimately offer the total solution.

Come back soon or subscribe to our feed to receive regular updates.

InformLive FM (Another view)

Welcome to the InformLive Blog Our Blog will discuss many tips and tricks on how to manage your estate, but more importantly, how to minimise cost and add value. This does not always mean 'Find the cheapest' !

Over the next few weeks, we will be talking about the very basic principles that many people either get wrong or simply miss. The effect on estate operation is effected immensly in terms of both uptime and cost.

It is our experienced view that 90% of Estate managers and Facility Managers spend in excess of 30% too much revenue in delivery estate sustainability, and revenue wastage is at an all time high.

The reason for this wastage is as a result of two very simple and basic protocols:

1. A robust and industry friendly management tool
2. A set of tried and tested processes.

Applying these simple protocols will guarantee added value and reduced costs to ANY Estate management department.

Our next article will be available within a few days.

http://www.informlive.co.uk/