Do KPIs and SLAs work for GCC's FM contracts?
Ian Harfield, CEO of Cofely Besix Facility Management (CBFM), explains how KPIs and SLAs can be optimised for the FM industry
Within our role as FM service providers, we are often asked this question when reviewing a contract document: Do key performance indicators (KPIs) and service level agreements (SLAs) really work?
As an industry, we are fundamentally driven by SLAs and various KPIs, from the most basic to extremely complex. However, I believe we should take a step back and ask the most simple of questions – do they genuinely work?
I suppose a question that quickly follows would be about how the effectiveness of a KPI can be measured. It may sound ridiculous, but the reality is that poorly-structured KPIs and SLAs can add significant cost and unnecessary complexity to the delivery of a contract.
How many of us have read an output specification and noted all too familiar wording used by more than one customer? The reality is that as employees move between employers and take best or ‘convenient’ practices with them, these standards or templates evolve and are recreated. In my opinion, an FM client should study their building and finishes in great detail and compose a brief to describe what they actually want.
Such a study should be specific to their building and in conjunction with the FM manager, as they would be able to view the building as an end user, and anticipate potential wear and tear as well as prescribe remedies required to keep the facility in optimum condition. Naturally, this would be the ideal situation.
This would lead to a customer that has a clear vision about the deliverables and is therefore able to quantify the specific and unambiguous outputs they need from the service. They know how the work specification was drafted and developed and thus, in conjunction with measurement points, they will define a deliverable that can be achieved.
This would also lend fair representation, with the supplier being able to demonstrate they are meeting contract objectives. Thus, the KPI or SLA document would be effective in this situation.
This process would, of course, be a lot simpler if the supplier was merely delivering boxes to various addresses as part of a certain framework, but an FM provider doesn’t deliver a tangible physical product – we deliver a service. So how exactly do we measure whether a service has been delivered?
For example, would it be the number of times the floor was swept, or whether the floor is clean? Obviously, the measure from an output would have to be that the floor is clean, but when would you measure the deliverable service – at the start of the day, or at its end? When is the right time to obtain a fair and accurate check? Would it be better to have an average measurement throughout the day, which could result in a floor being 75% clean, if that is even possible?
Measuring whether a floor is clean may sound very simple, but it is difficult to achieve without a large statistical manipulation of data that in real terms, creates a percentage or score that falls within a banding and in turn confirms that the service is set as satisfactory. Would a 75% score mean that a floor is clean? Further complexities are introduced at this point: does this change the deliverable, or does it change the reporting method?
In most cases, the reporting method is adjusted to suit the particular KPI so as to achieve deliverables to the correct standard. This brings me back to my initial question – are KPIs actually effective?
Perhaps we should take a look at KPIs and SLAs within the FM industry and determine whether they really need to be unique or exclusive to each customer. Every customer and their buildings or facilities are different but surely, clean is clean, and we can argue that cold air from a fan coil unit (FCU) is the same at 24° irrespective of where you are.
Seeing as these types of measurement systems are the cornerstone for the control and management of FM contracts, perhaps we should look at regulating KPIs and SLAs into a GCC-specific format or template, or even an accredited system. As the FM industry continues to be driven by output specifications, one of the fundamentals contributing to success in this fast-moving region could be the creation of an industry standard. This would entail that the facility manager is trained to monitor, and the supplier is educated about what to deliver – not how to deliver, which is a very different discussion – to meet stipulated standards.
If both parties are on the same page, then the supplier and the customer will be more efficient and effective, and this could result in significant savings due to their vision being aligned. An example of this is the British Institute of Cleaning Science (BICSc), the accredited cleaners of which are trained to work in a certain way, with an FM manager or customer trained to be a lead assessor. KPI expectations and deliverables are therefore completely aligned and free of ambiguity.
We all know that some customers and suppliers find it difficult to verbalise their requirements or even their expectations, and most conflicts stem from miscommunication between them. However, if suppliers become familiar with a set standard and demonstrated outputs, then it could result in a KPI system with an accredited manager on the client side and accredited supplier on the service side.
Both parties would be clear about delivery expectations and know they will be managed fairly, leading to an enormous risk reduction for them. The focus for the FM supplier would be getting the job done efficiently, which is eventually the key benefit of outsourcing.