Facilities Management and Corporate Real Estate Management as Value Drivers

How to Manage and Measure Adding Value

Per Anker Jensen, Theo van der Voordt, Per Anker Jensen, Theo van der Voordt

• Publisher: Routledge
• Year: 2016
• ISBN:
  9781317442097
• Edition: 1
• Topic: Technology & Engineering
• Subtopic: Construction & Architectural Engineering
• Index: Technology & Engineering

Facilities Management (FM) and Corporate Real Estate Management (CREM) are two closely related and relatively new management disciplines with developing international professions and increasing academic attention. Both disciplines have from the outset a strong focus on controlling and reducing cost for real estate, facilities and related services. In recent years there has been a change towards putting more focus on how FM/CREM can add value to the organisation. This book is driven by the need to develop a widely accepted and easily applicable conceptual framework of adding value by FM and CREM. It presents the state of the art of theoretical knowledge and empirical evidence about the impact of buildings and facilities on 12 value parameters and how to manage and measure these values. The findings are connected to a new Value Adding Management model.

The book is research based with a focus on guidance to practice. It offers a transdisciplinary approach, integrating academic knowledge from a variety of different fields with practical experience. It also includes 12 interviews with practitioners, shedding light as to how they manage adding value in practice. This is a much needed resource for practitioners, researchers and teachers from the field of FM and CREM, as well as students at both undergraduate and postgraduate level.

Part I

Introductory chapters

1 Introduction and overall framework

Per Anker Jensen and Theo van der Voordt

Introduction

Facilities Management (FM) and Corporate Real Estate Management (CREM) are two closely related and relatively new management disciplines with developing international professions and increasing academic attention. Both disciplines have from the outset had a strong focus on controlling and reducing costs for property, work space and related services. In recent years there has been a change towards putting more focus on how FM/CREM can add value to the organisation. A EuroFM research group established in 2009 and chaired by Per Anker Jensen, Professor in Facilities Management and head of the Centre for Facilities Management (CFM) at the Technical University of Denmark (DTU), has studied this development.

A main result until now was the publication of the anthology The Added Value of Facilities Management – Concepts, Findings and Perspectives (Jensen et al., 2012a), which was launched during the European Facilities Management Conference (EFMC) in Copenhagen, May 2012. That publication gave an overview of the many different concepts that have been developed, and contained many important insights on the topic. The present book is a follow-up to the book from 2012 and will focus on instrumental issues, i.e. how to measure added value and how to manage value adding facilities and corporate real estate. Therefore, in the following we will for convenience call the book from 2012 “the first book” without further reference, and the new book “the second book”.

The research group has since the first book focused on developing a more practical applicable framework and methods that can provide guidance on how to manage and measure added value. The first activity was a joint workshop for researchers and practitioners during the EFMC in Prague in May 2013. The workshop confirmed that the concept of Added Value is interpreted in many ways and linked to a huge variety of different topics. Prioritisation of different types of added value proved to be highly subjective and dependent on the participant’s position, experience and personal beliefs. Most prioritised values included the contribution of FM and CREM to quality of life, the productivity of the core business, user satisfaction and sustainability. The participants found it difficult to mention concrete measures of how to add value, partly due to different interpretations of the term “measures” as “interventions” vs. “ways to measure”. The answers ranged from concrete measures such as evaluate happiness, satisfaction, work support, creating energy savings in building retrofitting, and take care of shuttle buses and parking facilities for bikes, to abstract measures such as steering on economics, efficiency and effectiveness, or “good price and value for the client”.

The editors of the first book were, besides Per Anker Jensen from the DTU, Theo van der Voordt, Associate Professor in CREM at Delft University of Technology, and Christian Coenen, Professor of Marketing and Service Management at Zürich University of Applied Science. This group also organised the workshop in 2013 mentioned above. Since then the research group has been chaired jointly by Per Anker Jensen and Theo van der Voordt. Their next activity was to explore in more depth how people cope in practice with added value, and if and how they incorporate this concept into their daily practice. For this reason they conducted a survey consisting of ten interviews with experienced senior facility managers, corporate real estate managers, consultants and service providers – five in Denmark and five in the Netherlands. The findings confirmed the huge variety in interpretations of added value and the application of concrete measures, with user satisfaction (of employees and clients), cost reduction and improved productivity as the most frequently prioritised values. This survey resulted in a conference paper, which was presented at a session on “The Added Value of FM” at the research symposium during the EFMC in Berlin in June 2014 (Van der Voordt and Jensen, 2014a). The authors were afterwards contacted by the editor of the Australian professional FM Magazine, where a shorter version of the paper was later published as an article (Van der Voordt and Jensen, 2014b) with subsequent articles in a Danish and a European FM magazine (Jensen and Van der Voordt, 2015a, 2015b). Several of the interviews included in Part II of the second book are based on this survey from autumn 2013.

Another important activity by the editors of the second book was to write a critical review of eighteen papers on the Added value of FM and CREM that were presented at the Research Symposia of the EFMC conferences from 2013 to 2015 in Prague, Berlin and Glasgow respectively, and three papers from the CIB 2014 Conference in Copenhagen (Jensen and Van der Voordt, 2015c, 2015d). This review showed that during the last five years much good research on the added value of FM and CREM has been conducted. However, the cumulative creation of a shared body of knowledge is still limited. Furthermore, it appears that most research focuses on one or two value parameters such as usability, end-user satisfaction, productivity or safety. The twenty-one papers primarily discuss the benefits of FM/CREM interventions, and to a much lesser extent or not at all the sacrifices and costs. Most research on added value hardly pays any attention to the implementation process and seldom includes data from both an ex-ante and ex-post evaluation of FM/CREM performance before and after change.

This book

The planning of the second book started in January 2014, when the editors met at Delft University in connection with a PhD defence. The plans were presented to the EuroFM Research Network Group at the member meetings in Helsinki in February 2014. The preparation continued when Theo van der Voordt was guest researcher at DTU in spring 2014, including meetings with Per Anker Jensen and a workshop on the Added Value of FM with researchers from CFM. An open meeting for everybody interested was arranged during EFMC 2014 to involve twelve participants, where an outline of the book was presented.

Over the summer of 2014 the editors sent out invitations to interested contributors. The editors preferred that each chapter should be written in collaboration between two or more authors representing different backgrounds and affiliations, to ensure that the topic was covered comprehensively. Those who expressed an interest in contributing were asked to suggest possible co-authors and afterwards they were asked to write a chapter outline, including an annotated list of content and main sources as well as a work plan with the distribution of contributions and responsibilities of each author of the chapter. The chapter outlines were reviewed by the editors and discussed at the first author workshop in February 2015 in connection with EuroFM member meetings in the Hague. The authors then wrote full draft chapters, which were reviewed by the editors and discussed at the second author workshop in a pre-conference meeting at the EFMC in Glasgow 2015. The authors revised their chapters and the book was finalised and submitted for publication in autumn 2015.

The book addresses a topic of importance for both academics and practitioners. It presents an exemplary application of research-based knowledge to guidance for practitioners. It is based on research results and practical experiences from a number of academics and professionals in different countries. It is the first book that explicitly addresses both FM and CREM and their related communities. It combines a systematic presentation of knowledge and methodology and interviews with highly experienced practitioners building on many years of cumulative international knowledge development.

The book is divided into three parts. Part I – consisting of Chapters 1 to 4 – explains the background and presents a framework for understanding and analysing added value, as well as a list of twelve value parameters. Part II includes a chapter for each of the twelve value parameters, giving a state of the art description of the benefits and costs of typical interventions, an overview of possible KPIs, and recommendations for which and how to use such indicators in practice. Each chapter finishes with perspectives on the need for new knowledge and development. Between these chapters, Part II also includes twelve interviews with practitioners about their experience with managing and measuring added value. Part III is an epilogue, which presents tools for value adding management of a spectrum of value parameters, and overall reflections, conclusions and recommendations.

Definition of added value

In the first book we came up with a generic definition for Added Value of FM based on an extensive list of value terminology (Table 17.3, pp. 274–278 in the first book) and combined with the definition of FM in the European standard. According to the EN15221-1 definition, FM can be defined as “the integration of processes (…) to maintain and develop (…) services which support and improve the effectiveness of its primary activities” (CEN, 2006).

Thus, creating Value for the core business translates for FM into – as a minimum – delivering and maintaining services that support the effectiveness of the primary activities at a competitive le...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Preface
• Forewords
• Abbreviations
• List of contributors
• Abstracts
• PART I Introductory chapters
• PART II Value parameters
• PART III Epilogue
• Index