The main tools used to manage performance are benchmarking, key performance indicators and service level agreements. Laura King explores what each of these terms mean, and how to use performance management to demonstrate the value of facilities management.
Why is it important to manage performance?
The performance of facilities management (FM) has always existed on several levels. At its most fundamental, successful FM means working behind the scenes to ensure that the workspace is functional, safe and clean. However, this is just part of a performance spectrum that needs to be demonstrated. At the other end of this spectrum, performance management can demonstrate the wider “why” of FM, seeking to measure not only how efficiently the department is functioning, but also how effectively FM is supporting organisational strategy and value.
Recognising this spectrum is important: by evidencing that FM can deliver from the boiler room to the board room shifts perceptions away from a department that is solely focused on service delivery, to one that can influence leadership decisions.
What tools are used to manage performance?
Benchmarking can mean different things to different organisations. However, when you strip it back, benchmarking is essentially a comparative tool that allows you to reference your performance against the performance of others.
It can be conducted both internally (eg, comparing buildings) or externally (eg comparing against similar industries or industry standards) to uncover gaps in performance and identify opportunities to improve. It is this comparative process that is key to benchmarking and that sets it aside from other tools.
Internal benchmarking is often the easier of the two options, and the first step many organisations will take. As well as helping to establish best practice internally, this kind of benchmarking also allows an organisation to assess the impact of any changes it makes. For example, does paying cleaning staff the living wage improve staff retention and self-reported wellbeing?
Key Performance Indicators
First, it is important to differentiate between metrics and Key Performance Indicators (KPIs). Metrics are single points of data — for example, occupancy rates. These will relate to KPIs, but are not the same thing.
A KPI is instead a measurement that helps track performance against a specific goal. It does this by providing up-to-date data that gives decision-makers key information about what progress they are making. This then allows them to decide whether they need to change how they are working.
The action required as a result of any given KPI is key: if a KPI is not used to help an organisation adapt and improve, then it is not working effectively.
KPIs are often related to a SMART (specific, measurable, agreed, realistic and time-bound) target. For example, “Reducing the number of reactive maintenance tickets by x% by 31 March 2020” would be an example of a SMART target. The KPIs feed into this, highlighting whether or not progress is being made.
Tracking KPIs that measure the percentage of completed work that is reactive, compliance with maintenance programmes, and operating budget spend against forecast would all help demonstrate whether the organisation is moving away from reactive maintenance towards a more sustainable schedule of planned work.
It is also important to remember that KPIs can exist on macro and micro levels — they can support the bigger picture, but are also important for providing insights into day-to-day management.
Service Level Agreements
A Service Level Agreement (SLA) defines what level of service you would expect from a contractor. It outlines the metrics by which the service is measured, responsibilities and expectations. The SLA will also include penalties and remedies should the agreed service levels not be achieved.
There is some overlap between KPIs and SLAs. While the SLA defines the overall agreement and service standards, the measurements demonstrating the performance of the service provider will often be in the form of a KPI.
Because of this, any measurements evaluating performance should be chosen carefully: they should reflect factors within the service provider’s control and be relatively easy to report on. It is also important to determine the right number of KPIs: too many can mean that data is not reviewed properly; too few and breaches of contract can be missed.
Finally, they also need to be well-defined so that the intention of their meaning is properly captured. An automated response to an email, for example, should mean that 100% of emails are responded to within 24 hours, but might not reflect the spirit of what is actually required by the service provider.
How performance management can demonstrate the value of FM
To successfully demonstrate the value of FM to the wider business, it is important to create a clear line between top-level thinking and day-to-day management. This is a two-step process:
Translating business needs into FM process
The first piece of work is to make sure that the strategic objective of the FM team is aligned with the organisational strategies, aims and values. This overall FM objective should then be supported by the FM managerial and operational plans for the department.
Understanding and reporting on high-level objectives will also help identify the “why” of the FM team: is the team just there to support the day-to-day functioning of the site, or is the role a wider job of improving how employees experience the workplace? Recognising the bigger picture, and managing performance accordingly, is key to shifting perceptions inside and outside the team away from simply being a service provider, to a department that provides value and creates opportunities.
Using performance management tools
Once you have established the “why” of FM and aligned the FM strategy to the wider company strategies, it is important to pick performance indicators that drive improvement and clearly show what value is being created — or in the case of benchmarking, what value could be created.
When choosing which performance management indicators to use, keep the following in mind:
Involve senior management in data selection, and understand what questions they are trying to answer.
Ensure that there is always a line of sight to the strategic objectives: remember if an indicator does not support, or is not linked to, strategic direction then it is unlikely to benefit the business.
Make sure the data is relevant, useful and can be acted on.
If a piece of data is not doing its job, review it — you might need to change how it is measured or drop it completely.
Be mindful of creating balance: collecting a lot of easy data that is irrelevant is as harmful as collecting insightful but time-consuming data that debilitates a department.
Sell the story
Finally, it is important that the data is well-presented. Some tips for doing this include the following.
Know your audience — are they going to be more interested in finance or wellbeing?
Make sure the data is in an easy-to-read format and is simple to understand.
Remember that people making the decision will often be time-poor — do not expect them to wade through pages of statistics and context.
Show trends and pull out headline statistics.
Try to ensure that the data has been analysed and provides business-relevant insights.
Performance management is imperative to demonstrate the value of FM. It can be done in a number of ways, but it should always be done with the end point in mind. This means:
aligning with company objectives
picking data that demonstrates the “why” of FM
being alive to what the data is showing: for example, acting on KPIs and checking that data collected is relevant.
Last reviewed 2 July 2019