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By Tim Springer
Published in the October 2006 issue of Today’s Facility Manager
Lately, I’ve heard some concerns about the subject of facilities management’s (FM) ability to “talk the talk” with top executives. Specifically, I’ve heard several recent assertions with regard to the goal to move facility managers (fm) and their language “from the boiler room to the boardroom.” So here are my thoughts on the subject.
My first comment is on the “boiler room to boardroom” image. What a great aphorism! I can almost see “Charlie,” the boiler room guy, trading his big, greasy crescent wrench for a sleek Mont Blanc pen. He takes his place at the table, looks around, and listens as his fellow executives discuss strategy, return on investment, internal rate of return, and share price. When the CEO turns to Charlie and asks, “What do you have to say on the matter?” Charlie smiles and says, “We’re using a four zone system at 2750 cubic feet per minute, yielding a cost per square foot of….” You may be able to take Charlie out of the boiler room, but you can’t take the boiler room out of Charlie. Obviously, this is an exaggeration.
Indeed, the boiler room to boardroom progression has become an integral part of FM thinking. But can you personally point to anyone who has done it successfully? Perhaps a more relevant question is this: If invited to the boardroom, would you know what to say?
Unfortunately, too many fms are woefully inarticulate when it comes to understanding and expressing the language of business. Why is that? It’s not for lack of expertise or ability. Successful fms are smart people who must know a lot about a lot of things. Why then, do we not find Chief Facilities Officers (CFacOs) in any businesses? Is this an unrealistic goal? I don’t think so.
Consider IT—another professional practice that is approximately the same age as FM and has experienced a similar growth arc. Computers have been around for some time, but IT as a corporate function came into its own about the same time as FM in the late 70s and early 80s.
And yet, it is the rare organization that does not have a Chief Information Officer (CIO). Why is that? My argument is based on one simple principle: IT does an outstanding job of linking the impact of technology and information to business performance and outcomes.
As an example, a report by the Meta Group, now part of Gartner Group (a research and consulting organization focused on IT) states, “Every dollar spent on IT at a Fortune 500 company supports about $38 of revenue and $1.15 of income. The most efficient companies show $1,000 in revenue and $40 in income for every IT dollar spent.”
There you have it, in two short sentences and expressed in the language of business. This is why there are so many CIOs and so few—if any—CFacOs.
That’s not to say FM couldn’t express its impact in similar terms. After all, FM does influence profits and business performance. So why doesn’t it demonstrate this in terms of FM dollars supporting revenue and profits?
The issue is one of perception and tools. Facilities need to think less about the cost of FM and more about its value. In the language of business, FM is more about assets than it is about liabilities. A few examples illustrate this point.
Deferred Maintenance. In a TFM article I co-authored [“The Impact of Strategic Facility Planning,” December 2002], I told the tale of an organization that believed it was saving money ($30,000 per year) by deferring what was thought to be non-essential maintenance. Aside from the impact on image, identity, recruiting, and retention—all of which have significant financial impact on an organization—the cost to repair and catch-up from the accumulated neglect was 30 times the amount “saved.”
Working Conditions. This example requires following some linkages, but the real world is a complex system. Sears was dealing with a decline in customer buying behavior and catalog order revenues. Analysis showed a contributing factor was the attitudes of the employees working in the call center that took catalog orders. To address this problem, Sears invested in improving call center environments and working conditions. Employee attitudes improved five points. The impact was noticeable to customers, who reported a 1.3 point improvement in satisfaction. This in turn resulted in more repeat buying behavior and led to a 0.5% growth in revenue. Small numbers? Consider this: Sears attributes this change in workplace and employee treatment with moving the company from a $4 billion loss in 1992 to a $1.5 billion profit in 1997.
Finally, fms themselves discount many examples of workplace change leading to performance improvement. The most common lament being, “you can’t assign effect to specific elements in the workplace.” So what! If you could, would you change just one thing? Of course not! The workplace is a complex system, and change often has a subtle impact, but overall, the effect is significant.
So what’s my point? It’s simple. Success in any endeavor requires fluency in the lingua franca. In the case of business, that means expressing more than just cost, but also value, assets, return, and profits.
Unless—and until—fms become adept at explaining and expressing FM value in the language of business, the only time they will see the boardroom is to clean it.
That’s the way I see it from where I sit. Of course, I could be wrong.
Springer is president and founder of Geneva, IL-based HERO, inc. and frequently writes and speaks on a wide variety of issues affecting organizations, work, and workplaces. For past columns from Springer, go to From Where I Sit and for future musings from Springer, visit his Web site.