By Patricia Dameron
from the July/August 2015 issue
It’s midnight. Do you know where your customers are? If you’re a global brand like Nike your customers are probably online researching the purchases they’re planning to make the next day. Although your brand’s online experience may be cutting edge, do customers feel a seamless transition from the online experience to physical brick and mortar?
The omni-channel shopping world has arrived, as predicted, and in keeping with the big data dreams of the industry’s chief strategists, the biggest names in retail have been transforming how they approach asset management, work order management, and ultimately store maintenance.
The Professional Retail Store Maintenance Association (PRSM) profiled four retail brands in its “2015 Trends Report,” detailing the industry’s biggest challenges and what solutions retail companies are implementing. The report found retail brands are creating innovative programs in waste and recycling (especially for distinct types of waste), cutting edge energy programs (such as net zero energy stores), and developing facility teams to meet all of these new challenges.
One profile featured how Nike has entered a more analytical phase for maintaining stores and facility assets, as the brand’s portfolio of stores continues to broaden and new store designs present more maintenance related challenges. Entering into this growth mode of construction and retrofit, Nike’s facilities management team placed increased emphasis on a more data-driven approach to understanding store maintenance.
“A few years ago, I saw a real need to add an analyst to our department because our store count was growing, increasing the data we needed to analyze to make informed decisions,” says Walter Fuller, Nike’s senior facilities manager. “There’s so much information. The facilities managers and I were so busy doing the ‘keeping-the-lights-on’ work that we really didn’t have time to break away and to focus on that information. Plus, we didn’t have the skill set of an analyst.”
Enter facilities analyst at Nike, Christine Hinzmann, and her mission to extrapolate useful information from the company’s raw data and transform it into reports and analyses that help provide the managers with valuable insights.
“The data that Christine has been sending us allows us to find the root causes of certain issues and address them quicker and better, and it allows us to think in a strategic, forward-thinking mindset,” says Shawn Browning, territory facility manager at Nike. “Instead of reacting to every repair, we are now able to be more proactive and find an issue before it becomes repetitive or before it causes a problem.”
Data also helps the department make better decisions. For instance, Hinzmann and the Nike team developed a report on janitorial costs, breaking the information down into spend per store and per frequency.
“We then used pivot tables to look at several what-if scenarios,” says Browning. “For example, if we had to adjust our budget for janitorial spend by adjusting the frequencies for over 230 stores, what would that look like from an overall budgetary standpoint? With the pivot tables, we could quickly adjust frequencies based on a certain number of stores, thereby adjusting the cost and quickly giving us an end result on a budget number. It made it very simple and very analytic.”
“If you can’t measure it, you can’t manage it. That’s what Christine brings to the team: the ability for us to manage our resources because we have the opportunity to analyze a trend,” says Fuller.
Another area where Hinzmann’s analyses have had an impact includes managing vendor performance. Nike developed a scorecard to rate its strategic partners on a scale of one to 100 using five different variables: Interactive Voice Response (IVR) compliance, on-site compliance, completion compliance, recalls, and invoicing.
“We have seen a quarter-over-quarter improvement in our strategic partners’ scores, and we’ve seen more ownership on their end to strive for higher and higher success on the items that we measure,” says Fuller. “That has been a real success story; our vendors love having this conversation about their performance and really being able to highlight what they’ve done and show the steps they’re taking to get better and better to meet our measurements.”
Some vendors have even begun using a similar approach with their own subcontractors to spur improvements further down the line.
The department couldn’t achieve these results without the data to back it up. “The data that we share drives the conversation, but the conversation drives the ideas and the innovation and the inspiration to experiment and try different ways of doing something,” says Hinzmann. “We’re finding that our vendors’ scorecards are getting better because our strategic partners are trying new things. But we never knew that these situations existed until we collected the data and organized it in such a way that it started making sense.”
Analysis Makes The Case
Fuller asserts that a facility management department that wants to hire a data analyst should gain the support of upper management. They were fortunate because Nike managers realized from the start that the facilities team required an analyst to be more effective. “We are a very successful department in many ways, and they wanted us to be able to tell the story analytically so that people would understand it,” he explains.
That’s important at a time when many facility management departments are being outsourced. “It’s a big concern for our industry today. Setting up credibility with leadership is essential to success, whether that’s with the finance team or the operations team, the general managers or the VPs,” says Browning.
Technology For Transparency
Nike has a symbiotic relationship with its technology partner, ServiceChannel. The retail brand uses ServiceChannel’s automation, reporting capabilities, and connections with vendors. In addition, the two companies work together to compile data, and the retail brand provides productive feedback on how ServiceChannel can make its systems more user-friendly and applicable to other departments.
Siddarth Shetty, ServiceChannel’s vice president of global services, notes his company “has potentially changed the way that our clients can look at data and intelligence; it is no longer complicated, no longer hard to reach a target, because the information is literally one click away.”
“People usually spend 85 percent of their time gathering data and manipulating it and the last 15 percent in analyzing it,” he continues. “That is a problem. We have made it possible to reverse that.”
Shetty adds, “We’re trying to push best practices, that behavioral change where a facilities department is not just guesstimating anymore but is actually using data, having meetings, and using reports to measure their own performance and the performance of their contractors using KPIs.”
For Brixmor, Apps Reduce Paper Trail
Another profile in PRSM’s “2015 Trends Report” highlighted how the facility management company Divisions Maintenance Group developed an in-house mobile inspection tool, based on an iPad application. It wasn’t long before they realized they were onto something and offered it to one of its customers, New York City-based Brixmor Property Group.
The OnSite mobile application improves facility management efficiency by converting the inspection submittal process from paper to electronic.
“What we came to realize was that verifying service and identifying issues on site weren’t enough—we needed to find a better way of circling back with our customers to close the loop,” says Sondra Pflum, senior national account manager for Divisions. “When customers use the On-Site app to identify a problem, the issue is immediately visible to the service provider via a second app that we built called In-Position.”
The app allows the user to send site-specific information and work order requirements directly to the technician performing the work. Technicians can check in and out on-site through the app, helping verify job completion in real time along with GPS location verification. The application transmits the technician’s site photographs to Divisions’ central system, which is feeding the information directly to customers, increasing visibility on the company’s properties.
Divisions says the application is rapidly becoming a critical tool for Brixmor. The Real Estate Investment Trust (REIT) company owns and operates the nation’s largest wholly owned portfolio of grocery-anchored community and neighborhood shopping centers, with more than 520 properties located across 38 states.
Doing More With Less
“From a general increase in efficiency standpoint, this app allows us to do more with less,” says Brixmor vice president, property management, John Priede. “In the South region we have almost 200 properties, and by guiding the inspections we can bring more consistency to service levels on site. If we change direction or add something new, we can roll that out almost instantaneously.”
He continues, “Additionally, we have a company initiative, known as ‘Raising the Bar’, which focuses on enhancing our asset quality through merchandising upgrades and center improvements in order to drive higher sales, traffic, and small shop leasing. Over the last couple years, we have nearly tripled the level of maintenance capital invested in our properties. Deploying this app to our property managers allows us to manage toward this goal more consistently across the portfolio.”
All of Brixmor’s property managers in the South Region are using the application, and the consensus is that the overall process has saved them time. “Our PMs are actively managing multiple properties with a lot to get done, and removing steps from their process and improving their efficiency is a big win,” Priede says.
“There are really three ‘favorite things’ about the technology: it streamlines the collection of property inspection information (no more Excel spreadsheets); it gives the PM a very simple way to request services while on site; and it gives them an organized interface to find the information they need to manage their properties,” he adds.
“Brixmor will soon have the ability to approve their invoices directly on the iPad,” said Divisions’ Pflum. “Let’s say that we clean up some bulk trash in the back of the store. We can take a picture of the items removed and attach to the invoice as proof of completion. It greatly improves efficiency.” To facilitate the update, Divisions integrated the application with Brixmor’s accounting system.
As the retail shopping experience evolves the brick and mortar store continues to play a crucial role in the customer’s experience. Integral to the store’s ability to deliver that experience is the facilities department, which is in the midst of an evolution of its own, leveraging technology and data for better asset management, to achieve greater sustainability and to drive down costs.
Dameron is the executive director for the Professional Retail Store Maintenance (PRSM) Association. Based in Dallas, TX, PRSM helps retail facilities professionals make informed business decisions by delivering best practices, education, forums, and partnerships. In her role, Dameron works with the Board of Directors in setting strategy for the organization and leads the staff in delivering programs and services to its 1,000 member companies.