Business Value Accelerators When Facilities and Finance Share Data
When facilities management and accounting and procurement team up, there is gold to be found in facilities data! “Gold” in the form of business value accelerators that add to the bottom line through everyday cost savings, risk mitigation, continuously discovering new process efficiencies, and just working smarter.
A robust data-rich foundation and automated communications inherent in a smart facilities management solution can enable collaboration between facilities management teams and their accounting/finance counterparts that pay for the solution in savings.
When facilities management and accounting and procurement team up, there is gold to be found in facilities data!
Facilities is a business that generates a lot of transactions – some very small, some very big – to a wide range of providers. The very nature of the business results in a lot of work for accounting and procurement alongside the facilities teams.
Facilities teams need consistently available providers that do quality work reliably.
Procurement teams seek to assure consistent, efficient, and cost-effective contractual relationships with providers and asset vendors that get the business the best value for the money.
Accounting and Finance teams have to make sure that cash flow is optimized, all of those invoices pouring in are compliant to contracts, and accurate invoices are classified (expense/capital) and paid properly.
Our smart clients are finding clever ways to bring collaboration and harmony amongst these functions and more importantly, team up for much better business outcomes. These teams are leveraging and mining the data that lives inside of a smart facilities management software solution like Fexa in innovative and creative ways.
Here are four examples of how these collaborations and cross-organizational efforts are yielding supercharged value for the business.
Value Accelerator #1: Automation
Process automation is not new to the facilities management space, but it is not helpful if processes inside the facilities management function are automated only to require a swivel chair manual or duplicative effort to get the data and information to other teams. So going beyond the obvious value of freeing up the FM team from repetitive, routine tasks, to using automation and business logic to eliminate duplicative work or time spent in back and forth between facilities, accounting, and providers.
Just a few specific automation examples include:
Automating invoice compliance checks against specific business criteria so that no invoices ever show up in accounting until the required information is supplied by the provider. (Learn more here)
Automating exception oriented approvals based on business logic – example could be any proposal or invoice for asset repairs of a particular asset class that exceeds $X is routed to engineering and procurement for additional approvals.
Value Accelerator #2: Minimizing, mitigating, and sidestepping risks
Financial and business risks come in many forms for facilities teams. A smart facilities management solution can significantly earn its keep by minimizing, mitigating and avoiding costly risks for the business. And again, doing so in a way that keeps accounting, procurement, legal informed is even better.
Some excellent examples from challenges of this past year of how our customers are being proactive in this area include:
Having a documented process in the form of a smart checklist built right into the software to assure a consistent process is adhered to when stabilizing a location in times of natural disasters or civil unrest. This reduces risks substantially and assures there is an audit trail and documentation (images, timestamps, etc.) that the finance teams can use when filing insurance claims and more.
Taking it a step further, leveraging custom fields to denote all work associated with recovery from a natural disaster or civil unrest so that repair activity can be properly classified and accounted for. Establishing triggered alerts and reporting for accounting to get the timely information and details they need to submit claims as an example.
Automating alerts to facilities teams and procurement when providers become behind in demonstrating or providing proper documentation for compliance.
Equipped with early warning alerts and instant insights into scenarios that present financial or business risk allows all teams to be proactive to minimize and mitigate those risks in near real-time. Teams can take action before their organization is forced to absorb greater financial or business impact.
But decision support is also enhanced through a solution that captures, categorizes, and coordinates the underlying data surrounding these incidents in ways that support better historical analysis. Using powerful analytics tools, facilities and accounting and procurement teams can work together to continuously improve their processes and ability to mitigate or entirely avoid risk scenarios.
Value Accelerator #3: Efficient and effective asset management
Different industries have unique classes and categories of assets that are important to them. A comprehensive facilities solution includes a range of options to effectively manage those assets – extending their life, optimizing preventive maintenance, and analyzing trends. Examples of asset-related benefits include:
Smart preventive maintenance programs that you can set and forget. No wasted time scheduling or organizing regular maintenance activities. But because they are “smart,” you can assure they are bundled for maximizing trips by providers, or delayed so that there is never less than X days/months between service.
Asset classification flexibility allows you to create unique programs and tracking requirements for different classes of assets – a home improvement client tracks their material handling machinery as one class, their fleet as another, and even what they call “wearable” items – like parking lot striping in different classes with unique business rules and reporting. (Learn more in our Got Data? Data for Facilities Management Success Webinar hereWEBINAR: Got Data? Data for Facilities Management Success)
Taking it to the next step, data and analytics applied to asset management and tracking allow one of our customers to partner with procurement and negotiate very attractive “proactive” procurement arrangements on major assets like HVAC saving hundreds of thousands a year.
Value Accelerator #4: Using data at scale to strengthen supplier relationships
Facilities teams manage vast numbers of transactions and a broad range of provider relationships and contracts. Typical but suboptimal approaches to vendor management include treating them entirely as commodity transactional relationships or at the other end of the spectrum, making decisions based on emotions. An approach that delivers far more value for the business in the form of outcomes that are important – saving money, efficiency, quality to support the brand – is to put facts and data, in context, at the center of those relationships.
When there is clear objective data and adequate granularity and context to drill into the unique situations that occur and what went well or not so well, providers can understand specifically how to improve their performance for what is specifically important to the retailer/operator. Operators are far more likely to get the proper mix of efficiency, costs savings, and quality that each and every unique word order requires.
The context and demands of reactive work are quite different from preventive or even project-based work like store reconfigurations or construction. Establishing the right granularity of data, measuring the appropriate KPIs for each class of activity, and having clear communications of expectations between operator/retailer and vendor are key to getting a real win-win for everyone involved.
With immediate access to reliable data on performance and pricing data which can be viewed in the context of regions, types of work, and other categories important to your business, the facilities and procurement teams can be very specific with providers to advise them on what improvements are required – deepening and strengthening the organization’s relationship with them.
By using data to help build open, mutually beneficial relationships with providers, the procurement team can influence them to make meaningful changes to their operations. Equipped with verifiable proof that a provider’s first-time completion rates are wildly inconsistent across regions, for example, the procurement team can make an airtight case for change, reimbursement, or contract renegotiation.
Beyond just the value of data to negotiate and navigate the relationships, a sound data foundation for measuring what is important that is accessible and visible to all parties enables a culture of transparency with all members of the facilities management community. This transparency supports continuous improvement that benefits all parties and delivers much better outcomes for the business.
Facilities Management and Finance Value Accelerators Conclusion
The engine for enabling this level of collaboration and success across facilities teams, accounting teams, procurement teams, and providers and suppliers themselves is a platform where data is captured, categorized, and correlated in ways that support continuous improvement.
For too many facilities teams, years of risks and performance data, rogue outlier data, meaningful asset data by class, and other valuable insights have been either missed or trapped in rigid or fragmented systems or spreadsheets. Continuous improvement and discovering new ways to capture value for the business – saving time, saving money, improving consistency, reducing errors, extending asset life – are key to surviving and thriving in today’s facilities management business environment. The right tools can make a big difference and pay for themselves in months.
Find out how Fexa can help you surface the opportunities to put data and automation to work for your business.