4  FM quick reads on Facility management

1. Get Help From Finance On Proposals For Funding Facility Projects

Today's tip from Building Operating Management: Get help from the finance department when preparing a proposal for funding facility projects.

For many facility managers, presenting a funding proposal is the bane of their professional existence. Folks with engineering or operations backgrounds often struggle not just with the soft skills, like public speaking, marketing and campaigning, but also the financial expertise required to construct a proposal in terms that will resonate with those holding the organization's purse strings.

When it comes to actually building the meat and potatoes of the proposal, there's no better idea than to get financial folks to help you with the proposal. That way, your numbers are vetted and in the appropriate form before upper management lays eyes on them.

Regarding the proposal itself, the exact format will depend on the organization, but again, experts suggest a few best practices. The most important thing: Keep it short and sweet. Provide two to three alternatives, e.g., the benefits of the proposal if it is accepted, the risks of doing nothing, and what would happen if the proposal is delayed for a year or two or if a less costly option is chosen.

The problem, solution and benefit to the company should be made clear in the first 90 seconds, says Alan Whitson, president, Corporate Realty, Design & Management Institute.

Use PowerPoint because that's what executives are used to, says Stormy Friday, president of The Friday Group, but dress it up a little. Use photos, or "if you're extraordinarily clever, create a simulation model or things that move and circulate. Anything's better than just a flat presentation."

The actual hard copy of the presentation must be equally short and sweet. "I'd strongly recommend, and this is not easy with people with engineering backgrounds, one page or less and using bullet points," says John Balzer, vice president, facility planning and development for Froedtert Health. "That's the only way the CFO will look at it."

The biggest mistake to make is to assume more data, pages and spiffy charts will help your cause. "Leaders have a nanosecond attention span," says Friday, "So so you can't overwhelm them with blocks of text or charts and graphs that are hard to decipher."

Facility Managers Offer Advice About Winning Approval For Facility Projects

Today's tip from Building Operating Management: Follow these facility managers' advice about winning approval for facility projects.

  1. Tim Pennigar, project manager, engineering and operations, Duke University Health Systems: "Get the accountants to become roofers." Pennigar recommends going beyond simply putting proposals in the language of finance. That's a must, but you should also get the financial folks to help you write the proposal and vet your numbers before you ever think about walking into the boardroom.
  2. John Balzer, vice president, facility planning and development, Froedtert Hospital and Community Health: "Do not assume that more is better." Balzer says he can guarantee you that is not the case, when it comes to handing in a proposal. "The biggest piece of advice I can give, especially to those starting their career, is to be very specific and to the point, and to focus on measureable data," he says.
  3. Bob Holesko, vice president of facilities, HEI Hotels & Resorts: "Show a project's curb appeal and do your own PR." Holesko tells a story about how an article appeared on the front page of a local newspaper with a photo depicting a crane delivering a new HVAC rooftop unit to one of his hotels. "Now, I can say to the financial people, 'Remember when we had that crane on the front page of the paper?' That's free advertising for the company. Anytime you have a crane showing up, get photos. It makes you look good."
  4. Jim Cooke, national facilities operations manager, Toyota Motor Sales, USA, Inc.: "Don't go back for more money until you can prove your last project is successful." Cooke says that, even if a project demonstrates more modest results than you expected, don't hide those results. Instead, explain the specific reasons why that project wasn't as successful as you might have thought, why it's actually still a success in the grand scheme of things, and the specific reasons why this proposal is different.

Make The Financial Case For Additional Facility Staff

Today's tip from Building Operating Management: Facility managers can boost their chances of getting approval to hire new employees by making the financial case for additional facility staff.

Making the case for an increase in staffing is one of the more difficult proposals facility managers may have to write. That's especially true in a down economy. But it's not impossible and the case should be made on a financial benefit basis, just like any other facility proposal.

"In the case of staffing, you make the case that adding a body will save us X," says John Balzer, vice president, facility planning and development, Froedtert Hospital and Community Health. To do that, though, you have to have pretty detailed numbers of how that will happen. Will you be able to complete a higher percentage of preventive maintenance, which allows equipment to stay in service longer? Will you be able to offer better facility customer service to make building occupants more productive? Will you be able to start a new service or make an existing one (like a BAS) more efficient? It's important to building the answers to those questions out of data.

Another tip is to compare your organization to others, especially those you know your financial folks admire. "This is why your network is important," says Stormy Friday, president of The Friday Group. "Show what other organizations have done and what's working for them in regards to staffing."

Increased staffing may be a back-up plan if a facility equipment proposal doesn't pass or if a facility is aging. For example, Bob Holesko, vice president of facilities, HEI Hotels & Resorts, says that for hotels that haven't been renovated for a while, and thus need more maintenance, "that's when I have a good shot at getting another body."

Use Hard Data About Benefits To Justify Funding For Facility Projects

Today's tip from Building Operating Management: Use hard data about benefits to justify funding for facility projects.

While showing the downside of saying “no” to requests for funding for facility projects is important, the real hay is made with hard data illustrating the benefits — financial and otherwise — to the company of saying "yes."

"Understand the benefits to the business," says Alan Whitson, president, Corporate Realty, Design & Management Institute. "Quantify those benefits, and then 'dollarize' those benefits." Whitson adds that it's critical to know and understand the financial terms, such as discount rate, cost of capital, hurdle rate, investment horizons, etc. And then know your organization's thresholds and parameters for those metrics, and which are most important. Always relate back to those metrics.

John Balzer, vice president, facility planning and development for Froedtert Hospital and Community Health, gives an example of a new work order service. The idea is to show how customer service would increase from x to y, and what the financial impact of that would be. "It's a little more challenging, but with specific measurements, which are necessary, showing a monetary return can be done."

Showing that monetary return (or hurdle rate, if your organization prefers) is often easiest with energy efficiency projects. Still, as sophisticated facility managers know, building the proposal in terms that show dollars and not kilowatt-hours is the tack to take. Know your organization's acceptable return rate, but understand that it may not always be set in stone. Finding rebates from the utility or the government to lower that ROI, is one way to make your proposal more attractive.

So is adding soft benefits to the proposal. That is a legitimate strategy, but you certainly don't want to hang your hopes on soft gains, say the experts. Jim Cooke, national facilities operations manager for Toyota Motor Sales, USA, puts it like this, in reference to a recent proposal for photovoltaic panels: "We know and you know there's social value, but we can't quantify it. It is another piece for customers to recognize that we behave responsibly in terms of sustainability."


Facility management , retrofits , budgets

Start calculating