Today, monthly reviews examine the value of expenditures and readiness to capture savings opportunities. Discussions are escalating from "what," "when," and "how much" to "why," "what if," and "why not." Savings are tallied, without asterisks and footnotes. Gains are incremental and sometime hard-won, with occasional back-sliding.
As the owner, Delphi is responsible for providing direction, feedback, and support. It has engaged its individual sites to foster consistent scope and expectations. Especially in the baseline year of the contract, unreasonable demands and overpromises were mutually taboo, as both sides committed to candor, open-mindedness, and a willingness to learn.
Key performance indicators and metrics-with-meaning emphasize the quantity and the quality of work and help focus continuous improvement initiatives. For example, on-time preventive maintenance compliance rose 5 percent to 94.9 percent between 2012 and 2013, and safety-related preventive maintenance compliance is at 99.98 percent. Response time for reactive (breakdown/corrective/hot-colds) maintenance is tracked as less than 24 hours, 24-48 hours, and greater than 48 hours. The first category improved from 56 percent to 82.5 percent between 2012 and 2013. On a site-by-site basis, spending on subcontractors is monitored to improve utilization of on-site labor by raising their skill sets. Improvements of $37,000 and $28,800 were noted at key sites in the most recent year. Minor HVAC repairs, for example, are performed faster and cheaper in-house, enabling contractors to focus on higher-value work.
Management has set five value criteria for the contractor's performance reviews and evaluations: safety, technical expertise, leveraged sourcing, process and systems, and financial reporting. (See "Evaluation Criteria" sidebar for more detail.) These criteria enable Delphi and its service contractor to collaborate, mechanize, automate, systemize, and train to optimize processes. Leadership aligns their organizations to address real-world issues in real time. Peak value service contract management is a progressive path toward the ultimate success of the enterprise.
Alan R. Fyffe, P.E., is U.S. regional facilities manager, Delphi Automotive, PLC.
John Jarrett, CPSM, is facilities category leader — North America maintenance, construction, PME, and leasing, global supply management, Delphi Automotive, PLC.
Martin C. P. McElroy, CFM, is principal, MartinCompany Management Consultants, Inc.
2. Technical Expertise
3. Leveraged Sourcing
4. Process and Systems
5. Financial Reporting
— Alan R. Fyffe, John Jarrett, Martin C.P. McElroy
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