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Unit 4

Unit 4. Facilities Management Performance. If U Cannot Measure it U Cannot Manage It. So……….. If u can measure it U can manage it. Yes or No?. Overview. Key Performance Indicators (KPIs) Problems of Identification and Application of A Generic Set of Performance Parameters

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Unit 4

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  1. Unit 4 Facilities Management Performance

  2. If U Cannot Measure it U Cannot Manage It

  3. So……….. If u can measure it U can manage it Yes or No?

  4. Overview • Key Performance Indicators (KPIs) • Problems of Identification and Application of A Generic Set of Performance Parameters • A Methodolgy for Developing KPI (Management by Variance Tool)

  5. Learning Outcome • Appreciate the problems with contemporary approaches to the performance assessment and benchmarking of FM operations • Learn to develop an alternative technique of performance assessment

  6. Introduction • Based on a case study research done by the University for the premises department of Major Financial Service Company, Standard Life Assurance • Pertinent Info on the case: • Responsibilities: Mtce Mgt, Space Mgt, Proj Mgt, Gen premises Mgt of buildings, Admin of associated support services • 27 buildings & 6000 employees • Premise Manager and supporting managers • In-house team with external contractors – in house team single skilled environment 10%. • Planned & reactive maintenance & other works supporting the core business departments • Competitive bidding for projects and partnering approach for service contract • Need set of key performance indicators (KPI) to evaluate performance

  7. Current & Previous Approach to Performance Assessment • Limitation of current application of KPIs • Industry or Organization Specific • Applicable for monitoring the management of FM tasks • Gap in understanding of the metrics (standards of measurements) between customers & FM • Metrics have no or little link with the performance of business • Significance of FM on the business unnoticed

  8. Evolution of the Performance Assessment Framework(Massheder & Finch, Vliet, Becker, Slater, Vorkuka & Fliedner ) • Realisation of need to develop a more holistic approach linked to business: • Benchmarking • Use of non financial indicators instead of using just financial indicators • Include indicators relevant to business- oriented customer • Indicators can be presented graphically for comparison between desired and actual performance • Ranking or prioritisation of KPIs required in terms of the strategic significance of strategic objectives • Important to iron out the difference in perception between FM and customer. • Performance measurement must be dynamic • Performance profiling for effective communication and improvement

  9. Concept of the Alternative Framework • Based on Becker’s 1990 concept and Scale of Framework suggested by Slater(1997) i.e A set of definitive KPIs within a manageble framework. • Tool designed for a graphical profiling for easier use and application • Indicators selected for the tool were to be created using a combination of premises department and business customer views (done using a case study application – action research). • In the absence of a comprehensive alternative, a a bespoke tool would be developed using a bespoke set of performance indicators. (172 indicators)

  10. Use key literature sources to identify KPIs (Varcoe, Kay, Wang, Slater, Palvia, Grover etc) 172 KPIs identified Narrowing down KPIs Some Issues identified: Mix and weighting of measures determined by a combination by of factors (business env, bz strategy & type of service) and size of customer base Problem of correlation of performance and criticability to business or customer satisfaction Question of severity of gap between actual and he benchmark Selection of KPIs

  11. Management-by-Variance Tool Concept • ‘At a glance’ picture of the level of performance in key areas • Main KPIs and Sub-KPIs instead of a generic set of KPIs at departmental (latter ineffective) • Rationale - Strategic level of performance in form of main KPIs will, through measurement of sub-KPIs, contribute to continuous improvement of the department

  12. Management-by-Variance Tool • Architecture of the Tool • Selected KPIs – plot difference in perception (variance) by customer and the Premises Department. • Application – can track performance over time though several performance assessment • Gap (variance) identify problem area.

  13. Management-by-Variance Tool • Snap-Shot Application • Useful for identifying problems • Trend or variance analysis • Useful for identifying changes in performance over time • Correlate such changes to company’s policies and plans • Prompt action and prioritise action

  14. Methodology of the Alternative Performance Assessment Tool Phase 1: Phase 2: Phase 3: Phase 4: • Clarifying the performance assessment context • Developing the bespoke performance assessment tool • Prioritisation of key performance indicators • Rating of facilities management performance

  15. Methodology of the Alternative Performance Assessment Tool Phase 1 Clarifying the Performance Assessment context • Clarify the nature & priority of the performance parameters by expert panel • Expert panel - equal number of staff from Premises Dept & Customer • Consensus View using techniques- questionnaire, group feedback, scenario workshop, discussion to prioritise set of KPIs and rank this shortlist

  16. Methodology of the Alternative Performance Assessment Tool Phase 2 Developing the bespoke Performance Assessment Tool • Select a comprehensive & coherent list of PIs from the long list • Shorten list (by polling) by 1st classifying into categories of essential, only desirable and of only tertiary importance & then eliminating the last 2 categories • Further refinement from 59 to 30 and finally to 23 KPIs

  17. Methodology of the Alternative Performance Assessment Tool Phase 2 Developing the bespoke Performance Assessment Tool – Issues found • Definition of KPIs strongly influenced by corporate culture – confirm difficult for generic set of KPIs • Orientation of KPIs depends on corporate culture – customer focus KPI in this case • KPI chosen may be due to currency of issue (eg energy usage) • KPIs selection dependent on level of representation in the management heirarchy (result in low strategic focus) • Subjectivity and omission of KPIs

  18. Methodology of the Alternative Performance Assessment Tool Phase 3 Prioritisation of key Performance indicators • Allocate grade (1 to 10 mark for each KPI) in the context of strategic relevance to business • KPIs on top of list – of more strategic importance • KPIs at the bottom – more operational Difficulty of distinguishing KPIs at top end • the very and supremely important KPIs • Subjectivity in according marks • Mixed bag of indicators, strategic, operational & customer orientated arrived at and ranking subjective • Difference in perception (eg cleaning)

  19. Methodology of the Alternative Performance Assessment Tool Phase 4 Rating of Facilities Management Performance • Semantic scale of rating – Unsatisfactory, satisfactory, good, excellent • Plot result ( figure) Issues: Datum scale affect shape of graph Respondent may be skewed in their response due to perception and assessment approach Biasness may be presence depending on which department conducts the performance appraisal – 3rd party may be the answer

  20. SUMMARY

  21. 4.14 Consolidation exercises 4.14.1 Discuss the difficulties in assessing the performance of FM. 4.14.2 Is there a single group of performance indicators that is applicable to FM in the UK? If so, what is it, or alternatively is it possible to provide a best compromise? Explain your thinking

  22. End

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