Change the cost
center perception by
Facilities departments are traditionally viewed by their organizations as an expense – one that can be cut back when it’s time to
tighten the belt. This short-sighted
perception ignores the value FM brings
to the table and puts the department
at risk of further budget cuts.
Changing this unfortunate view starts with changing
FM as a Cost Center
the way the facilities department does business, both
internally and externally. Shift the perception at your
organization with these smart management strategies.
Traditional management techniques in the FM department tend to exacerbate the cost perception problem.
Very few facility departments have a revenue stream at all,
never mind a revenue stream that covers the department’s
expenses, notes Michel Theriault, author of Managing Facilities and Real Estate and principal of Strategic Advisor,
a facility, property, and asset management consultancy.
Instead of attempting to drive more profit under your
current business model, it may be more helpful to change
the narrative instead.
“The basic thing that we have to consider is that we
are, in fact, a cost center,” says Theriault. “But instead of
focusing on costs, we need to think about our impact on
the organization’s overall success, even in areas that can’t
necessarily be measured monetarily. If we shift that focus
to things like productivity, risk management, and cost
containment within reason, we will be more successful as
That change starts internally. Senior FMs tend to
receive less training in leadership, business, and strategy
than their colleagues in other departments, Theriault
notes. While tactical education on mechanical systems
and efficiency strategies is vital, it’s also important to
improve your business know-how.
“An FM, especially the senior person in the department, is actually competing with colleagues in other
departments – such as IT, logistics, sales, or business
development – for resources and attention from senior
management,” says Theriault.
Where to Start
Greater visibility and respect in your organization
starts with embracing the company’s mission, vision, and
values and aligning the facilities department’s goals with
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