Space Management Technology – Procurement perspective on Buyer’s Expectations

New technologies and customer requirements are reshaping the Facilities Management and Services Industries. Since 2005, office space in UK has decreased by 17% and stood at 10.20 square meters in 2012. However, rents have risen by 1.9% within a year from 2011 to 2012. The future is going to be challenging and will need Facilities Managers to think of and deploy innovative solutions within their organizations. Rising rental rates, coupled with rightsizing of employees, is adding pressure on managers to bring down costs and optimize the ever shrinking office space. Long term occupancy contracts mean that spaces are not reduced in line with the reducing number of workers, thus increasing costs due to unutilized spaces. The article captures insights on space management technology from a procurement perspective, highlighting its potential benefits and exploring various facets that will help buyers of Facility Management Services. It also focuses on how space management would resonate as one of the key technologies in the Facilities Management domain.

Why space management is crucial for any organization?

• People working in an organization are increasingly viewed as vital resources, and bringing out their best potential is gaining more ground now. Irrespective of where an employee chooses to work from, a high performing individual is essential to the organization. The quality of work is more important than the place of work

• Impact on bottom line: Predictive Analytics, which primarily involves analyzing present and past data to predict future trends, is making inroads into organizations that believe in increasing efficiency and bringing down their operational costs

• Office spaces are increasingly designed to enhance communication amongst members, as well as to facilitate flexible working hours. Such scenarios are increasingly adding pressure to further decrease the already shrinking work spaces, while keeping productivity at same or higher levels Technology Evaluation

1. Ease of Use: Rating - Easy

• The reporting platform projects results graphically as required by different users across the hierarchy in a simple and lucid way

• AutoCAD drawings can be directly embedded into space management software and transition to the new system will be easy, with simple training to the employees, without resulting in data redundancy

2. Cost Advantages: Rating – High

Cost of occupancy per year, across the US, for a single employee varies between $10,000 and $15,000. HVAC controls can respond to real time occupancy data, resulting in considerable energy savings across geographies

Practically, no maintenance/repair cost for sensors and a battery life of two years for the wireless sensors, along with low manufacturing costs, ensures that the technology can be deployed at a number of locations at a very low cost

3. Adoption rate of technology: Rating – Low

Currently, organizations are realizing the efficacy of technologies at a slow pace resulting in quite a low adoption rate. In future, however, as they expand and existing spaces become more expensive, the use of such technologies would be the go-to tool for management to bring in cost savings and make the best use of available spaces across different departments, locations and geographies

Tools for effective Space Management

Computer-Aided Facilities Management (CAFM) systems are most widely used for space management. In the pre-implementation phase concerning any space management software, precaution should be taken in assessing the technical feasibility of embedding the software easily into the existing system. This is very crucial in establishing a smooth transition of existing CAD drawings and database to the new system.

As an alternative to CAFM, Geographic Information System (GIS) tools perform equally well across all categories of assets, varying from a single room to an entire building

Heat sensors under the desk can detect occupancy rates and transfer data over a considerable distance using a standalone wireless network. People counter capture the number of people in an identified area. Sensors in meeting rooms help decide if the rooms are of ideal size for occupying a certain number of people.

Functional Benefits to expect

The available space across the hierarchy of an organization will help in planning effective utilization or disposal of underutilized or idle spaces

As compared to CAFM systems, GIS systems offer advantages such as graphical navigation and spatial analysis

GIS systems can integrate room level details with infrastructure systems that were not offered by traditional CAFM systems, though the present versions offer greater flexibility in data transfer. Linking of HVAC Controls to real time occupancy patterns can result in considerable energy savings

Space availability maps that project the type of space available and how efficiently it is used, instantly changes as real time data gets updated and intelligent analytics track and monitor occupancy patterns in different ways

Technology Working and KPIs:

The image below explains the space management technology and highlights the key performance indicators. The benefits of utilizing the technology are also listed.

Conclusion

Successful implementation of space management technology provides utilization data and up-to-date drawings that enable managers take real time decisions. As office spaces shrink and companies look towards cost cuts, technology is likely to emerge as one of the most important tools for Facilities Managers to rely upon. Riding on potentially high cost advantages, its adoption rate; although quite low at present, would certainly rise in the near future. References:

http://www.fm-world.co.uk/news/fm-industry-news/empty-offices-push-worker-costs-to-five-year-high/#sthash.7D0WF1vD.dpuf

http://www.johnsoncontrols.com/content/us/en/products/globalworkplacesolutions/services/workplace_strategy/space_utilisation.html

Beroe is the premier global provider of customized procurement services specializing in sourcing, supply chain visibility, financial risk analysis and environmental impact to Fortune 500 organizations. With nearly 400 dedicated procurement specialists in 38 domains, across 9 industries, we proactively invest in knowledge assets to build valuable, real-time procurement insight.

Rajesh Mohan is a Senior Research Analyst with Beroe Inc.

Rajesh specializes in tracking the Real estate vacancy and rental rates, Integrated Facilities Management (IFM) market and global food and catering services industry. He has worked on multiple projects for many Fortune 500 clients involving categories such as IFM, Real Estate, Engineering and Construction and Corporate Fitness Programs.

Rajesh shares insights on Space Management Technology and Procurement perspective on Buyer’s Expectations.

Find out more about Beroe by viewing their company profile, here.



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