Commitment to benchmark a facility
After determining your goals for your organization, your first task will be to identify the metrics you wish to benchmark. This is a one-time task.
Assuming you will want to not only look up what other buildings are spending and consuming; but also compare that to what you are spending and consuming, you will need to collect the data representing the metrics you wish to compare. These most often include your annual utility bills as well as a summary of what you spent for the year on maintenance, janitorial services, security, landscaping, etc. You may use totals or break everything down into individual tasks, depending on how much detail you wish to use in your benchmarking comparisons. For some organizations, this information can be retrieved instantly, as it already is in accounting and work management systems. For others, the worst case is that they may have to retrieve individual invoices from their suppliers.
For most benchmarking applications, you will need to input year-end data; there will be no need to break it down into monthly or quarterly data.
If you only are doing the Quick Start to Benchmarking, you just need to have your summary data printed on a piece of paper or accessible via a computer screen. If you are using an automated benchmarking tool, you then simply look up what others are doing.
Some tools have been developed by outsourcing companies. In these cases, their reports will be limited somewhat by their own clients’ data. Their value can be quite high when comparing how your building is doing to others managed by that outsourcing company; but that also is their weakness – the comparison set of buildings is limited in quantity, and also to the way in which that company manages its buildings. For example, if a company uses the same subcontractor for much of its work, or does not conduct as much preventive maintenance as many others do, the system will not show it.
Some of these comprehensive benchmarking tools will take facility professionals one step further – they will identify which best practices are being done by the better performing buildings in your comparison set of buildings. You then can see how to improve.
Most of the benchmarking tools tend to specialize in one aspect of buildings. For example, there are some that are designed primarily for leased buildings where comparisons between rental rates can be made. Obviously, this type of benchmarking is not designed to improve your building performance, but to enable you to compare your expenses to those of others.
Some tools focus on real estate. These generally focus on specific markets and submarkets, usually within one country. They often contain vacancy rates and sales data, as well as lists of comparables.
Some tools rely heavily on data extrapolation – these systems have some input, and then a variety of algorithms are applied to enable the systems to project costs in cities for which they may have little or no data. Construction cost and building cost indices frequently are compiled monthly and can be used for projecting building costs. These tools generally do not work as well for facility professionals looking to pinpoint specific costs for a specific building, but can be fine to project costs for building to be constructed or a building to be acquired.
Most tools today are automated, which enable facility professionals to click on a report type and select its filters as desired. Automation also makes it easier for users to input data.
Some systems require data to be input annually; some require monthly data to be input (the monthly data often can be input for an entire year at once); and some are updated only once every few years for each major FM component. Some require you to input data in order to participate; others ask you to volunteer to input data; and others will charge you different amounts depending on whether you input data. The sections below go through these options in more depth as you need to be aware of which type you are looking at before you select a system.
The systems vary not only in whether they track data annually or monthly, but also in when one may input data. Some systems allow one to input data at any time, and then to modify it at any time; others only will have a limited window (usually two or three months) during the year in which you may input data. The former method accommodates those on different fiscal years better, as well as those who may wish to modify data during the year, or who find a need to input data in more depth during the year. The latter makes it easier for the benchmarking company to validate data before it becomes “official;” the former’s benchmarking database is dynamic, providing a snapshot in time that can vary from day to day.
For systems that track data annually, some will allow comparison reports from year-to-year, so you can track your building’s performance over time.
Pricing also will vary considerably between systems, not just in terms of how much they cost, but the basis of the costs. Charges may be based on annual fees, per report accessed, per user and/or per building. A as mentioned previously, some will lower their fees if you contribute data to their system.
The bottom line is that with all these differences between systems, it is critical that you start by establishing your benchmarking goals. This will lead you to the type of system that will work best for you. Then you can select the metrics you wish to track, which filters are most important for you and which reports you will need to run.
Why benchmark and how frequently?
As can be seen, there are a lot of possible metrics to be collected and input. In all likelihood, the level of detail needed for any one facility component (e.g., maintenance, utilities, security) will depend on your benchmarking goals as well as on whether you are underperforming your peers in that area.
If you are underperforming, you will want to know more information. For example, if you are spending more on maintenance, you likely will benefit from knowing what is spent on corrective versus preventive maintenance. If that is in-line with others, you may benefit from breaking out the maintenance tasks. At some point, you hopefully will identify what the culprit is.
So do you need to put in all the data broken down by each craft on day one? If you have time, it only can help and not hurt. But if you don’t have the time (and most facility professionals these days don’t have a lot of this), you probably can wait until the benchmarking comparisons indicate you need a greater breakdown of the data.
Research has shown that facilities that are benchmarked annually will improve each year. This is because benchmarking is considered a continuous improvement process. Until one has a perfect facility, there always will be something that can be improved; benchmarking not only will identify it, but will show which of the improvements will have the most impact on the bottom line. Even if a facility were perfect, each year new technology delivers new tools that can help your facility operate more efficiently. The first year of benchmarking will identify the areas where the greatest improvement is possible (once recommendations are implemented), but there still will be value each and every year that you benchmark.
Some benchmarking tools for utilities enable data to be input monthly. While this can add to the data entry time, it can be helpful when making comparisons to other buildings in your area (with the same microclimate) where you may want to track the impact of local conditions in your building performance. For example, if your building is in an area that has major temperature changes, by tracking how other buildings in your area performed during a month, you’ll be able to see whether the sudden improvement in the month in your building was caused by the improvements you made to your building or because that month happened to be particularly warm.
