Effectively Realising Synergies in the Supply-Service Chain?

“Diligence feels like speed dating. You have a short timeline to make a critical decision that equates to marriage. The target shows off its colours, and you need to decipher between infatuation and a true match.” – PriceWaterhouseCooper

To put it in clean terms, the above simply means that the deliberations during the short meetings (dating) between the service provider and the client company or the equipment supplier and the service provider enable the parties involved to make the critical decision of collaboration (marriage). While each one puts up the best before the other during such meets, one has to figure out what is right (true match) and what lies beneath (infatuation) for a successful synergy.

In the normal scenario, the sale-purchase deal usually involves the equipment supplier and the service provider but lately, equipment suppliers are closing deals with the end users/client companies in specific industries. While both these kinds of deals are almost similar, the factors involved in creating synergies with the service provider has been found to be much strained.

Comparatively, the synergies between the supplier and the service provider have soured for several reasons, prominently owing to distracted equations and after sales service. Suppliers today find complacency in dealing with the end user, as the above two contributing factors are largely missing.

Factors driving the success synergy are being experienced in the institutional and commercial market too. says Vivek Mata, Managing Director, Charnock Equipments Pvt Ltd, supplies international brands.

Sitting across the table at the office of 247 Facility Services in Bangalore in a discussion on creating synergies, Vivek Mata says, “We have been supplying equipment to 247 FS since its inception and share a very comfortable equation. This has been possible because there is clarity in our transactions and services. Clarity steps up the buyer confidence in the seller; this in turn strengthens the relationship and contributes to successful partnership.”

However, there is misconception in the market that suppliers are more concerned with clearing stocks, resulting in customer dissatisfaction. Ultimately, however efficient the machine and however good its applications, unless it meets customer satisfaction, the deal is unstable. “Customer awareness is equally important, especially in customised machines, as it will help in understanding the need for such a machine and the operations for satisfactory results,” explains Mata.

The dating period with the client could be short or long depending on the educating and convincing factors. And not all courtships end in marriages. But to educate and convince, it is essential to understand the needs of the client. “This is possible only through thorough site audit,” says Mata. “The supplier should essentially accompany the service provider during such audits, to ascertain not just the kind of equipment but also the capacity and usage,” adds Shashi Kamal Garg, Managing Director, 247 Facility Services Pvt Ltd, which is not only into providing soft service but has trained staff for kitchen stewarding. Many of the Taj Hotels have engaged 247 Facility Services kitchen stewards.

Besides education, another most challenging factor is to provide services within the parameters specified by the client company. “Meeting this challenge is a win-win situation for both the client and the service provider. Clients spell out the limitations in the financial allocation for cleaning and to work out a suitable solution with the use of man and machine, it is important that the equipment supplier accompanies in the site study. This will simplify the process of selecting the right equipment and also enable better service,” Garg adds.

In the absence of this supplier-service provider synergy, in many cases, service providers have expressed dissatisfaction over the machine purchase and have complained of non-performance or faulty performance. “But how can a machine perform the task which it is not meant for? A lot of companies go wrong in the selection of the machine and land up buying the wrong machine on the basis of their limited knowledge,” says Mata.

The equipment supplier surveying the client site can ascertain the kind of equipment required, its size and its applications. “We form a team, understand the requirement and supply the right equipment at the best price for specific applications. As far as hospitality industry is concerned, there are certain key factors. Will the machine be used for back office or visible area cleaning? We suggest low decibel machines for the visible or traffic area and high decibel for the back office in order to save money. These are some of the suggestions that play a pivotal role in taking the right decision,” adds Mata.

This again is influenced by the cost factor which has to match the client’s financial allocation. “Nonetheless, whatever clientele we have today, we do not compromise on any point be it manpower or machine. We put forth to the client, the requirement toward meeting cleaning standards,” Sandeep Khosla, CEO, 247 Facility Services.

In the case of 247, having been in the industry for a significant time, it has been able to build on the client confidence on the service provider. “Based on the rapport that we share with the client and based on the confidence the client has on us in delivering the services and the products being used therein, we have been able to acquire a lot of new business in a short span of time,” says Khosla.

While the above is an ideal model, in nine out of 10 cases, the service provider opts for a cheaper machine despite recommendations of better machines by the equipment supplier. This has largely contributed to the ill confidence on the products and services offered by the service provider. “In such cases, as suppliers, we put in black and white that ‘X product has been recommended but since the service provider is opting for an X minus 1 product, the supplier is not responsible’,” explains Mata.

In the bargain, where the service provider goes for a lower priced products other than what is required, the machine gets abused and fatigued very fast and resultantly, the credibility of the machine and supplier gets damaged. “The equipment supplier plays an even bigger role in informing the client about the differences. In many cases, the machines have been called back and replaced with a higher model. Initially, service providers were unhappy and even refrained from buying from us. But, we had to keep our slate clean when it comes to the client. Many of them have come back to us at a later stage,” says Mata.

It’s not always that the service provider decides on what machines to buy. “A lot of clients know what they want and are particular about the machine being used for cleaning. The awareness among the clients is much pronounced to the extent that in some cases they are able to specify the model and the brand of the equipment,” adds Garg.

At times, the client’s demand for a particular brand can be challenging. “We had encountered with one of our clients, a Fortune 500 company. They insisted on us using a particular brand against what we had suggested. As a service provider we do not have a down time of more than four hours. Hence, the machines we use have to match the requirement and in times of breakdown, I should be able to get it fixed or replace parts in four to five hours. This would not be possible, if I had to procure the parts from London or Germany or the US, due to the time factor. Finally, we withdrew from the contract when the client held his ground. But the positive factor in this failed synergy was that the client, inspired by our commitment, called us back,” says Khosla.

As an equipment supplier, Charnock has 12 offices across India and 35 dealers with a good network. “Reaching the service provider or the client in time when there is a service call is a priority. With a good networking system, the nearest dealer reaches the site, anywhere between four to eight hours without fail. To quote the success of being on time for a call, reaching a multi-national company within one-and-half hours of its call for a demonstration, worked to our advantage to the extent that we have received the second order in a short span of time,” says Mata.

Today, the outlook has changed. You can’t sell just brands you can sell your commitment and service. The worst brand can become the best with proper services and vice versa.

“Thus, the synergy concludes when the right seller brings in the right results, with the right equipment going to the service provider at the best price and in turn the client draws the right benefits out of the transaction with smooth services and immediate action.”

Synchrony between service provider & client

The vital link in the chain of creating synergies is between the service provider and the end user/client. A disciplined and transparent approach in drafting and implementing agreements, form the foundation of a successful model. While agreement terms evolve from the requirements spelled out by the client, in many cases the briefing given to the service provider is limited, resulting in a breach of agreement at a later stage.

The discussion with Jagdish, the Facility head of Axa India in Bangalore, who has engaged Bangalore-based Wall2Wall Property Services for housekeeping services, brings to fore the successful parameters involved in designing Standard Level Agreements between the service provider and the client. Ava India office occupies about 52,000sqft in two floors with more staff concentrated on one floor than the other. Being an office space, the major areas involved in cleaning and maintenance are workstations, meeting rooms, GM rooms and other rooms. “At the time of initiation, we emphasised on the maintenance of restroom because it is frequently used, and more so because the restroom represents the image of the whole organisation,” says Jagdish.

In the general scenario, the service provider is briefed on the kind of equipment, tools and chemicals to be deployed but in many cases, the products specified are the ones used for domestic applications and not commercial. This is one of the major factors that works against quality deliverance and results in lack of confidence in the service provider. “At Axa, we have provided Wall2Wall with vacuum cleaners, bio-chemicals and other tools required for housekeeping purposes,” adds Jagdish.

“While, Axa provides us Scheveran chemicals and vacuum cleaner, we too have suggested a few products which have been procured,” adds Kevin R, Country Head-Operations, Wall2Wall Property Services.

Some of the hygiene practices emphasised at Axa is the use of sanitizers, which are placed at the entrance of the office, in pantries and in washrooms. Explaining the hygiene practices in washrooms, Jagdish says, “While we do not have feminine hygiene receptacles in our ladies washrooms, we have made provisions for feminine hygiene service which is being managed by Axa Business Services (Asset Management company of the Axa Group). For hand wash we have branded disinfecting liquid soap available in the market and paper napkins.” More than 40% of the 538 staff at Axa are women but “we have not installed ‘such’ feminine hygiene bins because we are particular that these bins should be maintained hygienically and the disposal should be done the right way”.

Despite provisions, the main challenge lies in maintaining it clean. “We have a housekeeper posted to clean the washrooms every hour. If he has cleaned the washroom say at 10am, he returns back at 11am to remove the tissues hanging from the rolls, dry the wet toilet seats, clear unflushed toilets, dry wet floors, and so on. During this span of one hour between two cleaning schedules, the user visiting the washroom turns uncomfortable and this has remained a cause of complaint,” explains Kevin. User education is essential in the proper maintenance of washrooms. Simple methods like hanging posters in the washrooms on flushing after use, leaving the seat upright when leaving, drawing required tissue paper only, not letting the floor get wet and so on.

“Quality deliverance can be possible through frequent review and feedback, which are communicated to the service provider, whereby the strengths are recognised and grey areas spelled out, and jointly overcome.”- Jagdish

“We do conduct awareness campaign for the staff on the proper use of toilets and we agree that posters should be put up to remind the user to leave the toilet clean for the next user,” agrees Jagdish.

Besides washrooms, the main flooring in the office area is wooden which is dry mopped and vacuum cleaned regularly. “Most of the area is carpeted and the periodic carpet maintenance has been outsourced to a private vendor. Similarly, pest management has been contracted out on annual maintenance basis,” explained Kevin.

“The success in this synergy not just lies in identifying the strengths of the service provider but in overcoming the weaknesses through joint efforts,” says Jagdish. The credentials, commercials and past performance records of the service provider are all checked at the time of selection by the procurement department at Axa. “Even though the preference of every client is to procure skilled manpower, it is not always that they deliver quality service. Untrained manpower too can perform better. Interest and dedication is vital in quality deliverance.

“Quality deliverance can be possible through frequent review and feedback, which are communicated to the service provider, whereby the strengths are recognised and grey areas spelled out, and jointly overcome. Replacing service providers on the basis of non-deliverance is not the solution, but healthy relationship management is important for a successful operation. The client may not be always right, as the service provider could be having better & beneficial ideas which should be discussed across the table to strengthen synergies,” concludes Jagdish.