The facility services segment is dynamic in nature with different levels of service providers sharing the same space. Despite odds, the projection for India shows exponential growth in the coming years for the service segment in India. Vijayalakshmi Sridhar compiles views of a few facility sevice providers on the industry trends.
In the last three decades, the facility service segment in India has been growing rapidly and with just a handful in the organised sector, ascertaining the number of operators in this field has become difficult. This segment is unique, as the players, even in the unorganized sector – tend to commonly use the term “professional” to define the services they offer. Everyone who gets into the race ‘offers’ a combination of both technical and non-technical services and evolves to specilise over a period of time. Undercutting, under quoting, poaching and other detrimental factors is hampering the standards and smooth growth of this segment. While one can say these detrimental factors are prevalent in the Indian market for a long time now, do we see it changing now?
Training & Quality
Cost challenges and deffered payments largely influence the comprehensiveness of services being offered.
Rajesh Shetty
No doubt, quality delivery is possible with trained manpower. Presently, training is a roadblock; particularly developing the right skill sets that is required to meet the escalating demand is challenging. On site training is topped with refresher training to keep up with the changes. The current attrition rate is reported to be between 3.5- 8%, which is another major detrimental factor in terms of investing in manpower. Various initiatives ranging from attendance bonus to employee assistance, reward and recognition with promotions are being offered to maintain a healthy workforce strength.
In terms of quality, Rajesh Shetty, National Director-Facility Management, Colliers International, says, “ We see to it that there is continuity of knowledge and awareness among the workforce and the gamut of services does not suffer by people movement.”
Price vs Service
The business for service providers has been an effort to strike a balance between impeccable service quality and having a competitive edge. However, the customer expectations are rising. MK Padmanabhan, Chief Executive Officer, Faber Sindoori Management Services Pvt. Ltd says, “Since the definition of “Best” is almost an individual perception, whatever be the improvement demonstrated in the present scenario, it still needs further enhancement to keep up with the increasing industry demand. IFM companies are well versed with the quality standards and the practices to be followed to achieve the desired results, but when the price to meet the demand is not achieved, the cost cutting measures make it tough to realize the higher level of service expectations consistently. So the service providers truly feel the pressure, since the debate on compensating the right service charges for the right work to upkeep the level of expectations is still in the nascent stage.”
The cost cutting mechanism, however, is adversely affecting the service segment and damaging the client confidence in outsourcing services. There are service providers who have taken a bold stand in turning down contracts that do not meet contract terms. Nonetheless, being a very competitive segment, in the wake of the uncertainity in the ability to sustain standardized practices has taken the back seat.
Growing Business
Most service providers agree that there is a plethora of opportunities, especially with the new government initiatives, and yet unhealthly business practices are being indiscrimately followed.
“In terms of new business, since corporate sectors and government units like Airports, Railways and Bus Transportation companies are realising the strategic importance of outsourcing to service providers, they have become more professional in selecting the right service providers,” says B S Shetty, MD, Durga Facility Management Services, Mangalore.
However, Bandi Kanna, Chief Executive Officer, 24×7 Facility Service Connect Pvt Ltd, Bangalore, has a simple approach to being sought after in the market. “If your rates and management fee are competitive, it is easy to get new business. We have retained 95% of our existing business.”
Client diversity has propelled the growth of brands and they are the ambassadors for this segment’s growth, says Bharathi Kamat, MD, CarwelIndia, Bangalore. “The last one year has been challenging but a successful year in terms of new business and revenue. It gives us immense satisfaction that with expansion into other office spaces, our clients have reposed faith in the quality of our services and retained business with us.”
Outsourced services in government establishments, industrial and manufacturing sectors, hospital, commercial and residential building segment, food processing units, ground handling service, public road sweeping and campus area sweeping are some of the segments the service providers have made in roads into. IT and ITES are reliable sectors with a steady business potential. Transport sectors, Municipal corporations, public areas, laundry and waste management services, residential cleaning and landscape maintenance are potentially growing segments. In the current scenario, being a technologically-savvy brand that offers sustainable solutions is the muchneeded feature that defines the brand’s positioning in the market and helps them to remain in the forefront.
Driving Factors
Shetty shares one such effort. “Mechanised cleaning will have better impact on the service as it requires lesser number of specialized manpower and is more sustainable to clients. This also leads to cost effectiveness and the customer will be benefited by providing value for money service along with desired results.”
Padmanabhan adds, “There are significant reduction in wastage of materials as well as operational cost without compromising quality standards. We have also noticed that the areas where we have higher attrition rate, mechanized work practices is the solution and has given satisfactory result in meeting the client expectations consistently.”
“The future of the service segment lies right at the grassroots level. The empowerment and elevation of the manpower in terms of training and skill development will be the focus in the years to come.“
Bharathi recommends the combination of both. “Mechanised cleaning dovetailed with handson cleaning makes the housekeeping job easier, neat and likable by the client. It saves time and effort, and the results are good. Employees find mechanized cleaning a boon and most of our clients are with us on this subject. We have been able to reduce manpower in large areas by introducing mechanized cleaning, which has been very well accepted by the client,” she tells us.
Future
At the end of the day, facility management is a significant business as it is directly concerned with the management and maintenance of physical assets and efficient operations of the company. Rajesh feels that sustainability is the key. “Sustainability for the organization can be achieved by bringing awareness in the class four level workforce. At Colliers, we inclulcate a sense of belonging, bringing more accountability to work by making them aware how critical or detrimental their contribution is to the organization and the society at large. We make them feel good about their work and keep track of their developments, letting them have a sense of their work concerning the chemicals handled, waste management beyond the organizational purview and the connection to the environment and sustainability.
“Continuous orientation and training will drive this message from the bottom most level of the force and up. It will help them understand that they are the first people to start a continuous chain of activity and the key lies in keeping it going consistently.”
The future of the service segment lies right at the grassroots level. The empowerment and elevation of the manpower in terms of training and skill development will be the focus in the years to come. In fact, it has already started with service providers investing in training schools and the cleaning industry taking initiatives to formalize the processes and education channels. This then will be truly professional and all other detrimental factors can be addressed as determining factors in chosing the right contract.