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Public sector FM outsourcing is growing: how can providers & FM professionals benefit?
In this article, Peter Forshaw, managing director of Maxwell Stephens - the UK professional services agency that specialises in facilities management recruitment - writes about the growth of outsourcing in the public sector...
"FM outsourcing is booming, but that's not the only big news. The definition of facilities management is changing, too. A huge trend is rising within the public sector, favouring outsourced experts to deliver services rather than in-house employees.
Whilst this is happening in a range of sectors, the facilities management industry is making a killing from this new craze. The UK Government is currently spending almost double the amount of the commercial sector on outsourcing. As much as £51 billion in recent years!
This impressive number, quoted in a study by the Information Services Group (ISG), has been put down to an after effect of the recession, and the Government's subsequent focus on cost reduction and value.
The worldwide market for FM outsourcing is predicted to increase by over 35% in 2018, according to research by ISS. And fuelling this outstanding growth is the continuous support and custom of the public sector.
This new-found love of outsourcing has resulted in a complete image overhaul in the FM industry. An ever-changing business, the definition of facilities management has become one of strategy.
For FM professionals and service providers eager to jump on the outsourcing bandwagon, there has never been a better time.
Economic pressure and an increase in competition means companies are looking for a strategic partner. An advisor. An expert. Not only do they want someone who can manage the facilities and services, but who can also to take on some of the associated risks. Under higher scrutiny and tighter regulations than ever before, private businesses and the public sector alike are hunting for the perfect FM provider to help them succeed.
So, what's different about the new FM?
Clients are looking for a new breed of facilities manager. The main feature of this miracle worker? Responsibility. With rigid guidelines and increased pressure from the health, safety and environmental bodies, the public sector has begun searching exclusively for FM providers who are willing to agree to penalty clauses for violations.
Companies want to focus solely on their core mission so leave it to facilities professionals to ensure they stay within compliance. The penalties simply add the same motivation as an in-house member of staff would have. They give you a sense of investment in the company. These huge responsibilities are what's driving the need for greater expertise in FM.
Outsourcing in the FM market has been increasing considerably for the past 20 years, and is expected to rise a further 4-5% in the next year. This is adding to the growing demand for 'value-added services' in FM. This is especially important for clients within the public sector.
Primarily, this involves an emphasis on:
* Social skills. Having genuine concern for the client's staff, their customers and their communities. The range of facilities service providers will attend within the public sector is vast. But with hospitals, police stations and schools on the list, it's obvious that some form of social finesse is necessary.
* Environmental. As a corporate citizen working for a government run facility, maintaining the highest standards and image is paramount. facilities managers must be mindful of the impact of their business' environmental footprint at all times.
* Economical. Ensuring shareholder value both in the present and in the future is another vital part of an FM's role in the public sector. With more external shareholders than any other industry, this is critical.
It has been suggested that as we head towards 2020, facilities management will become a key part in attracting and retaining employees, optimising efficiency and be a crucial component in HR strategy.
So how can FM providers benefit from this momentous change in the public sector's needs? First, you have to understand why any company chooses to outsource their services. The main arguments will always be either:
* Speciality. Most businesses aren't experts in delivering FM. Wanting an industry-standard, effective service, they will naturally go to the most qualified professionals they can find.
* Cost. Despite having to pay for outsourcing FM services, it is still more cost effective than attempting to do it themselves. Running a facilities team effectively, having the right knowledge of the industry, and tapping into the current needs of the company takes skill and experience. Without it, those companies are just wasting their time.
* Flexibility. Outsources specialists know how to adapt to each organisation. They can also dedicate all of their time to managing the facilities without having to juggle the rest of the business simultaneously.
* Innovation. External service providers gain an understanding of different sectors through their many clients. This knowledge can be applied to other businesses that they work for, helping their clients' companies flourish.
As an FM service provider, by proving that you can fill a vital role in the public sector, and meet the standards they are so desperate to achieve, you can truly take advantage of this incredible, ever-changing market.
23rd March 2017