Building & Facilities Operations

I recently attended an industry trade show for one of the markets we serve that uses our web-based operations platform to help manage building maintenance and other related tasks.

The facility manager of a fairly large organization expressed interest in hearing how we might be able to help them improve the efficiency of their maintenance operations.  Before a member of our sales team could finish demonstrating the options for the prospect’s maintenance staff to more efficiently manage maintenance related tasks either from a computer or a mobile device, the prospect exclaimed:

Oh, no!  Our maintenance staff would never use a computer or figure out how to do this stuff on a smart phone. This just wouldn’t work for us.

There were a couple of things that immediately bothered me about that statement:

• Generally, it is just not true.  We work with thousands of maintenance personnel across the country, and in the vast majority of cases we find them to be extremely competent and capable of using any part of our application. Often, they are the most knowledgeable users! It is important to remember a key fact about professionals in the maintenance field; they are excellent problem solvers.  They are tinkerers, fixers and people who excel at figuring out how things work. Who better to use a software application? In fact, we have had several experiences during our training sessions where a member of the maintenance team has had to explain to a member of the management team how to use the application.

• If it was true in this particular manager’s organization, isn’t that really representative of a deeper problem?  We are all aware that it is a manager’s responsibility to hire the best people possible to do a job given the resources that are available. But isn’t it also a manager’s responsibility to help his/her employees improve by providing access to the further education and training opportunities? A company that empowers employees to learn the necessary skills to achieve success in today’s technologically oriented world is both increasing its overall value and engendering an environment of loyalty and commitment.

I have seen many examples of companies that are committed to employee training and ensuring that all of their employees are capable of utilizing any technology that might help them improve their business. To wave your hands in the air and state dejectedly that your team isn’t capable of utilizing technology is really an indictment of your own skill as a manager.

Apathy only guarantees one thing:  that your employees will stay exactly where they are, and your organization will as well.

In a real estate down-cycle our asset valuation focus changes. The heyday of strong cap rates, rental rate growth and high transactions volumes caused asset managers to focus on high return through asset appreciation. Capital projects soared, borrowing soared, and valuations soared with them. It seemed like there was no ceiling to real estate values. The environment that created those boom times is not likely to return soon, but owners and managers still need to focus on increasing asset value.

Now that we’ve come back down to earth, the focus has moved inwards from transaction volumes to operations management. No one internal operating factor can make the kind of valuation impact that a positive transaction can make. However, litany of operating factors which might otherwise have little impact, when taken together can generate strong operating returns over the long term. Consider the operating levers that drive down costs and increase such as improved energy management; more effective preventive maintenance, improved staffing management, reduced risk and liability, and capturing more billable revenue.

To successfully manage your portfolio during this downturn, building owner and managers need to capture building activity data to assess how their buildings are performing and identify which performance influencing factors can and should be changed. Real estate managers must question their assumptions and embrace the tools and techniques necessary to stabilize, strengthen and then grow net operating income. One of those tools is a Web Based Operations Management system (“WBOM”).

To read more about better, more efficient means of operation request a white paper at the following resource location: http://www.buildingengines.com/index.php/research-library.html

Our new tenant satisfaction module introduces a brand new module option for managing tenant satisfaction. This module supports the workflow of proactively reaching out to tenants to gather feedback about request follow up, work completion or any other tenant concerns. This module is available to users of our New Work Order and Preventive Maintenance modules.For more info give us a call (click here) email us at jthompson@buildingengines.com.

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“We basically have nothing to sell but the service of our people. Customer service is our top priority ahead of growth, profitability, or selling the next piece of business because putting customer service first will make us the best and the other things will follow.”

-    Bob Sulentic, President and CEO, Trammell Crow Company (Link)

In February 2002, after the tech bubble burst and the 9-11 attacks, an interesting article appeared in Commercial Property News entitled “Santora, Gunn Keep Tenants Happy While Cutting Costs”. The article touches on many of the same issues the industry is facing today; namely cutting costs while improving tenant relations. It also reveals the beginning of what is now called the Web-Based Operations Management (WBOM) software industry and how these Gen I systems developed by owners and managers themselves, as well as third party vendors, were seen as the best solutions to mitigating the effects of the economic downturn by cutting costs while bolstering tenant relations.

We all know that effective tenant relations programs include everything from blood drives to building newsletters but what the early WBOM systems proved, despite being home grown and offering limited functionality, is that software could be used as a tool to efficiently improve customer service and tenant relations in all building types, while cutting cost. Now, almost a decade later, a new generation of WBOM tools have emerged and, again have become an urgent must have for the industry – rapidly replacing Gen I and homegrown systems with a single-platform, portfolio wide solution.

After the tech recession ended in 2002, many organizations, and indeed, many software vendors simply turned their attention away from the continued development of web-based solutions. The one-off approach that was implemented in the early part of this decade – where you might find a building using one solution for visitor access, another solution for service requests, and, yet another for preventive maintenance.  From there, passing paper between the operations team and other departments (i.e. accounting)  thus denying the dream of seamless paperless process. To make matters worse, buildings owned and managed by the same company were often using different solutions per building, making it difficult for asset and regional operations managers to generate reports and really know what was going on in each property.

From late 2002 to early 2008, tenant relations returned to a more traditional path, as staffing levels increased and the industry became flooded in cash. Advancing building operations and cost management took a back seat to high-flying business transactions. Then it all came crashing back to earth.

A repeat scenario for the real estate market ensued that was eerily similar to the tech recession. Layoffs, staffing shortages, higher level managers directly overseeing the operations of buildings across multiple regions, cost reductions, and reduced revenues. As Bob Sulentic said in the quote at the beginning of this article, “We basically have nothing to sell but the service of our people.” A difficult thing to do in the worst economic climate since the Great Depression and in one of the most heavily exposed industries.

Clearly business decisions will be made based on the bottom line but – ceteris paribus – the winner will usually be the property, the decision maker, or the decision maker’s employees. And like in 2002, a new technology trend started to emerge.  With almost a decade of developments and improvements to boot, Gen II WBOM systems are now delivering an entirely new level of customer service to building owners and managers.

Gen II WBOM systems bring together key elements critical to what building owners amd managers need to have in an integrated tenant relations program. In the past, design and ease were one of the most often overlooked areas of tenant utilized applications. Imagine crumpling up your printed company newsletter and delivering it to your tenants. They would be very dissatisfied.  The same would occur if they same to a difficult tenant landing page to submit a service request. Your tenants must feel confident; that the same or better level of service is going to be provided and there will be no interruption to their business due to cutbacks.  In addition, they will be looking at your competition as a service comparison.

Here is what your WBOM system must do from a tenant relations standpoint:

• Be attractive and easy to use
• Be branded with your logo and color scheme
• Allow tenants to enter and view service requests on the landing page and allow tenants to enter and view visitors on the same page
• Display upcoming events and other items of interest in your traditional tenant relations program
• Provide one-click access to other amenities, services, and functionality delivered through your system
• Support certificate of insurance compliance through timely, automated notifications or save your tenant time and notify their vendor directly
• Deliver a single email and/or text communication so your tenants know all that you do for them
• Allow your staff to communicate with tenants when service requests have been received and completed

Implementing a Gen II WBOM system should deliver these tenant relations benefits to you and your organization, eliminate the spider web of one-off solutions, and deliver visibility throughout your organization’s chain of command. Remember, you are in competition to keep your tenants and to attract tenants from the building next door. Even if your overall market has a 16% vacancy rate, if you are at 8% your well positioned versus the next guy.

On tomorrow’s Blog we will cover Business Problem #3: Getting People in Your Building – How marketing your building can help you drive tenant retention, acquisition, and fill space.

Why are companies like Related Companies moving rapidly to adopt Web-Based Operations Management (WBOM) systems? Simple! Having a WBOM improves upon four key aspects of any building or facilities operations organization: tenant retention & acquisition, cost savings, revenue generation, and improved efficiency. This week we will talk about the first aspect, tenant retention & acquisition.

Tenant loss can be very expensive; including costs associated with vacancy related revenue loss, brokerage commissions, tenant build-outs, allowances, and concessions. Property management teams are expected to provide a level of service that makes current occupants want to remain in their building or facility and also attract new tenants to fill vacant space.

Yet, in this increasingly competitive landscape combined with a reduction in staffing and budgets, many in the industry are concerned they will not  have the resources to continue to provide the high levels of service that drive tenant retention and acquisition.

Business Problem #1: Reduced Staffing

When the real estate bubble burst, one of the first actions real estate organizations took were to layoff employees.  At Building Engines we began to see an increase in inquires from senior level people saying their organization has gone through a reduction in force (RIF) and now they were directly managing building and property teams – with little or no visibility. While the RIF may have immediately impacted the company’s bottom line, it also may have created significant problems for managers in the short-and long term.

With fewer staff members, critical tasks, such as responding to a too hot/too cold request might not get completed. Worse yet, because the processes were not standardized throughout the organization and the data wasn’t accessible to managers, no one was really sure what was being submitted by tenants and what was getting completed. If this scenario were occurring, short-term cuts could lead to the long-term mortality of the building or even the entire organization.

With reduced staffing levels expected to continue for at least the next two years, the organizations Building Engines’ has been working with, have made the choice to standardize their property and facility operations practices so that management at every level, can make decisions based upon what is actually going on in their portfolio. Most of the executives we have talked with are willing to do just about anything to ensure that tenants who are not downsizing and are not going out of business, don’t let their leases expire and bolt to the building next door.

It is critical that your tenants do not feel the impact of your staffing shortages because that will impact their business, and they are as concerned about their future just as much as you are with yours. Here is what you can do:

• Security: If you have made reductions in your guard staff, ensure that you don’t have bottle necks, confusion, or breaches with a visitor access solution that works for your tenants and your guards. If a tenant’s business meeting goes poorly because they couldn’t get by the guard – that will reflect on you.
• Improvements, Projects, & Preventive Maintenance: Now that many capital projects are on hold, it is important that you keep what you have running and looking attractice. If the third floor men’s bathroom that was scheduled to be remodeled suddenly gets shut down due to poor preventive maintenance, you’ll have to deal with unhappy tenants and the expense of fixing the problem.
• Service Requests: Critical! If you are not responding to and completing your tenants service requests you are in hot water. Make sure that you know what is being requested, what relayed communications are taking place, and that your team is getting the job done!

On tomorrow’s Blog we will cover Business Problem #2: Effective Tenant Communications and How the “I Like You Factor” Can Influence Your Tenant’s Decision to Stay.