Performance management is frequently defined as a process by which the company manages its results and performance in line with its corporate goals and functional strategies.
Top 10 Key Performance
Indicators in Facility Management.
In Facility Management (FM), the objective of that process is to accomplish an integrated control
system, where the corporate and functional strategies are transferred to all support processes, activities, tasks, and personnel.
The key component of that control function is the provision of reliable feedback and information through the performance measurement system.
The goal is to provide the tools for informed and effective management decisions at all levels – strategic, tactical and operational.
Because Measurement is the first step that leads to control and eventually to improvement.
“If you can’t measure something, you can’t understand it; If you can’t understand it, you can’t control it; If you can’t control it, you can’t improve it.”
This magnificent reasoning by J. H. Harrington lies at the core of contemporary performance management.
The most valuable instruments of the performance measurement system are the Key Performance
KPI could be defined as a measure that provides essential information about the achievement of a targeted level of results.
Top Ten Facility management KPIs:
It is neither beneficial nor practical to attempt listing exhaustively KPIs in FM, due to the interdisciplinary and complex character of the sector and the significant scope of services provided. Rather, it would be more useful to identify the most frequently monitored KPIs in Facility Management practice today.
The presented KPIs reflect my professional experience, as well as research and reported best practices by The KPI Institute, Euro Facility management, and IFMA.
What are the most often used KPIs in Facility Management? (KPIs are
not presented in order of importance)
1. € Gross FM Costs (TCO) / 1 m² (ft²) of Gross Floor Area
2. % Degree of User Satisfaction from FM Services
3. € Capital Costs / 1 m² (ft²) of GFA
4. # End User Complaints
5. # Net Floor Area in m² / 1 working place or per 1 user
6. € Maintenance Costs / 1 m² of GFA
7. € Operational Costs / 1 m² of GFA or per 1 user
8. % Planned maintenance vs. Reactive maintenance Ratio
9. € Utility Consumption Costs / 1 m² of GFA or per 1 user
10. € Cleaning Costs / 1 m² of GFA
These metrics could easily multiply and become Top 20 or Top 50. But as William B. Cameron says:
Not everything that can be counted counts, and not everything that counts, can be counted.
The challenge is to select and maintain a manageable number of monitored KPIs. In this context, what would be the selection criteria for identifying, developing and utilizing KPIs in Facility Management?
KPIs have to be:
1. Balanced – An integrated KPI system must be balanced by offering indicators that measure quality and quantity; effectiveness and efficiency; objective and subjective domains.
It must employ objective measurement methods as well as techniques that capture and report
subjective opinions and reflections.
Example: # Net Floor Area in m² per 1 Workstation; Level of Satisfaction of Users from Help Desk Service; % Maintenance Overtime, Level of Employee Engagement.
2. Assigned to – The responsibility for monitoring and managing the feedback from KPIs within the concept of Plan-Do-Check-Act must be assigned to specific unit/position.
Software and automation systems could facilitate and enhance, but cannot manage or lead.
Example: Under the leadership of the Maintenance Manager reduce the Maintenance Costs as a percentage of Asset Replacement Value to 3% by the end of Q1, FY 2016.
3. SMART – KPIs should be Specific, Measurable, Achievable, Relevant Time-phased.
Specific – KPIs should be defined by using clear and specific terms. It has to be clear what the KPI exactly measures; Look for a uniform definition of the KPI; it must be accepted with consensus within the company to guarantee that different users interpret it in a uniform way.
Measurable – The KPI has to be measurable; it should define a standard, budget value or norm. A true KPI measures the actual value that could be compared to the target value. Example: € Operational Costs; % Occupancy Rate; # Corrective Maintenance Requests.
Achievable – Every KPI has to be realistic within the selected time frame. It is really important the acceptance within the organization that the target value or standard is achievable.
There is nothing more discouraging than making every effort for a result that will never be reached.
Relevant – KPI should be aligned with corporate strategy and must be signed for the specific area of services or activities, or a particular group of clients/customers/users. The measurement of many, insignificant indicators, with weak relation to the planned result, is the most common pitfall of performance management.
Time-phased – Every KPI becomes meaningful when its value is monitored in time periods. Example: Reduce percentage Ratio of Reactive Maintenance to 15% vs. Planned Maintenance of 85% within the next 12 months under the leadership of the Maintenance Manager. How do we apply these rules and criteria?
Deyan Kavrakov, FRICS
CEO at Mundus Services, Board Member at BGFMA