By George Bouri
In my experience, real estate and facilities management (RE/FM) executives have not traditionally enjoyed as much access to or involvement with C-level leaders as our peers in finance, HR and IT. There is an old joke that asks how RE/FM leaders get a seat at the table for senior-level meetings, rather than simply providing the table.
To some degree, RE/FM leaders are victims of their own success, especially in terms of reducing costs for commodity services. We have come to be viewed as a back-office function, quite capable of cutting costs and getting tactical things done. But, we are not typically viewed as strategic partners to the business. Thus, we are not regularly invited to help shape the corporate agenda, define the strategic vision of the enterprise or play leadership roles in broad-based transformation programs.
To me, this is a lost opportunity. The precious few RE/FM leaders that have reached the status of strategic business partners have adjusted their thinking and adopted behaviors that align directly to the C-suite’s strategic agenda in ways I highlight below. While these principles apply specifically to real estate and facilities management professionals, many of the concepts may also pertain to leaders and consultants in other areas of the business.
1. Think outside the function to become a business enabler (not an order taker). Strategic partners don’t wait for internal stakeholders to call with specific requests. In the case of RE/FM, those would involve reconfiguring workspaces or updating cafeteria menus. Instead, they devise and propose solutions that are designed to help business leaders seize high-value opportunities and mitigate urgent threats. That’s the best way to build sustainable, trusted relationships.
Enabling performance improvements in this way provides an opportunity for RE/FM to add value consistently across the business cycle, rather than at infrequent transactional or operational events, which have traditionally dictated RE/FM calendars. In fact, the internal clocks of RE/FM groups should not necessarily be keyed to lease renewal dates and other tactical milestones, but rather business events and timelines. In fact, RE/FM teams should synchronize such function-centric milestones to the broader operational cycles. That’s a clear checkpoint for validating strategic alignment.
Helping business units achieve their goals assumes that RE/FM leaders have a clear and detailed understanding of those goals—whether they are tied to operational excellence, global expansion or higher workforce productivity. For example, RE/FM leaders can provide guidance on the business case for alternative workplace strategies, such as hoteling and for rapidly scaling up operations in new geographies.
2. Focus on people, culture and connectivity. The primary job of RE/FM leaders is not to tend to the bricks-and-mortar assets of a company, but rather to make a company’s most valuable asset – its people – more productive and collaborative, as well as safe (especially for companies with operations in high-risk locations). A case can be made that this is IT’s role as well. This focus is especially important because 21st-century companies compete based on the ideas of their people and the collective intellectual property that underpins their offerings and customer relationships. RE/FM leaders have a significant and strategic role to play in creating the environments that ensure that ideas and insights can be efficiently and effectively converted into better products, services and processes.
If HR tries to identity and filter fitting candidates for a variety of jobs, then RE/FM leaders can make major contributions in attracting and retaining top talent by creating the environments in which they can work most successfully. It’s all about engaging these workers so they are fully committed to their roles and empowered to do their best work. Inspiring people and unleashing their creativity through forward-thinking workspaces and quality facilities will add a lot more value than simply knocking a few more dollars off a supplier budget, which has been RE/FM’s traditional focus.
3. Reinforce values. Physical workspace should be an expression of corporate values and the corporate brand—think the GooglePlex and Bloomberg’s impressive headquarters. Open workplaces have become the standard at firms where the emphasis is on information sharing, collaboration and open discussion. Companies that want healthier employees add gyms and walking paths to their campuses and encourage their employees to use them. RE/FM leaders can get creative in the design of such amenities, keeping in mind the business reasons for offering a great workplace experience.
Sustainability is one area where RE/FM has shown its strategic leadership potential relative to corporate values. Fortuitously in some cases and by design in others, RE/FM was assigned the oversight of many sustainability issues. In general, the RE/FM community deserves high marks for its performance in this area, especially as sustainability has become embedded into the organization’s DNA and is no longer a separate “agenda item.” Examples of success include energy management initiatives and the consolidation of spend for utilities. In the future, the industry will move beyond the achievement of LEED-certification and platinum-status buildings to focus on bigger-picture initiatives and small, but impactful programs.
4. Use metrics that emphasize value, not just cost. Traditionally, the RE/FM industry has measured itself mainly on financial measures, with a particular obsession on square-footage costs. They’re not the only ones of course; leaders in IT and finance have also been accused of being excessively cost-focused. But there’s clear reason for all types of business leaders to think in terms of customer satisfaction, productivity and other value-driven metrics.
Six Sigma and other advanced quality measures should be evaluated and implemented, too. Balanced scorecards, dashboards, KPIs, SLAs and benchmarking processes can also be useful elements of a performance management toolkit for RE/FM leaders. To some extent, this requires RE/FM leaders to engage with other groups (HR and IT being obvious examples) to survey workers and other internal stakeholders about how they use space and how well their needs are being served.
5. Set an innovation example: The best way to develop a reputation for having good ideas is to develop and implement them internally. Today, there is an open invitation to innovate across the business, and RE/FM leaders should seize it. Creating alternative workplace environments is a great first step, but much of the innovation action to come in RE/FM is likely to be in the technology and risk management space.
New technologies—like integrated workplace technology systems—can help RE/FM teams generate breakthrough gains in processes ranging from lease management to vendor management. Across the company, RE/FM’s value doesn’t come strictly from facilitating and sourcing all the materials and services to designing, building and maintaining data centers. Rather, it’s about understanding the technology trends (like mobile and cloud computing) that shape how we work.