PROPERTY AND

FACILITIES
MANAGEMENT
BLP 4106
By B Dube
Facilities Management.
 Facility management (FM) is a profession that
encompasses multiple disciplines to ensure
functionality of the built environment by integrating
people, place, process and technology (International
Facility Management Association (IFMA).
 FM involves guiding and managing the operations
and maintenance of buildings, precincts and
community infrastructure on behalf of property
owners (Burt,2012)
 The FM industry is generally acknowledged as having
stemmed from services provided by janitors and
caretakers during the1970s.
Facilities Management….
 Facilities management is an age-old
practice which has existed out of necessity
since buildings were first constructed to
support human activities.
Usefulness of FM

 The “management” in FM forms the crucial

link between the core business operations
of an organization and the reliability of the
facilities for the users.
 management entails proper planning and

coordination of service delivery—not simply

the response to the immediate issues that
periodically arise.
Facility Manager
 The Facilities Manager can consist of a
single individual or a team, with services
able to be delivered by dedicated ‘in-house’
professionals or ‘out-sourced’ in whole or
part to external providers.
 Facilities inspectors conduct periodic,

detailed inspections to evaluate the

maintenance condition of buildings and
facilities and to identify any necessary
corrective work.
Roles of Facility Manager
 The Facilities Manager organises, controls and
coordinates the strategic and operational
management of buildings and facilities in
order to ensure the proper and efficient
operation of all its physical aspects, creating
and sustaining safe and productive
environments for residents.
 it is the job of the facility manager to create
an environment that encourages productivity,
is safe, is pleasing to clients and customers,
meets government mandates, and is efficient
Roles of Facility Manager
cont...
 Provide services, meet varying
expectations, support, information, be a
good listener, and deal with conflict to
create a community environment residents
are willing to call home.
 Their role also includes dealing with various

contractors and suppliers in carrying out

maintenance and upgrades, and providing
services such as security, cleaning, and
property maintenance.
Summary of the roles of facility
managers
 Making sure operations run efficiently
 Ensuring the safety of workers
 Meeting building codes and government

regulations
 Saving money
 Boosting productivity
 Creating an environment that is pleasing to

clients and customers

Major services for FM
 FM can be divided into ‘Hard’ and ‘Soft’
services
Hard services of FM
 Building fabric maintenance
 Air conditioning maintenance
 Decoration & refurbishment
 Lift & escalator maintenance
 Mechanical & Electrical (M&E) plant

maintenance
 Fire safety system maintenance
 Plumbing & drainage
 Minor project management
Soft services of FM
 Cleaning
 Recycling
 Security
 Pest control
 Handyman services
 Grounds maintenance
 Waste disposal
 Internal plants
Defining the Scope and Competencies
of Facilities Management
 Traditional programming of buildings focuses on the
properties of the building itself.
 It focuses on the functional properties of the building and
assumes that usability will follow as a causal effect of a
functional design.
 Technical functionality of a design is defined as those
properties given to the artefact that makes it do the job in
itself.
 Usability also depends on the situation in which the artefact
is used, the context the artefact is designed and used in and
the values of the designers and users.
 It is also affected by the culture in which the artefact is
designed and used (Vatrapu, 2002)
 The FM profession is developing at a time of rapid change in
all the areas that define its practice.
Defining the Scope and Competencies of
Facilities Management
 The landscape for FM is increasing given trends in ‘total outsourcing’
of services delivery by large public sector authorities and major
international corporations.
 in its continued evolution, FM must embrace change and allow
diversity in the way it defines and manages practice.
 Facilities Management is about:
 􀂾 Understanding the business
 􀂾 Planning and providing for the business
 􀂾 Managing the facility as an asset resource over its functional life
cycle
 􀂾 Managing the facility as functional enablers to support human
resource and production
 processes within affordable occupancy costs
 􀂾 Managing change
 􀂾 Being visible as a value-adding resource for the business
 􀂾 Being professional
Defining the Scope and Competencies of
Facilities Management
 In functional terms, the scoping of facilities management can
also be defined to embrace the following:
 􀂾Strategic Facility Management (governance and organisational
capability)
 􀂾Facility Planning (identification of business need and response)
 􀂾 Facility Creation/Acquisition
 􀂾 Facility Operations
 􀂾 Facility Maintenance
 􀂾 Facility Replacement and Disposal
 􀂾 Facility Management Tools
 􀂾 Environmental Management
 􀂾 Facility Management Systems
 􀂾 Business Management
 􀂾 Legislation, Codes, Regulations and Standards
Current Facilities Management
deficiencies
 Facilities Management, as a management discipline,
has not been able to establish a clear identity as has
its close business management relations in human
resources, finance and information technology. One
primary obstacle is that most activities undertaken by
the facilities management function are seen as a
business cost and not seen as contributing to
maximizing shareholder and business value – unlike
human resources, finance and information technology
which are seen to be directly contributing to improve
business performance through:
 􀂾 recruitment of the right resources and skills;
 􀂾 making the right investment and financial decisions
Current Facilities Management
deficiencies….
 Facilities management identity is also obscured by the various disguises that it can operate
under. As facilities management is multidisciplinary, its identity can be lost through a specific
discipline focus within a business whether that be architectural, engineering, property
management or maintenance. This apparent lack of focus further erodes the ability of a
facilities management function to grow internally through building internal capability. The
multidisciplinary nature of facilities management also can obstruct its functional ability to
adapt quickly to business dynamics. As a result, the general perception remains of facilities
management being a non-value adding cost to the business and potentially being loosely
defined as “non-core”. This view generally results in facilities management support services
being identified as part of any downsizing and/or outsourcing initiatives to reduce the cost to
the business.

 Outsourcing Impacts
 What are the impacts?
 Observations from the outsourcing of facilities management support functions would agree
that
 the risks relate to:
 • The outsourcing trend contributing to the loss of internal knowledge;
 • The outsourcing trend adding uncertainties to ownership issues in terms of corporate
 information; and
 • Outsourcing placing the onus on the client to effectively manage the suppliers’ deliverables,
 which assumes the existence of adequate internal capabilities.
Current Facilities Management
deficiencies…
 NB// Clearly, there needs to be an adequate
level of internal business capability to
ensure that the above risks are mitigated
and managed over time and that business
performance is not compromised.
How to Build Facilities
Management Capabilities
 careful planning. In this instance, the internal
capability required to effectively manage an
outsourced facilities management supply
arrangements is in question.
 Building internal capability through internal
learning
 Building internal capability through external
education and training ensuring that strategic
and operational facilities management
capabilities are sustained and developed over
time.
 Facilities Management
throughout the building life cycle
 The building life cycle

Feasibility Design Approvals

Construction

Maintenance Operations
Commissioning
Facilities Management
throughout the building life cycle
 FEASIBILITY
◦ Advise developers
◦ Identify risks
Design
 Advise designers on how the design will
impact on the future operations and
maintenance of the building
 Identify suppliers
 Risk assessment
Approvals
 Establish supplier networks
 Identify stakeholders
 Risk assessment
Construction
 Selection of FM provider
 Identify supply chain
 Engagement with stakeholders
Commissioning
 Handover
 Defects liability
 Appointment of contractors
 Develop asset knowledge
 Appointment of staff for building
 OWNER’S CORPORATION establish

◦ Budgets
◦ Insurance
◦ Administration
◦ Secretarial
◦ levies
Operations
 Relationship management
 Performance monitoring
 Contract management
 Legislative compliance
 Provision of soft services
 Waste management
 Risk management
Maintenance
 Assess risks
 Preventative maintenance
 Reactive maintenance
 Risk mitigation
 Identification of opportunities
 Maintenance plans (sinking funds)
Capital projects
 Develop business case
 Commission specialists/consultants
 Project management
SERVICE CONTRACTS
 Service contracts need to be out sourced
when the property company does not have
the technical skill and resources in-house.
 Some of the out source skill include:
◦ Lift Service and Maintenance
◦ Air Conditioning and Ventilation Servicing and
Maintenance
◦ Cleaning and Janitorial
◦ Mechanical And Electrical Maintenance
◦ Property Maintenance And Day To Day Repairs
Tendering methods are used for procuring services
contracts
Definition of Tendering
 Tendering is one of the methods of
procurement whereby potential suppliers
are invited to make a formal offer to supply
goods, provide services, or carry out works;
which on acceptance, shall be the basis of
subsequent contract
 Tendering can be referred as a process of

selecting the most suitable contractor for a

specific project.
Object of Tendering
 The object of tendering is to select a
suitable contractor, at the proper time, and
to obtain an acceptable offer to execute
construction works.
Factors aiding tendering
 Size
 Character of project
 Location of project
 Level of pricing
 Period of time for construction project
 Type of firm and type of business carried out
 Financial resources of firm
 Physical resources of firm
 Human resources of firm
 Past performance of firm
 National economic climate.
Tendering Procedures
 Tendering process in procuring entity may
be divided into several stages:
◦ Preparation of tender documents
◦ Review and approval of tender documents
by the Tender Board
◦ Advertising of tender and issuing of tender
documents
◦ Submission and custody of tender bids
◦ Opening of tenders
◦ Evaluation of tender
◦ Approval and award of the tender by the
tender board
Tendering methods
1. Open tendering
2. Restrictive open tendering
3. Selective tendering
4. Negotiated tendering
5. Serial tendering
6. Two-stage tendering
1. Open tendering
 Open tendering is the preferred competitive public
procurement method used for acquiring goods,
services and infrastructure works. It is executed in
accordance with established procedures set out in the
procurement guidelines and detailed in the standard
bidding documents. For example S.I. 5 of 2018 (Public
Procurement and Disposal of Public Assets (General )
Regulations
 Open tendering is also known as open competitive
bidding, open competition or open solicitation, and
the procurement notices used to call for bids for these
requirements are identified as: Invitation for Bids or
Invitation to Tender.
Requirements of open tendering
 Be open to all qualified and interested
bidders,
 Be advertised locally (and internationally,
when required),
 Have objective qualifications criteria,
 Have neutral and clear technical
specifications,
 Have clear and objective evaluation criteria,
and
 Be awarded to the least-cost provider,
without contract negotiations.
Advantages of Open
Tendering
 Very competitive tenders are obtained
 fosters effective competition and adds value

for money
 Only interested firms will submit tenders
 New firms are able to obtain work and prove

themselves.
Disadvantages of Open
Tendering
 Some firms may not be well-equipped, either
materially or financially, to execute the work
 If a very low tender is submitted and accepted,
it may cause difficulties throughout the
contract
 Submitting tenders costs time and expense,
and this cost needs to be recovered.
 not suitable for complex procurements where
the focus is more on the output and outcome
of the contracting process rather than on strict
adherence to standards.
Restrictive open tendering
(ROT)
The method of restrictive open tendering
also uses advertisements which invite
applications from firms that wish to be
considered for tendering.
 From these applicants a selection list is

chosen and tenders are invited.

Advantages of ROT
 Only interested firms will apply
 Only suitable firms are asked to submit

tenders
 Less overall expense for tenderer
 New firms may be able to obtain work and

prove themselves.
Disadvantages of ROT
 Less competitive
 Can lead to cover pricing being submitted.
Selective tendering
 Selective tendering means a procurement
method whereby only qualified suppliers are
invited by the procuring entity to submit a
tender.
 In selective tendering the Architect/

Quantity Surveyor prepares a list of suitable

tenderers, and they alone are invited to
submit a tender.
 The tender list normally contains 6 to 8

firms, according to the size and type of the

proposed project.
Advantages of selective
tendering
 Only firms capable of executing the work
will be selected
 Selected firms will probably have already

proved themselves
 Reduction in the time and overall cost of

tendering.
Disadvantages of selective
tendering
 The price may not be as competitive
 Can lead to cover prices being submitted
 Difficult for new firms to obtain work easily.
 The cost level of the tenders received will be higher,
owing to there being less competition and also due to
the high caliber of the tenderers
 It can exclude smaller contractors or those trying to
establish themselves in a new market, it can reduce
the potential for innovation
 it can be seen to introduce bias into tendering as firms
may be excluded from approved lists for unknown
reasons, because of a lack of awareness, or because of
personal preferences.
Negotiated Tendering
 Negotiated tendering occurs when the client
approaches a single contractor based on their
track-record or a previous relationship and the
terms of the contract are then negotiated.
 Negotiating with a single contractor may be
appropriate for highly specialist contracts
(where there may be a limited number of
potential contractors in the market).
 It can give the client the confidence of working
with the contractor they already know
Procedure
 Tender documents are prepared in the normal
manner and sent to the selected contractor who
prices the work.
 When the final tender figure has been prepared it
is submitted to the Quantity Surveyor for
examination and a tender report.
 The contractor and the Quantity Surveyor will
meet to settle any queries and adjust details
such as unreasonable rates.
 After negotiation, a price that is acceptable to
both parties is agreed and a formal contract is
signed.
Advantages of Negotiated
Tendering
 Contractor can be selected early in the
design stage and can assist in the contract
planning
 Useful for a job of a difficult or unusual

nature
 Useful for extension contracts
 Useful where there is insufficient time to

prepare full tender documentation

 Establishes good relationships between

client and contractor

 Low overall cost of tendering
Disadvantages of negotiated
tendering
 Unless the structure of the negotiation is clearly
set out there is the potential for an adversarial
atmosphere to develop, even before the contract
has been awarded. Carrying out negotiations in
the absence of competition so that both parties
feel the outcome is fair can be complex and time
consuming;
 Difficult to justify price as there may not be any
readily available cost comparison;
 Employer must have some good and valid reasons
e.g. business relationship, technology, time, etc.
for wishing to negotiate
Disadvatages of Negotiated
tendering
 The price may be higher than in open
competition
 The design could be influenced by the

selected contractor
 Difficult for new firms to obtain work.
Serial tendering
 Serial tendering is a form of standing offer
where a contractor undertakes to enter into
a series of separate fixed price contracts in
accordance with terms and conditions set
out in the standing offer.
 The offer usually relates to a firm

programme of projects of a similar nature

within reasonable graphical limits, such as a
programme of building supermarkets.
Procedure for Serial
tendering
 Preliminary discussions are held with a short list of
contractors in order to draw up conditions of the
offer, such as the number of projects, the time
period and the phasing of jobs.
 A notional Bill of Quantities is used to help evaluate
the offers.
 When the offer is accepted, Bills of Quantities are
prepared for each project which are then priced in
accordance with the notational Bill of Quantities and
an agreed tender negotiation.
 The initial offer is merely a statement made in good
faith as a basis for negotiation that may be
withdrawn at any time.
Advantages of serial
tendering
 A competitive price may be obtained
 The contractor is able to plan a long-term

programme
 The experience obtained in earlier projects

may be used to the advantage of both

parties for the future projects.
Disadvantages of serial
tendering
 If the contractor initially produces
unsatisfactory work the client may be
committed to a long-term programme
Two-stage tendering
 There are occasions, such as those listed
below, when selection of the most
appropriate contractor is of prime
importance:
◦ The client wishes to start work on site early and
prior to full tender documentation being prepared
◦ The contractor can make a technical contribution
to the project.
Two-stage tendering cont…
 If the drawings and other details are not yet finalised then
the client may invite contractors to tender for a contract
after an initial and careful negotiation with each contractor
about how the proposed project should be undertaken.
 The selected contractors are then invited to competitively
tender for the work by pricing one of the following items:
◦ Approximate Bill of Quantities
◦ Bill of Quantities of a similar past project
◦ A fictitious Bill of Quantities.

 The contractor who submits the most favourable price (tender) is

then expected to work closely with the designer to agree on an
economic design and programme until a satisfactory solution to the
client's needs is realised.
 A final tender is then submitted by the selected contractor using the
Bill prices previously outlined in the successful competitive tender.
Advantages of two-stage
tendering
 Speed in planning and construction
 Use of contractor's specialist design team

and solutions
 Use of the contractor's management and

site-solving solutions.
Disadvantages of two-stage
tendering
 High overheads of unsuccessful first-stage
contractor
 High costs of variations.
Contract Management
Contract management is the process that
enables both parties to a contract to meet
their obligations in order to deliver the
objectives required from the contract.
 It also involves building a good working

relationship between customer and

provider.
 It continues throughout the life of a

contract and involves managing proactively

to anticipate future needs as well as
reacting to situations that arise
Rationality of contract Mgt
 To obtain the services as agreed in the
contract and achieve value for money.
◦ This means optimising the efficiency,
effectiveness and economy of the service or
relationship described by the contract, balancing
costs against risks and actively managing the
customer–provider relationship.
 To ensure cotinuous improvement in
performance over the life of the contract.
Contract Mgt activities
 Contract management activities can be
broadly grouped into three areas.
1. Service delivery management ensures that
the service is being delivered as agreed, to the
required level of performance and quality.
2. Relationship management keeps the
relationship between the two parties open and
constructive, aiming to resolve or ease tensions
and identify problems early.
3. Contract administration handles the formal
governance of the contract and changes to the
contract documentation.
Contract Mgt activities
cont..
 A key factor is intelligent customer
capability: the knowledge of both the
customer’s and the provider’s business, the
service being provided, and the contract
itself.
 This capability, which touches all three

areas of contract management, forms the

interface between supply and demand; that
is, between the business area and the
provider
Service Delivery Mgt
 Managing service delivery means ensuring
that what has been agreed is delivered, to
appropriate quality standards.
 The contract should define the service levels
and terms under which a service is provided.
 Service level management is about assessing
and managing the performance of the service
provider to ensure value for money.
 Considering service quality against cost leads
to an assessment of the value for money that
a contract is providing.
Service Delivery Mgt
cont…
 As well as assessments of whether services are
delivered to agreed levels or volumes, the quality of
the service must also be assessed. Quality metrics
will have to be created that allow the quality of
service to be assessed, even in areas where it is hard
to quantify. A key part of assessing the service
provided is the baseline, or level from which service
levels and improvements are measured.This will need
to be agreed before the service commences.
Benchmarking, or comparing performance across
different organisations and providers, is another
useful way to gauge improvements or pricing levels.
Managing risk is another important
Service Delivery Mgt
cont…
 Managing risk is another important aspect of
managing service delivery.
◦ The fulfillment of the contract may be endangered by
several kinds of risk; some within the provider’s control,
some outside it.
◦ Identifying and controlling (by avoiding or minimising)
the risks to a contract is a vital part of managing it.
◦ This includes those risks that have been transferred to the
provider under the contract.
 Business continuity plans and contingency plans
help prepare the customer organisation for the
situation where the provider cannot deliver. They
are an important part of managing risk.
Relationship Mgt
 The relationship between the parties is vital to
making a success of the arrangement.
 It is important that the specific responsibilities are
not neglected, even though there may not be a
nominated individual assigned to the role of
relationship manager
 In long term contracts, where interdependency
between customer and provider is inevitable, it is
in the interests to make the relationship work.
 The three key factors for success are trust,
communication, and recognition of mutual
aims.
Relationship Mgt cont…
 Management structures for the contract need to be designed to
facilitate a good relationship, and staff involved at all levels must
show their commitment to it.
 Information flows and communication levels should be
established at the start of a contract, and maintained throughout
its life.
 The three primary levels of communication in a contractual
arrangement are operational (end users/technical support
staff), business (contract manager and relationship manager on
both sides) and strategic (senior management/board of
directors).
 The right attitudes and behaviours, based on trust rather than
adversarial models, should be encouraged.
 A good working relationship will help make improvement a
reality, based on the principle that improvement is good for both
parties, not just a means for the customer to drive down costs.
Contract Administration
 Contract administration, the formal
governance of the contract, includes such
tasks as contract maintenance and
change control, charges and cost
monitoring, ordering and payment
procedures, management reporting,
and so on.
 Clear administrative procedures ensure that

all parties to the contract understand who

does what, when, and how.
Contract administration
cont…
 The contract documentation itself must continue to
accurately reflect the arrangement, and changes to it
(required by changes to services or procedures) carefully
controlled.
 Responsibility for authorising different types of change
will often rest with different people, and documented
internal procedures will need to reflect this.
 Management reporting procedures control what
information is passed to management about the service;
this can range from a comprehensive overview of all
aspects to solely reporting ‘exceptions’ to normal service.
 Arrangements for asset management must also be
considered.
Critical success factors for
contract management
 Good preparation. An accurate assessment
of needs helps create a clear output-based
specification. Effective evaluation procedures
and selection will ensure that the contract is
awarded to the right provider.
 The right contract. The contract is the
foundation for the relationship. It should
include aspects such as allocation of risk, the
quality of service required, and value for
money mechanisms, as well as procedures
for communication and dispute resolution.
Critical success factors for
contract management cont…
 Single business focus. Each party needs to
understand the objectives and business of the
other.
◦ The customer must have clear business objectives,
coupled with a clear understanding of why the contract
will contribute to them; the provider must also be able to
achieve their objectives, including making a reasonable
margin.
 Relationship management. Mutual trust and
understanding, openness, and excellent
communications are as important to the success of
an arrangement as the fulfillment of the formal
contract terms and conditions.
Critical success factors for
contract management cont…
 Service delivery management and
contract administration. Effective
governance will ensure that the customer gets
what is agreed, to the level of quality
required.
◦ The performance under the contract must be
monitored to ensure that the customer continues to
get value for money.
 Continuous improvement. Improvements in
price, quality or service should be sought and,
where possible, built into the contract terms.
Critical success factors for
contract management cont…
 People, skills and continuity. There must
be people with the right interpersonal and
management skills to manage these
relationships on a peer-to-peer basis and at
multiple levels in the organisation.
◦ Clear roles and responsibilities should be defined,
and continuity of key staff should be ensured as
far as possible.
◦ A contract manager (or contract management
team) should be designated early on in the
procurement process.
Critical success factors for
contract management cont…
 Knowledge. Those involved in managing the
contract must understand the business fully and
know the contract documentation inside out
(‘intelligent customer’ capability).
◦ This is essential if they are to understand the
implications of problems (or opportunities) over the life
of the contract.
 Flexibility. Management of contracts usually
requires some flexibility on both sides and a
willingness to adapt the terms of the contract to
reflect a rapidly changing world.
◦ Problems are bound to arise that could not be foreseen
when the contract was awarded.
Critical success factors for
contract management cont…
 Change management. Contracts should
be capable of change (to terms,
requirements and perhaps scope) and the
relationship should be strong and flexible
enough to facilitate it.
 • Proactivity. Good contract management

is not reactive, but aims to anticipate and

respond to business needs of the future.
Reasons leading to contract
mgt failure
1. poorly drafted contracts
2. inadequate resources are assigned to
contract management
3. the customer team does not match the
provider team in terms of either skills or
experience (or both)
4. the wrong people are put in place, leading
to personality clashes
5. the context, complexities and
dependencies of the contract are not well
understood
Reasons leading to contract
mgt failure cont…
6. there is a failure to check provider
assumptions
7. authorities or responsibilities relating to
commercial decisions are not clear
8. a lack of performance measurement or
benchmarking by the customer
9. a focus on current arrangements rather
than what is possible or the potential for
improvement
10. a failure to monitor and manage retained
risks (statutory, political and commercial).