Facilities Management and the Bottom Line

When the economy worsens and a company’s bottom line suffers, facilities managers often see their budgets decimated. As a result, Staff may be laid off, inventory reduced, and important facilities management training courses delayed or cancelled.

Cutting the facilities management budget is a knee-jerk reaction that, far from improving an organization’s bottom line, actually costs money. Convincing your chief financial officer of this can be difficult however. Difficult, but not impossible.

Why is Facilities Management Vulnerable to Budget Cuts?

A number of factors combine to make facilities susceptible to budget cuts when times get tough, but three in particular stand out. First, the important work and effort put in by facilities management usually goes unnoticed by other employees (including members of the executive) unless a serious event or breakdown occurs.

Secondly, facilities are rarely seen as an essential component to the institutions core mission. And finally, many executives have a poor understanding of the nature of facilities work, a problem often compounded by poor lines of communication between facilities managers and upper management.

Proving Facilities Management’s Worth

The onus on proving the worth of your department is on you, the facilities manager. Efforts to educate management on the importance of facilities management work best if, like preventative maintenance, a proactive approach is taken. This means establishing your department’s worth before an economic crisis hits.

You need to remind upper management facilities maintenance has a significant impact on both daily productivity and the bottom line. This message can be communicated in many ways, but if you’re looking to influence a chief financial officer, it’s best presented with data that clearly demonstrates your department’s return on investment and effect on long-term savings.

Track all data related to your department, so you can draw clear lines between department activity and the bottom line. Data tracking software is your best bet (even if you have to take facilities management training courses to learn how to use it), because the software allows you to analyze how your actions affect productivity and costs.

Using this same data helps add efficiency to your inventory management process and spot cost-cutting measures in areas you may not have considered. When you find and implement such savings, be sure to let the CFO know, reminding upper management of your department’s effectiveness and savings.

Data also helps you prove the importance of routine maintenance. When you report on preventative maintenance, include estimates on the downtime and cost that taking a reactive approach would have cost.

Facilities management doesn’t need to be an under-appreciated part of your company’s operational structure. It plays a vital part in keeping your organization’s bottom line healthy. Part of your job as facilities manager is get the word out about the amazing things you and your staff do.