Is There Waste in Your Facility Budget

Is There Waste in Your Facility Budget

I am not talking about waste that your janitorial services company failed to remove from your facility. I am talking about waste in terms of actions, purchases or activities performed in maintaining a facility that does not boost the building owner’s cap rate. In my previous post, I discussed eight ways facility or property managers could boost their NOI and improve the facility’s cap rate.

Here is more detail on those 8 wastes:

1. Defects

A defect is anything that does not meet the customer’s requirements or an activity that causes rework or extra time. A primary requirement for most building owners is a maximized NOI. Think of all of the defects that reduce NOI:

  • poorly scheduled HVAC systems (e.g. coolers that run at night)
  • roof leaks
  • pests
  • poor facility cleaning services
  • carpet tile curls on newly installed flooring
  • bubbles in the sheet vinyl
  • …and the list goes on! (all defects that cost money).

2. Over-Production

Think of your building as a system that produces a suitable environment wherein people can work. If your building systems are going beyond what is required to produce a suitable environment then you have over-production. For example, in regards to your janitorial cleaning services, are your frequencies too high? Is your facility being over-cleaned? In regards to energy, are you over lighting (leaving lights on where building occupants aren’t). Are you over-heating or over-cooling? These, and so many others, are common examples of over-production.

3. Waiting

If you are, or something in your facility is waiting, then nothing is being done. For example, if your building occupants call to complain about the cooling system and wait, and then have to call again and wait some more, then valuable time and energy resources are being wasted. Waiting is a waste. Turn that around on your contractor. If you wait 30 minutes each day for late contractors, that’s 130 hours in a typical work year. Eliminating waiting can be easily diagnosed and yields big gains when eliminated.

4. Non-utilized Talents

If you are not maximizing the talents of your facilities staff, then you are failing to gain their maximum contribution. That is a waste. Research has indicated that when individuals and their contributions are elevated and recognized, they do more.

5. Transportation

Do you have just a single janitorial supply closet in the basement, or at one end of your lengthy facility, for your janitorial services company?  This could be a reason for transportation waste. How many times do the cleaners have to return to the closet? How long does it take them to transport their equipment, waiting for elevators? Much time can be wasted in transporting supplies and equipment throughout your facility.

6. Inventory

It is said, “time is money”. So is inventory. Excess inventory reduces NOI. Whether it is paper supplies for your facility’s restrooms, janitorial service supplies, unneeded equipment or extra lighting held on site, the inventory is costing you. Make sure your inventory is minimized.

7. Motion

Motion takes time. Excess motion in work process wastes both time and money. Take for instance, your janitorial services company.  Janitorial services can consume as much as 30% of your company’s operating budget—therefore it deserves added scrutiny. Does your cleaning company pay attention to the motion of their cleaners? Years ago, I designed a janitorial operating system. The design of system included extensive analysis in ergonomic, time and motion studies for cleaners. It also included Lean Six Sigma projects work flowing facilities to improve the flow and time in cleaning. I can tell you without a structured way of identifying and eliminating motion waste, it will exist in your janitorial service.

8. Excess Expectations

Do you really want that, and at what cost?  Expectations are often derived from personnel backgrounds, from a brand and/or from a company’s culture. A combed carpet in an executive suite is an expectation. Polished marble is an expectation. Some expectations can be costly and excess expectations are a waste.  By identifying them, reducing or managing them, you can reduce your cost significantly boosting your ROI and cap rate.

Marc Collings

Senior VP of Sales and Marketing at Varsity Facility Services
Marc Collings is Varsity's Vice President of Marketing for Varsity Facility Services. Marc oversees the company's growth, branding, positioning, customer support and analytics. In this role, he has positioned the company as a customer solutions leader for lowering cost and improving quality. He also led the company-wide rebranding and strategically positioned the company as a sustainability leader, serving on a committee for the EPA, obtaining the Ashkin Group award for sustainable leadership, leading Varsity's CIMS Green Building certification with honors, and developing Varsity's S.H.A.P.E. sustainability strategy, which improves service results along five dimensions: Safety, Health, Asset Preservation, Productivity and the Environment.

In 2011, Marc's team won the large company category, "Best in the Industry" marketing materials from the Building Service Contractor Association International (BSCAI). Marc also directs Varsity's proposal writing, sales process and tools development, marketing campaigns, corporate website SEO performance and customer support center.

Marc has spent his career developing strategic capabilities that enhance value to customers and the company. A Lean Sigma Green belt himself, he developed the company's Lean Sigma offering, providing an innovative solution to customers' need to lower cost while raising quality. He led the development of JanOPS, an industry-leading janitorial operating system, which brings standardization and service consistency to large campus and geographically disperse national accounts.

Prior to this position, Marc was responsible for strategic management at Varsity. He has initiated or directed multiple strategic technology initiatives, ranging from a corporate website, a corporate intranet, a web/smartphone based quality control system, a learning management system, a corporate content manager and knowledge wiki, deployment and customization, and an Android app which facilitates the GROW sales process he has developed.

Marc is the author of several leadership and management training manuals, field guides, marketing collateral and case studies. He speaks Portuguese and Spanish and holds a bachelor degree in English/Technical Writing and a Masters of Business Administration in Finance from Idaho State University. Marc enjoys mountain biking, skiing, fishing and golf. He is happily married, and he and his wife Victoria enjoy raising and spending time with their four children.

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