Facilities management is the cornerstone of operations of Drake & Scull, a Tsebo Outsourcing Group company with aspirations to conquer Africa. CEO John Wentzel tells us more about the challenges facing the FM industry.
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Drake & Scull is one of the leading facilities management providers in Southern Africa and there are few that know more about the industry than Dr John Wentzel, CEO of Drake & Scull. He believes that the challenges facing the industry are huge and has identified areas such as energy management, environment sustainability, technology and complexity as amongst those that FM providers must tackle.
“You have to ensure you are equipped for the future; make the most of the opportunities,” he says. The first challenge? “I think in South Africa the challenges are not dissimilar to what we have seen internationally: globally clients are under financial pressure and companies in the FM industry are being asked to do more for less,” Wentzel says.
That is a constant. It will always be a challenge. “Cost pressures and the ability to do more for less. That is a big challenge,” he stresses.
The ramifications are huge. “It does have a knockon effect,” Wentzel says. “If you think cost, one way of making big savings is energy management, which is one of the big challenges. There is heightened interest in energy savings and for any company it is a major value-add if you know what you are doing when it comes to energy management. You have to understand what your client does, how you can help and how you can use data to manage it properly.
“Then follows environmental sustainability and we are seeing more and more green issues taking centre stage. In South Africa, we are talking about things like carbon tax and facilities managers are often controlling the clients’ environmental footprint, so they will need to be aware of the demands because there is already pressure on companies to reduce their environmental footprint, to reduce the amount of water and electricity being used and reducewaste. There is also pressure from the consumer side on businesses to operate in with an awareness of the environment. More and more people are not choosing not to use you as a service provider if you don’t operate in a concerned way.
“This will all impact on the FM industry.” Complexity is another challenge, keeping ahead of technology and changing standards. “Things are getting more and more complex and FM itself is too,” Wentzel says. “The scope of work for facilities managers has increased significantly. Pressures on FM relative to over 10 years ago is that there are more stringent controls to consider, you have to consider cost, environmental impact, legislation and new technology etc. The increasing complexity is putting pressure on FM to now balance those increasingly diverse demands. 20 years ago customers would go for the FM provider that would be able to give you the service at the lowest cost. Now you want that but you want everything else too – aspects of HR, procurement, strategy and IT on top of other capabilities.”
Facilities too have become more complex. “The rate of technology advancement and the demands that it now places on FM is huge, having significantly increased,” Wentzel adds. “You just have to look at the amount of data that is being generated and the technology platforms people want to use, like iPads etc. That puts pressure on systems and data and, of course, being able to make sense of that data is key from FM because now you have all those boxes to tick.
“Increasing it is about using that technology and data to add value, and how value can be optimised. It comes back to the need is to do more with less. More and more companies are scrutinising costs and have more questions. Cutting costs and becoming more efficient is what is generally required, across the board and this pressure of complexity and technology is likely to continue long into the future.
“Data management will be one of the big challenges. It is data that gives the foundation to deal with all the other challenges. But there is an explosion of data and managing that is the tricky part.
“The key for us is making sure the client understands that we get what their business is about.”
Skills are another challenge. “There is a global skills shortage and in South Africa it is probably more of an issue, with an acute skills problem– our education system has been weak and has not produced sufficient numbers of the right calibre of people and skills for us to be able to find technical skills. A big constraint that FM will have to tackle in this country is the ability to grow their business against a backdrop of a shortage in critical skills, mostly technical – electricians, artisans, plumbers: those are the skills that we are short of and the industry will feel the affect.
“I think given everything I’ve said and the challenges I’ve raised, the way things are, you are going to get a split between aggregators of FM services and strategic FM,” Wentzel adds. “We choose our sectors carefully and we are careful about where we go and what we do. There are some sectors we won’t venture into. Part of dealing with complexity is defining who you are and the services you offer into the sectors you want to be in. It will be impossible to be everything to all people in the future.”
The cost of occupying a building whether owned or leased and maintaining related assets is the largest item of budgetary spend for most large organisation, after employees and salaries. Any CEO will want to know what those costs are and where savings may be made, strategically and operationally. In this challenge there are opportunities Wentzel admits. “FM has a pivotal role to play in non-core business and increasing competitiveness in the market place. Drake & Scull has the capability to offer tailored solutions to meet the demands of individual needs.
“There are a lot of companies out there that want to grow but focus on core assets and bring in partners for non-core business but have a single point of contact. They will then want recommended technologies and strategies on how to improve productivity, not just a report on how much it costs to fix X, Y or Z.”
But the future is bright. “It is. At a global industry level the future is bright and the reason for that is the complexity and all the other challenges I mentioned. They mean there will be more and more companies are focusing on what their core is. That offers opportunities for specialists to come in and offer the services that are non-core and look after it on their behalf especially as the complexity and cost of providing those services go up. Globally the trend will be increasingly towards outsourcing and partnering with specialists who understand FM.
“In South Africa, it is a bit more complex because of political and policy dynamic at this point. Companies are uncertain about outsourcing from a legislative point of view; unions are concerned. We will go through that phase and when we have passed through it I think we will follow the global trend.”
To learn more visit www.drake-scull.co.za.
