FRAMEWORK FOR THE PROCUREMENT OF FACILITIES MANAGEMENT SERVICES OF PUBLIC BUILDINGS IN FCT-ABUJA

ABSTRACT

Deciding what to provide in-house and what to outsource is not always easy, because of the pros and cons of each approach. This study assessed the suitability of outsourcing and in-house routes for procurement of facilities management (FM) services in public buildings so as to develop a framework to assist FM practitioners in making decisions on procurement of FM services in Abuja. Mixed method research methodology was adopted involving the administration of 122 structured questionnaires and semi-structured interviews with 10 international facility management association (IFMA) members in Abuja metropolis. Findings show that the top three factors driving in-house FM services delivery are cost reduction, improved performance standard and improved customer orientation and service. While, the top three factors driving outsourcing of FM services delivery are improved quality of services, improved performance standard and improved responsiveness and cycle times. Also, from the findings, the top barriers to the delivery of in-house FM services are, financial constraints and Customer demands while lack of understanding of sustainability issues and lack of tools were indicated as the top barriers for outsourcing. The key factors considered for the development of framework to procure FM services includes the 11 core competency of FM (occupancy and human factor, operations and maintenance, sustainability, facility information and technology management, risk management, communication, performance and quality, leadership and strategy, real estate, project management, finance and business), availability of trained facility manager, new technology, management technique and cost. This indicates that the framework to procure FM services includes provision of clear policy which should consist of a policy statement, methodology resource mobilization, government policy regarding  the  maintenance  of  the  facility mapping  of  the  facility  and  a  means  of measuring performance of FM services providers. Therefore, organisation favours the use of in-house FM services in handling strategic functions while outsourcing is in charge of operational functions. Top management committee should endeavor to make progress on financial, technical and stakeholder constraints for effective growth and operation of in-house and outsourcing of FM services. The result of the study provides significant understanding that can support decision making on what FM services public organisations should provide in-house and what to outsource.

CHAPTER ONE

1.0      INTRODUCTION

1.1     Background to the Study

There has been a ton of discussion and disarray in many researches on the source of Facility Management (FM) as a discipline. Today, many literatures have renowned FM as an evolving discipline that is getting acknowledgement continuously in every edge of the world including non-native Western countries. Price (2003) avoided that FM establishes lie in the custodial job of a structure director/overseer to a great extent worried about operational issues of support, cleaning, and occupant security. Also, Price (2003) posited that the development in the multifaceted nature of structures and the centrality cost of their activity has prompted a need to present both strategic and key administration capacities, hence raising the profile of the order nearby other help capacities, for example, the administration of HR and data innovation. FM’s existence as a control is said to remain stable but in reality, there are constant changes in the present business world.

FM is a key capacity in overseeing office administrations and workplace to help the centre business of an association (Chotipanich, 2004). Although staff employed directly within organisations traditionally carried out FM wholly in-house, in recent times organisations might contract out (outsource) some or all of the FM services that were hitherto carried out in-house. Concluding whether to keep on  giving in-house or which activity to outsource is not always easy. This is because each approach has its pros and cons (Campbell, 2011).

In-house procurement of FM services is the management process that delivers facilities management services by in-house staff divergently employed by organisations (Musa, 2011). In-house alternative prompts improve the degree of representatives just as consumer loyalty simultaneously (Wise, 2007). While Atkin and Brooks (2005) observed that one of the greatest risk to the accomplishment of the in-house route is largely due to carelessness, which is effortlessly seen by clients. Williams (2003) posited that very few organisations currently employ 100% in-house operation. However, Sheng (2012) posited that in-house provisions have traditionally been esteemed to be the major methodology for the conveyance of property executives and support administrations.

The in-house approach basically refers to services that are provided by devoted assets and utilised by the customers; control of execution of such services are commonly coordinated under the provisions of conventional chief /representative relationship.   At times however, inner help level understandings might be utilized as controlling instruments (Barrett and Baldry, 2003). A potential advantage that is related to the desirability of in- house over outsourcing is the arrangement of the FM organisation necessitates the building of expertise and information for enhanced client administration. Wise (2007) posited that among the most critical benefits of domestic delivery of FM services is that it offers organizations the chance to develop individuals’ competencies internally, as opposed to enlisting such competencies from outside. In-house sourcing of FM services thus provides improvements in professional prospects that have the capability to lessen staff turnover.

In-house technique for getting FM administrations alludes to a type of administration arrangement wherein FM administrations are given by a devoted asset straightforwardly utilized by the customer association. Execution checking and control is directed under the details of regular manager/representative relationship; at times however, performance may be regulated through service-level agreements (Kamarazaly, 2007). An in-house approach deals with item or administrations that require ability and information so as to serve clients better The Association of People Supporting Employment first (APSE,

(2011) posited that in-house was regarded as a method for conveying proficiency and investment funds notwithstanding mounting budgetary weight.

Fuelled by the globalisation of business, outsourcing has become one of the most popular and widely practised business strategies (Cigolini et al., 2011; Willcocks, 2010). Typically, organisations are pushed to adopt outsourcing because of the potential to realize cost reduction objectives, by freeing up capital, pulling together on centre corporate business, moving land related dangers and expanding word related adaptability (Jensen et al., 2012). Outsourcing has been characterized as the demonstration of moving a portion of an association’s repetitive inner exercises alongside dynamic rights to outside suppliers under a contract agreement (Greaver, 1999). In effect, external service providers agree to undertake some of the organisation’s responsibilities for a consideration (Krell, 2006). To stay competitive in a dynamic business condition, organizations centre on centre exercises of their business and redistribute the non-centre capacities to other people who may be better able to carry them out (Kim & Won, 2007; Quinn & Hilmer, 1994). With respect to (FM), outsourcing involves the “contracting out” of FM administrations to an outer supplier (Atkin & Brooks, 2009; Barret, 2000). Outsourcing contributes significantly to the growth of FM as an industry which it is believed will in the foreseeable future become the driving force of the industry (Best et al., 2003). According to Ikediashi et al. (2012), the global outsourcing industry is worth over $1 trillion a year, according to the International Association of Outsourcing Professionals.

There are a few studies on how the procurement of facilities management services can be carried out (Keegan & Haden, 2000; Redding, 2007; Atkin & Brooks, 2009), but these are mainly theoretical in nature (Benjaafar et al., 2007; Ren & Zhou, 2008). Some past studies (Lonsdale & Cox, 1997; Adeleye et al., 2004; Hoecht & Trott, 2006) have shown that lion’s share of associations embrace re-appropriating without respects to the ramifications of the dangers in question. The ideal delivery mode of FM should be the one that adds the most value to the organisation concerned. The problem thus becomes on deciding how much value is added by any specific delivery mode (Kamarazaly, 2007).

However, in public building setting, a few associations favour an in-house FM course while others actually contract out all administrations imaginable, contingent upon the need of the administrations rendered by the association. Therefore, the procurement of framework is needed to guide FM practitioners while making decisions regarding in- house and outsourcing routes.

1.2     Statement of the Problem

The International Facility Management Association (IFMA, 2007) periodically conducts surveys on the act of redistributing in the office board field. The data obtained from these surveys revealed that there has been an expansion in the quantity of organizations that are redistributing (employing full-administration, single seller to offer numerous types of assistance packaged together). Associations for the most part re-appropriated their housekeeping, structural plan, squander evacuation and scene support exercises. The most significant standards when choosing whether or not to redistribute are budgetary in nature and incorporate controlling costs, liberating capital assets, improving return of venture (return for money invested), and diminishing turnover/preparing costs.

The theoretical background of outsourcing underlines the presumption that associations that re-appropriate their office administrations acquire an included incentive than associations that control their office benefits in-house (Perera et al., 2016). Although relatively untested, this assumption has provided increasing support for the selection of outsourcing as a better route over in-house procurement of FM services. The benefits of in-house procurement of FM services are rarely fully explored and considered when decisions on how to procure FM services are being taken (Perera et al., 2016). Kamarazaly (2007) and Perera et al. (2016) have shown that office executive benefits that are adjusted to key capacities are most appropriate for in-house conveyance, while those that are adjusted to project management and operational capacities are best handled through outsourcing. In the Nigerian public sector, most key capacities with respect to FM services are dealt with by in-house sourcing, notwithstanding whether outsourcing would provide better value (Ikediashi, 2014). To change the status quo, research must provide easy-to-apply framework that allow FM services sourcing to be made between in-house and outsourcing by the Facility Managers in charge of public buildings.

Perusal of research efforts in the FM field revealed that consistently replicable and systematic procedure by which outsourcing decisions could be taken have been developed for commercial buildings in Malaysia (Perera et al., 2016). However, such a procedure focuses on outsourcing ab initio, and works only for commercial buildings. Public buildings are different from commercial buildings in several ways, not the least being the absence of the profit motive in determining the facility management services to be procured. In a study focussing solely on maintenance management strategies used in tertiary institutions, the general condition of buildings and services appeared to be uninfluenced by the maintenance sourcing strategy adopted (Faremi et al., 2017). In the absence of all-encompassing dynamic structure, most associations primarily centre around transient cost minimization, to the exclusion of other important criteria. This has given rise to a typical preference for a dependable guideline way to deal with tackling FM issues (Cotts, 1999).

The practice of facilities management in Nigeria has been gradually improving in recent years, with a wide variety of applications (Alaofin, 2003; Opaluwa, 2005; Adewunmi et al., 2009). With increasing complexity of FM needs of organisations, the need for a simplified yet holistic means of choosing the optimum delivery mode for FM services also increases. Research in this area has either focused on institutions and business organisations (Kamarazaly, 2007; Vitasek et al., 2018), or a specific subset of public buildings (Ikediashi, 2014). The study is focused on developing a basis for selecting in- between subcontracting and domestic provision of FM services in public buildings generally, by providing solutions to the corresponding research inquiries.

1.   To what extent do the managers of public buildings procure FM services through outsourcing and in-house routes in the study area?

2.   What are the drivers of FM services procurement through outsourcing and in- house routes?

3.   What are the challenges/barriers to the procurement of FM services through outsourcing and in-house routes?

4.   What framework will be effective for procuring FM services in public buildings using either outsourcing or in-house routes?

1.3     Aim and Objectives

The aim of this study is to assess the suitability of outsourcing and in-house routes for procurement of facilities management (FM) services in public buildings by developing a framework to assist FM practitioners in making decisions on procurement of FM services.

The specific objectives of the study are to: –

1.   To assess the extent to which FM services in public buildings are procured through outsourcing and in-house.

2.   To determine the drivers of FM services procurement through outsourcing and in- house routes.

3.   To determine the challenges/barriers to the procurement of FM services through outsourcing and in-house routes.

4.   To develop a framework for procurement of FM services through outsourcing and in-house routes in public buildings.

1.4     Justification for the Study

The procurement of FM services has received notable research attention on a global scale. Lehtonen and Salonen (2006) reviewed acquisition patterns of office executive administrations. The study was however focused on describing the organization control systems that add to the accomplishment of FM associations Smit (2008) compared the further estimation of associations that have their own office the board office and associations without an office in the executive division. The study was mainly concerned with in-house sourcing of FM services. Ikediashi et al. (2012) broke down the hazard factors related with outsourcing of office executive (FM) administrations. Their research did not deal with in-house procurement of FM services.

In more recent times, Redlein and Zobl (2014) measured the use of outsourcing in order to understand the reasoning and patterns associated with the re-appropriating choice and procedure. This study did not also consider in-house procurement of FM services. Chua et al. (2015) conducted an examination among state funded colleges in Malaysia on the advancement of acquisition choice system dependent on Expository Chain of importance Procedure (AHP) method and standards. The focus was exclusively limited to educational institutions. Perera et al. (2016) developed a screening structure for choosing the appropriateness of redistributing versus in-house conveyance for FM administrations.

This research was however based on three levels of managerial functions prevalent in a typical commercial organization (strategic, tactical and operational), and would not apply fully to public buildings.

Owen (1994) concluded that the potential favourable circumstances and hindrances of contracting-out shift between associations, yet additionally in the manner in which they impact the conveyance of various FM benefits inside a given association. More importantly however in the context of this study, Owen (1994) also found that factors other than these focal points and weaknesses impact Clients’ contracting-out dynamic. Ten years later Shaw and Haynes (2004) proposed a “hole” model which looks at administration quality and the degree of significance that clients place on each help measurement. This assertion means that FM managers may use service dimensions to assess the quality of FM service delivery.

Despite the fact that FM is becoming more widely adopted in commercial and government agencies, little research has been done on FM sourcing strategies. Specifically, there is a scarcity of literature for certain decision-making principles or frameworks for meeting the FM needs of public buildings in Nigeria. A previous attempt to determine the suitability of in-house and outsourcing approaches in institutional buildings (Kamarazaly, 2007) focused on FM practice in New Zealand. As a result, using public buildings in Abuja as a case study would allow the study to achieve its broader objectives, which include (i) prioritizing criteria underpinning the factors affecting FM services in Nigeria; and (ii) developing a structure to assess the suitability of a delivery mode for some or all FM services in public buildings in Abuja, Nigeria.

In terms of the theory of FM, the examination is justified in that lessons derived from this investigation will contribute to the development of a body of knowledge on a systematic process  of  choosing between  outsourcing  and  insourcing of FM  services  in  public buildings in Abuja, in contrast to the existing situation where most of such research emphasize principally upon  the practises  of  industrialised  nations.  The information gained from this study will also assist the government and stakeholders in refining applicable laws, regulations, and guidelines in order to establish an effective system for insourcing, outsourcing, and FM practice in Nigeria in general.

This investigation will also contribute to practice by identifying factors associated with decisions by authorities in public buildings to outsource or to retain in-house of FM services provided in such buildings. The study is not only focused on identifying the benefits of outsourcing and insourcing; it will also weigh the advantages of adopting either approach in providing a specific FM service.

1.5     Scope and Delimitation

This study covered FM professionals within Abuja, the Federal Capital Territory. The day-to-day operations of such buildings are handled by Facility Managers or Property Managers that usually belong to one professional body of the other. The most well-known professional association for facility management is the International Facility Management Association (IFMA). The study therefore focused on members of IFMA within Abuja, as it was reasonably expected that these would be the people in charge of most of the public buildings in Abuja.

The focus was on the development of a framework that aids decision making with respect to what procurement route of FM to adopt. The data collected were pertain exclusively to public buildings located in the Federal Capital of Nigeria.

₦8,000.00 – DOWNLOAD FULL PROJECT DOWNLOAD FULL PROJECT Added to cart

---

---

---

---

Related Project Topics :