Facility management & procurement verticals are the two main pillars of any organization. Although they are considered to be the IInd highest spender of any organization at the same time they too function as the “Profit center” i.e. they generate revenue for the organization by saving cost. Oops forgot to tell you that the Ist highest spender of any organization is HR (Human resource) vertical.
Many of us live with this “myth” that facility management & procurement only spends money but do not generate any revenue whereas, the revenue-generating vertical is Sales however, it’s a mindset that every single penny saved is revenue only.
These two verticals have their own way of existence in every organization i.e. somewhere they are ;
- Absolutely different verticals with different BUH’s & reporting
- One vertical with a separate line of reporting
- One vertical managing both the portfolios together with one vertical head &
Procurement for new office/project: There are various challenges existing with both the functions as mostly procurement focuses on COST whereas the facility focuses on QUALITY & SERVICE. They always have a strong debate on these aspects. Although each of the function works as per their departmental goal but they forget that their actions ultimately boils down to attaining organizational goals. The blame game starts when something gets delayed & either of the function is made responsible for that delay. To make it simpler to understand:-“ If the Fit Out of bank branch is made ready & the delivery of the chairs is pending leading to delay in handing over the branch to the business team”. Here both the functions will put blame on each other i.e.
Procurement: The facility team should have timely followed up with the chair vendor & would have provided a firm timeline to the chair vendor to deliver the chairs whereas,
Facility: The procurement team should have given clear instructions to the chair vendor to timely transport the chair at the site considering all logistical aspects as the project schedule was duly shared with the chair vendor & the procurement team
In such a scenario, the business suffers the most…….
Procurement for existing office: There are a different set of challenges but do exist i.e. again procurement focuses on COST whereas facility focuses on QUALITY, SERVICE & SPECIFICATIONS as per the existing set up unless it’s a purely new requirement. Here again, the blame game starts when something gets delayed & either of the function is made responsible by the business team for that delay. To make it simpler to understand:- “ If the existing office demands additional chairs to accommodate new staff & the delivery of the chairs is pending leading to delay in starting of work by the new staff”. Both the functions will put blame on each other i.e.
Procurement: The facility team should have timely followed up with the chair vendor & moreover submitted the new requisition well before hiring the new staff whereas,
Facility: The procurement should have conveyed to the chair vendor to differentiate between a new project & a running branch & followed a lesser delivery TAT. The vendor listens to the procurement team more as compared to them because they offer them business.
Again In such a scenario, the business suffers the most…….
Looking at the above scenario they act as FRIENDS when it comes to the completion of any project that they have worked together as a TEAM & delivered X no. of projects & as RIVALS when it comes to taking the credit i.e. if by pure experience the facility team gives an idea to procurement to procure something that has potential to save cost & the procurement team executes that in the same manner then the question arises that who is going to take credit of that Idea/Procurement?
Synergies between the two functions: Both the functions are dependent on each other i.e. their performance depends upon each other. For Ex:
- Right & timely procurement leads to seamless execution by the facilities team
- Quality conscious procurement leads to sustainability
- After-sale service by the OEM only leads to long term equipment life
- Suggests alternatives at the time of procurement considering price/quality/brand/specifications & performance
Whatever the rivalry exists between the two departments, if they shake hands keeping aside the individual interests, it can turn out to be a fruitful result for the organization such as if;-
- The procurement team takes facilities inputs before procurement of material, equipment & services then there would be no clash as they are ultimately the end executor/user. Moreover, it would rule out any wastage of time, effort & money & bring fruitful results on the table.
- The facilities team shares their inputs timely with procurement to understand the material quality during execution. This enables procurement to take corrective actions if required any.
- Facilities team shares monthly vendor performance report with procurement to make them understand about procurement vs delivery on ground by the respective service providers
- Procurement listens to the ground feedback post procurement & implement in next purchase
- Procurement to consider quality parameters along with the cost
- Both of them decides on centralization/decentralization of services or supplies before executing in order to gain more
Let the synergies keep cultivating profit for the organization with the collective effort & proper collaboration between both the important functions.
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