Review of Facilities Management West Sussex County … · West Sussex County Council Review of Facilities Management 3 • Section 6 outlines some broad options for future development

Review of Facilities Management

West Sussex County Council

December 2012

Acknowledgements and Author’s Note

Any mistakes which appear in this report are to be regretted and are due to errors and

omissions on behalf of the author and in no way can be attributed to those interviewed. The

analysis and views expressed are the views of the author only and based on a limited period

of study between September and November 2012. It is hoped that the report will provide a

stimulus to West Sussex County Council to develop further their approach and capacity in

Facilities Management.



Contents

Executive Summary 1

1 Introduction 2

1.1 Purpose of Document 2

1.2 Format & Content of Report 2

1.3 Review Scope & Methodology 3

2 Overall Context 3

2.1 WSCC Strategic Policies and Objectives 3

2.2 Resource Context 4

3 Summary of Current Situation 4

3.1 Overall Purpose of FM 4

3.2 FM Delivery Model 5

3.3 Organisation, Establishment & Operating Costs 7

3.4 Problems & Pressures 8

4.0 Audit of FM Function 10

4.1 The Audit Process 10

4.2 Overall Findings 11

4.3 Strengths & Weaknesses 11

4.4 Detailed Audit 14

5.0 Comparative Analysis 23

5.1 Outline of Approach 23

5.2 Profile of ‘Comparator’ Organisations 23

6.0 Looking Forward - Options for The Future 25

6.1 Immediate Short-Term Priorities 25

6.2 Articulating Options for the Medium-Term 25

6.3 Summary Evaluation of Options 29

Appendices

A FM Team Structure Chart 32

B Profiles of Comparator Organisations 33



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Executive Summary NPS Property Consultants Ltd (NPS) were asked to undertake a review of West Sussex

County Council (WSCC) facilities management (FM) function with some limited comparative

analysis and to identify broad options for the future development of the service. The study

was undertaken between September and November 2012. The review of the FM Team was

undertaken as an ‘audit’ at an individual activity level drawing together available data on

volumes, costs and funding sources.

The FM Team has an establishment of over 90 staff with an annual revenue cost of £2.48M

for the year 2012/13. It undertakes the broad range of FM activities; including both ‘hard’

and ‘soft’ FM with a delivery model which can be described as a ‘mixed economy’ with a

strong internal client capacity and use of external contracts where these represent value for

money. WSCC has recently implemented a ‘corporate landlord model’ and there is

centralisation of all buildings related expenditure managed through the FM Team.

The capacity and experience of the FM Team is commensurate with its role and most

activities are operating well; with perhaps only a few areas of risk – FM information and

catering – both of which are recognised and where work is in hand to secure improvement.

There may be a lack of resilience as individual teams within the FM function are working at

full capacity and any extended absences could cause problems. The FM Team has a strong

senior management leadership across all its activities; the area-based delivery model and

close liaison with building users is effective and the service is generally well regarded.

In the immediate short-term there is a requirement to consolidate existing arrangements

and to ensure all aspects of the FM function are working effectively. In the longer term there

are a broader range of options. The choice of these is dependant on WSCC’s attitude to

three key questions – the size of the retained FM capacity; the extent and nature of

externalisation and the willingness to work with other partner organisations in the public

sector. The response to these questions is as much a ‘philosophical’ as an ‘efficiency’ one

and will shape the broad direction in which to develop the FM service.



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1.0 Introduction

1.1 Purpose of Document

This report has been prepared by NPS Property Consultants Ltd (NPS) on behalf of

West Sussex County Council (WSCC). It is intended to provide a response to an

agreed brief to provide a review of the council’s Facilities Management (FM) Team in

the Service Operations Directorate looking forward from January 2013. This report

deals specifically with the overall skills and capacity required to underpin facilities

management and is presented as an organisational audit. The report is designed to:-

• Give a definitive current statement of the activities of the FM Team

• Provide an external perspective of its capacity and expertise

• Provide some initial comparative analysis

• Give a narrative commentary of its Value for Money (VFM)

• Inform consideration of future options for the service

1.2 Format and Content of Report

The report is arranged in 6 sections with appendices containing supporting material:

• This section explains the purpose and scope of the review and outlines the

overall methodology.

• Section 2 provides some broad overall context in which to position the review

• Section 3 describes existing arrangements for FM within WSCC and positions

the activities undertaken by the FM Team in a generalised framework for FM.

• Section 4 gives an overall ‘health check’ of the FM Team identifying strengths

and weaknesses and gives an ‘audit’ summary for each individual activity

through a brief narrative commentary and an assessment using a Red-Amber-

Green notation to identify potential areas of risk.

• Section 5 provides some data to enable WSCC to compare itself with other

organisations with varying delivery models for FM. This is essentially qualitative

data which describes how activities are organised and undertaken in a mix of

other councils, chosen to illustrate the richness in delivery approaches.



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• Section 6 outlines some broad options for future development of the FM

service and gives some specific recommendations for improvement.

1.3 Review Scope and Methodology

The review has been undertaken as six discrete sequential stages over an elapsed

time of 10 weeks as shown in the diagram below.

Diagram 1 – Overall Review Methodology

Stages 1 to 4 focussed internally on the FM Team at WSCC to provide a ‘position

statement’ on the FM service; whereas stages 5 to 6 looked externally in order to

provide a limited comparative perspective to the review.

2.0 Overall Context

2.1 WSCC Strategic Policies & Objectives

The council is undergoing a period of change and re-organisation. A large scale

outsourcing of support service staff to Capita under a 10 year contract was

undertaken in mid 2012 and as continuation of the council’s shift from a ‘provider’ to

a ‘commissioner’ of services. The philosophy underpinning this change is a ‘customer

first’ focus and ensuring scarce resources are allocated in the best way to meet

residents needs. The current reorganisation, effective from 1st

Jan 2013 implements

a tri-part model based on policy - commissioning - delivery. The reorganisation is

intended to ensure VFM and takes a pragmatic view on the ‘sourcing’ of activities

From January 2013 there will be 9 directorates, with FM in the Service Operations

Directorate.



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2.2 Resource Context

The outlook for public finances in the medium term suggest that funding for local

government in real terms will continue to shrink meaning there will be pressure to

do more for less and differently. WSCC is facing significant budget pressures; an

efficiency savings target of £79M set for a 3 year medium term ending in April 2014

has been renewed with a new target to be set for the period beyond 2013/14. Whilst

there has been no specific efficiency target set for FM there is an expectation it will

contribute to savings and emphasis needs to be placed on ensuring VFM. There is a

need within the FM Team to be aware of, and seek to reduce costs

3.0 Summary of Current Situation

3.1 Overall Purpose of FM

There is no simple, single definition of the role of FM as it varies across organisations

according to their specific needs and culture. At WSCC the FM Team have adopted

an essentially pragmatic working definition which can be summarised as ‘ensuring a

working environment in its buildings portfolio which enables the council (and its

partners) to deliver effective and responsive services’. This can be amplified further

in terms of a hierarchy of priorities to:-

• Ensure statutory compliance

• Ensure buildings are clean, safe & secure

• Promote a welcoming & comfortable space for staff, clients & visitors

• Promote a positive image of the council through the interaction of people with

the council’s buildings

The FM Team place a specific priority in their work for services with vulnerable

clients; both adults and children, as in these service areas the interaction of people

with the physical space and associated services is important. As FM is an integrative

discipline involving many disparate activities there is no simple measure of

performance. The FM Team view the critical success factors for their service as:-



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• Minimising risks to WSCC from breaches of statutory compliance – as these are

a potential liability to the council both in terms of cost and reputation

• Providing a ‘comfortable’ environment for staff, clients and users – measured

both formally and informally through building user feedback.

3.2 Delivery Model for FM

The current service delivery model for FM could be described as ‘a mixed economy

with a strong informed client role with use of external contracts where these

represent value for money’. The emphasis of the FM Team is on policy, specification,

management and monitoring; but with light touch monitoring supplemented by

building users feedback on service quality and incipient issues.

An area based approach has been adopted with 5 areas. In each area a

comprehensive, integrated service is provided through a dedicated Lead Building

Surveyor, Engineer & Facilities Manager. These roles are pivotal in the service

providing the expertise and capacity across the broad range of FM activities and

strong ‘on-the-ground’ customer focus through to building users to understand

service needs, quality, and responsiveness and to help to identify any emerging

issues. The area teams make use of the council’s office hubs in the respective areas

as well as working flexibility. The Area Facilities Managers (AFMs) undertake a

multiplicity of roles and there is also an intention for them to act in a capacity to

resolve problems and undertake small, immediate work jobs as appropriate.

The council has adopted a ‘Corporate Landlord Model’ with centralised budgets for

premises related expenditure managed through the FM Team. There are plans for a

‘nominated building contact’ for each building which is due to be implemented prior

to March 2013. The FM service applies generally to all council buildings but in some

specific instances there are differing arrangements for schools because of their

degree of autonomy. The Fire Service retains a small FM capacity and some of their

building management arrangements are not within the scope of the WSCC FM Team.



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The broad ‘direction of travel’ for the FM service is to seek to reduce the number of

contracts and to move towards fewer corporate contracts with common standards

for major areas of activities which schools can ‘op-in to’.

Positioning of FM in Wider Organisational Structure

The FM Team is located in the Service Operations Directorate which from January

2013 will be one of 9 directorates within the council. The FM team has strong

working linkages with the Capital and Infrastructure Team which is located within a

separate directorate. The FM Team report to the Member for Finance and

Performance and also from time to time to the council’s senior management team;

as subject matters dictate. The Team also reports through to the Capital Investment

Appraisal Group which is responsible for allocating scarce capital resources to major

projects.

Diagram 2 – Positing of FM Team within WSCC Structure

Profile and Understanding of FM

The recent re-organisation within the council is providing a greater focus to FM

activities as a single, integrative support discipline. Whilst FM is recognised as a

support activity through its positioning in the Directorate of Service Operations, the

strategic dimension of FM is also being increasingly recognised. Although the

purpose and benefits of strategic FM are not yet widely understood across the

organisation this is changing and its profile within the council is rising. There is

interest in FM by specific members (such as the Member for Finance & Performance)



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as well as members in general and the work of the FM Team underpins some of the

council’s key priorities such as carbon reduction.

Scope of FM

There is no single definition of FM and no specific model of its scope and activities.

Organisations typically tend to organise and undertake FM activities on the basis of

historic ways of doing things, organisational culture and pragmatic experience of

what works well. A simplified model of the potential scope of ‘premises related’ FM

activities is shown below and used as a framework to identify what WSCC currently

undertakes through its FM function. Whilst FM does tend to have a primarily

operational focus there is also an important strategic element to it as FM needs to be

consistent to, and supportive of, wider organisational objectives.

Diagram 3 – Scope of Activities under taken by FM Team

Space Planning

ADDITIONAL FM

Office Furniture

Meeting Room Services

Cleaning

SOFT FM

Security

Waste Disposal

& Recycling

Reception

Caretaking

Post Services

Utilities Management

Condition Surveys

HARD FM

Building Maintenance

M & E Services

Statutory Compliance

Project Management

Carbon Management

Grounds Maintenance

Scope of FM Activities

Activities undertake by WSCC FM Team

Other potential FM activities

Member & Senior

Officer Liaison

Policy Development

FM Strategy & Support

Performance

Management

FM Information

OperationalStrategic

Minor Improvements

Suitability Assessments

Catering

Property Review

Courier services

Move Management

FM ‘Help Desk’

Health & safety

PA & Admin Support

Events

Training

Porters

3.3 Organisation, Establishment & Operating Costs

The FM Team has a total establishment of 90 posts plus 4 apprentices with a total

revenue cost of £2.48M for 2012/13. A simple summary structure chart of the Team

is provided as Appendix A. Within the FM Team the age and sex profile shows a team

which is broadly well balanced and with an age profile which is relatively



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experienced. With recent organisational changes the average age of the FM Team

has reduced significantly. Table 1 below provides a summary age and sex profile of

some of the main functions within the FM Team. Indicative annual spend, based on

2001/12 outturn was £2.38M for maintenance spend (revenue); £4.8M for

maintenance spend (capital) – reducing to £2.6M for 2013/14 and £2.7M spend on

soft FM.

Table 1 - Profile of organisation (age – sex mix)

Function Average Age Males Females

Building Surveying 43 12 4

Carbon Engineering 45 10 2

Soft FM 46 23 7

Grounds Maintenance 48 1 1

Caretaking (schools) 49 4 0

Engineering Apprentices 21 0 2

Catering 1 7

Note: The above table does not account for all staff but is used to illustrate the age and sex profile of the FM Team

The FM Team has implemented apprenticeships as part of a ‘grow our own

approach’ to staff. The scheme covers M & E surveyors (2) and soft FM (3). The

apprenticeships are essentially day-release courses over 3 years alongside on-job

training. Apprentices are assessed on an on-going basis and prior to their final year

to see if they are to be offered a career post within WSCC. On the soft FM side the

apprenticeships are essentially on-the job training. So far the scheme has been

successful in bringing through staff capable of working in a full-time capacity and has

also help to create an improved working environment.

3.4 Problems & Pressures

The FM Team has a number of problems and pressures to which it needs to respond.

These related problems are generally well known and understood, with actions in

hand to address them:



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• Implementing the Corporate Landlord Model – There is a legacy of work

associated with the centralisation of property budgets. As full ‘property costs’

were not transferred across to the FM Team current budgets do not match

activity levels. This issue is being teased-out on a building by building basis but

this painstaking work can be detrimental on relationships with building users

and service managers. It also has an impact in the short term on spend on

buildings which has to be restricted with a consequential detrimental effect on

buildings, service image and council image.

• Relationship continuity – WSCC has gone, and continues to go through, a

period of significant organisational change. This inevitably causes disruption to

established internal working relationships and lines of communication. Whilst

the FM Team has shown a strong degree of flexibility in adapting to this change

this issue of establishing and sustaining effective working relationships is a key

priority looking forward. The FM Team has recently undertaken a stakeholder

analysis in order to identify existing strengths and weaknesses in internal

relationships and this provides a basis for identifying priorities for action.

• Business Continuity – organisational change can also have a detrimental effect

on business continuity. This can be seen in several areas. This includes

sustaining staff morale and motivation in a period of uncertainty over jobs and

how the FM service might be provided in the future. This is also disruptive to

planning for the future (due to uncertainty) and can undermine the consistency

of ‘messages’ about the service and there is also a risk of paralysis from a

feeling of a lack of influence over wider organisational changes.

• Quality of FM data – There are concerns over the quality (currency, accuracy &

completeness) of data as this may impact on the quality of decision making.

There is a strong drive to implement Atrium as the council’s corporate property

database and recognition that there is a need to improve FM information so

that the FM Team can fulfil its role properly.



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4.0 Audit of FM Function

4.1 The Audit Process

The audit was based on a high level analysis which tried to answer four questions:-

• What activities are the FM Team responsible for; how are these organised and

delivered?

• What is the level of capacity (FTEs) and skills for each of these activities and are

there any issues related to this?

• What are the broad dimensions associated with each activity (volumes and

spend)?

• What are the costs1 of each activity and how is each activity funded?

The ‘organisational audit’ is reported in a simple colour coded way (green through

amber to red) for the main activities within the scope of the FM function. The

analysis is presented in a form which is easy to use and understand. From the

analysis two further questions can be posed:-

• What are the areas of risk in terms of the existing arrangements?

• Are there alternative arrangements which could be put in place to improve any

of the activities; either individually or collectively?

A degree of caution needs to be taken in reviewing the audit as time did not permit

anything more than a high level audit.

1 The basis for the financial figures used through this report is as follows. The cost of staff (FTEs) is based on the

organisational structure looking forward based on budget allocations for 2012/13. Staff costs are actual costs

plus a 15% to account for on-costs (office space, supplies & services etc.). For posts being covered by external

consultants the costs of the funded post has been used rather than the costs of the engaged consultant. The

costs for activities undertaken (other than staff costs) are based on actual spend during 2011/12. In both cases

there is a level of estimation used and so some care needs to be taken in interpreting the data. The overall

approach through the analysis has to be provided the ‘best estimation’ of costs based on available data.



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4.2 Overall Findings

The capacity and experience of the FM Team seems commensurate with the size of

the WSCC portfolio and the scope of its responsibilities. There may however, be a

lack of overall resilience with some recognition that as individual teams are working

at full capacity any extended absences (such as periods of sickness) may cause

problems. There is a strong emphasis on day to day operational matters; in

developing relationships with building users and service managers and in ensuring

arrangements around the Corporate Landlord Model are working effectively. This

short term operational focus may be being undertaken at the expense of the more

strategic considerations of FM. The all round capacity and experience of the FM Team

does mask some ‘bind spots’ in capacity; but these are felt to be relatively minor.

4.3 Key Strengths & Weaknesses

A number of key strengths and weaknesses have been identified through the review

and these are summarised briefly below. The areas of weakness are recognised

within the FM team and in some cases work is in hand or planned to resolve them.

Strengths

• The overall capacity and expertise of the FM team seems consistent with its

responsibilities with relatively few areas of risk.

• The age profile of the group is well balanced with no incipient risks from an

aging workforce.

• There is experienced leadership of the FM function through the Principal

Facilities Manager and the 4 senior team leaders.

• The apprenticeship scheme has allowed the council to ‘grow its own’ in

response to an historical problem of finding suitably qualified and experienced

staff. Although still in its relative infancy the scheme has proved successful.

• The FM Team has strong working relationships with service managers and

building users through its area structure. This approach has allowed building

surveyors and Area Facilities Managers to develop a good understanding of the

individual buildings they are responsible for.



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Weaknesses

• The fragmented nature of contracts may mean that economies of scale are not

being achieved and that contract management is more complex than it need

otherwise be.

• There are some potential discrepancies around the organisational placement of

some (parts of) FM activities (such as responsibility for condition surveys)

which may give rise to a disjointed elements of service. In large measures these

appear to be historical legacy issues and the FM Team work with the existing

arrangements in a pragmatic way.

• As a legacy of organisational re-structures in WSCC and the implementation of

the Corporate Landlord Model there is currently a mismatch between funding

and required activity levels. This is being resolved on a building by building

basis.

• The quality of data to underpin decision making on FM matters may be lacking

for some activities – this is an area of concern but there is also a recognition

that ‘perfect information’ is difficult to achieve. Whilst there has been an

intention to consolidate data onto Atrium as the WSCC’s preferred corporate

property system progress on this has stalled and this remains an important

priority to resolve.

• There is a disconnect between the property review process undertaken by the

Capital & Infrastructure Team which identifies whether buildings should be

retained or released by the council and activities undertaken by the FM Team.

This may mean that there is risk of maintenance or improvement spend being

misdirected on buildings likely to be no longer required by the council.



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Diagram 3 - Overall Audit Assessment of FM Function

Space

Planning

ADDITIONAL FM

Move

Management


Cleaning

SOFT FM

Security

Waste Disposal

& Recycling

Reception

Caretaking

Post Services

Condition

Surveys

HARD FM


M & E Services


Project

Management

Carbon

Management

Grounds

Maintenance

Activities undertake by WSCC FM Team

Other potential FM activities

Member &

Officer Liaison

Policy

Development


Performance

Management

FM Information

OperationalStrategic

Minor

ImprovementsCatering* Courier Services

Suitability Assessments

Property

Review

Office FurnitureFM ‘Help Desk’


Health & Safety

PortersPA & Admin.

Support

Activity FTEsCost(£ooos) Audit

0.85 46.0

0.65

1.65

2.40

0.1

0.30

5.95

36.5

97.0

85.5

4.7

7.6

277.3


0.55

0.60

3.85

2.15

22.9

6.65

4.90

3.35

N/A

132.4

181.0

240.0

627.4

83.5

107.8

26.6

25.5

1424.2


N/A N/A

N/A

N/A


N/A

N/A

N/A

2.65

0.90

8.1

170.7

27.7

0.80 23.7

174.6

4.4 83.8

4.30 119.0

2.00 55.0

N/A N/A

N/A N/A

1.55 32.1

2.00 34.6

0.10 5.5

0.15 8.2

N/A N/A

N/A N/A

N/A N/A

23.15 654.5

Events

Training

0.75 14.8

1.30 33.0

5.85 128.244.95

2484.279.90

Total FTEsTotal Cost

(£000s)

* This is corporate catering only. 6.5 staff

are involved in management & 45 staff

with delivery (as supervisors & kitchen

assistants) for schools catering which is

recharged back to schools



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4.4 Detailed Audit


Activity Audit

Member & Senior Officer Liaison

The work of the FM Team is reported through to the Member for Finance

& Performance and variously to Chief Officer Groups depending on the

specific subject matter in hand. The team also reports through to the

Capital Investment Appraisal Group. The nature of the work is essentially

meeting attendance and report writing.

Policy Development

The FM Team takes a lead on several aspects of policy development

relating to the WSCC portfolio. These include developing overall

maintenance strategy, carbon reduction policy and development of the

council’s Asset Management Plan (AMP). The FM Team also contributes

(from an FM perspective) to corporate initiatives and policy development.

Most of this work is undertaken by the Head of the FM Team supported as

appropriate by the relevant senior professional managers. This policy work

requires liaison with managers across the council. The AMP is refreshed

annually and signed-off by members. It is not entirely clear what the

respective responsibilities are between the Capital & Assets and FM Team

are in relation to the AMP and whether the FM lead means that the AMP

has a predominantly maintenance focus.

Performance Management

The FM Team has an annual service plan which sets out priorities and

targets and these are monitored through the year and through staff

individual performance reviews. The FM Team has some responsibility for

corporate targets such as the WSCC carbon footprint reduction target.

They key performance metric that the FM Team focuses on is service

continuity and quality as measured through client complaints. The FM

Team adopts a pragmatic and informal approach to this through outreach

to building users from activity leads and the Area Facilities Managers.

There maybe scope for a more systematic approach to performance

management using a range of techniques (periodic structured peer

reviews; regular client surveys and use of ‘benchmarking’ clubs such as the

Sheffield Hallam Public Sector FM Network) – although it is recognised that

there is balance between costs and reward from such activities. There is an

intention to undertake comparisons with private sector organisations.

FM Information

There is no specific focus on information; rather it is perceived as part of

‘everyone’s job’ according to their individual activity needs. There is no

specific FM database but the FM Team tend to use the corporate property

database (Atrium) which is ‘owned’ and maintained by the Business



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Information Team. Where appropriate FM data will be migrated to; and

held on Atrium. There are some concerns over data quality (currency,

completeness & accuracy) – although it is also recognised that ‘perfect’

data is both time consuming and expensive to achieve. There is a risk of

less than optimum decision making because of this poor quality data. A

specific concern is the up-dating of floor-plans (undertaken in the Capital

& Assets Team) as this impinges directly on defining cleaning areas. There

maybe some value in having a clear ‘road map’ of data needs for FM and in

ensuring robust links with the corporate property database administrator

to ensure FM data needs are understood.

FM ‘Help Desk’

There is no internal help desk for FM. During working hours building users

are encouraged to call their area based FM staff; whilst outside of office

hours they call SSE (Scottish & Southern Electric) who handle emergency

maintenance, M & E, or security problems. SSE will assess calls and provide

a short term response pending resolution of any problems. The SSE ‘help

desk’ is provided through 2 FTEs at a cost of £50k. The contract with SSE is

part of a long term contract, initially established in 2008 and which has

recently been extended for an additional year taking it until 2014. It covers

corporate properties and those schools who opt-in to the service through

an SLA. The likelihood after 2014 is that the contract will be retained for

corporate buildings but SSE will deal directly with schools. For out of hours

emergencies the number and nature of calls are captured through SSE’s

own systems; whereas for normal working hours there is no formal

recording of calls – rather there is a ‘once & done’ approach. There are

plans to systematically capture normal office hour calls through the ‘Help

Desk’ module of Atrium once it is implemented. Overall the service is

highly regarded and responsive. There maybe potential to integrate the

FM ‘Help Desk’ with a wider corporate help desk service but this is not

seen as either a preferred or necessarily effective solution (as it may dilute

the existing service which works well).

PA & Admin. Support

Dedicated PA, clerical and administrative support has been considerably

diminished due to re-organisations and subsequent out-sourcing of office

services. However the FM Team has adopted a self-help attitude and this

has meant there are no significant capacity issues around PA and

administrative support.

There is also PA & Admin support provided through Capita under a long

term contract between WSCC & Capita. The FTEs and cost estimates for

this part of the activity are not included in the summary cost totals.



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Hard FM

Activity Audit

Condition Surveys

Condition surveys are outsourced and undertaken through multiple area

based contracts. The contracts include both schools and non-schools and

full surveys both building fabric and M & E equipment. The whole portfolio

is reviewed over a 5 year period (approximately 20% of portfolio per

annum). The condition surveys are overseen by the Business Information

Team in Capital & Infrastructure Assets Directorate; with data being held

in the council’s corporate property database which can be accessed by the

FM Team. The positioning of the overview of this activity with the

Business Information Team is an organisational quirk and it should more

appropriately sit with the FM Team where the building surveying expertise

resides. It may be relevant to review the basis of the service and to see

whether a single contract or a change to a full portfolio service every 4 or 5

years may be better value for money. However the service is likely to

remain as an externally provided activity.


The building maintenance activity (both planned and reactive) is lead by

the Building Surveyor and area teams supporting both the schools and

non-schools portfolio. For the non-schools team there is one building

surveyor for each of the 5 FM areas; whereas for the schools portfolio

there is one surveyor for each of the 6 school areas. The Schools Team is

funded by SLA income whilst the Non-schools Team is funded through

base budget. The teams develop and deliver the annual building

programme in liaison with service departments and building users. The

teams are also responsible for managing reactive maintenance work. The

current organisation and delivery model has only been recently

established and there are no plans to change. The service works well in

part due to the experience and capacity of the team members, their

inherited knowledge of the buildings and good working relationships with

building users. In addition the area based model provides a greater variety

of work for the surveyors.

M & E Services

There is an M & E contract with SSE (Scottish and Southern Electricity)

which covers inspection, testing and reactive services. The FM Teams also

has area-based engineers looking after both schools and non-schools. In

the past WSCC has struggled to get building services engineers and has

now adopted the approach of ‘growing our own’ through an

apprenticeship scheme. Whilst the existing FM Team M & E staff are busy

broadly the balance between capacity and work-load is about right plus

there is the option to use agency staff to handle peaks in work (although

past experience of using agency staff has not been good). The activity is

part base funded and part funded through the Schools SLA.



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This activity over-arches both Hard and Soft FM and is a key priority for the

FM Team. There is no specific organisational focus for the activity through

a defined team / post; rather it is an activity undertaken by the area based

surveyors, engineers and facilities managers as part of their mix of

responsibilities. There is a compliance ‘checklist’ which identifies specific

requirements and frequencies for individual buildings. Data will eventually

be held in the Atrium database which will be used through ‘alerts’ to

prompt for required actions. Overall there are no issues around capacity of

expertise and the activity works well in practice.

Project Management

This activity covers mostly capital maintenance projects including some

schools projects. Generally they are small projects and programmes of

work which tend to be less than £300k (larger projects sit with the Capital

& Infrastructure Team). The activity is funded through base budget; except

for schools projects which are typically charged on a fixed fee or hourly

charge basis. The project management role is carried out by the area

based by surveyors & engineers. Generally there are no capacity issues but

if there is then external consultants are used. There is no formal

requirement to use a specific project management methodology. There is

a possibility that under the wider reorganisation of the council this activity

could end up as a ‘commissioned’ activity.

Carbon Management

This team has two dedicated posts (one is currently vacant) covering

specific areas of expertise (notably energy and water). The team is

supported by the area based building surveyors and M & E Engineers. They

cover the broad mix of work for energy and water management. The team

are responsible for policy development, raising awareness, training and for

developing and implementing programmes of work (such as renewable

energy). The team provided a dedicated focus for the activity which is a

key priority for the council. Overall capacity and balance is about right.

Display Energy Certificates (DECs) are done through the Business

Information Team and there may be an argument that this element of

work should be more appropriately placed with the Carbon Team.

Minor Improvements

Minor improvements works are managed by the area building surveyors

and M & E Engineers as part of their broad mix of responsibilities. The Area

Teams liaise with services to determine priorities and establish the

programme of works. Typically these projects are small to medium sized in

terms of value but for the 2012/13 there is no specific budget provision.

Property Review

This element of activity sits with the Estates Team within Capital and

Infrastructure. The Estates Team lead the review activity and the FM Team

N/A



18

provide support as required. It is not entirely clear how robust the process

is and to what extent it ‘challenges’ the need for and performance of

assets. There may be a need to improve coordination with the FM Team in

part to act as an early warning mechanism for possible release of buildings

(for which FM are responsible) and in part to secure FM perspectives on

issues such as energy performance, running cost performance, condition

and functional suitability of buildings.

Suitability Assessment

The FM Team undertake suitability assessments of the non-schools estate

on a 5 year rolling programme (20% of portfolio per annum). This is

undertaken as one element of the building surveyors’ role using a WSCC

developed methodology and pro-forma. The philosophical approach is to

do the assessments ‘with’ services rather than ‘to’ services. The

assessments cover a broad range of themes (environment / accessibility /

performance / sustainability etc.) and the information is used to inform

development of the capital programme & investment prioritisation. The

assessments are currently held on spreadsheets but there is an intention

to hold them on the new corporate property database (Atrium) in due

course. The activity is base funded. There is a lack of clarity over the wider

linkage to property review and a potential deficiency in that the

assessments do not provide a robust ‘challenge’ to property need,

utilisation or performance and that they are not used to inform ‘retain’ or

‘release’ decisions on the portfolio. There is a different approach to

schools suitability assessments which not undertaken by the FM Team.

Soft FM

Activity Audit

Cleaning

The FM team undertake the client management activity for cleaning

services (specification, letting & monitoring) which are delivered through 2

contracts (for schools and non-schools) each having differing renewal

dates, contract lengths, cleaning frequencies and standards. The intention

is to have a single, coordinated, approach which streamlines the existing

fragmented, legacy arrangements the FM team has inherited. The FM

Team undertakes ‘light touch’ monitoring to supplement building user

feedback on quality issues. The non-schools cleaning is centrally funded

through base budget whereas in the case of schools there is a part

recharge mechanism. There may be a ‘time lag’ issue between changes in

the portfolio (down-sizing) and how these impacts on the cleaning

contract and potential for reduced payments. There may be the scope to

improve linkage with capital projects to understand how floor finishes

could impact on cleaning frequencies and costs.



19

Security

The 5 hub office buildings have caretakers responsible for opening and

closing and general security of the building. Elsewhere in the corporate

estate local building users (through local arrangements and nominated

staff) are responsible for locking and un-locking on a daily basis with an

emergency security call out service provided through a single contractor.

Schools have their own individual arrangements according to their needs

outside of any corporate arrangements. In practice these arrangements

work well and are cost effective.

Waste Disposal & Recycling

The waste disposal activity undertaken by the FM Team is essentially at a

budget management level. Services departments raise their own orders for

specific waste services against a budget held by the FM Team. Services are

responsible for the waste activity procured and the FM Team for the

associated budget issues. There are no specific capacity issues around this

element of this work.

Reception

Reception in main office buildings is not managed from within the FM

Team but by Office Services which is a separate team. There is no strong

rationale for this to be considered within the scope of FM.

N/A

Caretaking

FM has a caretaking team comprising a manager + 3 staff who look after

schools (support the schools in terms of cleaning & other contract issues).

These have recently been incorporated into the FM Team and their

traditional focuses on school could be broadened to non-schools. They are

based centrally but have a county-wide remit. Currently the cost of the

service is re-charged back to schools. School based caretakers are

provided by individual schools with the FM Team providing a support role.

Facilities Officers and FM Operatives are the first point of contact for

services / building users – each having responsibility for about 10

buildings. There are no capacity or expertise issues, a mix in terms of age

profile and adequate service resilience. As all the WSCC buildings come

under FM control and the service more fully established there may be

scope to extend the service.


This activity covering the whole portfolio and all utilities (water, electricity

and gas) is currently carried out by the Business Information Team within

Capital and Infrastructure Directorate. The activity is seen largely as a data

issue – collecting reading data and paying bills; although the FM Team

provide the scrutiny role to monitor utility usage. There is an argument

that the activity sits more logically with the FM Team because of its

scrutiny role and responsibility for overall energy policy and practice. The

current arrangements mean that the focus and management of full

property running costs does not sit entirely within FM and this is

N/A



20

inconsistent with the corporate landlord model that council is seeking to

operate.

Catering

The FM Team provides catering services at 3 of the WSCC hub buildings

through part in-house and part contracted out arrangements. In County

Hall catering is provided through an in-house service; at Durban House in

Bognor Regis the service is provided by the Aldingbourne Trust (for people

with learning difficulties) on a semi-contract basis and at the northern hub

(Horsham) through a catering contract. There are no catering facilities at

Crawley or Worthing. There is strong member view on retaining these

facilities which are highly regarded. This corporate catering element is

required to be cost neutral with the service ‘netting off’ from charges. The

non-offices catering service covers school; run a ‘meals on wheels’ service

alongside the WRVS & employ catering staff in special schools. They also

undertake training. The funding base of this element of the catering

activity lacks clarity – some work is unfunded; there are differing funding

arrangements for different contractors and overall the service is part

funding through the schools SLA and part re-charge. There is potential to

unify these disparate approaches to ensure overall cost recovery. There is

some limited catering for outside functions (such as weddings) on a cost

recovery basis and there maybe a longer term prospect to generate

income as the team has some commercial acumen. There maybe potential

to consider external catering provision in key offices using ‘a profit-share

franchise model’ with a private sector partner.

Health & safety

The FM Team have a responsibility for H & S for buildings related matters.

This is done by the Area Facilities Managers, M & E Engineers and Area

Building Surveyors as a significant part of their jobs. This activity is base

funded. H & S incidents and actions are recorded in a log. There is also an

Asbestos Officer, which is a dedicated post attached to the Building

Surveying Team. This post provides specific subject matter expertise, and

is responsible for asbestos management policy within the council. It is a

full-time post required to meet WSCC needs but there is some limited

selling of expertise services to academies. In addition to the FM Team H &

S activities there is a corporate H & S function for the council which has

recently been outsourced.

Grounds maintenance

There is an experienced, dedicated team of 2 which focuses on this aspect

of the FM service. The service they provide is highly regarded and overall

capacity provides adequate resilience to manage the activity which is

undertaken exclusively on WSCC sites. There are currently two contracts

covering the estate (corporate buildings and schools – to which schools

can opt in on a voluntary basis) plus some minor cases of services making

their own local arrangements. The intention is to rationalise these into a

single contract to be re-let in January 2013. The activity is base funded



21

from WSCC revenue with schools paying for services they receive directly

to the contractors. There is an SLA with schools for FM Team’s grounds

maintenance work which is re-charged on a fee basis.

Additional FM

Activity Audit

Space Planning

Undertaken as part of the Corporate Facilities Team within FM. Currently

very busy because WSCC is going through a period of office rationalisation

and implementing new ways of working. The work requires close liaison

with service departments. There is adequate capacity, expertise and

resilience through the Area FM Teams. Space planning is undertaken using

AutoCAD Lite which requires some significant expertise to use well.

Move Management

This is undertaken by the same staff as the space planning. Essentially it

can be seen as a project management activity. Although currently a busy

period for the team the overall capacity, expertise and resilience is

adequate.


This activity is not within the scope of the FM Team. It is part of the Office

Services Team + there is a post within the WSCC Communications Team

which is focussed on reducing use of external meeting rooms as part of an

efficiency drive. It could be perceived as an FM activity and in the future

could possibly have an emphasis on income generation through letting of

space for external users (Although the prevailing philosophy of the council

is that if space is not being used it should be disposed of).

N/A

Post Services

This is not currently undertaken as part of the FM Team activities but is

provided by the Office Services Team.

N/A

Office Furniture

The FM Team undertake the administrative function of ordering office

furniture which service departments pay for from their own budgets.

Whilst there is a presumption in re-using furniture where possible the

move to a new corporate model supporting flexible working also requires

new furniture. The delivery of furniture however sits outside of the FM

Team with the Capital & Infrastructure Team. There does not appear to be

a clear rationale for the separation between ordering and delivery parts of

this activity (which can from time to time lead to problems); rather it is a

legacy of earlier organisational decisions. There are no specific views on

this element of FM activity but it could be readily outsourced.



22

Porters

The FM Team has two porters at County Hall + a grounds maintenance

person who keeps the area tidy. These three posts focus on ‘front of

house’ at County Hall and there are no others porters at other buildings.

All posts are based funded and there are no capacity issues.

Courier Services

This is not currently undertaken as part of the FM Team activities but is

provided by the Office Services Team.

N/A

Events

The FM Team provide services, such as catering for events which are held

from time to time at the facilities within Chichester (County Hall and Eades

House) and at County Hall ‘North’. These are ad hoc, rather than regular,

and the services are provided as an adjunct to staff main duties. These

events include, for example, weddings and member receptions. This is

currently seen as an incidental activity which is undertaken on a cost

recovery basis but there maybe some scope to develop it as an income

generating activity.

Training

The FM team provide on a systematic basis training on building matters.

These training sessions are typically for caretakers; school bursars and

occasionally school governors. The focus for this activity is through the

catering team but other staff are drawn into to provide specialist expertise

as required.



23

5.0 Comparative Analysis

5.1 Outline of Approach

In order to provide WSCC with a robust reference point to support consideration of

any proposals for the future of the service a comparative benchmarking exercise was

undertaken with 8 other councils. These included 4 county councils and 4 unitary

authorities.

The 8 councils were chosen to provide richness in terms of their size and existing

organisational arrangements for FM. Collected data was presented so as to allow

easy comparison of WSCC in terms of their organisation and delivery model. As a

consequence of the differing interpretations of activities amongst the other

authorities, a certain degree of pragmatism and convenience was used in the data

collection stage with an emphasis on using what data was available.

5.2 Profile of Comparator Organisations

For the purposes of this review, comparisons were made with 8 other councils. These

were grouped into county councils and unitary authorities. The county councils are

referenced 1 to 4, and the unitary authorities A to D. Authorities have not been

identified by name. A ‘pen picture’ of each authority in terms of their broad

dimensions and current FM arrangements is given in diagram 4.

In general there are common themes amongst all comparator organisations – the

fact that the FM function has been involved in a ‘journey of development’ and that

this journey is continuing; budget pressures and the move towards a more

integrated ‘Total FM model’. However there are also some significant differences

even amongst the small number of comparator organisations and this includes the

types of organisational models being used for FM delivery. The narrative of the

comparator organisations in Appendix B illustrates some of the diversity of existing

arrangements.



24

Diagram 4 – ‘Pen Picture’ of Comparator Organisations

Decision taken in terms of future FM options



25

6.0 Looking Forward – Options for the Future

6.1 Immediate Short-Term Priorities

The FM Team has recently been established in its current form as part of WSCC’s

recent and on-going restructuring. As a consequence the immediate priority of the

FM is to consolidate; assume the Corporate Landlord Role; clarify existing roles and

responsibilities and to make ‘it work’. This in itself requires some significant work to

resolve FM costs at an individual building level (so as to ensure activity levels are

commensurate with funding); the development of effective working relationships

with building users and service managers and the streamlining of existing contract

arrangements with external service providers. Specific short-term priorities for

action include:-

• Review of existing contracts to consolidate into fewer unified corporate

contracts in which schools can participate (on a voluntary basis).

• Clarify and resolve operating costs to ensure these are consistent with required

activity levels (legacy issue from implementing the Corporate Landlord Model)

• Support the implementation of Atrium as the corporate property database and

‘audit’ data quality to identify areas where data availability may be

compromising FM performance.

• Resolve any legacy issues from recent organisational changes such as

misplacement of activities.

6.2 Articulating Options for the Medium-Term

The options for developing FM services are dependant on three broad questions and

WSCC’s view of the key factors influencing these questions. These are:-

• The size and role of the retained FM capacity

• The scale and nature of any externalisation of activities

• The extent of engagement with other public bodies



26

Diagram 5 – Key Questions Shaping Future Options for FM Service

Diagram 6 below presents a broad framework for identifying a range of options for

the development of the FM service. This is based on the extent to which FM activities

(and their management) are retained internally or outsourced and the scale of

properties to which the FM service is applied.

Diagram 6 – Outline of Future Options

Sin

gle

bu

ildin

g

Ma

ny

po

rtfolio

s

3

Totally in-

house

Totally

outsourcedCurrent

FM

Model

Wh

ole

po

rtfolio

2

4

1B1A

Internal

External

Ex

tern

al

Inte

rna

l

Placement of Activities

Sco

pe

of

Bu

ild

ing

s

5



27

Within this framework the current positioning of the WSCC FM Team is identified as

well its historic positioning and a range of future development options. The

identified future options are consistent with the broad direction of travel for the FM

service which is focussed on improving value for money (quality and cost blend).

These are illustrative of future delivery models and are not an exhaustive list of

options and the options are not necessarily mutually exclusive. They are presented

as a simple mechanism to aid thinking about the issues around potential options for

the future.

The positioning of potential future options against the twin axis of ‘scope of

buildings’ and ‘placement of activities’ has some general implications. These are

summarised in the diagram below. Widening the scope of buildings within the FM

function increases the economies of scale but also increases management

complexity and may reduce local control and flexibility. Outsourcing of activities

whilst securing improved access to capacity and expertise and increasing certainty

and resilience can also mean a loss of flexibility and internal ‘intelligence’.

Diagram 7 – Implications of changing Scope of Buildings & Placement of Activities

Sin

gle

bu

ild

ing

Ma

ny

po

rtfo

lios

To

tall

y in

-ho

use

To

tall

y o

uts

ou

rce

d

A broad description of the future options for the FM function identified in Diagram 4

are summarised in the table 2 below.



28

Table 2 – Description of Broad Options

Option Description

1A ‘Thin Client’ function for WSCC only FM service – with FM activities

largely outsourced

1B ‘Thick Client’ function for WSCC only FM service – as 1 above but with

greater internal capacity to provide improved resilience and expertise.

2 Joint FM arrangements (few) – with one or few other public bodies

(such as a District Council) with WSCC acting as ‘lead’ authority

3 Joint FM arrangements (many) – with several or many other public

bodies with WSCC acting as ‘lead’ authority

4 County-wide FM Framework for a ‘pooled’ FM service for public

bodies in the county with WSCC as ‘lead’ authority

5 Sub-Regional Framework for a ‘pooled’ FM service with WSCC as

‘recipient’ rather than ‘lead’ authority

Note: Option 1 (1A & 1B) relate to WSCC only and are concerned with the relative degree of

externalisation of FM activities; whereas options 2-5 are concerned with WSCC operating with partner

organisation(s) to secure efficiencies of scale. The existing delivery model for FM at WSCC although it

has externalised some activities is best described as a ‘mixed economy’ with some activities

undertaken in-house and others externalised.

The relative merits of each of these options will in large measure depend on WSCC’s

views on the:

• Willingness to cede control to another body for management of the service.

• Potential efficiency savings to be derived from securing economies of scale

• Willingness to work in partnership with other public or private sector bodies

• Need for some retained ‘intelligence’ capacity

• Need to retain flexibility to respond to changes (e.g. portfolio reduction)

• Requirement to retain its own identity

• Access to wider capacity & expertise (both public & private)

• Promotion of local knowledge, expertise & prosperity



29

6.3 Summary Evaluation of Future Options

The relative merit of the options against these ‘evaluation criteria’ is presented

below. This analysis should be treated with caution as it has been undertaken at a

high level (without relative weighting of criteria) and is intended to highlight key

issues relevant to each option rather than to identify a recommended option.

Table 4 – Broad Evaluation of Options for the Future

Options Evaluation

Criteria 1A 1B 2 3 4 5

Control

Efficiency

Partnership

Retained ‘Intelligence’

Flexibility

Identity

Access to expertise

• ‘Thin Client’ Function for WSCC only – This option would see further

externalisation of existing FM activities. This could be undertaken on an

incremental, activity by activity basis, to assess VFM or through a ‘big bang’

approach where a set of identified activities which could be outsourced are

defined and externalised through a single block contract. This would leave

WSCC with a largely service specification and monitoring role with external

service provider(s) focussing on delivery and day to day client liaison.

• ‘Thick Client’ Function for WSCC only – This is similar to the ‘Thin Client’

Function above but would see WSCC retain greater internal capacity to



30

undertake some limited FM activities in-house and thus provide WSCC with a

degree of resilience and flexibility (through its retained capacity).

Both these options can be implemented through standard contractual

arrangements using a ‘specified service for cost’ approach or on a ‘partnership

basis’ where there are agreed shared business objectives which could relate to

some form of profit sharing.

• Joint FM Arrangements (few partners) – There is potential for WSCC to develop

joint FM arrangements with a single or few partners to achieve the economies

of scale from ‘bulking-up’ activities. This can be done in an incremental way; for

some activities with initially one partner organisation and extended over time.

WSCC could also position itself to act as ‘lead’ authority for any joint

arrangements. Such arrangements are complex to deliver; in large measure

because of the separate identities of the participating organisations, potentially

different requirements and differing starting points (in terms of cost base,

existing contracts etc.). However financial pressures and the prevailing

government policy context is pointing towards greater ‘joining-up’ up of

services across public sector bodies and this option has the potential to secure

significant efficiency savings.

• Joint FM Arrangements (many partners) – This is an extension of the option of

joint arrangements (few partners) identified above. The above option could be

a stepping stone towards even greater economies of scale from joining with a

larger number of partners – although it is recognised that this also involves a

greater degree of complexity in terms of management arrangements and

operation.

• County-wide Framework for a Pooled FM Service – Through this option a

collective approach is taken to managing the FM activities of the public estate

within the county. This is consistent with government policy direction which is



31

promoting the management of public property in defined geographical areas as

a single, unified portfolio. This is a complex option to implement because of the

difficulty in securing engagement with other public bodies but also has the

potential to secure significant efficiency savings arising from the ‘bulking-up’ of

activities. This option can however be implemented on an incremental basis

and WSCC could, if it wishes to, position itself as the ‘intelligent FM client’ for

the wider public sector.

• Sub-Regional Framework for a Pooled FM Service – This option is presented for

completeness although it is not considered a realistic medium term solution.

This is because whilst such an arrangement provides the opportunity to

maximise the economies of scale and is consistent with broad policy and

resource influences which are encouraging ‘shared services’ such a framework

does not currently exist and maybe be complex to establish. However it could

be considered as a long term option with either WSCC creating an appropriate

framework through which others could participate or with WSCC opting in to a

framework created by another body. None of the adjoining County Councils

have established such a framework although Hampshire County Council are

well placed to create one.

.



32

Appendix A - FM Team Structure Chart



33

Appendix B – Profiles of Comparator Organisations

Organisation 1

• Organisation of the FM function

FM function is split into two organisational units. One is focussed around

corporate accommodation which has a ‘thin client’ organisation primarily

concerned with contract and performance management and the other a ‘thick

client’ organisation concerned with Children’s’ Services and a range of FM

contracts focussed on schools.

• Scope of FM

The contract provides services to all corporate sites and includes cleaning,

portering, grounds maintenance, courier, security and furniture moves.

Property maintenance and repairs plus M & E are outside the scope of the

current contract and these services are managed by the Property Team and

provided through term contracts and frameworks.

• Nature of FM Contracts

The new FM contact is a traditionally procured contract let in 2012 for a long-

term. It replaces a previous contract initially let in 2005. At the time of

preparing for the contract Organisation 1 sought to involve other public bodies.

This collaboration proved difficult – in terms of decision making, time,

negotiation and the political will to engage. The current contract does involve

some limited partners (district council and Fire Authority). Although a

collaborative approach was difficult to achieve Organisation 1 sees the issue of

a joint public approach one to explore in the future because of the potential for

further savings through economies of scale.

The contract is generally well received by building users and service managers

who have been used to working with external consultants. An accommodation



34

board involving department representatives, the service provider and client

team meets regularly to review performance and identify any incipient issues

in contract delivery. There is a focus on ensuring the service provider is

‘embedded’ into the organisation. The FM service provider uses its own

information system which the client side of Organisation 1 can access.

• Treatment of Schools

Schools were explicitly kept out of new FM contract. This was in large part due

to complications over internal decision making and because of the level of

autonomy enjoyed by schools. A pragmatic approach was taken to create a

contract for corporate properties although it is likely that in the future

arrangements there will be a renewed attempt to create a unified contract to

which schools can opt-in to. At the moment there are separate arrangements

for schools and these tend to be a mix of contracts with differing start dates,

lengths and quality standard.

• Current Issues

Implementing corporate landlord model – Organisation 1 has been

implementing a Corporate Landlord Model with a centralisation of activities.

One of the issues to implement in support of the model is the centralisation of

budgets which are currently held by service departments.

Bulking-up contracts – as other contracts for FM services are due for renewal

there is an intention to allow these to be incorporated into the new FM

contract.

• Future intentions for FM

The current contract has only recently been let. The immediate priority is to

make sure that it is working well and to resolve any ‘teething’ problems. In the

medium term there is an intention to move towards a ‘Total FM Service’

covering the broad range of hard and soft FM for the entire portfolio. Move



35

towards this will be made by ‘bulking-up’ the existing contract. This will be

done by offering expiring contracts which are due for renewal to the

incumbent FM service provider to bid for on an exclusive basis.

Over the longer term there is an intention to seek to collaborate with other

public bodies (such as adjoining authorities or district councils) to secure the

potential savings from the economies of scale and to reduce the overall

requirements for contract management on the collective public sector client

side. There is recognition, however, that this will not be an easy process as

different bodies have different needs.



36

Organisation 2


Organisation 2 initiated the development of a shared services joint venture

partnership involving a strategic private sector partner. FM services are now

provided through this long-term joint venture as part of a broader range of

back-office activities. The joint venture was initially established in 2007 with

three public bodies (the county council; district council & the Police Authority)

and a private sector partner. The joint venture is structured as a strategic

framework agreement so that other public bodies in the region can opt-in if

they choose to do so

Staff from the participating public bodies have been seconded into the joint

venture with ‘assured employment’ status and the joint venture also has some

additional directly employed staff. There is a small retained thin client capacity

for all partners 2 – principally for governance and contract management. Each

partner also retains its own intelligent client capacity rather than there being a

single unified one on behalf of all the public bodies.

• Scope of FM

Hard FM services are provided to the whole operational portfolio whereas soft

FM services are provided to the HQ and principal office sites. There are

different service and output specifications for each of the participating public

bodies which reflect their differing needs. These are monitored through regular

review meetings and defined performance measures.


The joint venture has an initial time frame of 10 years from 2007 with an option

of a 2 year extension. The joint venture is currently at its mid-point. Whilst the

private sector partner has significant financial and operating control of the joint

venture through its share holding of 70% of the Limited Liability Partnership



37

(LLP); Organisation 2 and its partners exercise a degree of control through

senior officer and member participation on the joint venture Board and

through the output specification and contract governance arrangements for the

services provided.


The overall service specification has been written to allow schools to opt-in to

FM services. Approximately 70% of schools currently opt-in to the agreement

for their maintenance requirements with the others making their own local

arrangements.

• Current Issues

Budgetary pressures – The partner organisations are facing significant budget

pressures as a result of wider public expenditure constraints. With initial

savings from the joint venture largely secured it is becoming more difficult to

realize savings from FM activities. The approach to the budget pressures is to

look for opportunities to streamline on an activity by activity basis.

Spike in capital spend – After a period of restricted capital expenditure

Organisation 2 is facing a short term (2-3 years) spike in capital spending. This

is causing capacity and resilience issues around the capital programme.

Prioritization of maintenance spend – At the current time it is difficult to

determine the best options for maintenance spend. This is in part due to the

broader context in which the FM service is working with partner bodies seeking

to rationalise their property holding through disposals or shared asset use in

response to savings pressures. Whilst the FM service can prioritize spend on

‘life & limb’ issues it is more difficult to allocate spend against buildings which

may in the future be closed. There is a degree of uncertainty over the release

or retention of buildings which hinders capital and maintenance spend.



38

Legacy IT systems – the creation of the joint venture brought together some

legacy IT systems. This has caused some operational problems due to their

inability to communicate together or share data and because of some differing

data security needs. Work has been undertaken to specify a new, replacement

systems which is due to be procured in the immediate future.


The immediate priority for Organisation 2 is ‘business as usual’ – making sure

that the service is operating effectively and taking opportunities to streamline

activities to secure savings. In the longer term there will be a need to review

the operation of the joint venture and to consider implementing the extension

option. There is an acceptance that over the course of the life of the joint

venture that both the political (new Police Commissioner and changes in

political balance across the public sector bodies) and financial landscape has

changed and these factors may have a bearing on the consideration of the long

term direction.

Broadly the joint venture is working well although there are mixed views from

the participating bodies over the service quality – related to their differing

needs.



39

Organisation 3


Organisation 3 has fragmented client-side arrangements (with a separate focus

for corporate offices; schools and other non-schools buildings excluding

offices) but with a single joint venture supplier for the full range of FM services

through a long-term arrangement underpinned by a Service Level Agreement

(SLA). There is no single, corporate, client focus but rather a fragmented client

spread across the main service departments. This means there are some

disjointed and confusing arrangements over service standards and

performance.

• Scope of FM

The Service Level Agreement covers the broad range of both hard and soft FM

services with a few minor exceptions retained in-house. The joint venture

partner also provides much of the ‘intelligent client’ function on behalf of

Organisation 3.


The joint venture has been established for several years and has been working

partly on an ‘informal basis’. The SLA is being re-written and sharpened-up

with perhaps a more stringent focus being placed on service performance. This

has been partly driven by budget pressures and partly as part of work to

implement the Corporate Landlord Model.


Schools are able to opt-in to the existing joint venture FM arrangements on a

voluntary basis. There is a high degree, but not universal take up of the service.

The Children Services Directorate have their own client function for property

matters in support of schools.



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• Current Issues

Budget pressures – There are significant budget pressures facing Organisation

3. To date these have not impacted to a significant degree in how the FM

service operates. However large organisation-wide savings targets have

recently been announced and it is anticipated that all core corporate functions

will be subject to critical review on the basis of their provision and costs. It is

anticipated that FM will be within the scope of this review with initial work

starting in the new calendar year.

Corporate Landlord model – Organisation 3 has recently undertaken work to

implement a Corporate Landlord Model with the centralisation of property

related staff in service departments and centralising property budgets.

However this has yet to be implemented and there is some resistance from

service managers and a lack of corporate will to direct its implementation.

Office rationalisation – there is a significant programme of work to implement

flexible working. There is likely to be a reduction in the number of

administrative buildings and changes to where and how staff work. This may

have significant implications for FM services.


There are no specific plans to change the FM service as it currently operates as

this is a long-standing joint venture arrangement that is generally perceived to

be working well. However there are immediate budget pressures which will

require some streamlining of processes and possible changes to service quality

standards and frequencies in order to reduce costs. Over the medium term

Organisation 3 will seek to implement the corporate landlord model on an

incremental basis. There are no specific intentions with regard to joining up FM

services across the wider public sector; although there is some recognition that

Organisation 3 is well placed to take a lead role in this because of the scale of

its portfolio and its existing joint venture arrangements.



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Organisation 4


Organisation 4 has a lean corporate property client team covering estates, FM

and asset management. This team covers strategy, provides the technical lead

for Hard & Soft FM and undertakes contract and performance management.

The broad range of FM services are provided as part of a long term contract

with a large service provider as a subset of a larger corporate contract for a full

range of back-office services.

The impetus for the contract was for cost savings, service resilience and to

secure the more commercial, entrepreneurial skills provided by a large private

sector company. Certainty of costs looking forward, quality of services provided

and issues relating to job security and career progression for transferring staff

were also significant factors.

• Scope of FM

The contract covers the full range of hard and soft FM services (with some

limited exceptions) for the full property portfolio with the exception of schools

(for which there are alternative arrangements which allow them to opt-in to

the services provided).


The contract was let in 2012 for a 10 year period with an option for a further 10

year extension. FM services were one part of a much larger corporate contract

covering all ‘back office’ functions of Organisation 4. Alongside this contract a

framework agreement was established to allow other public bodies and

schools to opt-in to the contract arrangements if they choose to. There is a

guarantee of savings and certainty of costs over the life of the contract. The

new contract replaced the provision of services from another external

provider.



42


Schools are not specifically included in the contract but a framework created to

work alongside the contract allows schools to opt-in to FM services. It is

anticipated that as the service provided and the contract become embedded

and fully operational then the service provider will be in position to offer

services directly to schools.

• Current Issues

Transition phase - Organisation 4 has undertaken a significant piece of work in

the course of the procurement, negotiation and mobilisation of this new

contract. It is now in a transition phase during the initial period of the contract

with a strong emphasis on ‘making it work’ and ensuring process and working

arrangement are streamlined and well embedded.

Front facing services – Whilst the contract is working well there are some initial

teething problems for some of the ‘front-facing soft FM services such as

cleaning. Work is in hand to resolve these.

Asset rationalisation / joint asset - There is a significant programme of work

around the rationalisation of Organisation 4’s portfolio and joint-use of

properties with other public agencies. In the future the scale, nature and

distribution of the portfolio will be different and this will have implications for

the volume of FM services provided through the contract.

Flexible working –Organisation 4 is implementing a significant flexible working

programme changing where and how staff work and adopting flexible work

standards around ‘hot desking’; work-station space and personal storage

space. In the future the FM arrangements will need to underpin a more agile

workforce.



43


The immediate priority for Organisation 4 is to ensure that the transitional

phase of the contract proceeds smoothly with any teething problems resolved

quickly. Thereafter the FM response to asset rationalisation and flexible

working will need to be addressed. In the medium term monitoring of contract

performance will become increasingly important and KPIs have been identified

for this purpose.



44

Organisation A


Organisation A has adopted a ‘commissioning model’ with the broad range of

FM functions outsourced through a single long-term prime contract. This was

due to expire in 2013 and has recently been renegotiated and extended (for a

short period) pending a decision over the longer term. As part of this

renegotiation further FM activities have transferred from organisation A to the

FM service provider and the costs of the contract have been reduced to

provide savings. The retained client capacity is very lean with approximately 5

FTEs who undertake the contract management role and provide some internal

professional capacity and specialist expertise (for M & E services and carbon

management). Although organisation A has not fully implemented a ‘Corporate

Landlord Model’ there has been a strong degree of centralisation of property

budgets associated with the implementation of the FM services contract with

an external provider.

• Scope of FM

The broad range of hard FM and soft FM are undertaken through the contract

with the exception of H & S (undertaken by an in-house corporate team) and

grounds maintenance (provided through a separate contract with another

service provider). Move management, post services, office furniture ordering

and courier services are all provided in-house. The small retained client

capacity is also responsible for the strategic elements of FM including member

and officer liaison, policy development and performance management.

Organisation A has adopted a new corporate property system with links to the

data from the FM service provider’s own propriety database system.


The existing FM contract covers all ‘corporate’ buildings – but the housing

stock and investment portfolio is excluded with some specific buildings also



45

excluded for historical reasons. The contract also covers the broad range of

hard and soft FM functions with some limited exceptions and there have been

no undue performance issues during its operation.


Schools have a strong degree of autonomy and a tradition of making their own

arrangements with limited central support. Schools have the ability to ‘opt-in’

to the corporate FM contract but the majority choose not to do so (as it is

considered too expensive). Schools generally make their own arrangements

with local contracts to suit their specific needs.

• Current Issues

Budget pressures – the council needs to improve VFM through its FM contract

arrangements. These arrangements will continue to be scrutinised to identify

whether there are opportunities to streamline processes, reduce costs and

generally improve VFM.

Clarification of roles – there is a need to clarify roles and responsibilities in

relation to specific types of assets – essentially ‘who pays for what’ discussions

that need to be agreed with service directorates.


Organisation A is committed to a ‘commissioning’ model so that in the longer

term it is likely that FM services will continue to ‘bought in’. There will be a

review of options prior to the expiry of the latest contract. Whilst the scope for

‘shared services’ with adjoining authorities has been considered; it was felt,

because of organisation’s A current position as largely commissioned function

with pre-existing long-term contracts that this was not necessarily a practical

option to take forward.



46

Organisation B


The broad range of FM services are provided through a ‘mixed economy’

arrangement with (in simple terms) most hard FM services and most soft FM

services provided externally through 2 separate long-term joint venture

arrangements and with other selected services (such as carbon management)

provided in-house. Existing council FM staff were transferred into the joint

venture under TUPE arrangements. The retained client side is centralised and is

relatively lean comprising approx. 24 FTEs with the ‘partnership management’

role exercised by 2 FTEs. Whilst the geographical area served by organisation B

is relatively wide it only has two principal, city centre based offices and in the

wider operational portfolio some FM activities (closing & opening of buildings)

are undertaken through caretaking arrangements.

• Scope of FM

Hard FM services excluding carbon management are provided through a long-

term joint venture arrangement. The Soft FM services of catering, cleaning and

couriers are provided through another separate long-term joint venture. Other

services, such as porters, reception services and FM information are provided

through the in-house client-side team.


The partnership arrangements cover the whole portfolio. Both long-term joint

ventures have a common time-span with a remaining life of 23 years. They are

viewed as ‘partnerships’; with a shared annual business plan and priorities,

rather than as simple contractual arrangements; although they are

underpinned by a Service Level Agreement which details activities provided

and performance expectations. Services are provided by the partnership

organisations staff with specific specialised expertise bought in to supplement



47

their own resources as required. The annual revenue spend through the

partnerships is approximately £10.5M. There is an expectation that the

partnership organisations will seek to grow their business through securing

other contracts and in doing so contribute to improved cost effectiveness of

services provided to organisation B.


The partnership arrangements have been created so that schools can ‘opt into’

them at their discretion. The majority of schools do opt-in; but some also make

their own arrangements. There are also in some cases separate contractual

arrangements between the council’s partnership organisations and individual

school with the council’s partnership organisations providing services directly

to these schools.

• Current Issues

Budgetary pressures – the council is facing acute budget pressures over the

immediate short-term. This will require a reduction in the council’s revenue

budget of 14% over the next 2 years and will impact on all council activities.

The principal issue for the FM service therefore is to improve overall cost-

efficiency activities. This is being undertaken on an individual activity basis with

the council client-side working with its partner organisations to stream-line

processes and reduce costs.

Capacity & expertise to respond to strategic issues - whilst the partnership

arrangements have worked well for operational matters there has been a lack

of an adequate response to more strategic issues the council is facing. This is

considered as perhaps an issue of ‘local’ capacity and expertise of the

partnership organisation(s), rather than any specific concern over

performance; although there is some disappointment that the expertise of the



48

wider partnership organisation has not been brought to bear for organisation

B’s needs.

Communication – generally communication between both the council and the

partnership organisations and the partnership organisations and the end users

(service managers and building users) could be improved. There are regular

monthly meetings between the council’s client side and the partnership

organisations to review performance and a periodic ‘Client Forum’ to engage

with service managers which is chaired by the internal client. This discusses

issues relating to the operation of the partnership arrangements (quality and

responsiveness of services provided). Communication on day to day matters is

handled by the partnership organisations directly with building users and

managers with the council’s client side only involved on an exceptional basis.

.


There are no specific intentions in the short term over and above responding to

the immediate financial pressures facing the council and ensuring the

partnership arrangements, which are still relatively embryonic in nature, are

working well. Prior to establishing the current joint venture arrangements a

range of options were explored and alternatives such as creating ‘shared

services’ with adjoining authorities were discounted as not viable due to

complexities. Following the appointment of a new Chief Executive the council

is currently going through a re-structuring process. This may lead to the

creation of a split between commissioning and delivery and the potential for

the council to commission a broader range of services - which could be

provided through its existing joint partner arrangements or with other

providers.



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Organisation C


Organisation C is a newly established unitary authority. The former county

council inherited property and FM staff from former district councils on the

creation of the new authority. It also inherited a mix of FM contracts of varying

nature and timescales. There is a principally in-house service and an area based

approach to FM with the area divided into 3 areas with a broadly similar

number of properties in each

• Scope of FM

The FM service covers the broad range of hard and soft FM activities. Whilst

hard FM is provided for the whole of the portfolio the soft FM is focussed

principally on the main administrative buildings.


Organisation C has recently undertaken a programme to rationalise its non-

schools FM contractual arrangements. Prior to this each contract had its own

individual service specification and contract terms; inherited from legacy

arrangements that were in place prior to the creation of the unitary authority.

It was thus difficult to manage performance, cost and risk across a high number

of disparate contractual arrangements. Three separate contracts (for cleaning,

security and catering) have recently bee let. Each of these contracts is for a

short-term of two years, with an option for extension. There is scope to

rationalise these and other contracts further in the future.


Schools have a significant degree of autonomy of how they procure their

support activities. Organisation C has a ‘buy-back’ scheme allowing schools to

opt-in to the FM arrangements for their building maintenance needs using

delegated funding. Approximately 70% of schools currently use this opt-in

scheme.



50

• Current Issues

Budget pressures – Organisation C is facing significant revenue budget

pressures. The FM response to this in the short term is to seek to look for

opportunities to streamline activities and to secure improved value for money

from the rationalisation of existing FM contracts.

Office rationalisation – Organisation C has been undertaking a large-scale

flexible working initiative in conjunction with modernisation of county hall. This

is changing the pattern of where and how staff work and this requires a

significant cultural change programme to underpin it. This cultural change has

an impact on FM services, in particular soft FM services which itself has to

adapt to the changing nature of work patterns.

Multi-agency hubs – plans are in place to create a network of 20 multi-agency

campus buildings across organisation C’s administrative area. Whilst these will

be occupied by a mix of organisations it is likely they will be served by a unified

FM function but this has yet to be defined or established.


The immediate short-term priority is to make the existing arrangements work

well. Looking further ahead there is scope for further contract rationalisation;

the potential to integrate a multiplicity of activities through a single contract

with a service provider using a long-term contract.



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Organisation D


Currently the management of the FM function is largely in-house with a mix of

contractual arrangements for service delivery. A recent review of procurement

activity under taken within Organisation D identified potential savings on FM

spend. As a result work has been undertaken to review options for the FM

service (both hard and soft FM) going forward. The impetus to the review was

to secure improved value for money, a better quality FM service and to have

access to improved commercial expertise and the resilience that a larger FM

organisation could provide.

• Scope of FM

The FM service is part of a wider organisational unit covering property and

asset management. It covers the broad range of hard and soft FM activities

through a single unified function for the whole of the operational portfolio.


There are a variety of pre-existing contracts for FM activities. Some of these

contracts have been extended on a short term basis to allow them to be

incorporated into a future joint venture on their expiration.


Schools have a large degree of autonomy. Some FM services are offered to

schools on an opt-in basis against a ‘fixed price’ Service Level Agreement with

take-up by schools currently in the region of 70%. Other schools make their

own local arrangements. With the option of a public-public joint venture

currently being explored (see below) there is an expectation that the joint

venture will be able to offer services to schools in the future.



52

• Current Issues

Budgetary pressures - There are significant revenue budget pressures and the

review of FM activity leading to the decision recently taken on future direction

for the FM service has been influenced by the potential of achieving some

significant savings from FM activities. There is work looking forward to ensure

that the identified scale of potential savings are realised through the

implementation of the proposed joint venture arrangement.

Ensuring building compliance – there is a priority to ensure that all buildings

meet statutory obligations and that appropriate inspection and servicing is

undertaken in order to ensure both safety and compliance.

Due Diligence - there is an immediate priority to undertake due diligence work

in conjunction with Organisation D’s preferred option of a joint venture. There

is also a need to determine the exact mix of activities and scope of services that

might be included within the joint venture – with an assumption that over time

at least most hard and soft services will be within scope of the joint venture

creating a ‘Total FM service’.


The council has just reviewed the options for its FM function as part of a new

approach to procurement. The relative advantages and disadvantages of two

total facilities management options were considered. These were undertaking

an OJEU procurement exercise for a Total FM solution through a traditional

procurement of an FM partner through a traditional contracting arrangement

or establishing a public-public joint venture through a ‘negotiated’ process

taking advantage of the TEKAL exemption. At the time of writing the council

are in the process of developing a business case for the preferred option of a

joint venture and undertaking due diligence in regard to the proposed joint

venture.



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Factors influencing the selection of a joint venture include the ability to

exercise control (through the joint venture governance arrangements);

ensuring an adequate level of service resilience and the degree of flexibility to

modify and develop services in conjunction with the chosen FM joint venture

partner. There are expectations that savings in the order of 10% can be secured

through the joint venture option (slightly less than that which might be

achieved through a traditionally OJEU procured service). There is also an

expectation that the joint venture will be able to offer its services to the wider

public sector in the area with both partners benefitting from future cost

savings.

Documents

Review of Facilities Management West Sussex County … · West Sussex County Council Review of Facilities Management 3 • Section 6 outlines some broad options for future development