Mind over Matter
FM Magazine (GCC Edition) spoke with Bill Heath, managing director of Mace Macro which has been making significant inroads into the Middle East since leveraging Mace's position to launch an FM division in 2002.
For some facilities management companies, FM is a very labour intensive business, involving the provision of all ‘non-core’ services to clients by hundreds or thousands of in-house staff. Other FM companies prefer to outsource their manpower element and focus on managing core competencies: management. Mace Macro is one such organisation.
“There’ll be a lot of people that will say they can do everything from consultancy to management to delivery, but nobody can do it all perfectly,” says Bill Heath, managing director of Mace Macro. “Total facilities management (TFM) in my mind is a model some people like to accept as management merging into service delivery. I don’t subscribe to it, and our model is pretty different to that".
“If we get involved in a management contract, we are there to act as the management function for the client to specify what’s required, ensure the contractor delivers what they are supposed to deliver, and then monitor and measure. It’s the choice of the developer/client at the end of the day, whether they feel that there’s a conflict of interest for a person who is operating and is also giving them advice associated with their own operating costs. A lot of people like the fact that we are independent of the supplier base of the delivery chain.”
Macro is one of five subsidiaries of Mace Limited, a UK-based construction and project management company operating in the building, civil engineering and property sectors. Macro provides facilities management within the Mace Group.
Mace has been managing projects in Dubai for a number of years. On the back of Mace being project manager for the Jumeirah Beach Residence (JBR) project, Macro entered the local market in 2003 to provide FM consultancy on JBR. Proclaimed to be ‘the largest single phase commercial and residential project in the world’, the Dhs 6 billion ($1.6bn) real estate development overlooking the Arabian Gulf contains 36 residential towers, four hotels and beach clubs over an area of 22 million square feet.
“The JBR development is significant in terms of its scale, but there had been little thought on the running and operating of that facility at the end of the project,” explains Heath. “So we devised an FM strategy for them that looked at the overview of the design, the service charge, the model for that, and how they should run and operate the management structure. This actually gave them the bones for Idama.”
Idama Asset Management Solutions is the newly formed integrated facilities management arm of Dubai Properties, which is itself a member of the colossal government entity known as Dubai Holdings. JBR is just one of a plethora of projects that now fall under Idama’s allencompassing shadow.
“They [the government] identified in JBR that they had a business opportunity for an FM capability,” says Heath. “Idama was born from that part of the concept, and obviously as they were looking at other developments it made more sense.”
Macro initially undertook a six week study of the entire JBR project before getting down to critically examining its design and ensuring FM issues such as ease of cleaning and maintenance were accounted for. The next stage was to create what Macro calls ‘high-level operating statements’. In other words, how would it function? These operating statements devolved into precise specifications for individual services which would then allow procurement of each of the service contractors, thus putting considerable thought into how the operation was going to be organised and structured.
"So the idea is to go right through from design, through the construction, through into the commissioning phase, where you are capturing all the information the project has got and handing that over to the FM operator post-completion," explains Heath. "It's typical in a lot of projects, for the project team to be all focused on practical completion, that no one thinks of the gap between practical completion and some sort of steady state, but there is a gap. The idea therefore is to try and transfer that knowledge.”
The original plan for JBR was that Macro would get it to this ‘steady state’ and the client would take it on with the appointed operators in place. Macro would then do an audit to ensure that services were being provided according to their specifications. However, that was before Idama was formed. “It was felt there wasn’t a need for our role to continue and our role was subsumed within Idama,” says Heath. “We completed what we were asked to, up to the end of last year, and Idama is now looking after that particular role we created and were providing.”
Heath is unperturbed, however, as the GCC market is huge and he believes there is a niche to be filled for FM consultants such as Macro. And having a parent company in the construction business can only add value to Macro’s offering, says Heath. “It’s more of a lifecycle thing. If you’ve got a client that’s taking something from the cradle to the grave, the concept of a building, you go through the design process with them and bring FM thinking into all those aspects of a project. It enables the Mace Group to provide a more integrated service for the client.”
While Heath sees much potential in the GCC, he subscribes to the market-wide complaint that decision-makers here are more concerned with reducing capital expenditure than reducing operating costs – even though the latter will end up being a far greater figure over the life of a building.
Energy management is a prime example of this. By investing as little as two to three per cent more on an energy efficient air conditioning system, huge operational savings can be made so as to recuperate that investment in the first year and save millions in the years to come.
Heath also believes that FM companies are not thinking creatively enough in the local market. “Being creative, being innovative is trying to come up with different ways of doing things rather than standard answers,” explains Heath. “Different ways of working with contractors, different ways of delivering the services and being more efficient in operations.”
Space utilisation is an area he identifies as being often neglected and where a lot of creative thought can be allocated. Space costs money. If it is not utilised efficiently, it will be an unnecessarily high cost to the owner, not to mention a hindrance to the functionality of a company.
Another key component of innovative FM is the ability to manage financial information. “One of the very early things that we did was to invest in financial software that enables us to calculate FM costs and break them down,” says Heath. “When we go into most organisations and ask them what they spend on FM, firstly, more often than not, they won’t know what falls within the FM remit and, secondly, they won’t be able to identify the cost.”
With this financial capability, Macro can quantify the cost per building, cost per floor, cost per meeting room and so on and have it allocated to a specific cost centre. The idea is to link the help desk to the financial software to give real-time information about cost commitments.
These skills, Heath says, are thin on the ground in the GCC. The ability to set up effective contracts, make them performance-based, and know how to measure the performance is desperately required here. In addition, the accurate estimation of service charges is a growing requirement. This can be in the form of assisting the developer in controlling costs and understanding what should be built within those charges. Or it could be to provide resident associations with advice as to whether they are paying their respective developers a fair and reasonable service charge.
“I think it’s an exciting environment,” says Heath. “Dubai is great and the business environment is big enough for everybody. We’d like to believe we are offering something quite unique".