Dan Diehl, Paul O’Malley & Lou Ronsivalli.
Daly Delivery09 January 2013 / by Staff Reporter (author) / Dubai
With the advent of mega-group Dubai Holding there has been speculation as to what facilities management arm, IDAMA, is going to do. Billy Daly sets the record straight.
“IDAMA has been created to enlighten the regional market,” says a self-assured Billy Daly, Chief Officer of Asset Management (IDAMA) at Dubai Properties. “We didn’t want to have the normal cliché vision statement that we want to be a leader in facilities management. There’s enough of these people around saying this.”
Heading up what will inevitably become one of the largest and most influential facilities management firms in the region is no small task – Daly knows he has his work cut out for him. Though an independent limited liability company (LLC) in its own right, IDAMA – meaning ’administration’ in Arabic – is the asset management division of Dubai Properties, which is a member of the colossal entity Dubai Holding. Dubai Holding, in turn, is one of the main investment arms of the Government of Dubai. Just recently, the company signed an exclusive agreement with the World Economic Forum (WEF) to become a strategic partner – a privilege that in the past has been strictly limited to a small number of Fortune 500 companies.
Having already commenced operations, IDAMA has the responsibility of managing the facilities of Dubai Technology and Media Free Zone (TECOM), which includes Dubai Internet City (DIC), Dubai Media City (DMC) and Knowledge Village (KV); as well as Dubai Healthcare City (yet to be built); Dubai International Financial Centre (though not part of Dubai Holding); and Jumeirah Beach Residence (under construction).
In the immediate future, new developments that IDAMA will manage are Dubai Properties’ multibillion-dollar Business Bay and the 29 million square feet The Villa project in Dubailand. Being independent allows IDAMA to trade outside Dubai Holdings and it has already a number of clients of this kind.
An engineer by degree, Daly has a background that brings together an array of competencies from the construction and FM industry to the business of finance and asset creation. In a candid interview with FM Magazine, Daly outlines the background to the formation of IDAMA, its business plan, the challenges it faces and its supply chain strategy.
The History: TECOM
IDAMA is a by-product of a market intelligence review that was carried out by TECOM. In the middle of 2003, they had an internal facilities management department and they started to ponder ’What are we going to do with this department?’ At that time it was about 14 or 15 people and it was straightforward outsourcing, so it was client direct to the supply base.
They had three choices: they could either have joint ventured with a large global player; they could have expanded the internal capabilities of the department either to take more responsibility or to look at self delivering some of the activities; or they could have created an independent organisation.
I got into discussion with the organisation at the end of that market intelligence review. A lot of good pedigree companies were involved in that, and TECOM has always been thankful for that review. But when I came in January 2004, I spent time with the CEOs and Director Generals evaluating the market intelligence. And I came to a decision after about two months of working with them, but before joining, that irrespective of which decision we made, we face, in principal, the same challenges here in Dubai.
Therefore, what became essential decision-making factors were controllability of the growth of the organisation and the quality and the delivery of the services that we provide to clients. And thereafter, value for money in terms of the costs.
The History: IDAMA
After agreeing that these three headline objectives had to be achieved irrespective of which decision was made, we believed that ownership of the total company would create speed in the process. So spinning it out and creating what was called IDAMA was agreed around the end of the second quarter of 2004. And at that stage, speaking very freely now, the intention was to then spin back in through a direct client supplier relationship with TECOM – that is, the FM-related services to DMC, DIC and KV. But clearly, the announcement of Dubai Holding - which without a shadow of a doubt had been on the horizon for a lot longer than most of us would know-changed the overall organisational structure and how we fit into the business.
So the decision was made for the right reasons in terms of creating a separate entity. Then, however, a parallel review was carried out and what came out of that was primarily a single-tier governance model of Dubai Holding. In that holding company, therefore, all the infrastructure-related developments relating to Dubai were basically captured in one box. It was realised at that stage that there was a need to centralise and control the end-to-end process of how we design, build and operate.
We centralised the ability to do the design concept. We centralised asset construction, which is basically the ability to provide the client with project management. We combined it with asset management, which is IDAMA. And also combined it with asset portfolio management, which is the department that works on investment strategy and how we position our developments in the market.
So basically what was created was an end-to-end real estate model. A variety of organisations globally say they’re end-to-end real estate, but even in mature markets such as the UK and the United States, these organisations tend to be made up of consortiums of different companies. Whereas Dubai Holding, under the auspices of Dubai Properties, has the ability under one ownership to provide those four critical stages and be able to look after the asset for its full lifecycle.
So due to the re-engineering project, IDAMA now slotted in as an independent organisation, but we fit in this end-to-end real estate model to deliver from the start to the finish the consultancy through to delivery services that are required.
We started with 14 people and we probably now have around 183 people – and that’s in the space of six or seven months. In terms of growth, we estimate having about 600 people by the end of this year and around 1,600 by the end of next year. The split will be roughly 85 per cent delivery, which will be from project management downwards, and 15 per cent intellectual.
The Business Plan
We agreed through to the latter half of next year what the business model would do. I went for a very straightforward 18-month-based business model which had four key silos. The first is that we have at director level an operations silo, and we just recently re-engineered this to cope with some of the business we are getting today. We then have a commercial silo; strategy and planning; and then key account management.
The vision was to develop a role model organisation - a role model organisation that is trying to be the best at everything id does in terms of its deliverables.
Key account management is the main thrust of the organisation. The model was nothing scientific; it’s basically a key account management structure that’s market sector focussed. It’s based on an Oracle ERP suite, which enables us to have independent profits and losses for each of these accounts. So there are many businesses within a larger business. The vision was to develop a role model organisation, a role model organisation that is trying to be the best at everything it does in terms of its deliverables.
The other three silos are basically what we call an enabling unit. We recruited from far and wide to build this team. Their role is as a matrix management function. Their responsibilities are solely to ensure that each of those accounts achieves consistency tailor-made to those market sectors in terms of quality and value for money. And we believe that if we deliver the service and the quality, the money will come.
Our mission is to think harder, work smater and win. That's the undertone of everything that we actually do.
Clearly when you move towards a value chain proposition, that structure would naturally change, which is what we are currently going through today. Our value chain proposition is to deliver consultancy through to delivery of the FM contracts. So the vision is very clear. Our mission is to think harder, work smarter and win. That’s the undertone of everything that we actually do.
Challenges: Labour Dubai’s got huge challenges without a shadow of a doubt. Intellectually, in terms of the key deliverables that are required for any asset management company, I don’t feel a great exposure there.
Where we have the challenge is cascading that intellectual property into the delivery of the services to the clients. I think this is a main issue for the whole of Dubai, which we don’t want to meet head on – but we’ve gone around it and above it and come up with some other solutions. For example, how do you build the motivation and sense of belonging to a company of people from certain developing countries when you’re paying them such a low salary? And then when you want them to go up to somebody’s apartment because they’ve got an issue with the airconditioning, how do you try and get these people motivated to deliver a good quality service with a good customer service focus?
So we developed a customer service charter, which starts from where these people are born, where they come from, in terms of how we recruit them. We don’t use middle men any more. We don’t believe in people arriving here with debt, for example, which is clearly a major pressure for many of these people working in Dubai, from what I hear.
So we looked at the whole people cycle, which is fundamentally what facilities management is – we’re a people organisation that provides a service. We’ve now partnered with two organisations, where we have full control over that whole process; where we’re actually based over in India, Pakistan, India, Sri Lanka and even the Eastern Bloc.
We then look at when they arrive in Dubai and how they are treated from Day One. One of the major issues is accommodation. Accommodation is atrocious in Dubai, generally. There are some organisations that are trying very hard to change that. It is part of the fabric of Dubai and it will go through change. A major concern of anybody coming to a new country, no matter what level they are, is that they will have a half-decent roof over their heads and will have the amenities they need to look after themselves.
So we decided to build our own labour camp, but it's more of a complex, so that somebody who didn't want to leave the complex wouldn't have to. So every kind of domestic issue-such as a chemist, hairdressers, TV rooms, computer rooms, sports rooms, those kind of things-are all built in. That’s due for completion around September.
Challenges: Education We then move to dealing with the education process. How do we educate people into the facilities management world? How do we transfer from the construction base skill set to the facilities world? How do we raise the standards of maintenance into something of value to clients? So we’ve entered into a partnership with two local colleges and have created, with the assistance of some UK colleges, a specialised FM programme that will go live round about September this year.
So how do we recruit, how do we look after them, and how do we educate them? Then what underpins all of that is the customer service charter, which we’ve labelled ’New Horizons’. New Horizons is all about identifying your 10 commandments of customer service. The idea is to focus on those type of key customer engagement issues that identify what that client actually wants.
I think, very strongly, that Emiratisation here is essential. I don’t say that to be politically correct. I think if we don’t get the right diversity of cultures to work in Dubai, especially in the support services area, mixing with UAE nationals, then Dubai will not be as successful at it can be. So what we have done is linked with Tanmia, the local channel for taking the higher diploma.
Fostering and bringing up the bloodline of the local individuals and the local organisations up to a business standard, to a level that we want, will begin to give us a sense of security and continuity.
Supply Chain Strategy
When you look at the supply chain generally here in Dubai, most of the suppliers I engage with are very commodity-based organisations – they supply a body. We are building a management team that has to engage with the supply chain, either in an outsource or an in-house way.
I decided very quickly, because of the low level of intellectual property in the supply base, that what is fundamentally critical to these buildings and their infrastructure is engineering – so we decided that we will self-deliver our engineering.
We went through a process of engaging with companies such as Drake & Skull, who were initially doing the job at TECOM. And we mutually agreed, in a very comfortable way, that due to the strategy of the organisation we had decided to selfdeliver. So nothing derogatory against them at all – good organisation.
When we looked at outsourcing, we spent the past year looking at the other services – which are your cleaning, your security, your landscaping and your specialists. We approached the market differently. Most of the contracts these days are let on a year-by-year basis. In order to get these organisations to trust us, in terms of investment, we decided to go straight to a five-year deal with the suppliers.
I don’t believe at this point in time Dubai is mature enough, in terms of the supply chain of support services, for one company to supply all of these developments.
Did it work?
It helped a little bit, but it still wasn’t the main answer to the core issues, where we are wanting to instil in the supplier the same levels of expectations we have. So we came up with moral codes of conduct, we came up with transparent SLAs [service level agreements], we came up with transparent audit sheets, and we moved into a risk and reward type of contract with these organisations.
So the technical infrastructure is self-delivered and everything else is outsourced. But I don’t want to commit to any particular supplier because that would be slightly derogatory. Economies of scale do mean reduction of cost per square foot, but I don’t believe at this point in time Dubai is mature enough, in terms of the supply chain of support services, for one company to supply to all of these developments. To me, it’s too big a risk today.
We are not saying we are the best. We are very clear on where we are going to be in the next five years. Potentially, IDAMA is going to be the largest FM provider, depending on how you measure it – whether it’s by people, value, contracts or even market share. But without a doubt, we will be one of the most noticeable within the next 12 months. To be very open with you, I’d rather be the smallest and be the best. That’s always been one of the major things for me in terms of how I have built businesses up.
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