IFM outsourcing: how to make it work?

Many buyers terminate their Integrated Facilities Management (IFM) contracts with their service providers due to lack of synergies and collaboration in their relationship. To have a good working relationship, buyers should focus on the sourcing and pre-delivery process.

A sourcing team should be formed with local/regional stakeholders and representatives who are aware of the IFM benefits and understand the intricacies involved in the process. A supplier should be finalized based on the response to the RFP, services and delivery capability. The in-house procurement team’s role should be limited to functions such as establishing communication, ensuring supplier KPIs and vendor management. The team’s role should be defined for the IFM contract to be successful. The transition and change management is the most complicated part of outsourcing large contracts to a new supplier. As per a survey conducted by KPMG in 2009, the major reasons for failure of IFM contracts may begin from the buyer’s side.

There are three dimensions to a good transition process – individual initiative from the buyer side, the supplier side, and a joint initiative from both the parties.