Mark Whitehead 17 December 2018

Putting people at the heart of asset management plans

We live in uncertain times, but progress is possible. As participants gathered at the prestigious QEII Centre in central London for the Assets & Estates Management Conference, optimism seemed to hang in the air.

Just the previous day the organisation at the heart of the UK’s facilities management profession had changed its name to reflect the much bigger role now being played by its members. ‘The key to it all is the idea of adapting and evolving,’ said Chris Moriarty, director of insight at the Institute of Workplace and Facilities Management, 24 hours previously the British Institute of Facilities Management, as he opened the event.

Janet Young, the Government’s chief property officer, outlined the huge scale of the country’s public property portfolio: worth a total of £420bn, with a further £60bn under construction, with running costs of £23bn a year. The numbers are simple, but these assets, she reminded the audience, are ‘the biggest and most complex in the UK’.

The One Estate programme charged with bringing all the assets together in a manageable and cost-effective way was making good progress in delivering big savings as well as creating 44,000 jobs and land for 25,000 homes by 2020. But in a theme that ran through the day like the lettering in a stick of seaside rock, Ms Young stressed it was not just about buildings.

‘Our estate strategy is very much focused on the public benefits we offer to the UK,’ she told the conference. ‘We aim to put the public at the heart of our work and place far more emphasis on collaborating with other organisations in the public and private sectors to make sure we deliver real benefits.’

Steven Boyd, director of estates at HM Revenue and Customs, told a similar story, describing how a 10-year programme to streamline resources was aimed at reducing costs but also at meeting a range of other objectives including better business outcomes, improved collaboration and better use of IT. ‘It’s not just about bricks and mortar,’ he said, echoing the day’s theme. ‘It’s about providing an environment where our people can be the best that they can be.’

David Bentley of public financial authority CIPFA took on the currently controversial issue of local authorities investing speculatively in commercial property. He prefaced his main presentation with a heartfelt protest about the cuts in provision which meant many councils no longer had the resources to maintain the public estate, which had forced many to look for alternative sources of income. And therein were certain dangers.

Outlining CIPFA’s good practice guides for local authorities, he warned: ‘We are concerned that local authorities might be investing too far. We’re saying they must be very careful.’

Investing in town centres to help keep them vital and active was a legitimate aim for local authorities, he said. But commercial investments were sometimes being made for purely financial purposes rather than as a way of improving service outcomes.

‘You need to consider the long term sustainability risk implicit in becoming too dependent on commercial income or in taking out too much debt relative to net service expenditure,’ he said.

‘It is unclear whether local authorities who have adopted a debt-financed commercial investment strategy have realistic plans to manage failure. Whilst the Government recognises the importance of local authorities taking on debt to enhance service provision irrespective of the source of finance, it does not believe that it should do the same for commercial investments’.

The message, he said, was: ‘Look at the risks and liquidity and manage what you can afford’.

The conference also heard an update from Sir Robert Naylor on the government-commissioned review of NHS property and estates, charged with the sale of £2bn of surplus property to release land for 26,000 homes – the first review of its kind since 1962.

The NHS estate, Sir Robert said, is not fit for the NHS five-year plan (the FYFV or ‘five-year forward view’). Around 18% of current buildings date back to before the founding of the NHS in 1948 – including one he discovered which was built during the Crimean War – and there was currently a £5bn maintenance backlog. A particular worry was that the maintenance deemed to be most urgent was increasing as a proportion of the whole.

But total capital spend has declined since 2007 and in total £10bn is needed from the Government, private capital and sale of land.

Land sales alone could raise £5.7bn but new incentives were needed to encourage trusts to let go of their spare assets rather than holding on to them because they fear the income raised will be taken by the Government and used elsewhere. There are few incentives to collaborate to meet community needs, Sir Robert told the conference.

All the recommendations made by the Naylor Review were accepted by the Government earlier this year including setting up an arms-length NHS Property Board to provide a strategic direction on estates and make sure they are developed in a way that benefits the service as a whole. Incentives will be agreed to aim for a ‘challenging’ target of £3.3bn land sales. The repairs backlog was rising and the risks posed by dilapidated buildings becoming more urgent: ‘We have to do something about this if we are not going to put patient safety in jeopardy,’ Sir Robert warned.

After the day’s discussion of how facilities management is becoming increasingly seen as a top-table, strategic function, it was appropriate that the final session of the conference was delivered by a rare if not unique creature: a chief workplace officer.

Simone Fenton-Jarvis outlined how Tinkl, which provides educational materials to teachers in 168 countries worldwide, was focused on the changing role of FM. It was expected to maintain clean and secure buildings to a high standard, she told the conference, but ‘it’s time to look beyond that’.

Effective workplaces could improve business productivity by as much as 3.5%, adding up to perhaps £70bn to the UK economy.

Yet only half of employees believe their workplace helps them to be more productive. Fenton-Jarvis saw her role as being a ‘super-connector’, sitting in between the core functions of HR, IT, FM and commercial real estate.

A chief workplace officer knows the right colleagues to turn to and is able to match the right people to the right opportunities, she said, adding that the position is now meaningful for the first time because so much more data is available to inform the role. This officer can develop integrated business cases and act as the interpreter between individual team/business unit needs and the infrastructure teams that deliver them.

She explained how her role had expanded over the last 18 months and her team now covers a range of functions including internal communications, leadership, culture, facilities and corporate social responsibility, ensuring ‘a strategically aligned workplace created to get the best out of our people’.

This had created an impressive range of outcomes: unprecedented levels of engagement among employees, an 18% increase in productivity, a 32% reduction in energy costs and a 21% reduction in building maintenance costs. The workplace would be free of single-use plastic by 2020.

Fenton-Jarvis described workplaces where you would know who is in the building at all times and their exact location, virtual reality could be used so that remote workers are ‘in the same space’ as office workers and a building management system uses artificial intelligence to allocate work based on employees’ skill sets, how nearby they are and the priority of the task.

Not only that, but the building itself would tell you when there was something wrong with it and would also monitor staff well-being, telling them, for example, ‘you’ve been sat down for two hours’ or ‘straighten your back’.

In this vision of the future - perhaps the quite near future, robots would carry out automated tasks that require no creativity or empathy and, because personnel were measured on their outputs rather than their time at work, there would be unlimited holidays.

That was the optimistic vision brought to life by the world’s first chief workplace officer as the conference drew to a close. The thoughts of the participants could be easily imagined: Wow! What’s not to like?

This feature first appeared in Public Property magazine. Email to sign up for your own free copy.

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