Procurement Intelligence Unit

Facilities management is something that every company – big or small – has to deal with, and it's fast-emerging as a new outsourcing battleground.

According to a recent PIU Operational Report, more businesses than ever are looking to outsource facilities management (FM), but for a industry that's worth US$300 billion globally, there's still a huge slice of the action available. At present, just US$68 billion of that overall figure is outsourced – a sum significantly lower than that enjoyed by Business Process Outsourcing (US$240 billion) and IT outsourcing (US$280 billion).

As cost continues its reign as king, though, that US$68 billion could increase rapidly over the next decade, particularly as businesses look to focus on their core business. The increasingly complex nature of facilities management coupled with the growing amount of technology required to govern its various areas could also prove to be another factor in this outsourcing growth.

That said, a study by Deloitte, conducted in Q2 2009, claims that the most effective way to deliver FM combines both in-house and contracted services.

Of the services that are outsourced, food services, grounds keeping, janitorial, security and HVAC (heating, ventilation and air-conditioning) are the top five areas with the highest level of complete outsourcing. A total of 45% of companies completely outsourced their grounds keeping, while almost a third completely outsourced janitorial, security and HVAC services.

HVAC, energy management, custodial and environmental services are expected to be four major growth areas as we move through 2010 and beyond.

For those companies that do look to outsourcing as the most effective way of managing their facilities, there's certainly no shortage of options available. And whereas in the past companies have outsourced in piecemeal fashion, we're now beginning to see a huge rise in the number of large outsourcing firms – thanks mainly to widespread consolidation within the industry - capable of taking on most FM requirements.

As a greater focus continues to be placed on sustainability and environmental concerns, then there is a growing appreciation of the key role that FM can play in reducing carbon footprints and energy usage.

And with sustainability's importance likely to increase over the next decade, it could certainly strengthen FM's position as a key business discipline.