Executive Summary
Facilities management tends to get forgotten once the contract is signed. The vendor is in place, the work seems to be getting done, and attention moves elsewhere.
For procurement leaders running multi-site operations, that can get expensive.
Prices creep up with nobody checking them against the market, service targets can be missed without meaningful consequences, and the business may have outgrown the supplier you hired.
As portfolios expand and buildings lean more on technology, the shift toward integrated facilities management (IFM), an outsourced model that brings multiple facilities services together under an integrated arrangement, makes knowing what your contract really delivers matter even more.
GEP’s IFM Value Assurance Framework looks at three things together: how your pricing compares with the market, whether your supplier can keep up with the business, and how well the contract holds them to account. The framework’s IFM Health Index turns that into a clear picture of what’s weak and what needs to be fixed first.
Two client engagements show what that looks like.
A global pharmaceutical company spending $69 million a year on facilities management identified $34 million in projected savings over five years through benchmarking-led repricing, scope rationalization, SLA redesign and vendor consolidation, while a utility firm identified about $16 million in projected savings by replacing a supplier that lacked the technology and scalability to support its expansion plans.
The paper offers valuable insights: negotiating rates at renewal isn’t close to enough. Reliable benchmarks, clear performance obligations and regular supplier reviews keep facilities management in step with the business.
Read the full paper.
Frequently asked questions
Procurement teams can compare contracted rates with current market benchmarks, review total cost of ownership instead of just unit prices, examine scope definitions and assess whether service-level agreements (SLAs) have enforceable penalties if targets are missed. Reviewing these regularly tends to show where prices have crept up, where responsibilities are fuzzy and where the supplier is falling short.
It is a structured approach to evaluating facilities management programs across three dimensions: cost competitiveness, supplier capability maturity and contract structure quality. Its IFM Health Index helps organizations identify where they are exposed and determine where corrective action is needed.
Organizations can strengthen SLAs and key performance indicators, spell out exactly what’s in service scope, establish accountability and assess whether suppliers have the technology, scalability and innovation capabilities to meet evolving business requirements. Depending on the findings, the answer might be redesigning the contract or replacing the supplier.
Results depend on the contract, supplier capabilities and opportunities identified in the assessment. In one GEP engagement, a global pharmaceutical company identified projected savings of $34 million over five years. In another, a utility firm identified about $16 million in projected savings by replacing an incumbent supplier with a provider better suited to its expansion plans.