How Space Management Systems Make Operating Costs Predictable

Workforce Management Solutions with an IWMS

Real estate is expensive. Unused or underused real estate is expensive and wasteful.

Also, water is wet.

While everyone knows the third statement to be true, COOs and other facilities managers know about the first two from experience. The more square footage your company has in real estate holdings and usage, the truer those statements are. Because real estate is generally a fixed cost, using it wisely can have a big effect on your bottom line.

At the very least, you want to ensure that space doesn’t sit fallow. The general goal across industries is to have no more than roughly 4% of your space unused. This gives you the flexibility needed for reorganization or other moves, but not so much underutilized square footage that you incur a significant opportunity cost. Yet many companies fall far short of that goal, letting 10% to 20% of their space lie vacant. If you’re dealing with millions of square feet in real estate holdings, that 6% to 16% of additional vacancy adds up quickly.

Space management as part of an integrated workplace management system (IWMS) like IBM TRIRIGA® helps optimize real estate holdings—both in terms of getting the most use out of your space and of making the most efficient, productive and highest-value use of your space. The idea is not just to learn where the unused space is, but how best to use it as well. This applies at all levels: floor, building, regional and global.

What Space Management Systems Do

If you’re responsible for managing your company’s real estate holdings, you have a range of options. You could just start reducing the square footage allocated to each worker until they howl, but that type of coarse adjustment is counterproductive. Space management software gives you far more precise tools to help you in your quest for efficiency.

First, space management software lets you track and benchmark your usage, costs and terms. It can make recommendations for improvement and let you run hypothetical scenarios with a view toward reducing costs, both in expenses and inefficiencies.

To get to that type of insight, IBM TRIRIGA’s Facilities Manager module includes space management capabilities that let you:

  • Gain visual insights into the ways spaces are assigned through web-accessible CAD drawings.
  • Automatically generate and assign facilities projects and work tasks while tracking associated costs.
  • Regulate rentable and usable area measurements by ensuring facility measurement calculations for the International Facility Management Association (IFMA) and the Building Owners and Managers Association (BOMA).

Most space management software includes such functions. Where TRIRIGA excels is in providing a single view of the information as part of a whole IWMS, revealing opportunities for large-scale savings.

Turning Space Management Scenarios Into Real Savings

Every scenario run in a space management system is based on data. The drawings and information—room types, representations of people and assets, et cetera—are linked to specific database entries, and vice-versa: If you change something in the database, it will be automatically updated in the CAD drawings and other planning information.

This data-driven approach supports your decisions, helping you go beyond what-ifs. One global firm with more than 15 million square feet in facilities has used IBM TRIRIGA to:

  • Consolidate operations at more than twenty facilities in the US, ducking more than $30 million in costs over time.
  • Discover new revenue opportunities totaling more than $750,000 over four years
  • Start preventive maintenance that improved asset performance
  • Shrink reporting times by 99%

Another way space management systems help make operating costs more predictable is through longer lead times to manage changes. You’ll be able to see far earlier when a site needs more space, giving you more time to nail down the best possible deals before you expand or reorganize—instead of taking what you can get on short notice. It’s like having a staff of efficiency experts working around the clock to help you get the most value from your real estate holdings.

Space Management as Part of IWMS

One of the less flashy yet highly valuable benefits of space management systems, when used as part of an IWMS, is the ability to support leasing decisions to make operating costs more predictable. If you’ve ever tried to nail down the individual line items that make up the dreaded opaque category of “operating expenses” that many landlords charge—and raise—every year, you know why that’s valuable.

Those costs can be anywhere from 30% to 50% of every rent dollar paid, according to BOMA, and it’s often tough to figure out where that money really goes. Is it even based on the correct square footage? Your space management software can help you know what your usable square footage is, regardless of the nominal number stated on your lease. Knowing about those types of variables upfront makes all the difference at budgeting time. Predictable operating costs let you make more accurate projections and plans—which helps your company stay competitive.

The right space management system, as part of an IWMS (here, using both the Facilities Manager and Real Estate Manager modules), can help with lease operating expenses and lease accounting as a whole by giving you a clear view into:

  • Quarterly occupancy trends
  • Maintenance requirements
  • Asset performance

You’ll be able to compare your current lease terms with various scenarios, tinker with the particulars, and have the program create a new contract on the spot with updated terms during lease renewal negotiations. Knowing these types of details upfront and being able to project likely changes over time will help make operating costs more predictable and keep surprises to a minimum.

eCIFM Solutions, Inc. has helped implement IBM TRIRIGA for clients across multiple industries since 2000. Many companies have used our services for recurring real estate and facilities management tasks and planning, including:

  • Space Management
  • Move Management
  • Chargebacks
  • Space Requests
  • Strategic Planning
  • Space Forecasting
  • Personnel Provisioning
  • CAD Interface

Space management is just one function of the many pillars of the IBM TRIRIGA IWMS. Your company may find value in incorporating others, such as Capital Projects Manager or Energy Manager. With six modules in all, the system includes thousands of ways to discover opportunities for savings and operations optimization.

We look forward to learning about your organization’s space management needs, which systems you use now, and how we can best harness the data within. Contact us to discuss how we can work together, how to improve your real estate usage, and how to make your operating costs more predictable.

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How IWMS Enables Global Facilities and Real Estate Management

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