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Thu 17 Dec 2009 04:00 AM

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Tips to beat the recession

Maintaining operations during the latest global recession is a challenging task. fmME investigates how it's possible to achieve success during an economic downturn.

Tips to beat the recession
Imdaad has clinched a major FM contract at Jumeirah Golf Estates in Dubai.
Tips to beat the recession
It is important that FM services are planned properly and executed thoroughly.
Tips to beat the recession
EFS KSA general manager John Kelly Quinn.
Tips to beat the recession
Imdaad CEO Jamal Abdullah Lootah.

Maintaining operations during the latest global recession is a challenging task. fmME investigates how it's possible to achieve success during an economic downturn.

How do you survive a recession? Several of the region's FM firms appear to have the answers; not only surviving, but thriving during the past year. While headlines worldwide have highlighted redundancies, cancelled construction projects and collapsing firms, for some there has been positive news.

Major contract wins during 2009 have allowed firms to gain market share, expand geographically and grow their product portfolios. So who have been the winners over the last year, and how have they achieved this success?

One firm that has demonstrated significant growth during 2009, and particular success in winning new business, is EMCOR Facilities Service Group (EFSG). By Q3 2009, EFSG had secured over AED750 million in new contracts-a 125% increase over 2008. The firm predicts that this figure will increase to more than AED1 billion by the end of 2009 if it achieves the further contract wins it expects in Q4.

One of EFSG's largest contract wins also signified a regional expansion for the firm into Saudi Arabia. Here a ten-year contract for the full facilities management of King Abdullah University of Science and Technology (KAUST) was won by EMCOR Facilities Services Kingdom of Saudi Arabia (EFS KSA) for an undisclosed sum (see inset story).

"This is the largest single contract awarded to EFS in 09," reports EFS KSA general manager John Kelly Quinn. "KAUST is also EFSG's first contract in KSA, and it was a massive project to undertake," he adds.

Despite the complexity and scale of the project, however, the firm began work in the Kingdom within a very short time-scale, which was one of the primary factors in it winning the contract. "Our experience and resource levels meant we were able to mobilise the contract within eight weeks from inception," explains Quinn.

A second factor in the firm's success was that it offers integrated FM services and systems based on internationally-recognised standards. By providing this service using experienced and knowledgeable local personnel, the firm was able to satisfy several of the client requirements.

Another firm that has taken steps to expand into the Saudi Arabian market this year is Able Facilities Management. In 2009, Able won the facilities management contract for the 34-storey residential and retail development, Time Place Tower in Dubai Marina.

"This project is our main key to enter the Saudi market with the Saudi-owned property developer Abraj," explains Able FM facilities manager Nasr Saliba. Key strategies in winning the contract against strong market competition included minimising project costs by obtaining the most competitive subcontractor rates possible, plus providing a 24/7 helpdesk and permanent resident technicians.

One of the main challenges facing FM firms entering the Saudi market is lack of knowledge of the industry. "FM is a relatively new concept to the Kingdom, which can be challenging at times," states Quinn. In order to overcome this factor, EFS has been conducting ongoing education and training programmes and workshops to increase the understanding of all parties involved in the KAUST project.

The firm has also developed a ‘lessons learnt' diary and presentation concerning KAUST to relay to staff for any future projects. Another issue with the Saudi market is reportedly the ability to recruit qualified international staff, the Kingdom often being seen as a less attractive prospect for expatriate staff.  One way to overcome this challenge is to recruit and train nationals.

Case study: King Abdullah University of Science and Technology

In 2009, EMCOR Facilities Services Kingdom of Saudi Arabia (EFS KSA) won the contract to provide full facilities management services to King Abdullah University of Science and Technology (KAUST) for a period of ten years.

The largest single contract won by the firm this year, it includes the management, assistance, inspection/auditing, recording and reporting of all facilities management and services; plus overseeing the collective maintenance requirements of the entire Jeddah-based development.

There are several challenges to be overcome by the firm for the project. These include the managing of service providers while the construction of the project is completed; plus the recruiting of suitably qualified personnel that have good cultural knowledge as well as general Middle East experience.

EFS mobilised its workforce into Saudi within eight weeks from the project inception despite being its first project in the Kingdom. "Our extensive regional experience ensured our success and we are now in a steady state of operations across the township," explains EFS KSA general manager John Kelly Quinn. EFS' offering of integrated services and systems carried out to recognised international standards was another primary reason for the firm winning the contract reports Quinn.

As well as providing a geographical expansion for EFS, the KAUST project is enabling the firm to widen its product portfolio. "Some of the services required are allowing us to broaden the range of services we can offer our clients in the future ie sports and recreation management; events management; food services and hospitality management; plus marina, beach and waterways management," concludes Quinn. A positive outcome all round for the firm.

EFS is one firm investigating such plans on a larger scale. "We hope to create a FM Training Academy and Direct Service Provider Model to integrate and engage local talent, communities and companies for a prosperous and sustainable FM future in the Kingdom and around the Middle East," explains Quinn. "Our target is for 70% of our employees in the region to be nationals by Q4 of 2015," he reports. Expanding business

Within the UAE, despite the general downturn in the construction sector in cities such as Dubai, several large FM contracts have been awarded in 2009. Among the winners of these are Imdaad and Etisalat Facilities Management, who have won major contracts in Dubai and Sharjah respectively.

Imdaad recently won a two-year contract valued at more than AED10 million to provide FM services to three tower projects in Dubai. The firm has also won contracts for Jumeirah Golf Estates and several Dubai Real Estate Corporation (DREC) developments.

On the tower projects, Imdaad will represent the client in matters such as liaison with public departments, collection of service charges and tenant communications. "Our role is that of a true total FM service provider, not merely a hard or soft services contractor," explains Imdaad CEO Jamal Abdullah Lootah.

Part of the firm's winning strategy was to tailor its services to individual client needs. Lootah attributes the firm's wide range of services as key to its continuing success during the recession. With options including MEP, pest control, camp management and infrastructure maintenance, Imdaad has been able to target sectors according to available work.

"Such a range allows Imdaad to provide an holistic FM approach," explains Lootah. "Imdaad client profiles vary greatly, thus we have not been affected by the slowdown in construction or tightening spend by developers," he adds. In fact, Imdaad experienced strong growth between 2007 and 2009, and this growth was unaffected by the recession, reports Lootah: "We have continued to win jobs and are continuously increasing our workforce," he states.

Imdaad's latest contract wins signify a market move by the firm outside Dubai World projects. Its short- and medium-term strategies include expanding further within Dubai, the UAE and the GCC in general. "There is a huge growth potential within the FM sector across the region," stresses Lootah. "Tapping these opportunities and expanding our clientele base is a priority."

For Etisalat Facilities Management (EFM), the signing in July 2009 of a five-year contract to provide FM services to Sharjah International Airport was a major milestone for the relatively young firm. The contract win followed the completion of an in-depth study to establish how the quality and efficiency of the airport could be improved. A Memorandum of Understanding had previously been signed between EFM and Sharjah Airport Authority.

Under the contract, EFM will provide a dedicated team of 84 staff for the airport, which will work in three shifts. Its staff numbers will be increased to 100 once the defect liability period of the airport expansion ends, in order to cope with the expanded scope of works.

EFM will also use the latest technologies to manage its operations on the project, which was another factor in its contract success. For example, FM software Maximo and personal digital assistants (PDAs) will be utilised to monitor key performance indicators related to service level agreements and staff productivity.

With many other contract wins recorded by the region's fm firms throughout the year it appears that the opportunities for growth remain.

Strategies for success• Know your market: ensure that you are up to date with the types, number and scale of projects that are ongoing and upcoming.

• Be prepared to change: being open to expansion into new geographic areas or different market sectors can increase the number of potential contracts available.

• Keep up to date with the latest technologies and techniques so you are able to offer potential clients the best possible service.

• Individually tailor your service package to meet client-specific requirements rather than offering set solutions.

• Ensure your firm is accredited to relevant international standards and operates within their requirements.

• Be available when needed: ensure that your firm has the resources available in order to mobilise within the timescale that the client require.

Arabian Business: why we're going behind a paywall

Hal-Luke 10 years ago

I think there is a mistaken conception about the FM, even Total FM!!.. The primary reason for FM is to assist the overal business operation which the end result is profitability (or not) - at least since the early 2000s - Subsequently, whether in the Middle East or not, any attempt at understanding the true FM without grasping the Corporate, Business and Organisational Strategies chosen by the Corporate Management will result in less effective and efficient FM operations. If anybody wishes to become FM Manager or apply FM principles without appreciating the Strategies employed or even examining the Business Development activity of the company will fall short of his/her objectives. TO SUM UP, FM IS NO LONGER SEPARATE FROM SENIOR MANAGEMENT FUNCTION, AS IT IS WRONGLY ASSUMED THAT FM IS RELATED TO BRICKS&STONES AND BITS&BOBS ATTACHED TO IT ONLY!! Maybe the next stage in FM development is Corporate Functionality Management and Not Corporate Facilities Management. Hal-Luke Savas MBA FCIM MBIFM ICIOB affCIBSE londonmanagement@aol.com