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"Bottom-Line Sustainability for Business" report from ESI

Economic pressures, cap and trade legislation, and other economic drivers are forcing companies of all sizes toward efficiencies to improve the bottom line. Environmental Systems, Inc. (ESI), a commercial and industrial building systems integrator headquartered in Brookfield, WI, recently released an independently researched study aimed at helping executives responsible for financial and operational performance sort through sustainability information, understand trends, and visualize what is possible.

“Companies of all sizes and types are looking for ways to control operating costs, including energy, personnel, facility and maintenance,” ESI President Paul Oswald said. “The good news is that the benefits derived from reducing operating costs have a direct positive impact on creating a more sustainable business.”

The study, “Bottom-Line Sustainability for Business,”  covers reduced operating costs to improved productivity as it relates to building performance and security, energy efficiency, pending legislation, information technology, sustainability, innovation, and integration of systems.

“The difficulty for many businesses is a lack of understanding in how to get started on a path to reduce costs and improve sustainability,” Oswald says. “Making sense of it all and determining what is relevant to reducing costs are not easy tasks.”

This is demonstrated by results from a study conducted by Moskowitz Jacobs, Inc. In interviews conducted with 450 CEOs, CFOs, and senior management, it was found that:

• 87% have room to improve on energy management.
• 74% do not have a handle on energy cost.
• 59% are not well positioned in-house to control energy and improve operational efficiency.
• 49% are seeking ways to optimize energy usage.

ESI commissioned independent researchers to compile the study, which  contains insights from industry experts, including:

• Schneider Electric, EVP, Chris Curtis
• Quad Graphics, Director, Joe Muehlbach
• GE Medical, IT, Kerry Malland
• Sustainability Expert, Paul Ehrlich

“Bottom-Line Sustainability for Business” can be downloaded on the ESI homepage (Look for cover image at left. Registration required.)

Two-thirds of school districts responding to a new “School Energy and Environment Survey” from Honeywell and Education Week Research have made spending cuts or modifications as a direct result of rising energy bills. Seventy-four percent of respondents also said their districts don’t have the money to pursue energy retrofit or renewable energy projects. These budgetary constraints and cutbacks, primarily in building maintenance and capital investment, are hurting efforts to boost efficiency and resolve schools’ long-term energy and financial concerns.

“The School Energy and Environment Survey reveals that increased energy spending is negatively impacting school districts’ investments, programming and priorities,” said Sean Herdman, the associate publisher at Education Week Research. “Spending cuts tied to rising energy costs include areas that impact instruction and the learning environment, including teacher staffing, maintenance and key capital investments.”

The online survey gathered input from more than 250 district administrators nationwide regarding energy management and environmental sustainability practices. More than half of respondents have scaled back, delayed or eliminated the possibility of energy efficiency and renewable energy projects due to the economic downturn. In addition, while 96 percent of survey respondents view energy management as important to their district’s long-term success, one-third reported that they do not have a strategic plan for managing energy consumption and costs.

“Many districts find themselves caught in a vicious cycle: deferred maintenance and upgrades mean less efficient equipment, which results in higher energy bills and ultimately leads to tighter budgets,” said Paul Orzeske, president of Honeywell Building Solutions. “Unless districts find solutions to address the required energy and infrastructure improvements, they’ll have to dedicate more money to utility bills, and less to teachers, supplies and other critical needs.”

Although school districts consider renewable energy sources as a potential solution, many do not have the internal resources or expertise to determine the most suitable investments for their buildings. According to the survey, 61 percent of school districts have evaluated or implemented renewable energy sources, with solar photovoltaic, wind and geothermal the most popular choices. Yet, 40 percent of these respondents said they don’t have a clear understanding of the variables that impact the economic viability of renewable technology.

“The renewable energy options that seem to be top of mind are telling,” said Jeremy Eaton, vice president of energy solutions for Honeywell Building Solutions. “Solar, wind and geothermal are the most visible, well-known technologies. However, when we analyze energy prices, resource availability, financial incentives and other factors, we see biomass thermal as having the greatest financial drivers for the education industry as a whole. And that technology is barely on people’s radar, according to the survey.”

In addition, while there is growing interest for schools to incorporate sustainability practices into their building operations and curriculum, there is a clear gap between commitment and activity. While 26 percent of districts have set goals to reduce their carbon footprints, only 7 percent have completed a greenhouse gas inventory — a necessary step in cataloging emissions and setting a baseline to gauge the impact of environmental initiatives.

When broken down by district type, the gap becomes more evident. For example, 40 percent of urban districts have made carbon reduction commitments, yet only 9 percent have completed an emissions benchmark.

“Many schools are trying to improve sustainability, but it’s difficult to make changes without having the tools to identify the main areas of concern or measure success,” Orzeske said. “The key is establishing an accurate baseline, and finding the mix of conservation measures that will deliver not only environmental benefits, but also improve the bottom line.”

Survey Methodology
In July 2009, Honeywell Building Solutions and Education Week Research conducted an online survey of Education Week Web subscribers identified as school district administrators or school board members. The survey consisted of 253 respondents from across the United States.

For detailed survey results, please visit www.honeywellnow.com.

The odor in a room is enough to elicit a stronger impulse towards fairness, claim researchers from the Kellogg School of Management at Northwestern University. They believe their research proves there is a correlation between hygiene and decency and that by improving our environment we can improve our behavior. The research found an increase in ethical behavior when the scent of a fruit scented cleaner fills a room.

Professor Adam Galinsky, the psychologist who conducted the study, said it shows “morality and cleanliness” are inextricably linked. “Researchers have known for years that scents play an active role in reviving positive or negative experiences. Now, our research can offer more insight into the links between people’s charitable actions and their surroundings.”

Katie Liljenquist, assistant professor of organizational leadership at Brigham Young University Marriott School of Management said: “This is a very simple, unobtrusive way to promote ethical behavior. The data tells us a compelling story about how much we rely upon cleanliness cues to make a wide range of judgments about others.”

The researchers see implications for workplaces, retail stores, and other organizations that have relied on traditional surveillance and security measures to enforce rules.

“Companies often employ heavy handed interventions to regulate conduct, but they can be costly or oppressive,” said Liljenquist. “This is a very simple, unobtrusive way to promote ethical behavior.”

Cleaning The Way To Virtuous Occupants

The study, titled “The Smell of Virtue,” made subjects carry out several tasks, with some asked to work in unscented rooms, while others worked in rooms freshly sprayed with lemon scented cleaner.

The first experiment evaluated fairness. Participants were given $12 and were asked to decide how much of it to keep and how much to return to their partners who had trusted them to divide it fairly. Subjects in clean scented rooms were less likely to exploit the trust of their partners, returning a significantly higher share of the cash.

The average amount of cash given back by the people in the “normal” room was $2.81. But the people in the clean scented room gave back an average of $5.33.

The second experiment evaluated whether clean scents would encourage charitable behavior. Subjects indicated their interest in volunteering and their interest in donating funds to a charitable cause.
Participants surveyed in the clean-smelling room were significantly more interested in volunteering (4.2 on a 7 point scale) than those in a normal room (3.3).  Meanwhile, 22% of participants in the clean-smelling room said they’d like to donate money, compared to only 6% of those in a normal room.

Follow up questions revealed that participants did not notice the aroma in the room and that their mood at the time of the experiment did not affect the outcomes.

Commenting on the study’s findings, Steve Wright, Chairman of the British Cleaning Council, said: “We all know that cleanliness is key to encouraging a sense of pride in local areas, but this is the first time a link has been proved between people’s behavior and their surroundings. I hope this encourages more people to get involved with efforts to make to make their area cleaner and greener, and the cleaning industry welcomes the opportunity to work with local councils and government as we strive to create a cleaner environment.”

While concrete is the most widely used building material, the production of some of its component materials accounts for up to 5% of global carbon dioxide emissions annually. To address the sustainability and environmental implications of the use of concrete in construction, MIT has announced the creation of the Concrete Sustainability Hub, a research center established at MIT in collaboration with the Portland Cement Association (PCA) and Ready Mixed Concrete (RMC) Research & Education Foundation.

The Concrete Sustainability Hub (CSH), established with the goal of accelerating emerging breakthroughs in concrete science and engineering and transferring that science into practice, will provide $10 million of sponsored research funding during the next five years. Researchers from MIT’s School of Engineering, School of Architecture and Planning, and Sloan School of Management are expected to participate in the CSH’s research activities.

Components of concrete (image courtesy of Portland Cement Association)

The launch of CSH on October 5, 2009 came a week after an announcement that the U.S. EPA is moving to enact rules that would curtail greenhouse gas emissions from power plants and large industrial manufacturers. If enacted, these rules would likely impose regulations on all 118 cement plants in the U.S. The RMC and PCA leaders expressed their hope that research results emerging from CSH projects will help ease the way for the industry to meet any changes that would be required by those new regulations.

“The concrete industry has the honor of producing the world’s most favored building material, but this honor comes with a responsibility for the industry to minimize its ecological footprint,” said Julie Garbini, executive director of the RMC Research & Education Foundation.

Brian McCarthy, CEO and president of PCA, added “The MIT research team is an exceptional group of dedicated interdisciplinary faculty and the CSH will take a holistic approach to research that allows science to feed seamlessly into today’s concrete applications like paving and wall systems. For ultimately, the greatest opportunity for the building industry to reduce greenhouse gas emissions may lay in the development of more durable and energy efficient roads, houses, and buildings.”

“This collaboration is an excellent example of how MIT is addressing complex, interconnected issues of sustainability–and working to provide solutions,” said Subra Suresh, Dean of Engineering and Vannevar Bush Professor of Engineering at MIT. “Putting engineers together with economists, urban planners, architects, and industry experts and practitioners on issues related to our built infrastructure will create truly novel opportunities for intervention.”

CSH research is initially be organized around three focus areas: concrete materials science, building technology, and the econometrics of sustainable development. The first two projects, “Green Concrete Science,” and “The Edge of Concrete: A Life-Cycle Investigation of Concrete and Concrete Structures” are already underway. Franz-Josef Ulm, the Macomber Professor in the Department of Civil and Environmental Engineering, will serve as the CSH’s inaugural director and is the lead investigator on the Green Concrete Science project. The CSH will be co-directed by John Ochsendorf, Class of 1942 Career Development Associate Professor of Building Technology in the Department of Architecture and the Department of Civil and Environmental Engineering. (Those interested in following the research can contact Denise Brehm, MIT Department of Civil and Environmental Engineering, brehm@mit.edu.)

“It is rare that one has an opportunity to have a positive environmental impact on the most prevalent building material in the world,” said Ulm. “This means working closely with industry partners over time to ensure that our ideas and research are sustainable economically, as well as environmentally, and are a source of job creation.”

The recent death of Yale graduate student Annie Le and the subsequent arrest of lab technician Raymond J. Clark III — who is alleged to have murdered her — has thrust the topic of workplace violence back into the national headlines.

While workplace violence prevention has typically focused on the role of the human resources department, there are several aspects of the problem that can be alleviated by having the proper safety plans and security procedures in place, and by the facility itself.

To that end, facility professionals interested in reviewing their workplace violence prevention policies may want to check out the IFMA Foundation’s recent report entitled “Violence in the Workplace: The Role of the Facility Manager.”

Written by Wayne D. Veneklasen, Ph.D., CFM, and Donald W. Barnes Jr., CPP, the report looks at the history of violence in the workplace, examines the scope of the problem, describes the statutes surrounding it and concludes with a focus on planning, response and recovery. It takes the perspective of the building owner and facility manager while outlining the steps they can take to help mitigate this problem.

The report was made possible through contributions donated in memory of W. David Beverly, the late husband of Linda Beverly, CAE, IFMA’s vice president of administration. A long-time engineer at the National Aeronautics and Space Administration, David Beverly was killed on April 20, 2007, at Johnson Space Center in Houston, Texas, by a contract engineer who shot him and held another coworker hostage before committing suicide. This senseless act impacted the lives of countless people and underscored the very real threat posed by violence in the workplace.

To obtain a free copy of the report, visit www.ifmafoundation.org.

The International Facility Management Association has released “Operations and Maintenance Benchmarks, Research Report #32,” a study outlining the facility trends affecting workplaces throughout North America. Among the new report’s findings are that the average space per person has risen nearly 40 square feet since 2007 — likely due to recent corporate layoffs — and that companies are adjusting their thermostats higher or lower by an average of one degree Fahrenheit, compared to data from three years ago, in an effort to minimize energy use and cut costs.

The study provides data from 1,422 facilities comprising more than 600 million square feet of commercial space, representing organizations from Fortune 500 companies to the U.S. government. It examines built environment trends in 34 industries — including banking, health care and motor vehicle manufacturing — and in various facility types, such as corporate headquarters, call centers and religious facilities. In total, the report provides benchmarking statistics covering space per person; sustainable, janitorial and maintenance practices; utility consumption; and more.

The amount of square footage per building occupant, a measurement IFMA has calculated for the past 15 years, has increased to an average of 435 square feet in 2009, up from 415 in 2008 and 396 in 2007. This additional space per person is not attributed to employers allocating greater individual office space to employees, but instead is likely the result of the ongoing economic downturn, layoffs and fewer workers occupying the same amount of space.

The report also highlights developments in built environment sustainability trends. Of those surveyed, only 11 percent report managing buildings with no green elements or certification, with 28 percent reporting one or more certified buildings and 61 percent saying their buildings contain green elements but are not certified. Additionally, more than four out of five businesses now utilize recycling programs, and 62 percent use green cleaning supplies in their facilities.

Survey respondents report spending on average 25 cents more per square foot on janitorial costs than they did in 2008, the last time similar data was collected. Given that labor makes up two-thirds of this cost, the rise is likely due to the implementation of mandatory wage increases. To combat mounting costs, the frequency with which certain janitorial tasks are performed has decreased. When compared to IFMA’s 2006 measurements, survey respondents report that practices such as daily trash removal and restroom cleaning have declined, while other tasks remain about the same.

Organizations are also increasingly performing their building maintenance with fewer personnel. Respondents report employing one maintenance staff member for every 49,000 square feet of office space this year, compared to one staff member for every 47,000 square feet in 2006. Layoffs and a sluggish economy are likely contributing factors to these changes.

In an effort to reduce utility consumption, facility professionals are going to great lengths to modernize building equipment and implement controls such as sensors and building automation systems. Changing the operating hours of a building’s heating and cooling systems and adjusting thermostat settings are two prime examples of how facility managers have achieved energy savings with little expense involved. When compared to IFMA’s 2006 measurement, the average summer low thermostat setting has risen by one degree to 72 degrees Fahrenheit, while the average winter low setting has dropped a degree to 69 degrees Fahrenheit.

The amount of electricity buildings consume on average continues to decrease as more sustainable practices are being implemented. Survey respondents who manage buildings with no green elements report using an average of 82 kBtus of electricity per square foot, while those whose buildings contain green elements but not certification report using an average of 72 kBtus per square foot. For those who manage certified green buildings, electricity use is even lower, at 69 kBtus per square foot. In total, utilities constitute the largest component of a facility’s operating cost, with electricity use alone making up 25 percent of the entire cost of operation.

“While focusing on providing healthy and productive work environments, facility professionals have found ways to reduce energy consumption, conserve water, harness natural sources of light and ventilation and minimize waste, all without increasing their operational costs,” said IFMA Director of Research Shari Epstein. “This year’s results demonstrate that by implementing a variety of cost effective practices, workplace professionals have improved the operational efficiency of their portfolios and contributed positively to their organization’s bottom lines.”

For more information about “Operations and Maintenance Benchmarks, Research Report #32,” click here. The publication is available for purchase at the IFMA bookstore by visiting www.ifma.org/bookstore. Members of the media may request a free copy of the report. To learn more about other IFMA research reports, visit www.ifma.org/tools/research/research.cfm.

IFMA is the world’s largest and most widely recognized international association for professional facility managers, supporting more than 19,500 members in 60 countries. The association’s members, represented in 125 chapters and 16 councils worldwide, manage more than 37 billion square feet of property and annually purchase more than US$100 billion in products and services. Formed in 1980, IFMA certifies facility managers, conducts research, provides educational programs, recognizes facility management certificate programs and produces World Workplace, the world’s largest facility management conference and exposition. To join and follow IFMA’s social media outlets online, visit the association’s LinkedIn, Facebook, YouTube and Twitter pages. For more information, visit the IFMA press room or www.ifma.org.

When MSNBC workplace and career columnist Eve Tahmincioglu began her recent story on corporate layoffs resulting in “cubicle graveyards” full of unused office space, she looked to the International Facility Management Association for research to back up her claims.

As it turns out, the latest IFMA research pointed to exactly what Tahmincioglu had noticed. The average square footage per building occupant had risen from 415 square feet in 2008 to 435 square feet in 2009—an increase more likely attributable to layoffs from the nation’s recent economic downturn than to ballooning individual office space.

The figures, from IFMA’s just-released “Operations and Maintenance Benchmarks Research Report #32,” are only one snapshot of how today’s built environment is being impacted by the economy. To learn more about IFMA’s latest research report, or to order a copy, click here. To read the full MSNBC story on the rise of cubicle graveyards, click here.