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Find The Way: Strategic Facility Planning

By Tim Springer, Ph.D.,
Steve Lockwood, CFM, Foresight Associates

"What's the question?"

Strategic facility planning starts with this single question. As simple as it sounds, it can be difficult to answer in practice. The response relies on understanding both the purpose of the activity and the desired results.

Traditionally, strategic planning has focused on answering five questions:
1. Where have we been?
2. Where are we today?
3. Where do we want to go?
4. How can we get there?
5. What needs to change?

Stuck In The Past
Unfortunately, there is too often little difference between where facilities have been and where they are today. The nature of business, the processes of work, and the skills of the workforce have changed radically over the past two decades. Yet, how many facilities today look remarkably like those of the 1980s, 70s, or even 60s? Even those that are newly designed and built commonly fail at supporting the goals and objectives of their business organizations.

One reason workplaces and facilities have not kept pace is the reliance on traditional, tactical, project-based approaches to planning. The traditional approach follows well-defined steps:
1. Define a project;
2. Secure budget approval;
3. Hire an architect or designer;
4. Program, plan, design, build;
5. Occupy;
6. Maintain;
7. Renovate;
8. Repeat.

Time frames associated with this approach, at best, straddle more than one fiscal year. Solutions are based on information collected very early in the process–usually 12 to 18 months prior to build-out and occupancy. Seldom is data revisited or validated. Solutions are rarely tested to see if they actually work before they are applied. Small wonder the resulting workplaces and facilities often don't work very well.

Futuristic Facilities
To support current business and where it is heading, facilities that are highly responsive to change are flexible, adaptive to individual differences, and supportive of new technologies and ways of work. In addition, facilities must provide value and deliver a high return on assets. Finally, the present business climate emphasizes low cost, no cost, or cost-cutting solutions.

To meet these challenges, facilities professionals need to do a better job of developing facility strategies. A strategic facility plan is not project based, but it defines and supports projects and budgets. Strategic facility planning takes the long view, but it anticipates rapid and frequent change. A sound facility strategy is aligned with–and responsive to–business plans and objectives while demonstrating the significant value associated with the facility assets of the organization.

Making Changes
Clearly, to get to the desired future state, things must change. To achieve fundamental change, one must change the fundamentals. Facilities and real estate professionals must change how they think, how they plan, how and what they measure, and what they value. The place for today's facility managers to start is with the questions they ask.

To get the right answers, ask the right questions. For facilities, the right questions focus on the work, the workers, the workplace, and the interaction among them. These might include:
• How are processes changing?
• How are behaviors changing?
• How is organizational culture shifting?
• How are tools and technology changing?
• How are the market and customer/client base changing?
• What are the existing constraints (e.g., financial, organizational, technological, geographical, political)?
• What are the workplace implications of these changes?
• What measures link to business performance?

Answers With Impact
These questions inevitably lead to additional, more detailed questions. In turn, the impact of the various elements on facilities–and vice versa–begins to emerge.

As an example, assume a business unit decides to change its work processes from individual, "solo" work, to more collaborative, group based work. Some relevant questions include:
• What jobs lend themselves to collaboration and "teaming?"
• Does the facility support this change in work behavior?
• Are the right technologies and workspaces available? Are they in the right locations?
• To how many different work groups will people belong?
• What is the typical size of a work group or team?
• What's the life cycle of a work group?
• Will group membership change over time? If so, in what way?
• What work behaviors need supporting within the group setting?
• How can the facility support the need for concentration and "solo" work in proximity to–and as part of–work groups?
• What measures show whether the facility is helping or hindering collaboration?

Spending Money Wisely
Organizations spend money on facilities, but do they spend it wisely? Part of the problem lies in what is measured and part is a function of how facilities are viewed.

Assets and elements that contribute to revenue generation (e.g., product development, production, work processes) are viewed differently than sunken costs. Standard accounting practices treat facilities as sunken costs. In fact, facilities are assets from which organizations should expect returns. Thus, it's not about whether to spend money to develop a facility strategy–money is already spent on facilities–the issue is whether the investment in facilities is made strategically.

How can facilities professionals develop facility strategies to align their plans with those of the business? They can accomplish this by moving from a planning process that is tactical, project based, and cost-driven to one that is strategic. Like many successful processes aimed at changing behavior, there are 12 steps.

1. Identify the organization's vision, values, mission, goals, and objectives. Without an understanding of where an organization is heading, it is very difficult to know whether it is on track, if it has reached its goals, or if it aligns with the facilities' plan. Most organizations publish and promote such defining statements. These are often found on corporate Web sites or in annual reports to shareholders. Other valuable information sources include internal and external communication documents to employees, clients, and other stakeholders.

2. Analyze processes, functions, work behaviors, tasks, and activities. Understanding what gets done in a facility is a necessary step in defining how best to support work. Such analysis is critical to determining the necessary actions and realizing maximum return from facilities investments.

3. Define and align facility strategies with business strategies. The first article in this series (August 2002) discussed common business strategies and their interaction with facilities elements. (See Table 1 of the online version at www.facilitycity.com/tfm or check the August TFM). The results of steps 1 and 2 allow determination of how facilities support or hinder progress toward the organization's goals and objectives. This information begins to inform what changes to facilities are needed to support the organization more effectively.

4. Identify key success factors (KSFs). Key success factors are expressions of accomplishment that represent either progress toward–or success in reaching–goals. For example, a business may set a goal to be more responsive to change. A KSF in attaining this goal is identified as flexibility or adaptability.

5. Articulate attributes that support KSFs. Attributes are the functional elements of KSFs. Building on the example from step 4, facility related attributes of flexibility include ease of reconfiguration and time/cost to execute a move. Defining attributes allows identification of measures. Meaningful measures can be linked to information from each of the preceding steps. In this example, a measure might be cost to reconfigure a work space or time to move an employee.

6. Conduct rapid prototyping of concepts and solicit feedback. A common practice in product development, rapid prototyping allows ideas and concepts to be quickly mocked up and tested. Rapid prototyping facility strategies involves testing on a small scale in a compressed timeframe to determine the accuracy of understanding and suggested solutions. Business units and end users provide valuable feedback during prototype testing.

While this may appear to add unnecessary cost, the opportunity to learn what works and correct what doesn't quickly, inexpensively, and on a small scale before implementing across an entire organization yields enormous savings and benefits.

7. Model benefits and identify costs. Building business cases for strategies and solutions involves identifying costs and modeling benefits. Foresight Associates recommends modeling low, medium, and high targets for benefits.

Returning to the example, a low target for flexibility is a 10% reduction in average time to move an employee. Similarly, medium and high targets are reductions of 20% and 50%, respectively. Modeling both costs and benefits of a particular strategy enables the facility professional to weigh the potential impact of the associated decisions and actions.

8. Create workplace plans. The output of steps 1 through 7 are used to create specific plans for workplaces based on a strategy aligned with the business and equipped with business case justifications. With the traditional approach to workplace planning, the project is considered finished at this point, but the process is not finished!

9. Develop communication and change management plans. Few things have as significant an impact as changes to the physical environment. Consequently, it is imperative to communicate frequently and completely with those affected.

Managing the change will minimize negative impact and maximize acceptance and support. Several well designed and executed facility plans have failed because the end users were not included in the process and resisted the change–even to the point of sabotage!

10. Implement the strategy. By following steps 1 through 9, the facility professional arrives at the Nike moment–just do it! However, it is now possible to do it with knowledge that the plan is well thought out, justified, and communicated. Still, it's essential to monitor the implementation.

11. Measure the results. Measures of effectiveness, functionality, performance, and success were identified throughout the process and specifically defined in step 5. Good measures reflect both positive and negative impacts. Putting in place meaningful measures and metrics provides the answer to the question: Are facility dollars wisely spent? Measurement is discussed in greater detail below and will be the subject of the third article in this series (coming in December).

12. Fine tune, verify, repeat. Strategy development and planning are ongoing processes. Conditions change and the facility strategy must be able to adapt. Armed with information from steps 1 through 11, facility professionals can fine tune the outcomes, refine the steps, verify the information, and repeat.

No Management Without Measurement
Most organizations relegate facilities to the cost side of the balance sheet. Whether in spite of–or because of–this, measures of facility performance and impact are mostly cost based.

Cost per square foot or cost per employee are commonly used expressions. If the only available measures are cost based, it is no surprise that organizations continue to exert pressure to slash facility costs. Yet these measures have little relevance to organizational goals of innovation, improved performance, service quality, shareholder value, or customer loyalty. An expanded approach to measurement is necessary to demonstrate the value, impact, and benefit of facilities.

Most organizations spend between $10 and $15 on human resources for every $1 they spend on facilities, real estate, and workplaces. Consequently, facilities have significant leverage, especially in light of the impact of the physical environment on employee performance and the consequent contribution to organizational effectiveness and profits.

Research conducted over the past 25 years has built a persuasive body of empirical evidence demonstrating the positive impact of the physical work environment and facilities on employee performance(1). More recently, researchers have shown a link between certain decisions, actions, and profits(2). These and other issues will be examined in the final article in this series.

Measure only costs, and costs are all that are managed. But align facilities strategy with business goals and objectives–and measure impact on employee performance and organizational effectiveness–and facilities (and the professionals who manage them) will come to be accepted as the valuable assets they are.

Springer and Lockwood are partners and principals in Foresight Associates, a workplace strategy-advising firm with offices in the Chicago, IL and Minneapolis/St. Paul, MN areas. They have more than 50 years combined experience as practicing facility managers, researchers, university professors, and consultants. For additional information about Foresight Associates, call (888) 551-4376, visit the Web at www.fa-strategies.com, or e-mail info@fa-strategies.com.

Footnotes

(1)Multi-factor studies by Springer (1982, 1986), BOSTI (1984, 1996, 2001), and Sullivan (1989), among others, show consistent performance improvement from 10%-15% attributable to sound workplace design.

(2)Marc J. Epstein and Robert A. Westbrook, "Linking Action to Profits in Strategic Decision Making," MIT Sloan Management Review (Spring 2001), pp. 39-49.