MARKET STUDY TO UNDERSTAND THE CUSTOMER PERSPECTIVE OF FACILITY MANAGEMENT.

Report By Anu Ashraf (Roll No. 06008) Work Carried at Jones Lang LaSalle Bangalore

Submitted in partial fulfillment of the requirement of Summer Internship Programme Under the Supervision Of Mr. Rajesh Krishnan Training Manager, Jones Lang LaSalle Property Management Private Limited, Bangalore

SDM Institute for Management Development Mysore, Karnataka, India (June 2007)

Summer Internship Project at Jones Lang LaSalle, Bangalore Supervisor: Rajesh Krishnan Name of student: Anu Ashraf I ) Executive Summary Facility management is vital to any organization that wishes to achieve its profit and productivity goals. It has evolved beyond maintaining and constructing physical infrastructure to being a critical component to the overall success of today's top organizations. This project work gives an account of customer perspectives of facility management which helps the company understand, what these customers look forward in facility management and to make a growth strategy to increase the customer base of JLL. This study also helps to find the emerging trends of facility management. Depth interview and questionnaire form of market survey was conducted With 28 sample questions for companies having outsourced facility management and 30 questions for companies having in-house facility management aimed to pinpoint the issues through email and direct conversations to 35 recipients. Seventy one percent (25) of those people answered the questions, 52% were having in-house and 48% having outsourced facility management service. 8% mailed their response; 60% responded only to the questionnaire, remaining 32% gave an interview. The responses are collected from various top level managers who are really beneficiaries of facility management services. This visit helped to understand many problems faced by the client organizations from their facilities. The survey involved preparation of questionnaire, its pre-testing, and data collection through questionnaire, analysis of data and interpretation of results. It was found from the survey that most customers prefer for most of the soft services and hard services except securities and transport management. They have various attributes depending upon the company. The study is limited to Bangalore. Signature of Student Anu Ashraf Date: Signature of the supervisor Mr. Rajesh Krishnan Training Manager, Jones Lang LaSalle, Bangalore. Roll no: 6008

SDM-Institute for Management Development, Mysore

Summer Internship Project at Jones Lang LaSalle, Bangalore ii ) ACKNOWLEDGEMENT

I wish to express my sincere regards and deep sense of gratitude to my project guide, Mr. Rajesh Krishnan, Training Manager, Jones Lang LaSalle, who has always been a great source of inspiration, for his guidance, constant help and encouragement throughout the investigation and preparation of the project report. I am thankful to my faculty guide Prof. Neetu Ganapati who helped to complete my project successfully. I would like to express my gratefulness and sincere thanks to Mr. Pavan Koyal, Regional Head (south zone) for his help and extended support at various stages of the work. Without his help and valuable suggestions my project would not have been a success. Last but not the least; I thank God Almighty, from whom flows all wisdom and knowledge.

Anu Ashraf

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Summer Internship Project at Jones Lang LaSalle, Bangalore

iii) LIST OF SYMBOLS & ABBREVIATIONS USED STP: WTP: EHS: E.g.: i.e.: H0: H1: IT: BPO: Sig: N: Sewage treatment plant Water treatment plant Environmental health and safety. Examples That is Null Hypothesis Alternative Hypothesis Information Technology Business process outsourcing Significant level Number of variables

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Summer Internship Project at Jones Lang LaSalle, Bangalore

Iv) List Of Charts And Diagrams

Tables 3.1) 4.1) 4.2) 4.3) 4.4) 4.5) 4.6) 4.7) 4.8) 4.9) 4.10) 4.11) 4.12) 4.13) 5.1) 5.2) 5.3) 5.4) Research design In-house and outsourced companies from the total response Area wise distribution in comparison with both in-house and Outsource Percentage Distribution of Security Between Outsource and In-House Security Type Cross Tabs House Transport Service Type Cross Tabs Percentage Distribution Of Cafeteria Between Outsource And In-House Cafeteria Type Cross Tabs Percentage Distribution Of reception Between Outsource And In-House Reception Type Cross Tabs House And In-House Number Of Companies Outsourced and Duration* Bar Graph Showing the Companies Outsourced and In-House With Respect to time they being in the Business in that Building Correlation Charts Bar Graph Showing the Various Attributes 26 27 28 21 21 22 23 23 20 20 17 18 18 20 14 Satisfaction level of each customer for the services offered to them. 15 Title Page. No 11 13

Percentage Distribution of Transportation between Outsource and In-

Percentage Distribution of Chiller Units between Outsource and InPercentage Distribution of Sewage Treatment Plant between Outsource

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Summer Internship Project at Jones Lang LaSalle, Bangalore

Table of Contents
Ch No. Title Page No.

i) Executive Summery ii) Acknowledgement iii) List Of Symbols And Abbreviations Used iv) List of Charts and Diagrams 1) Introduction 1.1) Problem Definition 1.1a) Background to the Problem 1.1b) Statement of Problem 1.1c) Research Problem 1.1d) Research Objectives 1.1e) Limitation of Study 1.1f) Product Range 2) Industry Analysis 3) Research Design 4) Analysis and Interpretation 5) Findings 6) Conclusion 7) Suggestions Appendix a) Questionnaire- in-house b) Questionnaire- outsource References

2 3 4 5 7 7 7 8 8 8 9 9 10 11 13 25 30 31 33 33 36 39

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 1

Introduction
Company Profile Jones Lang LaSalle, the only real estate money management and services firm named to Forbes magazines Platinum 400, has more than 100 offices worldwide and operates in more than 430 cities in 50 countries. It is also listed in NYSE. The company provides comprehensive integrated real estate and investment management expertise on a local, regional and global level to owner, occupier and investor clients. Jones Lang LaSalle is an industry leader in property and corporate facility management services, with a portfolio of 927 million square feet worldwide. Jones Lang LaSalle provides clients with analysis on economics, real estate market trends, forecasting, and location analysis and investment strategies. Jones Lang LaSalles research will keep you ahead of the curve. Knowledge is power and analysts throughout Asia Pacific arm clients with intelligence to make strategic decisions, ahead of their competition. 1.1) Problem Definition 1.1a) Background of the problem The real estate industry in India is growing fast and has become the hot property for investors worldwide. This has a direct impact on facility management services too, as these services are outsourced by many companies. The deluge of funds is sure to change the face of the industry. Also companies from sectors such as automobiles are setting their manufacturing hubs. Various researches say that success of IT/ITES sectors is gradually increasing to broader economy. Thus more and more players entered in this facility management field with various services. In Bangalore market Jones Lang LaSalle wants to know the customer expectation in facility management, so that they can provide better services to its customers and can also increase its customer base.

SDM-Institute for Management Development, Mysore

Summer Internship Project at Jones Lang LaSalle, Bangalore 1.1b) Statement of the problem The first step in any marketing research project is to define the problem. In defining the problem, the researcher should take into account the purpose of the study, the relevant background information, the information needed and how it will be used in decision making. Here the number of companies doing in-house is increasing and the customers demand for certain products is also changing. This is the major cause for this research study. 1.1c) Management decision problem To check the viability of these new services they need to cater in future. 1.1d) Marketing research problem The primary objectives of this market research are: To understand customer perspective of facility management. The management problem is defined; an approach is developed to the problem by defining the marketing research problem. The research problem is then divided into objectives, so that when each objective is attained, the research problem is tackled. Once the research problem is tackled, it gives clear insights to the management problem. Secondary objectives: 1. 2. 3. 4. 5. To find the customer expectations in facility management. To assess the roles needed by facility management professional to stay competitive in the near future. To understand the changing trends in facility management. Target improvements to support customer satisfaction and production. To understand the competitive environment in the industry.

SDM-Institute for Management Development, Mysore

Summer Internship Project at Jones Lang LaSalle, Bangalore The first objective is to find out the customer expectation and once it is found the research is narrowed down to the roles needed to be played by the facility management professionals to stay competitive thus finding and creating a trend in the market. Thus helping superior service in the industry 1.1e) Limitations Due to time constraint sample taken is small Few questionnaires were filled up through email, where some questions where not responded. This study is limited to Bangalore.

1.1f) Product Range Jones Lang LaSalle has a wide range of products to serve their customers. The main products they are dealing in are property management service and facility management service. In facility management service its products are categorized in to soft services and hard services. Soft services which include security, house keeping, pest control, cafeteria, vending machines, mail services, reception, waste management, help desk, transport management etc. Hard services which include generators, chiller units, effluent treatment plant, environmental health and safety, heating ventilation and AC, sewage treatment plant, water treatment plant etc.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 2

Industry Analysis
Facility management is business where there is high growth in the current scenario. It aims at creating an efficient work place which supports a 24/7 work environment. This is required to provide the cutting edge necessary in todays competitive market-driven environment. Facility Management is a critical part of every organization. Right from the time of inception when the organization plans to set up a business entity to the actual implementation in physical terms and finally to the continued maintenance of the work place, related services and the built environment. The skill sets of a Facility Manager demand a high level of technical knowledge, professional judgment and management skills. It encompasses multiple disciplines, which address the functionality of the built environment, integrating people, place, process and technology with an aim to operate the facility at the highest possible efficiency with quality services and performance levels Maintain the facility, in compliance with all applicable and appropriate life safety, environmental and crisis management issues in place Provide customer services to the Management, which are highly responsive to the needs of the organization and its employees. IT industry, where majority are outsourcing its facility management service is the real customer for facility management companies. Here in 2004 -05 the number of employees 348,000 as per the survey conducted by NASSCOM. This increase in employees is one factor which makes companies to go for outsourcing option. India's GDP grew by 9.4 per cent in 2006-07 over and above the nine per cent growth witnessed in 2005-06. The major drives of this grow were the manufacturing sector and the service sector. The manufacturing sector grew by 12.3 per cent as compared to the 9.1 per cent growth registered in 2005-06. The growth in service sector also accelerated to 11 per cent from 9.8 per cent in 2005-06. Hence facility management industry has a good time in the years to come

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 3

Research design
To condense and bring down the problem to specifics, a research design was developed. The following framework was developed for the market research

Defining the problems and research objectives

Development of research plan

Data collection

Data analysis

Presentation of findings

Recommendations and suggestions Table: 3.1

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Summer Internship Project at Jones Lang LaSalle, Bangalore The problems and the objectives are already been covered in the introduction. Development of the research plan In the research plan, decision on data sources, research approaches, research instrument and contact method were done. Data sources Secondary data available on the internet about the facility management provided the starting point for the research. The secondary data collected were diffused and lacked focus on the problem and thus did not fulfill the needs of the project and hence attention was focused on collection of primary data. Research approach Qualitative research approach was used since it was not clear at the outset Research instrument Questionnaire was the main instrument used to collect primary data. (Refer appendix 1 for the questionnaire). Direct interviews and Telephonic interviews were also conducted. Contact methods The industries were contacted through personal interviews, telephone and mail. Collection of information Many IT industries, banks, BPOs, builders where selected to collect information. Most of the executives contacted were available for duration of fifteen to thirty minutes for the interview. Telephonic interview was conducted towards the end of the project. Those who were not available for personal and telephonic interview were contacted through mails.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 4

Analysis and Interpretation

In-house and outsourced companies from the total response
60

50

52 48

40

30

20

Percent

10

0 inhouse outsource

type

Table 4.1 52% of the companies are availing in-house facility management and 48 percent availing outsourced facility management services from the total response collected. The current trend is showing that 90% of the new companies are opting for outsourcing rather than going for in-house facilities. This statement is based on the analysis done on table 5.2. The main reason for this continuous growth in outsourcing is their negotiable interest, to reduce their burden, companies (facility management companies) who are having core competencies in this area will continuously try to decrease the cost ultimately increasing the profit of their customer companies and also themselves.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Area wise distribution in comparison with both in-house and outsource The bar chart shows that majority of the outsourced companies are IT related with 75% of the outsourced company and 25% are BPOs. Rest all other industries which are included in the survey are adopting in-house management. This shows a trend that most outsourcing company provides services for IT companies.

80 75

60

40

46

20

25 15 15 8 Manufaturing BPO 8 builders and devolop stocks&shares

type
inhouse outsource

Percent

0 IT

banking

area of business

Table 4.2

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Summer Internship Project at Jones Lang LaSalle, Bangalore Satisfaction level of each customer for the services offered to them.
Group Statistics type inhouse outsource inhouse outsource inhouse outsource inhouse outsource inhouse outsource N 13 12 13 11 13 12 13 12 13 10 Mean 1.7692 2.2500 2.2308 2.3636 2.3077 2.2500 2.0000 2.0833 2.3846 2.2000 Std. Deviation .8321 .8660 .8321 .5045 .7511 .8660 .8165 1.1645 .8697 .4216 Std. Error Mean .2308 .2500 .2308 .1521 .2083 .2500 .2265 .3362 .2412 .1333

overall satisfaction in soft services price satisfaction satisfaction in quality overall satisfaction in hard services vendor responsiveness

Table 4.3 Satisfaction level of soft services Soft services which include security, reception, housekeeping, pest control etc. are given ranking in accordance to the satisfaction they gained from the services (I being excellent and 5 being worst). So mean is found with the assumption that whichever mean is small they are highly satisfied than the other (because the response is collected in rank terms). Here in-house mean is 1.7692 with a standard deviation of 0.8321, which is smaller than the mean satisfaction of outsourced companies in soft services. This means that out of total companies having in-house facility management service majority of the company ranked their satisfaction level which is in between 1 and 2 ( 1 being excellent and 2 being good i.e. 1.7692 is the mean shown by them). Standard deviation of .8321 means that the some people who respond to this question have a variation from its mean lesser than the variation shown by companies outsourced. Satisfaction level of price Hard services which include generators, chiller units, ETP, STP, EHS, WTP etc. are given ranking in accordance to the satisfaction they gained from the services (I being excellent and 5 being worst). So mean is found with the assumption that whichever mean SDM-Institute for Management Development, Mysore 15

Summer Internship Project at Jones Lang LaSalle, Bangalore is small they are highly satisfied than the other (because the response is collected in rank terms). Here in-house mean is 2.2308 with a standard deviation of 0.8321, which is smaller than the mean satisfaction of outsourced companies in soft services. Mean 2.2308 implies that people have ranked in between 2 & 3 (2 being good and 3 being average). But since the standard deviation is high there is high fluctuation in choosing the rank in different in-house companies, which means that some companies have ranked in extreme ends thus it derived its mean. Quality Measuring customer expectations and then aligning those expectations with the delivery mechanisms are the whole issue. It is impossible, however, to measure, record, and report quality without a definition of what constitutes quality. Several simple methods can be utilized to gain this valuable information. Here quality said by the respondents means they compared their expectation with the services that they are getting from their facility management team. In 95% of the companies preferred quality as their first criteria to select the facility management team. The main reason is companies need to maximize their employee satisfaction which intern help to retain these highly skilled employees in the organization. Facility management companies who are fully concentrating on this function can deliver better facility services than the client companies itself Timeliness of delivered services is a critical evaluator of service level by the customer. Response Time. The time that it takes to respond to customer requests for service can be tracked as an indicator of the ability of the organization to provide prompt service delivery. Some examples could be first response, time to completion, or time to invoice. Scheduled v Actual. On-time performance compares when a service item is scheduled v when the service is actually provided. Preventive Maintenance Completion Rate. This measures the compliance by the service provider in completing predetermined work tasks.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Work Status. Knowing what is going on and communicating it to the customer creates a strong customer provider relationship. Satisfaction level in Quality. As per the quality point of view outsourced companies are getting more quality satisfaction 2.2500 with a standard deviation of 0.8660 which means that the companies who are outsourced are getting better quality service than the in-house companies. Mean satisfaction came in between 2 & 3 (good & average). But high standard deviation implies that even though there are people who responded quality as excellent and good the some people also stated that the service they are getting is poor. Security and Safety issues Safety issues have been thrown to the forefront, whether they relate to the national security or just keeping the building safe. The quantitative analysis done in security from the response collected from 25 companies gave results that only 2 companies (8%) outsourced, the remain 23 companies(92%) were in-house. This is one of the prime concerns of many big organizations particularly in I.T firms. Mostly their security is not coming within the outsourced facility management services, company directly enter in to contract with the security agencies thereby ensuring secured dealings(without going in the hands of a mediator). Thus companies like IBM, Sasken communications, Net App, Perot systems directly have a contract with security agencies like G4S, Terrier etc.
Security Frequency Valid Outsourced In-house Total Total 2 23 25 25 Percent 8.0 92.0 100.0 100.0 Valid Percent 8.0 92.0 100.0 Cumulative Percent 8.0 100.0

Table 4.4 SDM-Institute for Management Development, Mysore 17

Summer Internship Project at Jones Lang LaSalle, Bangalore

Security * type Cross tabulation Count Type In-house Security Total Outsourced In-house 13 13 Outsource 2 10 12 Total 2 23 25

Table 4.5 Transportations Companies face the problem of attrition especially in IT industry. In India, the average attrition rate in the BPO sector is approximately 30-35 percent, hence they are giving more preferences to comfort than cost as it directly influences the employee satisfaction. Some companies also state that they have a cost advantage if they stick on to in-house transportation facility. They are going by their own as some companies are getting services from other transportation agencies for lower cost than the facility management company can provide. Accessibility to the local transportation facility: There are companies located in areas where local transportation (KSRTC, autos etc.) is available. So these companies dont need transport management service.
transport services Frequency Valid outsource inhouse not required Total 1 17 7 25 25 Percent 4.0 68.0 28.0 100.0 100.0 Valid Percent 4.0 68.0 28.0 100.0 Cumulative Percent 4.0 72.0 100.0

Total

Table 4.6

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Summer Internship Project at Jones Lang LaSalle, Bangalore

transport services * type Crosstabulation Count type inhouse transport services outsource inhouse not required 9 4 13 outsource 1 8 3 12 Total 1 17 7 25

Total

Table 4.7 The analysis show that out of the 12 companies that avail the facilities of outsourcing only 1 company is availing transport management. This shows that 68 percent uses inhouse transport facilities. Also 7 companies which is 28 percentage of the total response do not required transport management because the reason stated above the chart. Cafeteria A hygienic, well-furnished and well-equipped canteen is available in all IT and BPO campus to provide food for the staff. This is also given more importance by many Organizations as it is one attribute which increases the employee satisfaction. Companies are finding new methods for making and catering food to its employees which give these companies a superior compared to other rivalry companies. Many companies are going world class standard with ready kitchen and serving the food prepared on spot. E.g. Makino. This also will indirectly reduce the attrition. Here survey helped to understand that out of 12 companies that avail the facility of outsourcing only 10 are availing cafeteria outsourced. Remaining 1 is in-house and 3 company is given not required option (1 is from co. having outsourced facility and 2 from in-house facility company). Not required option is given by the company when the staff is ready to bring food from their respective home, but this system is normally not seen in many organizations. Total 40%companies are outsourced.

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Summer Internship Project at Jones Lang LaSalle, Bangalore

cafetaria Frequency 10 12 3 25 25 Percent 40.0 48.0 12.0 100.0 100.0 Valid Percent 40.0 48.0 12.0 100.0 Cumulative Percent 40.0 88.0 100.0

Valid

outsource inhouse not required Total

Total

Table 4.8
cafetaria * type Crosstabulation Count type inhouse cafetaria outsource inhouse not required 11 2 13 outsource 10 1 1 12 Total 10 12 3 25

Total

Table 4.9 House keeping Outsourced companies are having 100% outsourced housekeeping and all the company carrying in-house activities are also cent percent in-house. This is one service which companies are not much concerned as it does not directly influence employees. But the facility management companies should take care of the activities undertaken in housekeeping as the response suggests that many organizations needs improvements in this particular area. Pest control 48% has been outsourced and the remaining 40% is in-house, 12% companies responded not required. The reason is same as mentioned above.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Reception

reception Frequency Valid ouotsource inhouse not required Total 7 17 1 25 25 Percent 28.0 68.0 4.0 100.0 100.0 Valid Percent 28.0 68.0 4.0 100.0 Cumulative Percent 28.0 96.0 100.0

Total

Tables 4.10
reception * type Crosstabulation Count type inhouse reception ouotsource inhouse not required 12 1 13 outsource 7 5 12 Total 7 17 1 25

Total

Table 4.11 Only 20% of the company is having outsourced reception remaining preferred to have their own staff employed for this service. Only for a single person companies do not prefer to outsource this service.

Hard services
Maintenance &Engineering Organizations with a range of 1lakh to 1.5 lakh square feet would be located in some tower or major buildings with number of companies. In such buildings its owner would be providing with diesel generators, chiller units, STP, WTP etc. In such cases these firms who take office space in this building wants to look only its soft services. One example for this is NETAPP which is located in Embassy golf ring in Bangalore, Maruthi Info Tech in intermediary ring road, and Prestige Tech Park in Marthahalli.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Companies like symphony services, LG, Siemens have in-house facilities in all services ranging from soft services to hard services. Most of these respond for the question whether they are planning to change to outsourcing company is NO. The reason is they are satisfied with the current facilities, and the loyalty that is with their contracted agencies forced them to continue the same services. Generators Many companies have taken the building for rent or lease, where the hard services will be provided by the building owner themselves. This way companies can avail the facilities directly from the building owners. This is the case of generators, companies do not require bothering about the generators and its functioning since its taken care of by building owners.
generators * type Crosstabulation Count type inhouse generators outsource inhouse not required 10 3 13 outsource 8 1 3 12 Total 8 11 6 25

Total

Here this is the major reason why 44% is in-house and the remaining 32% and 24% in outsourcing and not required options respectively. Chiller units The reason stated for generators for choosing not required option which is mentioned above is same for chiller units also. i.e. chiller unit is also provided by building owners which companies dont want to think. 48% of the companies preferred not required option

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Summer Internship Project at Jones Lang LaSalle, Bangalore

chiller units Frequency Valid ousource inhouse not required Total 8 5 12 25 25 Percent 32.0 20.0 48.0 100.0 100.0 Valid Percent 32.0 20.0 48.0 100.0 Cumulative Percent 32.0 52.0 100.0

Total

Table 4.12 Sewage treatment plant This is one area which is statutory requirement for some industries. Some responses where not required, mainly because shortage of place. Eg. AXA.
sewage treatment plant Frequency 8 5 11 1 25 25 Percent 32.0 20.0 44.0 4.0 100.0 100.0 Valid Percent 32.0 20.0 44.0 4.0 100.0 Cumulative Percent 32.0 52.0 96.0 100.0

Valid

outsource inhouse not required 33.00 Total

Total

Table 4.13 All the 8 companies who are availing the facility through outsourced company are having outsourced sewage treatment plant also. Similarly all the in-house companies are having in-house STP. Totally 11 companies not required this plant which is 8 from in-house and 3 from outsource. The reason is building owners are providing sewage treatment plant to many companies.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Water treatment plant 13 out of 25 responses stated that they dont require water treatment plant. This means that this is provided by the building owners. All the outsourced companies are outsourcing including water treatment plant. Effluent treatment plant The issue faced by the company is the space required for this effluent treatment plant. In some company they avail this facility from building owners. This made those companies to choose not required as their option making it 60% of the total response (36% in-house and 24% outsourced)

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 5

Findings
1. Many organizations dont prefer securities under facility management; it is treated as a separate trade which will be looking directly by the company itself. Thus ensuring more secured transaction within the organization. Table 4.4 page 17 & 18. The quantitative analysis done in security from the response collected from 25 companies gave results that only 2 companies (8%) outsourced, the remain 23 companies(92%) were in-house As many I.T companies do not prefer security, this trend made facility management companies take away this service from their package. Thus the companies who are now the clients are bound to get in to contract with other security agencies by them selves. 2. Transport management is another area where company prefers to have their own team rather than including in their outsourced facility management team, with reference to the analysis done on transport management (page no. 18 table no.4.6). The reason for this are: Transports being an area which directly affect the employees, companies dont want to take a risk by outsourcing the same to the facility management company. Many companies are in prime industrial areas where there are private and KSRTC services; here employees are comfortable with this existing. Some companies also mentioned that they are able to get better price from outsider travel agencies than outsourced companies. 3. Poor communication: new changes are not informed to the executives in the organization. This is the response given by the companies for the question no. 20 in page no.34. 4. Customers face problems which arises unavailability of sufficient stock. This is again qualitative study done based on the question no.10 in page no.32.

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Summer Internship Project at Jones Lang LaSalle, Bangalore

Number of companies outsourced and duration* Count type in-house Outsource Number of years Outsourced Less than 1yr Less than 2yr Less than 5yr 4.00 Less than 10 yr 3 1 7 1 1 10 11 2 5 1 Total 3 3 12 2 1 21

Total

Table 5.1
120

100

100

80

60 50 40

61 50 50 39 50

duration in business
less than 1 yr between 1and 2yr

Percent

20 between 2 and 5yr 0 inhouse outsource between 5 and 10yr

Table 5.2

type

5. The diagram above shows that 100% of the companies who started business in a particular building in the past one year have preferred to avail outsourcing facilities. Companies with 5 to 10 years business in some building have 50% in-house and 50% outsource. But the trend was changing in the past 1 to 2 years, companies started going for outsourced option.

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Summer Internship Project at Jones Lang LaSalle, Bangalore

Correlations importance of loyalty in service expectation Spearman's rho Correlation Coefficient importance of loyalty in service expectation importance of price in service expectation importance of quality in service importance of reputation in service expectation importance of loyalty in service expectation importance of price in service expectation importance of quality in service importance of reputation in service expectation importance of loyalty in service expectation importance of price in service expectation importance of quality in service importance of reputation in service expectation 1.000 importance of price in service expectation -.589** importance of reputation in service expectation -.313

importance of quality in service -.286

-.589**

1.000

.076

-.477*

-.286

.076

1.000

-.204

-.313

-.477*

-.204

1.000

Sig. (2-tailed)

.002

.175

.136

.002

.724

.018

.175

.724

.339

.136

.018

.339

24

24

24

24

24

24

24

24

24

24

24

24

24

24

24

24

**. Correlation is significant at the .01 level (2-tailed).

Table 5.3

*. Correlation is significant at the .05 level (2-tailed).

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Summer Internship Project at Jones Lang LaSalle, Bangalore

Various attributes are ranked according to its importance Spearmans rank correlation is used for this analysis. Hypothesis: If the significance level is less than 0.05 the null hypothesis is accepted and if it is more than 0.05 null hypothesis is rejected H0: there is no relation between quality and price in making decision H1: there is relation between quality and price in making decision Observation: The analysis shows that alternate hypothesis is true which means there is a relation between quality and price. Both the attributes are positively correlated (.076). Result: Price and quality is positively correlated. Hence when customer gives more importance to price there is a same trend followed in quality also. This means customers decision is based on both price and quality.

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Summer Internship Project at Jones Lang LaSalle, Bangalore

4.0

3.5

3.0 importance of loyalt y in service expecta importance of price in service expectati 1.5 importance of qualit y in service 1.0

2.5

2.0

Mean

importance of reputa .5 inhouse outsource tion in service expe

type

Table 5.4 The above diagram shows there is a direct relation between price and quality. The pattern of increase in price and quality are same. The diagram also shows that there is an indirect relation between price and loyalty and also price and reputation. When price is going up, loyalty and reputation is coming down.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 6

Conclusion
The main objective of this study is to find the customer expectation in facility management service. Once it is found the research is narrowed down to the roles needed to be played by the facility management professionals to stay competitive thus finding and creating a trend in the market. Thus helping company to give best service to their customers in the industry. The customer expectation is found in respect to the various services. Analysis is done on their satisfaction level mentioned by them for different attributes. Also ranking method is done to find which attribute will give these customers more important while taking decision. This analysis will help the management professionals to act according to that. The changing trend with a bar graph is also shown in the report. This industry has become a one stop shop which helps its customers for single point responsibility, with better service integration, synergy and higher management commitment. There is huge growth potential for this industry, since the entry barrier is low more and more companies are entering in the market. So to be competitive the company need to provide its customers with world class facilities, especially to IT & BPO. Also it has to widen its services to other industries (manufacturing) also.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Chapter 7

Suggestions
Technology change and integration .In the field of security, many security programs are now being integrated in to systems to create operational models that are easier to use and are based on overall integrated approach. Digital video surveillance, telephone recording system, electronic timer, electronic exit switch and door access. This would help JLL by providing its customers with more quality delivery. If security is automated, companies who are now willing to put their own security staffs will start giving contracts to JLL (outsourcing company). This data is from the qualitative analysis done with the question no.21 which is in page no.34. currently 92% companies are having inhouse facility management team as per the analysis done on safety and securities. Communications should be proper in such a way that if any changes are going to make it should be informed in advance. This is due to the reason that many organizations faces the problem of not informing the executives about the changes made in the client company, especially in areas like security and house keeping. This response is collected from the question no. 20 in page no.34. For this company can prepare a daily report which includes all the activities done on that particular date and it should be submitted to the concerned person in the client company. Proper forecasting should be done about the services that are going to take part, for e.g. If labour is needed urgently, they should be able pool the personals with in no time. E.g. In case of Leave replacements etc. Perot system is one company who has faced this problem at time of emergency. Emergency service response team should always be there. There should be a proper tracking of stocks thus reducing the number of break downs. Eg. Diesel for generators etc. Tracking the number of times that services have to be re-performed because of mistakes, improper definition of scope, or inadequate communication. This is one of the improvements they need which mentioned in the survey.

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Summer Internship Project at Jones Lang LaSalle, Bangalore Many automobile and other industries (banks and stocks & shares) are coming to Indian market where there are lots of opportunities for facility management companies which is now in-house facility services. JLL should start catering services to these sectors . As per the table 4.2 page no. 14 out of all the industries taken in the survey only 15% of the manufacturing company is having in-house facility management service. Buying decisions of the customer are depending up on certain attributes like price loyalty, reputation and quality. As per the data available from the table 5.3 & 5.4 on page no.27 & 28. Spearman correlation is done to find this result. This analysis shows that most of the customers give more importance to price and quality while taking decision and these attributes are positively correlated. Hence people are looking for facility management company who can deliver with high quality and low price. Further research in the cost reduction would help the company to gain cost advantage without affecting its quality. If the company can provide with world class facilities in soft service and hard services, more companies would be coming for facility management services, IT and BPO companies are finding newer strategy like this to reduce attrition rate. E.g. Makino is having an international style kitchen facility where they can prepare food and cater to the employees. This way companies can satisfy its employees than its competitors. Thus reducing the turnover of employees. Environmental safety and energy management conservation is the area where most companies looking for improvements The House keeping is the place where most of them are not getting satisfied, regarding the timing they are working and the cleanliness of their work are the major criteria which evaluates their performance. So it should be in a timetable manner in which there should be a balance of work between employees time of work and housekeeping peoples work.

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Appendix I
1) In-house I am an MBA student from SDM-IMD, a premier M-school in Mysore. I am part of a larger study to understand the current facility management market. Filling this questionnaire would be of great help in our academics. Please spare your valuable time. 1. Company Name: 2. Area of business: IT BPO Manufacturing Others specify >2 years >5 years

3. For how long you are in this business:<1 year >10years 4. Number of employees: 5. What is the sq ft. area of the company: 6. Facility management we are currently having: in-house 7. Number of years having in-house facility management

outsourced

8. During the life time of the business have you outsourced Yes

No

9. If yes for the above question, does your facility management team provide both soft service and hard service now. Yes No

10. If yes, why now you changed to in-house 11. If no for the 9th question, Why either soft service or hard service, why not both provided by the same facility Management.

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12. What are the activities your facility management team do in soft service (please tick) House keeping Security Cafeteria Pest control Mail service Receptions Transport management Specify others

13. Rate your satisfaction in soft service (in five point scale 1 being excellent and 5th being the bad). 1 2 3 4 5

14. What are the activities which are under hard services (please tick): Generators Chiller units Effluent treatment plant Environmental health & safety Heating Ventilation & AC Sewage treatment plant Water treatment plant Specify others

15. Rate your satisfaction in hard service (in five point scale) 1 1 2 3 4 5

16. Are you satisfied with quality of service (in five point scale) rate it: 1 2 3 4 5

17. Are you satisfied with price (in five point scale) rate it 1 2 3 4 5

18. Are you satisfied with vendors (in five point scale) rate it 1 2 3 4 5 No

19. Is there any scope for improvement: Yes

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Summer Internship Project at Jones Lang LaSalle, Bangalore 20. If yes what 21. What are you looking forward in facility management? 22. Are your facility management team able to meet the market standard? Yes No No

23. Planning to outsource in future: Yes

24. State why you are planning to outsource in future 25. What is the cost of the facility management in your company 26. Please rank it, I give more importance to (1 given most preference and the last Preference given 4) Price Quality Loyalty Reputation 27. What are the best services which is provided by your facility management service team made you to be with the same team/company all the years

28. How would you rate your current facility management team (1 being excellent and 5th being the bad) 1 2 3 4 5

29. What is the profit you gained by having in house facility management:

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Summer Internship Project at Jones Lang LaSalle, Bangalore 30. Please rate your overall satisfaction in five point scale (1 being excellent and 5 being Bad). 1 2 3 4 5

Appendix II
2) Outsourced Companies Questionnaire I am an MBA student from SDM-IMD, a premier M-school in Mysore. I am part of a larger study to understand the current facility management market. Filling this questionnaire would be of great help in our academics. Please spare your valuable time. 1. Company Name: 2. Area of business: IT BPO Manufacturing Others specify >2 years >5 years

3. For how long you are in this business:<1 year >10years 4. Number of employees: 5. What is the sq ft. area of the company 6. Facility management we are currently having: in house 7. Outsourced companies name: 8. Number of years outsourced

outsourced

9. What is the cost of the facility management in your company 10. Do your facility management team provide both soft service and hard service Yes No

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11. Why either soft service or hard service, why not both provided by the same facility Management. 12. What are the parts being outsourced: 1. If that being (question no. 12), why not other parts: 14. Rate your satisfaction in soft service (in five point scale 1 being excellent and 5th being the bad) 1 2 3 4 5

15. Rate your satisfaction in hard service (in five point scale) 1 1 2 3 4 5

16. Are you satisfied with quality of service (in five point scale) rate it: 1 2 3 4 5

17. Are you satisfied with price (in five point scale) rate it 1 2 3 4 5

18. Are you satisfied with vendors (in five point scale) rate it 1 2 3 4 5 No

19. Is there any scope for improvement: Yes 20. If yes what

21. What are you looking forward in facility management:

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23. Are your facility management team able to meet the market standard? Yes No

24. Please rank it, I give more importance to (1 given most preference and the last preference given 4) Price Quality Loyalty Reputation 25. What is the best services which is provided by your facility management service team made you to be with the same team/company all the years

26. How would you rate your current facility management team (1 being excellent and 5th being the bad) 1 2 3 4 5

27. What is the advantage your company will get by outsourcing facility management: 28. Please rate your overall satisfaction in five point scale (1 being excellent and 5 being Bad) 1 2 3 4 5

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References: 1. http://www.ifma.org/tools/monthly_media/wire/2007/0517p.html 2. www.devon.gov.uk/csd-facilities_management_support_service.pdf 3. http://www.ifmamfc.org/events/MFC_IFMA%20Industries%20Forum%202007_ Program.pdf 4. www.appa.org/files/PDFs/FM050604Quality.pdf 5. Current issues and emerging trend affecting facility management now and in to the future. (Based on the IFMA foundation survey and analysis) from Facility Management Forecast 2007. 6. Bangalore real estate review conducted by Jones Lang LaSalle city report on 2nd quarter 2006. 7. Quality Measurements in facility management, by Richard W. Robben P.E. May/ June 2004.

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