What KPIs are important for facilities management?

Effective facilities management requires an analytical, data-driven approach to all work the company undertakes and how it functions as a whole. This helps businesses operate as efficiently as possible, reducing unnecessary costs and improving productivity. In this blog post, we will explore the importance of KPIs in facilities management, discuss 8 crucial KPIs for facilities management, and go into detail about reviewing and optimising your KPIs. 

What are KPIs?

Key performance indicators (KPIs) are a type of performance measurement. They evaluate the success of an organisation or of the work they undertake. KPIs should be the key targets that you need to track in order to make smart decisions about your business strategy and focus on what gets you the best results. Examples of some basic KPIs are performance, quality and cost – we’ll expand on these later. 

Why are KPIs important?

KPIs provide valuable insights into the performance and progress of facilities management initiatives. They enable organisations to track and measure key aspects such as quality, cost, performance, risk, and customer satisfaction. By establishing clear KPIs, facilities managers can set benchmarks, monitor progress, identify areas for improvement, and demonstrate the value of their efforts.

What are the best KPIs for facilities management?

Before we start, it’s important to note that KPIs differ for each organisation and need to be customised according to the top priorities and needs of that particular organisation and environment. To understand which KPIs should be implemented, consider your main business drivers as a starting point. To give you an idea of what KPIs will drive effective facilities management, we’ve listed 8 essential KPIs below.

1. Quality

Maintaining a high level of quality is crucial for facilities management. KPIs related to quality may include compliance with legislative requirements, certifications, and standards. Additionally, measuring responsiveness to maintenance requests or facility issues can provide insights into the effectiveness of the facilities management team. Customer satisfaction surveys or feedback mechanisms can also help gauge the level of quality experienced by internal and external stakeholders.

2. Cost

Managing costs efficiently is a key aspect of facilities management. KPIs related to cost may involve tracking expenses, analysing energy consumption, optimising maintenance and repair costs, and evaluating the return on investment for facility upgrades. Effective cost management ensures that resources are allocated wisely, ultimately benefiting the organisation’s bottom line.

Facilities management KPIs related to cost can often be split into smaller metrics, such as utility costs and equipment costs.

Utility costs by area

Assessing utility costs per square foot, square metre, or other area measurement enables facility managers to monitor the facility’s power, water, and other utility usage. It also helps gauge asset efficiency, maintenance effectiveness, and user habits. 

By understanding the ups and downs in these cost cycles throughout the year, facility managers gain valuable insights into the tactical steps needed to improve sustainability and achieve cost savings. This could include installing LEDs or sensors to automatically switch off lights or heating when no one is in a room.

Equipment costs

Do you find yourself repeatedly repairing the same appliance? Is it an outdated device that would be more cost-effective to replace? These are important considerations when establishing facilities management KPIs.

While it may be tempting to continue using the existing appliance until it completely breaks down, this approach could end up being more expensive than investing in a new one. Make sure to do your research into whether equipment is cheaper to upkeep or replace.

3. Completion time

Completion time is a crucial KPI for facilities management, as it measures the time taken to complete maintenance or repair tasks. This metric reflects the efficiency and effectiveness of the facilities management team in resolving issues and minimising disruptions. Tracking completion time enables facility managers to identify bottlenecks, optimise workflows, and ensure timely delivery of services.

4. Employee satisfaction and turnover

All organisations need to be aware of their employees’ satisfaction and whether this is reflected in their employee turnover. High employee satisfaction levels contribute to productivity, quality of work and overall job performance. By encouraging feedback and monitoring turnover rates, facility managers can identify areas for improvement, address concerns, and implement strategies to retain skilled and motivated staff.

5. Equipment downtime

Equipment downtime measures the duration during which critical assets or systems are non-operational. Minimising equipment downtime is vital for maintaining productivity, reducing operational costs, and meeting service-level agreements. By tracking equipment downtime, facility managers can identify recurring issues to allow them to plan ahead. It also helps when planning out preventive maintenance measures in order to maximise uptime.

6. Customer satisfaction

Customer satisfaction should be measured regularly by facility managers. Evaluating customer satisfaction through surveys and performance evaluations helps facility managers to assess the quality of the services they are delivering. This helps to identify any areas for improvement and ensure that facilities management practices align with customer expectations.

7. Ratio of planned and reactive maintenance

The ratio of planned and reactive maintenance measures the proportion of proactive maintenance activities compared to reactive or unplanned maintenance. A higher ratio of planned maintenance indicates effective preventive strategies, which can help minimise unexpected failures, extend asset lifecycles and optimise resource allocation. Monitoring this ratio allows facility managers to shift towards a proactive maintenance approach, reducing downtime, costs and emergency repairs.

8. Risk and rewards

Introducing a risk and rewards framework within the KPI model incentivises service providers to commit to delivering against clearly defined expectations and standards. This approach creates a collaborative environment where both facility managers and service providers work together towards achieving outstanding results. By implementing a risk and rewards mechanism, facility managers can align service delivery with their organisational goals and motivate service providers to go above and beyond to meet and exceed expectations.

Deciding KPIs in line with customer needs

Different customers will want to measure different KPIs depending on their needs and working environment. For example, customers who are focused on keeping costs low would naturally look at a minimum legislative compliance service. KPIs detailing responsiveness and certification uploads will often provide enough information for these clients to measure and understand performance.

On the other hand, customers who operate in critical environments or have a higher weighting around quality may want more sophisticated KPIs. These could include asset downtime and overdue ratchet systems on specific work order types. This is where a robust and intelligent CAFM system comes into play, providing visibility and delivering leading indicators to ensure effective management is in place.

How often should facilities management KPIs be reviewed?

KPIs should be reviewed and amended on a 12-month basis. Reviews should look at scaled targets so that top-notch performance continues to be recognised without setting the bar too low or high. Criteria and definitions should form part of the review process to ensure that it remains relevant and on target. This milestone also creates an opportunity for businesses to re-engage with key stakeholders, as well as to ensure that the existing strategy remains aligned with organisational needs. 

Effective facilities management is something that Thermatic Technical FM are proud to deliver daily to a wide range of customers. We provide tailored solutions at affordable prices, saving you time and money in the long run. Get in touch today!