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Changing Retail Environment

It has been clear that a critical facet of successful facility management is the ability to link the role of facilities to an organization’s core business strategies. In the coming years, I believe this will be of even greater importance. Physical facilities can have a large role in determining productivity, supporting innovation, efficiency, customer’s satisfaction and public perception of a shopping center/ mall/ retail store. Every Rupee invested in improving and maintaining facilities must be analyzed for return on investment (ROI).

This is an exciting time to be in the business of facility management (FM) or being a part of this growing industry as a professional. There are many challenges that await the FM professional in the coming years. The increasing pace of Retail sector in India and the continued materialization of the Real estate marketplace ensure that the overall size of the playing field that facility management professionals oversee is growing. Most of the historical key topics continue to be relevant and significant. These include:

  • Rapid pace of change,
  • Changing technology,
  • Building/ Facility/ Store/ Mall/ Shopping center automation,
  • Security issues and,
  • Sustainability.

Issues have been discussed before but the emphasis have changed due to “open to all the time” nature of retail business, such as the importance of linking facilities/ Malls/ shopping centers with business strategies of the retail organisations, developing approaches to deal with aging building stock and the importance of advance planning for disaster preparation and recovery. While these are not new ideas, they have a greater prominence in the retail world. Although this wide range of issues may appear overwhelming at first glance, FM professionals have the opportunity to impact customer expectations and leverage the tools they currently use to provide customers the wide range of services they have come to expect in Retail store or shopping centre.

The increasing diversity of the workforce will present another significant challenge to the facility management professional. In developed world like Europe especially in the UK, France and Germany, one-fifth of the population is currently 60 years or older; by 2050, that proportion is expected to rise to almost a third. In developing countries like India, the proportion of the older population is expected to rise from eight per cent to almost 20% by 2050. Ergonomics will also become a greater concern for FM staff in Retail sector as they will be required to accommodate a wider range of ages and physical abilities. Similarly, the cultural and generational preferences of this diverse workforce often manifest themselves in distinctive working styles that will become increasingly important to all facility management professionals, whether they manage just one shopping center or a large portfolio of formats that spans states and different nature/ requirements of business. From the retail industry point of view the biggest trend and issue for the coming years in the field of FM will be:

1. Linking FM to Retail business strategy – including business culture and branding Demands on facility management professionals in Retail:

  • Ensure that facilities support the Retail business culture and brand.
  • Provide a sufficient and measurable return on investment.
  • Help differentiate the organization to recruit and retain the best people.
  • Have a clear vision and understanding of long-term corporate business strategy rather than a short-term focus on tactics.
  • Understanding and contributing towards the Retail brand building will be a very challenging aspect of the Facility management industry in the coming years
  • Moving from highly labour intensive solutions to technologically advanced and optimsed solutions Learning challenges/opportunities for facility management professionals in Retail sector:
  • Importance of linking facilities with core Retail business strategy.
  • It is sometimes difficult to prove and communicate the value of facilities (Constantly changing market place adds to its complexity).
  • Speaking the language of the C-Suite (highest-level executives, e.g.,
  • Chief Executive Officer, Chief Operations Officer, Chief Financial Officer, etc.)
  • May require diversified training.
  • A shift in the belief that facilities are an effective component of business strategy and more than just the cost of doing business is required.
  • Understand the complexities associated with Shopping centers/ Malls/ Store formats (planning/budgeting)

2. Emergency preparedness – including (but not limited to) basic safety and security, acts of terrorism, natural disasters, bandhs/violence, security incidents, pandemic crises, data protection, etc. The topic of preparedness often brings to mind emergency planning, but it encompasses much more than that single aspect. This encompasses a wide spectrum of issues that can affect a Retail business and its customers and damage the Brand value of a retail organisation. Advance planning and preparation are important in minimizing the disruption – and speeding the recovery process – that often follows such an event. In the wake of large-scale natural disasters that have occurred in recent years, facility management professionals have seen evidence that outside sources of help may be slow to respond, placing more importance on self-reliance which must include:

  • Analyze vulnerabilities.
  • Develop and implement protection strategies.
  • Develop response plans in advance and communicate them to all stakeholders.
  • Leverage resources (both Rupee and people).
  • Implement training and practice drills.

3. Change management – including changes in operations, construction escalation, continued demand to increase efficiency, regulatory changes ((local codes and regulations will vary by city/ states). The rapid pace of change in the retail sector in India has necessitated that facility management organisation and professionals develop skill sets that cover a variety of areas:

  • Security & parking management
  • Innovation in facility operation e.g. CAM billing, Tenant mix, leasing options
  • Strategic planning
  • Motivational training
  • Energy management
  • Cultural diversity
  • Productivity measurement
  • Negotiation strategies
  • Sourced services management
  • Project team building
  • Multi-lingual capabilities

4. Sustainability – including environmental/ social responsibility, energy management, refrigerant management, investing in high performance systems, indoor air quality issues etc.

Demands on facility management professionals:

  • Learn about LEED, ENERGY STAR and other high-performance building ratings systems and initiatives.
  • Ability to make a business case for sustainability.
  • Establish programs to reduce reuse and recycle. Develop/maintain technical skills expertise.
  • Operational expertise is critical to building performance.
  • Perform commissioning and retro-commissioning to ensure that “You’ve gotten what you’ve paid for.”

5. Emerging technology – changing user/tenant needs, changing building technologies, Building Information Modelling (BIM), Integrated Workplace Management Systems (IWMS), and underutilization of current technology.

6. Glocalisation (being global but acting local) – increased infrastructure; the need to bridge larger physical operating distances; facilitate productive work across various geographic locales; address differences in mobility, communication tools, culture, languages, laws, regulations, measurements, and education.

7. Broadening diversity in the workforce – ageing workforce, different work styles.

8. Ageing buildings – maintenance, replacement issues Another key issue which I would like to touch will be the Energy management in Retail sector, which provide opportunity to FM industry and a challenge as well. Global energy consumption continues to increase, with the greatest increases in demand occurring in developing regions like Bangalore, Mumbai, and NCR etc. Key issues of facility energy management have been:

  • Focusing on improving existing technologies vs. finding renewable energy sources.
  • Judicious use of potentially unreliable benchmarking data due to geographic spread of Retail sector
  • Focusing on improving large amounts of existing building stock.

Energy management is primarily about change; leadership, commitment and discipline are needed to manage a successful program. It’s important to remember that there in no one right answer. Each culture has unique requirements, and no single solution without specific tailoring is appropriate.

Areas of opportunity include:

  • Technology step change – today’s equipment can be much more efficient than that made several years earlier.
  • Operational change – although it is easier to operate equipment, it’s much more difficult to understand how to run it efficiently and realize maximum benefits.

Success factors

  • Robust system design: failure of one piece shouldn’t lead to excessive energy consumption.
  • Effective commissioning and maintenance.
  • Maintenance accessibility.
  • Ability to turndown the system in slow periods.
  • Plant efficiency.
It has been clear that a critical facet of successful facility management is the ability to link the role of facilities to an organization’s core business strategies. In the coming years, I believe this will be of even greater importance. Physical facilities can have a large role in determining productivity, supporting innovation, efficiency, customer’s satisfaction and public perception of a shopping center/ mall/ retail store. Every Rupee invested in improving and maintaining facilities must be analyzed for return on investment (ROI). This is an exciting time to be in the business of facility management (FM) or being a part of…

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