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Why Facility Management Companies Fail Big Without Digital Transformation

Why Facility Management Companies Fail Big Without Digital Transformation

Posted on 31/07/2019
5 min read

The digital transformation in facility management is no longer a matter of yes or no. With the rapid pace of technological growth and the disruption in almost every business field, no industry will remain untouched. It means that also traditional businesses based on people relationships will be forced to become more data-driven and automated. If firms remain stagnant, they run the risk of being disrupted and pushed out of the market.

#1item on the boardroom agenda: Impact of digital technology on the business model.
EY Survey, Global Capital Confidence Barometer
April 2017

The property management industry is no different. Especially in the field of building maintenance. Neglecting recent changes can bring business risks such as costs of delayed work, insufficient quality of services or constant employee training. FM needs to adapt to both the workforce and technological changes to become competitive the way modern customers expect.

What you’ll learn about digital transformation in FM from this article

  • What is digital transformation and why it matters for FM sector
  • Why FM companies need to become digital
  • What are the benefits of using real-time data in facility management

What is digital transformation and why it matters for FM sector

Digital Transformation is the application of digital capabilities to processes, products, and assets to improve efficiency, enhance customer value, manage risk, and uncover new monetization opportunities.
Bill Schmarzo
CTO of Dell EMC Services

Simply put, digital transformation is the use of technology and data in order to stay competitive and constantly add value to companies’ offering. This can happen through improving the reaction time, broadening the services or collecting building information real-time.

But in order to benefit from digital transformation in facility management, we need to remember that it’s not only about collecting data. When only collected, data is useless. The essential part of transforming an FM company into a digital business is understanding the implications of data analysis for the company as a whole.

collect analyse data and predict behaviors of your systems

Some tools for company transformation are management systems such as

  • Energy management systems (EMS)
  • Building automation systems (BAS)
  • Computerized maintenance management systems (CMMS)

or technologies like machine learning, artificial intelligence, virtual reality or Internet of things (IoT).  

Going digital and using some of the real data can help your property management team avoid risks but also make informed decisions in the field of staff allocation. It also allows energy saving, predictive maintenance and hence shows the building manager as a reliable and proactive business partner.  

Of course, not everything that glitters is gold. As every significant change, also the digital transformation requires investment. In transformation strategy, plan and tools as well as in people who can be the catalysts of the upcoming changes. 

Why FM companies need to become digital

The competitive area of facilities management forces FM companies to work on smaller margins with operational costs getting higher year by year. Even those two factors make it difficult not to struggle. If we add to it employees rotation and high training costs, we see that the business is not only tough but also complex.

Companies are trying to implement repetitive processes and cut down on training costs use different software to collect information. The information concerns clients, invoices, inventory, repairs etc. Unfortunately, companies usually collect most of the data in separate systems. This creates data silos that result in poor knowledge sharing and consequently poor customer service.

Real insight can be provided when the silos are removed and technology is used to connect the distributed information into one ecosystem of devices and systems. This way, data from sensors is immediately sent to the system showing that a radiator can be airlocked, a room should be aired or cleaned. There’s no need for the staff to control rooms or buildings that need no control at the moment. Instead, they can proactively plan their resources to focus on the areas that need a reaction. 

Let’s take the heating gauge as an example. In traditional buildings, a facility team needs to apply one gauge on each radiator before the heating season starts. When the season ends the team reads the indications and replaces the gauge with a new one. Both actions require the tenant to be at home and the engineer to visit every room in the building. Often, it means coming back to the offices or apartments no one was present at the scheduled time. The past readings are available only on paper.

With digital read ons fm companies can manage their staff more efficiently

With a digital system, the facility company would install the heating sensor once and then would be able to read the indications on a monthly or weekly basis without the need to knock at every door in the building. What’s more, the sensors could control the temperature or use eco mode to generate savings.

The same rule could apply to power, water, gas, space and other utilities.

What are the benefits of real-time data in facility management

Data collection, analysis and prediction are the core of digital transformation in facility management. The race between companies shows that the most important factor in the next few years will be the ability to gather and analyse the information as fast as possible. It will have an impact not only on minimising costs but most of all on improving customer service and customer satisfaction. 

Let’s take a look at a few competitive advantages facility management companies can benefit from thanks to digital transformation.

Adding new services to the portfolio

What if your customers were able to cut the heating costs by 28-36% a year in each building thanks to the solutions you provide? Real-time insights can lead you to become not yet another facility management company but a competitive and customer-oriented partner. 

Thanks to digital transformation and data collection your company is able to provide brand new services such as instant utility read-outs, setting maximal or minimal heating levels, optimising operational costs for the building owner.

That’s how you can flip the coin of low margins and a highly competitive environment in your favour. 

Responding to customers’ expectations

The customer demands have changed a lot since Apple introduced its first smartphone back in 2007. Nine years later, in 2016, the cumulative number of downloaded applications reached 65 billion. With such a pace, people got quickly used to updates, notifications and real-time conversations both in private and business areas. Hence the expectation of being served instantly became a significant factor in customer experience worldwide. 

It’s no different in facility management segment. 

A few years back, facility companies used mobile access mostly to distribute work and send tickets to field engineers. Today, the demands are much more strict. It’s not the facility management company but the end client who needs the data.

Therefore, facility businesses start to become hubs for services such as workspace optimisation based on measuring occupancy, traffic or utilisation of available office spaces. 

Once this becomes a standard in the majority of buildings in the client’s portfolio, it will also affect their operations. For example, the client’s teams will be able to sublet unused space and increase the company’s revenue. 

Ensuring predictive maintenance 

Early fault detection is critical for customers business continuity and expense avoidance. Usually, the fault is reported when the harm is already done. The pipe is leaking, the radiator is cold, the air conditioning wouldn’t work when we need it. Even if a facility engineer reacts immediately, the inconvenience or even the inability to continue work ruins our day or our wallet as a replacement part or equipment needs to be set up.

The new technology applied in buildings allows for avoiding this type of inconvenience. Modern equipment is often connected to sensors. Thanks to the analysis of the information from the sensors, new digital solutions can determine whether the device works as expected. In case of an anomaly, the system can notify a facility company in advance that a device would need replacement in the next few days or weeks.   

Labour saved on serving last-minute fault reports can be used for planning and performing other tasks, based on the business needs.

Technology opens new opportunities for property managers

A research made by Zebra Technologies shows that improving customer experience is the most important reason why intelligent enterprises invest in sensor solutions. It accounts for 70% of surveyed companies. What’s more, 53% of companies expect that thanks to IoT solutions their revenue will increase in the next year. This shows not only the scale but also the competitive advantage of sensor solutions and digitalisation. 


What does it mean for facility management companies? 

Customers used to being confronted with data and competing through technology can push the facility management sector to new waters. By the transformation into a digital company driven by real-time insights, facility managers can become a new stream of information about potential cost optimisation for commercial real estate owners. What’s more, with predictive maintenance and energy efficient solutions, managers can help buildings become greener and more sustainable. This itself can attract new business customers.

In short:

  • Digital transformation in facility management is happening now
  • Thanks to real-data insights facility companies can enhance their product portfolio
  • Customers demand access to data analytics
  • Enterprises use data mostly (70%) to increase customer experience
  • Facility managers can become a reliable source of information about cost optimisation


About the author

Joanna Chmiel
Head of Business Development

Works with Briisk clients long before they become ones. She listens carefully, proposes solutions and eases the project kickoff. While the project is ongoing, she monitors client satisfaction and helps to remove any blockers that get in the way. Madly in love with French toasts, red wine and pole dancing (but not all at the same time).

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