by Ken Neal | 3/3/16
In a recent Workflow article, I mentioned that due to the complexity and special skills required to manage corporate campus logistics services, outsourcing is often a key ingredient to success. A new approach to outsourcing these services is now available, a topic I will expand on in this column.
First, let me revisit my definition of corporate campus logistics: a specialized service that ensures the efficient flow of materials and people at large multi-building office campuses serving thousands of employees. It’s a workflow that spans a wide range — coordinating the receipt and distribution of supplies, equipment and packages; safely transporting thousands of employees as well as suppliers and contractors to locations within the campus; tracking and warehousing countless materials to support daily planned and unplanned workplace needs.
Tapping Outside Help
Because many enterprises do not have a centralized process, including the staff, expertise and technology to manage these diverse campus logistics activities, they often tap large commercial real estate companies to take on the complex challenge. The core business of a commercial real estate company, however, is managing physical real estate — overseeing business services is a secondary focus. Consequently, for many years, real estate companies have typically subcontracted facilities management and campus logistics services to a variety of different vendors.
This has led to the challenge of coordinating many vendors, each with distinct services tied to separate contracts as well as different methodologies, performance metrics and reporting systems. The various suppliers are responsible for providing a range of amenities, from shipping and receiving dock services to warehouse and inventory management, food service deliveries and employee shuttle services. For the real estate companies and their corporate clients, however, this approach is changing. Today, real estate companies have begun leveraging the benefits of working with one vendor as a partner who can provide comprehensive campus logistics services bundled under one contract, with one set of performance metrics and one efficient reporting system. The cost savings and efficiency gains associated with this new approach can be significant.
A New Strategy
The driving force behind this approach has been the desire for vendor consolidation. Commercial real estate companies have been looking to hire fewer vendors, each providing more services. One real estate management executive I spoke to put it this way: “Not many enterprises or real estate companies are yet aware that a truly consolidated services approach is now feasible. Today we can secure multiple services under one contract that provides performance data for all services via a standardized, automated system that makes the data readily available. With this approach, we can avoid the necessity of learning and validating different performance management systems and metrics from numerous vendors.”
If on behalf of its corporate client a real estate company is managing five different service providers, each with a different performance management reporting system, the real estate company has to verify that the vendors are monitoring and reporting the correct key performance indicators (KPIs) using agreed-upon methods and that the data accurately reflects the corporate end-user’s experience. In contrast, if the real estate company works with one vendor using one system to report performance data, including KPIs that have been clearly defined in SLAs (service level agreements), then the real estate company can much more easily access the data and understand how it can be applied to continuous process improvement.
One Vendor, One Contract, One System
The latter approach is now possible because select vendors are offering the bundled logistics services and the expertise to effectively manage diverse campus logistics activities. The “one vendor, one contract, one system” solution has appeal to both the real estate company and its corporate client. For the real estate company it is primarily about simplifying campus logistics management while reducing costs and improving operational efficiency. For the enterprise client, the goals are similar. As the real estate manager I quoted above explains, “Though campus logistics vendors may be managed through subcontracting agreements by the real estate company, an enterprise will interface with the people providing the services on campus every day. Naturally, the corporation would prefer to avoid dealing with numerous vendor organizations and management structures. Beyond this, enterprises are most concerned with consistently providing high-quality logistics services that ensure safety and result in a high-quality employee experience.”
Following is a summary of the most important benefits of the one vendor/one contract/one solution approach to delivering campus logistics services.
- One Team: The real estate company has one team onsite managing the client’s logistics services, collecting data, reporting and working to continuously improve critical functions from shipping, receiving and mail to shuttle services, food service deliveries and more.
- One Contract: The real estate management company can combine multiple services bundled into one contract. This enables the real estate firm to secure a more consistent level of service from the provider.
- One Performance Management System: The capability to track compliance with SLAs via one performance management system can enable campus logistics teams to effectively measure, manage, benchmark and drive continuous improvement in the services that are being provided.
- Access to Technology: Access to advanced tools and technology is another potential gain when teaming with the right campus logistics service provider. Some examples of these tools include a cloud-based warehouse management system and a mobile enterprise mail and package tracking system.
- Superior Vendor Management: Real estate companies can better coordinate various suppliers that support their clients’ facilities management operation because there is one service provider onsite virtually 24×7, interfacing with and managing the suppliers and subcontractors, which is critical to supporting the efficient flow of people and materials throughout the environment.
Facilities management professionals are starting to leverage service providers that can deliver a bundled corporate campus logistics services offering that spans a wide range from shipping and receiving to reporting and analysis. This new trend can give real estate firms the confidence that the logistics services they manage will be innovative, efficient and aligned with their clients’ business goals.
Ken Neal is a certified enterprise content management practitioner (ECMP) and fellow, corporate communications at Canon Business Process Services, a leader in managed services and technology.