mefma confex 2017 the multi facets of fm and the people...
TRANSCRIPT
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MEFMA CONFEX 2017The Multi Facets of FM and the
People who Connect ItMarch 13 & 14, 2017
The Address Hotel
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CONFERENCE FACILITATOR
DUNCAN WADDELLChairman – Global FM
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The Recipe to make TFM a Success
STAN MITCHELLKey Facilities Management International
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The Recipe to make TFM a Success
• “The proof of the Pudding is in the Eating”!
• The formula for Success:• Chef (or cook)• Tools• Menu• Ingredients• Instructions
The Haggis!
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The Chef (or cook)• The Expertise and
standards of the Input will directly influence Output!
Tom Kitchin –Michelin Star Chef
The Swedish Chef –Muppet Star
• Short Term• Quantity• $$$$
• Long Term• Quality• Sustainable• Life Cycle
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The Tools
• Efficiency
• Effectiveness
• Data
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The Menu
• Communication
• Clarification
• Perception
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The Ingredients
• Expertise
• Fresh Produce
• International Ideas
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The Instructions• Tried and tested formula
• The whole is greater than the sum of its parts
• Integration of the ingredients, in the right proportion, will deliver the anticipated output!
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The Recipe to make TFM a Success
The Parallels are obvious????
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The Recipe to make TFM a Success
For this:
• Chef (or cook)
• Tools
• Menu
• Ingredients
• Instructions
Think this:
• Facilities Manager
• Technology/ Data/ Equip
• Strategy/ Tactical Plan
• People
• Policy/Process/Procedure
The Parallels are obvious????
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Relationship of Resources Applied to Performance Impact
Tactical Level
Strategic Level
Operational Level
FM Resources(people, expertise, etc)
Organisation Performance(costs, quality, etc)
Operations Management
Consulting
Services© Copyright KEY Facilities Management 1990-2017
All rights reserved.
Understand the Requirements & Priorities
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CRUCIAL ISSUES TO BE ADDRESSED BY FM LEADERS
DUNCAN WADDELLGlobal FM
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Gem Cutting and Polishing
• Planning• Maximising the value of the stone
• Colour retention
• Weight retention
• Cleaving or sawing
• Bruting
• Polishing
• Final Inspection/Quality Control
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3 Key Elements of Leadership
1. Giving guidelines for what is to be done;
2. Getting people to co-operate, and
3. Supplying the energy and resources to reach set objectives.
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Characteristics of Leaders
• Open and extroverted
• Inquisitive
• Sensitive
• Result and performance orientated
• Decisive
• Critical
• Experimental and tolerant of mistakes
• Charismatic
• Capable of inspiring confidence and enthusiasm
• Calm
• Willing to listen
• Warm and empathetic
• Unfettered by considerations of status or prestige
• Courageous
• Unflappable
• Flexible
• Willing to encourage development in others
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Crucial Issues
• Walk the talk not just talking the talk
• ‘Back to basics’
• KISS
• Be prepared to make mistakes
• Challenge and educate inhibitors in a positive manner
• Adopt conviction and courage as traits
• Accept that others might know more or have the appropriate experience
• Know you have to respond with agility and capability to adapt
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FM Leadership
2 key questions BEFORE you start:
• Why am I doing this?
• How is it currently done and how can it be done better?
THEN
• Get on and do it!!
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The Size of the Prize!!
• Its up to you!
• It will feel sooooo good!
• Share with others
• Have fun!
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The rewards can be yours!
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WOMEN IN FM LEADERSHIPBlend & Perception
DANIELA VOICUKlue Service Management
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Contents
Statistics
_______________________________________
Live stages
_______________________________________
Future Recipe
_______________________________________
Differences
_______________________________________
Key Ingredients
_______________________________________
Successful Companies
_______________________________________
The Way Foreword
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Women Statistics in STEM
VARIANCES Teens 50%
50%
Graduate 27%
Graduate 25%
Work field 38%
Quit or never
work Below 10 %
Executives
Girls Are Smarter At School Than BoysThe University of Missouri and the University of Glasgow
Male and female mean IQs are about equal below the age of 15 but males have a higher mean IQ from age 15 on
0%
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How did we get HERE?
=
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Future Recipe
Leading innovation culture requires diversity leadership
COLLECTIVE GENIUS
COLLECTIVE CREATIVITY
INNOVATION
• Diversity is crucial for innovation
• A diverse and inclusive workforce
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Why such gender GAP in FM
Factors Contributing to a Lack of Representation of
Women in FM Positions
• Lack of flexibility in the workplace
• Heavy workloads
• Shortage of mentors for women in the FM field
• Hostile male dominated environment
• Lack of acceptance from supervisors and peers
• Isolation
• Social Stigma : demanding, masculine and
aggressive
• Double burden syndrome :
o stereotype roles for women for familiar and
household responsibilities and
o child rearing
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Key Ingredients
Create a marketplace of ideas through debate
and discourse. Amplify differences, don't
minimize them. Constructive argumentsto create a portfolio of
alternatives.
Never go along to get along. Don't compromise Combine even opposing
ideas to reconfigure them in new combinations to
produce a solution that is new and useful.
Test and refine that portfolio of ideas
Discover-driven learning Act the way to the futureLinda Hill –
Collective Creativity Linda A. Hill is the Wallace Brett Donham Professor of Business Administration at the Harvard Business School.
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Successful Companies
Successful Leadership
Creative resolution
Creative agility
Creative abrasion
• Diverse and inclusive workforce is the key to innovation • Create the space for innovation : Open door policy for all • Build a sense of community to which people want to belong • Bestow credit in a very generous way• Co-create the future of company by participation • Hire people who argue with you • Sometimes it's best to be deliberately fuzzy and vague.
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The Way Forward
RECOMMENDATION FOR ORGANIZATIONS:
• CREATE CLEAR, VISIBLE, AND TRANSPARENT PATHS TOWARD ADVANCEMENTs
• INVEST IN PROVIDING SUBSTANTIAL TRAINING AND PROFESSIONAL DEVELOPMENT
• COMMUNICATE CLEAR WORK GOALS AND RELEVANCE OF INDIVIDUAL TASKS TO THE BIG
PICTURE
• IT’S THE WORKPLACE CLIMATE!
• CREATE AN ORGANIZATIONAL CULTURE THAT VALUES EMPLOYEES’ CONTRIBUTIONS
• ROOT OUT UNCIVIL AND UNDERMINING BEHAVIORS IN THE WORKPLACE;
• CREATE A CULTURE THAT RESPECTS ALL
• CREATE A SUPPORTIVE NETWORK AT WORK: SUPPORTIVE COLLEAGUES, SUPERVISORS,
AND MENTORS MAKE A DIFFERENCE
• CREATE OPPORTUNITIES FOR FORMAL AND INFORMAL MENTORING
• OFFER WORK-LIFE INITIATIVES THAT ARE EMBEDDED IN FAMILY SUPPORTIVE CULTURES
• STRENGTHEN UNIVERSITY-INDUSTRY PARTNERSHIPS BY ALIGNING CURRICULUM WITH
ORGANIZATIONAL EXPERIENCES
• CREATE CLIMATES THAT HAVE ZERO TOLERANCE FOR INCIVILITY
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Thank you for listening
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THE CRITICAL ROLE OF STAKEHOLDERS MANAGEMENT IN FM
ALI ALSUWAIDIMEFMA Board of Director
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Ali AlSuwaidi Profile
MEFMA Founding Board Member
Global FM Board
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Successful ImplementationStakeholder Management in FM
Define FM
Critical Thinking in Facility Management
Building Metaphor for FM
Critical Thinking Examples in FM
FM Model & Stakeholder Involvement
Interactive Session – Stakeholders in Involvement
Q&A
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•Adding
Value
Then (Rev.2001)
•Meeting
Business
Requirements •Optimising Costs
•Providing
Facilities
Solutions
•Property
•People•Technology
Facility
Management
Processes
هي إدارة عمليات متكاملة هدفها
حفظ وتطويرمجموعة الخدمات الالزمة لدعم أداء وفاعلية
مؤسسة معينة
Professional Core of Facility Management
Strategic Enabler of Corporate Business Success
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Input Throughput Output
People
Technology
Money
QHSE
Business Vision, Mission &
Strategy
Legal Requirement
Risk Management
Reliance on outsourcing
Effective Implementation of
Competencies
Human Comfort
Health & Safety
Sustainability
Regulatory Compliance
ROI
System Thinking Skills Needed – FM Manager
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Leadership &
Management
Operations &
Maintenance
Real Estate
Quality
Assessment &
Innovation
Human&
Environmental
Factors
Project
Management
Leading the
OrganizationCommunications
Technology
Finance
Managing the
Facility
Supporting
the Business
FM CompetenciesBuilding Metaphor for FM
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Critical Thinking Examples – FM
Business Issues
TOC
LCC
Integration of Services
Design for Ops and MNT
Responsibilities
Cost Effectiveness
Constant Efficiency Improvement
In-house vs. Outsource
Quality of Life
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Reasons & Contents
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Discussion
RELATIONSHIP & AGREEMENT
The success of any facilities management operation relies not so much on the
contractual arrangement and governance but on the quality of relationships.
The relationship is as important as the contract.
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FM Model Benefits
What are the Benefits of FM Model?
Please take 15 minutes
to list 7 main benefits
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FM Model Benefits
Clear & Transparent Communication Between Supply & Demand Sides
Simple & Manageable Concept: Internal & External Responsibilities of Services
Reduction of Conflicts
Integration & Coordination
Transparency
Improved Communication Between Stakeholders
Development of Tools & Systems
Systemic insourcing and outsourcing procedures
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FM Model 3 Levels Examples
Facility products at the strategic level is called FM strategic integration & contains
the integration of all purchased & used or consumed products of an organization. It
is an integration & not just bundle of facility products1At the Tactical Level, it is divided into two main groups2 Tactical integration of space, infrastructure2.1
Tactical integration of people and organization2.2
At operational level, there are standardized products. The classification is just
identification code.3
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FM Model 3 Levels Examples
1. Plan – SL / Client Interface / FM
Contract / Strategic Planning
TL/ Customer Interface / Defining SLA /
Resources
PL/ Ordering Facilities and Products / Services
2. Do SL / Integrating all Products
(Services)
PL/ Operational Doing & Facility Production
3. Check – SL Strategic Controlling /
Fulfillment of Requirement
TL / Quality Control & Cost Control
PL/ Evaluation of Products
4. Act SL / Change Management
/Managing Improvement Process
TL / Continuous Improvement Process
PL / Operational Measures
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What to measure against?
Agreed
benchmark
Your
current
performance
Performance Gap
Agree:
1. What to measure
2. Best practice comparator
3. Current performance
Implementation
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Understanding the performance gaps
• Performance gap:
– Lack of attention?
– Lack of knowledge?
– Lack of equipment?
– Complex processes?
– Lower skills?
Current Performance
Customer Focus
Information Management
Process Efficiency
Workforce Skills
Future Performance
Implementation
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Correct Structures, Skills and
Motivation
Systems for Comprehensive
Measurement
Embedding Continuous
Improvement
Organisational
Structure
Job Design
Incentives Training
Targets
Results
Working on the structures, skills and staffing
Closing The Gaps
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Inputs
Client needs
and scope
Service
structure
Agreed service
model
Mobilization,
resourcing
Outputs
Service
delivery
Quality
assured
Targets and
actions
Asset/service
lifecycle
CAFM data
integrationEnablers
Service
support
Staff
trainingCRM
concept
mobilize
operate
sustain
From the concept and model, to sustainable service
Using Benchmarks & Service DesignTo Add Value
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Good SystemsGood Information
Good RelationshipsGood Communication
Good Management
You need to build up transparency and
teamwork culture.
Summary
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Sustainability is not an added cost; it is
clever living
الستدامه هي ليست تكلفه اضافيه وانمااالستدامه نمط حياة
Thank You
المهندس علي السويدي Engineer Ali Al Suwaidi
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PANEL DISCUSSIONWhy Pursue a Higher Education in FM?
DR. YASEMIN NIELSENHeriott-Watt University
MAHMOUD MAWEDHeriott-Watt University / ETA
SIMON LONGOman International Group SAOC
FERDINANDO SCALAMANDREManchester Business School
Moderator - MARK GRAHAMMacro International
RANDA BESSISOManchester Business School
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STRATEGIC FAÇADE MANAGEMENT(More than just Glass Cleaning)
DARREN WILLIAMSSpider Access / Vertico X-treme
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Strategic Facade Management(More than just Glass Cleaning)
• Why would you only maintain a third of the external buildingenvelope i.e. glass, whilst the rest of façade and curtain wallingsufferers with environmental pollution build up and thebuilding envelope ends up unbalanced?
• Why allow façade weathering to build, weaken and breakdown the building skin, often creating problems beyond simplecleaning or repairs?
• Traditional procurement processes and maintenance budgetingdoes not allow for the detail needed to protect the conditionof external façades.
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Strategic Facade Management(More than just Glass Cleaning)
• Construction investment seeing significant growth• Importance of ensuring building managers / owners and
budgets are aware of the external building fabric condition • Limited information provided on the condition of external
façades• Limited understanding on how high level building
materials and curtain walling weather and decay (New technologies / Extreme designs)
• Material life expectancy is not always as it was initially intended.
• Quality of initial installation!
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Strategic Facade Management(More than just Glass Cleaning)
• Managing in-situ building façades• Optimising each opportunity within traditional cleaning
and maintenance programmes to take greater action and deliver greater value.
• Proactive Protection of your Asset
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Strategic Facade Management(More than just Glass Cleaning)
• The 3 ‘P’s
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Strategic Facade Management(More than just Glass Cleaning)
• The 3 ‘P’s
• PERCEPTION
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Strategic Facade Management(More than just Glass Cleaning)
• The 3 ‘P’s
• PERCEPTION
• PREVENTION
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Strategic Facade Management(More than just Glass Cleaning)
• The 3 ‘P’s
• PERCEPTION
• PREVENTION
• PRESERVATION
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Strategic Facade Management(More than just Glass Cleaning)
• Why does it affect you?
• Liabilities and Obligations
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Strategic Facade Management(More than just Glass Cleaning)
• What should you do?
• Condition Survey
Cracks and crazing Surface finishesOpen movement joints Joint sealsCorrosion StainingMoisture Weep holes and Air ventsPlumb and level Moving partsHand rails Maintenance equipmentFixings and fastenings GasketsFire Breaks Electrical Installation
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Strategic Facade Management(More than just Glass Cleaning)
• What should you do?
• Condition Survey• Planned Inspection and Maintenance (What does your Building / Structural O&M state?)
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Strategic Facade Management(More than just Glass Cleaning)
• What should you do?
• Condition Survey• Planned Inspection and Maintenance (What does your Building / Structural O&M state?)• Component Durability
• Short 2-5 years• Medium 5- 10 Years• Long 10 – 20 Years• Very long Non-maintained during
building design life
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Strategic Facade Management(More than just Glass Cleaning)
• What should you do?
• Condition Survey• Planned Inspection and Maintenance (What does your Building / Structural O&M state?)• Component Durability• Inspection Frequency
• Routine – All staff / tenant feedback• General• Detailed – not exceeding each 5 years
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Strategic Facade Management(More than just Glass Cleaning)
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Strategic Facade Management(More than just Glass Cleaning)
• Case Study
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Strategic Facade Management(More than just Glass Cleaning)
• Case Study
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Strategic Facade Management(More than just Glass Cleaning)
• Case Study
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Strategic Facade Management(More than just Glass Cleaning)
• Strategic Façade Management is;
• Whole Life Performance
• Pro-Active not Re-Active
• Utilization of all Access Opportunities
• E.g – Utilize your approved specialist service provider on each cleaning cycle to undertake an elevation condition survey – Typically 4 cycles per annum
= Whole building surveyed each year
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Strategic Facade Management(More than just Glass Cleaning)
Thank You
Questions Please?
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OAM SERVICES IN DUBAIIts Relationship with FM & Challenges
NISHAT CHIDA - Wasl Properties&
ADNAN ZAINUL ABIDEEN – Nakheel Owners Association Management
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Owners Association Management (OAM)
Law No. (27) of 2007 concerning Jointly Owned Properties in the Emirate of Dubai
Classification - Master communities, Residential ,Hotels, Retail and Mixed developments
Currently 75 OAM’s providers registered with RERA
>450 OA’s established
Value of OA business of >AED 200 million.
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OAM- Value Preposition
Adds value to asset and property
Enhances the asset
image
Increases asset life
Improves community & the harmony therein
Optimize expenses, maintain asset
with Aim to enhance property
value
Ass
et &
Fac
ility
man
agem
en
t
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Owners & OA Boards Role with FM
Owners -elect the board
Owners at AGA- ratify contracts , annual budgets & expenses
Board is elected to manage the affairs of the OA and procure FM services
Manage delivery of FM services through the Association Manager
Expect FM to Use best practices to deliver services
Directly
Procurement experts
Cheapest is best
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Challenges in FM
Input or output specific services
Management of Specialist services
providers
FM services inside unit
Capturing FM costs in standard
format
Lack of benchmarking
Cost conscious clients
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OA’s Relationship with FM
Alignment of client expectation for FM services
Budgets based on service levels
FM deliver services as per SOW & OAM evaluate service performance
OAM depends on FM to bring out innovative strategies to provide energy efficiencies
FM uses CAFM to analyze , report and provide solutions
OAM & FM work to enhance equipment & asset life
Client satisfaction & enhance asset value
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Thank You
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ASSOCIATION MANAGER’S EXPECTATION FROM FACILITY MANAGEMENT SERVICE DELIVERY
FAHAD MOHAMEDDeyaar Owners Association Management
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DETECTIVE
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Uplift the teams’ mood
Encourage motivation
CHEERLEADER
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Show empathy
Act as a reliable point for the customer
Apologize for poor experiences
Provide advice
Walk customers through the various aspects of the community
THERAPIST
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Bridge the gap
Speak to the customer
Take feedback
Explain to the admin team the customer’s requirements
Translate technical geek into layman's terms
TRANSLATOR
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Be in the front-line in tough
customer situations
Remain calm in
sensitive customer
communication
Show strong diplomatic
skills
DIPLOMAT
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Contain sensitive and incorrect information
Align the team and the service providers
Wrestle to bring all parties on the same page
COWBOY
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Analyseissues
Analyseexpenses
vs revenue
Analyseservice
providersperformance
Summariseto optimise
future strategies
ANALYST
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Email Clients & Service
Providers
Post notices
Prepare violation notices
Update the
customer
AUTHOR
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Deliver
Meet demands
Close issues
Keep records
Marketing
Ensure integrity
Achieve savings
Association Manager
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Authorities Owners / Developer / Board
Utility Providers
FM
AM
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Our expectation
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ProductProcessPeople
Consistent Performance
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Staff / Contractors
Customers / occupants
Emergency Management
Quality, Health, Safety &
Environment
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Effective Communication & Reporting
Use Different Methods
Repeat if required
Be Concise and Informative
Think like a C-level Executive
Don’t communicate in a Bubble
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Performance Management
Measurement is the first step that leads to control
and eventually to improvement. If you can’t measure
something, you can’t understand it. If you can’t
understand it, you can’t control it. If you can’t
control it, you can’t improve it.
(J. H. Harrington)
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TRA
Trai
ning
Setting a target based on training needs
Based on complexity of the facilities
Identifying the best mix of training resources
General awareness on ethics and grooming
Importance of time management
Importance of Performance
QHSE trainings
Trainings on communication and reporting
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Top management involvement
Define clear objectives and
create awareness
among ground staff
Understand and plan effective
transition
Develop a training,
learning and development strategy to
respond to the changing work environment.
Follow good measurement techniques on
effectiveness of the training
Constantly monitor
performance
Stay up to date with the latest
technology
Ensure Customer
Satisfaction
Quality Service Delivery
The
AM
’s E
xpec
tatio
n
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Hol
istic
App
roac
h
Cleaning
Security
Engineering (MEP)
Concierge
Landscaping
Specialist Services• Pest Control
• Waste Management
• Elevator Maintenance
• Fire Fighting System
• Fire Alarm System
• Central battery
• BMU
• Swimming Pool
• Water Testing
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Thank you, any questions?
www.doam.ae
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SERVICE CHARGE INDUSTRY IN DUBAI
MAHMUD MERALIMerali’s Group
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DEVELOPER
Developer sells property
All owners become members of the
Owners’ Association
Owners’ Association Interim
-Board
COMMUNITY MANAGER
Jointly-Owned Property
BUILDINGS
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DEVELOPER
Developer sells property
All owners become members of the
Community
Community Interim -Board
COMMUNITY MANAGER
VILLA COMMUNITY
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WHAT IS AN OWNERS’ ASSOCIATION?
Owner Associations (OA) are non-profit organizations that are formed when there are more than oneowner in a property.
Owners’ Associations are formed to take care of the commonly owned properties. They collect monthly orannual dues to pay for maintenance of common areas like parks, tennis courts, elevators, gym, andswimming pools and can levy special assessments on homeowners when the association lacks sufficientreserves to pay for unexpected repairs. It also includes collection of reserve fund for future replacement ofassets.
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WHAT ARE THE RESPONSIBILITIES OF OA?
▪ to supervise, manage and control the Common Areas and Assets for the collective benefit of ownersand in ways that promote positive environmental outcomes;
▪ to ensure that the building or Association, including the Common Areas, are maintained in goodconditions;
▪ to integrate waste management, energy and water efficiency policies into the Association's strategyregarding the Common Areas and Assets;
▪ to register the Jointly Owned Property Declaration, including Association Rules, and any BuildingManagement Statement in respect of the Jointly Owned Property;
▪ to promote harmony and a sense of belonging among Owners and Occupiers of Units;
▪ to obtain and maintain any license it requires by law;
▪ to maintain records and produce statements and other documents as required by this Constitution orthe Regulator;
▪ to otherwise comply with all laws, decrees, regulations, by-laws, policies and directions by which it isbound
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WHAT IS SERVICE CHARGE ?
• Service charge is the amount collected from the owners to cover the maintenance cost of theproperty’s common areas and reserve fund for future replacement of assets.
• Every financial year, budget is prepared which forecasts the maintenance expenses for the yearahead and accordingly the service charge rate is derived. RERA Approved Budgets.
• After the end of the financial year, when the final cost of providing services is known, the finalaccounts are prepared and audited. These compare the amount charged during the year with theactual costs. If the costs are lower than the amount charged as service charge, there may be asurplus.
• If the costs are higher than the amount charged, there may be a deficit. In most cases the cost isspread by adding it to your estimated service charge in a subsequent financial year.
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WHY IS IT IMPORTANT TO CONTRIBUTE SERVICE CHARGE?
• Service charge is collected solely to covers the costs of managing and maintaining the property onbehalf of all the joint-owners of the property. Therefore its crucial that all owners timely contributeto the service charge to ensure proper maintenance of the property.
• Default in service charges ultimately effects all the owners of the property, in terms of services andfinancial stability of the Association.
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LATE PAYMENT FEE
What happens if you don’t pay
• Delay in service charge payments, ultimately affects the wider community.
• Potential to deprive your community of the funds required to continue the supply of essentialservices such as common area maintenance, air-conditioning, security, waste collection, streetlighting and irrigation.
• Timely payment of the service charge is vital to uphold the high standard of living you expectin your community.
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LONG OUTSTANDING RECEIVABLES
• Service charges has been a contentious issue with property managers having to resort to blockades and legal notices to recover outstanding charges.
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WHAT IS SERVICE CHARGE AUDIT ?
• Verify the financial statements, information & records prepared and maintained byCommunity Manager,
• Obtain reasonable assurance the financial statements have been free of materialmisstatements and properly prepared in accordance with financial reporting framework (IFRS)and in accordance with the requirements of the applicable laws and regulations.
• give a true and fair view of the state of the association’s affairs as at financial year end dateand of its surplus /(deficit) for the year then ended;
• with a view to express an opinion on the information given in the Management’s Report forthe financial year for which the financial statements are prepared is consistent with thefinancial statements.
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AUDITOR’S RESPONSIBILITY
• Report independently to the owners / management
• Express an opinion on the Financial Statements
• Conduct Audit in accordance with ISAs (International Standards on Auditing) issued by IAASB(International Auditing and Assurance Standards Board)
➢ ISAs require
➢ Compliance with Ethical Standards
➢ Obtaining reasonable assurance whether the financial statements are free from materialmisstatement
➢ Obtaining audit evidence about the amounts and disclosures in the financial statements
➢ Evaluating the appropriateness of accounting policies used and the reasonableness of accountingestimates made by management, and evaluating the overall presentation of the financial statements
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DEVELOPMENT OF A SERVICE CHARGE MODEL
• A high level cost model, with all necessary strata components including General Fund (operationalcosts) with a breakdown of each calculation methodology.
• This model apportions costs to stakeholders based on the most appropriate methodology for eachstrata component.
• This model allows scenario and sensitivity based analysis.
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RESERVE FUND STUDY
• The reserve fund study is important as it acts as a separate fund to be used solely for the purposes ofpaying for the existing major repair and replacement of the common elements and assets of abuilding/community.
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The Association budget of income and expenditure for the financial year in respect of the Common
Use Facilities should be prepared at least two (2) months prior to the end of each calendar year
together with capital expenditure. Provision should be made for all anticipated expenses including,
but not limited to, the following:
• Fire Protection
• Life Maintenance
• Landscaping
• MEP
• BMU
• Swimming pool
• Cleaning
• Pest Control• Security
• OA Management
• Waste Management
• Audit Fee
• Utilities
• District Cooling
• Insurance
• Master Community charge
PREPARING THE BUDGET
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• administrative and professional expenses, including the costs incurred in enforcing the provisions
of this Declaration,
• management fees;
• contributions to the Reserve Fund;
• financing costs incurred by the Master Developer in connection with the establishment and
maintenance of the Common Use Facilities and related infrastructure in the Association;
• any other cost incurred by the Master Developer in connection with the Association including, but
not limited to, the cost of providing any other services which the Master Developer reasonably
considers in its sole discretion necessary for the purpose of complying with its management and
administrative functions in accordance with this Declaration.
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➢ The budget shall cover all activities; income and expenditure (both capital and revenue expenditure) of the Association for the financial year to which they relate and the projections for the succeeding year. The budget shall be designated in Arab Emirates Dirham (AED).
➢ There shall be a budget for each Cost Centre accounted for under main headings such as income and expenditure (with the respective sub-classifications). Expenditure shall be categorized under capital and revenue expenditure.
➢ The budget should be sent to Owners’ Association Board for approval➢ Copy of approved budget should be sent to owners➢ Professionals can be engaged to review the budget➢ Exceptional expenditure should be approved from the Board
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DO’S AND DON’TS OF THE INDUSTRY
133
The service charge fee is important as it covers all expenses relating to the operation and maintenance of common areas, below are some of the list of Do’s and Don'ts of industry in
regards to the service charge:
Do's Don'ts
Service charges levied to developer for unsold units. Unsold units not being charged any amounts.
Levies should be charged as per approved budget.Levies charged as per management prepared budget, not
approved by RERA.
Pre handover expenses being charged to developer. Pre handover expenses being included in OA expenses.
DLP and snagging issues being dealt by and expenses to developers.
DLP and snagging issues being charged to or dealt by OA.
In Facility Management contract include a clause that allows auditor access to all records of the FM company.
Deny auditors access to information and records
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DO’S AND DON’TS OF THE INDUSTRY
134
Do's Don'ts
Service charges levied should be at a higher rate using participation quota, to hotels, restaurants and
commercial offices than to residential.
Charge equal levies to hotels, restaurants, commercial office and residential units.
Service charges to be levied from date of handover of units.
Service charges to be levied before handover dates.
Financial statements to be audited as per IFRS.Financial statements to be audited as per agreed upon
procedures.
Computation of reserve fund must be done professionally.
Do not make provision for reserve fund in the budget.
Deposit reserve fund in separate bank account (savings account)
Use up reserve fund as part of general expenses.
Use designated accounting system and effective controls
Let management over ride controls and operations.
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THANK YOU
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PANEL DISCUSSIONOwners Association Services & the Challenges faced by the Industry
FAHAD MOHAMEDDeyaar Owners Association
Management
NISHAT CHIDAWasl Properties
MAHMUD MERALIMERALI’S Group
Moderator – IMAD NAMRAWIThree60 Group of Companies
ADNAN ZAINUL ABIDEENNakheel Owners Association
Management
KANAGARAJ GURUSAMYDeyaar Owners Association
Management
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Today’s Discussion
Panel Discussion 60 minutes
Introduction 5 minutes
Questions 40 minutes
Audience Q&A 10-15 minutes
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Questions
Q1. With mounting pressure on cost’s by the Owners Associations how can FM providers preserve quality of service delivery?
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Questions
Q2. How does the tenure of FM service provision contracts impact the OA (Short term vs Long term)?
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Questions
Q3. What consideration should be applied in selecting a FM service provider for an OA Managed property?
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Questions
Q4. Do you experience issue’s with OA Boards having conflicts of interest when selecting FM service providers in today’s OA market? And how would you suggest the industry can best overcome this?
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Questions
Q5. Who leads the FM budget creation process and what impact do OA Board’s have on the same?
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Questions
Q6. When considering FM contracts, what is the basis of delivery the OA’s should be looking to embrace?
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Questions
Q7. What is the panels view on FM service provision relating to the common area of a OA property only? And are there circumstances where inside a unit should not be “the unit owner’s problem”?
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Questions
Q8. When producing a Reserve (Sinking) Fund, should these be purely based on technical inputs and how sustainable are these studies in reality?
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Questions
Q9. How important is it to introduce minimum standard qualifications into the industry and what should it include?
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Questions
Q10. How do you see MEFMA being best able to assist in improving FM service provision in the OA market?
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Audience
Q & A
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THANK YOU