Extended FM contract terms – good or bad?

image

Extended FM contract terms – good or bad?

‘Longer term contracts for facilities management must be flexible enough to reflect changing market conditions.’ That was a primary conclusion of a panel of experts drawn from procurement and facilities management who contributed to a webinar held by FM World in association with Office Depot.

300 procurement and FM professionals logged on to listen to this lively discussion about the potential benefits of longer term FM contracts.

Our three experienced panelists – Matthew Smith, Head of Procurement at Office Depot, Peter Jones, Head of Facilities Management at CBRE and Alan Barratt, procurement consultant at Barratt and Co – debated whether longer term FM contracts really do lead to more consistent service delivery and better relationships.

Matthew Smith told listeners that achieving full benefits from a longer term supplier relationship often requires patience and warned that you had to guard against complacency.

Changes might well be required during the contract to maintain standards and prevent the buyer/supplier relationship from deteriorating. “If you start to see suppliers running contracts to a minimum standard of performance rather than driving innovation, then procurement needs to take action.”

Amongst the questions posed were:

  • What is the optimum term for an FM contract?
  • What are the potential disadvantages of an extended contract term?
  • How do you make sure that a longer FM contract remains competitive?
  • How is flexibility best fostered in the supplier management model?
  • How do you ensure the long-term alignment of the objectives of each party to take account of continually changing market conditions throughout the contract term?

To find out the answers to these and other questions, check out the webinar yourself.
 

View the webinar here

By |