The Corporate Landlord and Strategic Asset Management in the Public Sector

1. The Corporate Landlord and Strategic Asset Management in the Public Sector Jill Fortune Senior Lecturer Facilities Management Graduate Centre

2. Overview • Public Sector Asset Management • Guidance from Government • Evaluation of practice in local authorities • Survey of members • 'quick and dirty' • Opportunity to share practice

3. Guidance from Government • High Performing Property • route map to asset management excellence • developed from OGC commissioned study • High Performing Property Implementation Plan • delivering a transformed government estate • a programme of change

4. HPP: Areas for action • Recommendations for 10 areas of practice identified as 4 components: • Leadership and Integration • creating property champions • property asset management boards • integrated property strategies • aligned with business and co-ordinated across departments • Benchmarking and Standards • developing standards and maturity matrix • efficiency and effectiveness benchmarks – cross government • central, strategic coordination

5. HPP: Areas for Action • Skills and Capability • skills profiling • developing capabilities • recognising asset management skills • strategic and operational • Review and Challenge • asset management performance scrutinised, challenged and reviewed • use of benchmarks and standards • self assessment – transparent

6. High Performing Property • a programme of change • reduction in space required and occupied • increased and improved space utlisation • improved procurement of fm contracts • improved procurement of leasehold contracts • linked to actions and key targets within set timeframes, March 2007, 2009, 2011.

7. Evaluation of practice in local authorities • Evaluation of Corporate Capital and Asset Planning in Local Authorities • report commissioned by Communities and Local Government • 2001- 2007 evaluation of development and implementation of corporate capital strategies and asset management plans in local authorities • Why? assess impact of the policy initiative on effectiveness and efficiency of property and capital resources

8. Evaluation of Corporate Capital and Asset Planning in Local Authorities • What: • questionnaire surveys of local authorities • case studies from 36 local authorities • discussions with staff from Government offices responsible for assessment of cc strategies and am plan documents • discussion sessions at Inst. of Public Finance Asset Management Planning Network Events

9. Good Practice • Corporate Capital and Asset Planning in LA's • 12 Good Practice Processes identified organised under the following 5 headings: • Corporate Management • strategic leadership, cultural challenge, focus on strategic and effective property decision making • Capacity Building • developing first rate property management service • develop corporate approach to complex capital programmes and project management tools

10. Good Practice • Information and Evidence • gather, store, maintain and update property information (value, condition, suitability etc) • Strategic Planning • develop medium/long term property strategy linked to business planning • develop strategic approach to use of office space including different ways of working • Capital Programme • develop corporate approach to option appraisal for capital projects • corporate approach to prioritisation of capital projects (aligned with option appraisal results)

11. generating a capital receipt rationalising property holdings reducing level of required maintenance reducing annual revenue costs improving facilities for service delivery introducing new working practices increasing space utilisation increasing cross service working increasing co-location/partnership working compliance with DDA improving accessibility extending the range of services enhancing sustainability What are the desired outcomes?

12. Conclusions • Areas of strength: • effective and well resourced arrangements for property management • ongoing collection of property data • ongoing process of property reviews • formal corporate approach to prioritisation of capital expenditure • Areas of weakness: • project management systems/skills/capacity • performance management to drive continuous improvement • medium/long term property strategy integrated with authority wide medium term planning • formal approach to option appraisal

13. A quick and dirty survey!

14. Public sector office space management How is your organisations space managed: In house: 80% Outsourced: 12% Combination: 8%

15. Flexibility • Flexibility of office space to meet changing user needs • Poor/Okay: 70% • Good/Excellent: 28% • Flexibility of occupational arrangements • Poor/Okay: 77% • Good/Excellent: 23%

16. Explanatory notes: • Poor/Okay: • Limitations due to Listed Building status • Old small offices – but investment programme planned • Open plan and flexible but 'ownership' of space by directorates prevents corporate flexibility • Lack of office space standards, staff resistance to new ways of working • Rating is 'okay' because we have surplus space • New corporate standards approved, further education of staff required

18. Explanatory notes: • Good/Excellent: • Majority of offices refitted in recent years, provide modern, open plan layouts, wireless IT, assists with flexibility of space and capacity • 75% of offices refurbished and 95% of office staff now based in one location • Temporary accommodation on three open floors makes management of internal moves straightforward

19. Space charging • Is it used: YES: 56% NO: 38% • Benefits: • Departments more aware of costs: 57% • Encouraged departments to give up space: 43% • Inc. recognition of using space efficiently: 57% • None: 29%

20. Space Charging • Why is space charging not used? • space charging used previously and did not work 25% other: • no benefits perceived • combination of factors (not cited)

21. Understanding....... • What space departments occupy • Exc/Good: 67% Poor/Okay: 33% • The cost of occupation • Exc/Good: 75% Poor/Okay: 25% • Market value of office space • Exc/Good: 33% Poor/Okay: 67%

22. Understanding...... • Income per m2 produced • Good: 17% Okay: 8% Poor: 75% • User satisfaction • Exc/Good: 42% Okay/Poor: 58% • Performance of office space relative to other LA/Depts • Good: 42% Okay: 33% Poor: 25%

23. Space Management Practices • What are the following space management practices used in your organisation? • Space Standards 67% • Home Working 67% • Standards for Storage 25% • Space allocated on need 25% • Delivering Shared services 42%

24. Relationship between FM and other departments

25. Skills and capabilities • Do you believe your organisation has the skills and capability in house to manage space effectively: Yes: 91% No: 9%

26. Skills and capabilities • Several very experience staff, staff being constantly trained. We have a good understanding of the organisations needs and understand well the requirements of departments. There is room for improvement, but on the whole good understanding of space, costs, utilisation which are crucial • Where necessary external skills can be imported to provide support for specific issues eg space planning, external experts to assist with management of major refurbishment project • A central Corporate Landlord mechanism is proving to be relatively effective. The FM team have been strongly led, has a voice through the council's strategic asset management group. FM have taken the lead with the council's accommodation strategy, as well as operational matters around hard and soft FM • Skills and experience to deliver this service and the in depth knowledge of the portfolio

27. Skills and capabilities • The council has a wide skills base but does not have the structures in place to make the best use of its resources • We have recognised we need to significantly improve in this area. We have the skills and capability but we can restructure and are doing so to drive efficiency • XXX has recognised for several years it does not have in house skills and capacity and has established a 50-50 JVP

28. Discussion: How well are you doing in relation to developing a medium to long term property strategy?

29. Thank you