This research report (Report 2005-001-C-6) is part of a series of reports for the Sydney Opera House - FM Exemplar Project. The Sydney Opera House FM Exemplar project procurement research aims to develop innovative methods and guidelines for the procurement of FM services applicable to iconic facilities and/or performing arts centers or facilities with similar FM functions. A subsequent interim report on public procurement in September 2005 discussed the elements that contribute to the decision-making criteria in the public procurement process.
This procurement report focuses on research on procurement strategies and innovative methods using a case study approach. Innovative procurement methods and processes, drawn from a case study of the Sydney Opera House as an example. Procurement methods and contract outcomes, focusing on Sydney Opera House building maintenance and cleaning services.
While the Sydney Opera House case study highlights the experience of the Sydney Opera House, a study on procurement strategies and methods from published research and FM good practice will provide facility managers with alternative procurement routes. Further research on the topic of public procurement will develop a final decision-making model for the procurement of FM services based on the assessment of case study outcomes and FM good practice and the findings of currently published research.
Introduction
Introduction
Procurement Research
Deliverables
Asset Maintenance in Iconic / Performing Arts Facilities
Asset Maintenance in Iconic and / or Performing Arts Centre Facilities
Service Procurement Objectives and Strategies
- Outsourcing of Maintenance Services
- Key Success Factors for Procurement of Outsourcing
- An Integrated Performance Framework
Trends and Innovation
- Strategic Outsourcing
- Alliance / Performance Based Contract
- Innovation in Key Performance Indicators (KPIs) /Non-financial Criteria
- Joint Partnerships
- Information Sharing and Communication in Procurement Process
- Data Management and Knowledge Management
Procurement objectives and strategies for maintenance services must be aligned with high-level organizational objectives and ensure that innovative approaches can be used in the procurement process to increase business outcomes. For example, the Sydney Opera House has in-house resources focused on strategic management, control, etc., while selected operational maintenance services are outsourced. The outsourcing procurement process should consider the integration of organizational goals with outsourcing strategies, performance requirements, etc.
Key success factors for outsourcing derived from FM industry practice (University of Technology Sydney, Transfield Services Ltd and Boston Consulting Group, 2004; Kakabadse A and Kakabadse N, 2002) are presented as follows. The use of key success factors in outsourcing services will be analyzed in the Sydney Opera House case study in Section 3. The effective transfer of best practice approaches to building maintenance and management from the service provider to the Sydney Opera House staff responsible for building operations, enabling proven value improvement services during the duration of the contract.
Introducing new technical approaches and maintenance practices in consultation with the Sydney Opera House, to ensure that maintenance is carried out using modern maintenance technologies and approaches. An integrated service procurement performance includes physical performance, operational performance, business performance, Service Provider performance as well as innovative aspects such as collaborative relationship management, information sharing and communication in the procurement process and innovative technologies and approaches. Information sharing and communication appear to have an important impact on the procurement process and operations.
BIM for FM was developed in the digital modeling theme (Report 2005-001-C-4) of the Sydney Opera House FM Exemplar Project.
Sydney Opera House Study
- Facilities Procurement Strategies at Sydney Opera House
- Sydney Opera House: Business Enterprise and Facilities Management
- Service Procurement Strategies and Methods
- Innovation
- Procurement Methods and Contract Outcomes
- Analysis of Existing Contract
- Performance Requirements
- Research Survey Results
- Summary
- Summary of Findings
- Existing Research
- Decision-making Strategies and Guidelines for Procurement of FM Services
- Corporate Strategy
- Asset Strategy
- Asset Knowledge
- Asset Monitoring
- Asset Management and Operational Level
- Planning for Capital Investment
- Intervention Decisions
- Managing Strategic Management of Long Term Assets
- Summary
Preserving and enhancing the Sydney Opera House as a cultural landmark, performing arts center and architectural masterpiece. Invest in performing arts, cultural activities and audience development by maximizing the business outcomes of the Sydney Opera House and leveraging its assets, resources and brand.” 3. Perhaps more than in many buildings, facilities management at the Sydney Opera House is seen as a core business function that contributes directly to the visitor experience and therefore to the success of the building.
Facilities management at the Sydney Opera House is managed by the Facilities Portfolio, which is also responsible for site management. The subsequent evaluation process focused on non-commercial criteria related to understanding the Sydney Opera House business and demonstrating how the bidder would contribute to this. Outsourcing was addressed in a thorough review of facilities management at the Sydney Opera House in late 2004.
An understanding of how building maintenance and cleaning impacts the Sydney Opera House experience for patrons, presenters, visitors and staff. The subsequent interviews gave each applicant the opportunity to present their own modus operandi and demonstrate their understanding of the Sydney Opera House business. Did not attempt to view Sydney Opera House from the patron or tourist point of view.
For the procurement team the workshops were a critical stage in enabling and encouraging tenderers to understand the Sydney Opera House enterprise. During the tender period, two site visits were conducted to enable the tenderers to familiarize themselves with the premises of the Sydney Opera House. The survey of participants enables an assessment of the effectiveness of the procurement process in securing tenders in line with the aims and objectives of the Sydney Opera House.
Figures 3-7 demonstrate that the innovative use of workshops was valued by participants and improved understanding of Sydney Opera House's business. The workshops were less successful in explaining Sydney Opera House's culture and the BCI concept, possibly due to the degree of subjectivity. This research undertaken is subject to the approval of the Sydney Opera House - Facilities Management Department.
As an iconic building, the Sydney Opera House is integrally incorporated into the enterprise as a feature of the patrons' performance experience and is an incentive for repeat business. As with the Building Condition Index (including BPI and BFI) adopted by the Sydney Opera House, the performance of assets and services must be measured and monitored.
Conclusion and Future Development
Conclusion
Future Work
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Appendix A - Procurement Questionnaire for Contractors
In your own judgment, how much of the tender material you submitted was written specifically for SOH as opposed to being generic corporate material. Did you spend more or less time preparing the offer than you would on a typical offer of similar value. Which of the following aspects of this tender were an improvement over other tenders you have experienced?
Appendix B - Procurement Questionnaire for Tender Evaluation Committee
Which of the following best describes the efforts involved in understanding quality issues in tender submissions? In a similar process, how would you change the weightings of the criteria, specifically between commercial and non-commercial components. Which of the following aspects of this process was an improvement on other processes you experienced?
