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Fresh take on facilities management
SOME transformations are gradual and tentative. Facilities management provider CBM's journey was quite the opposite.
In 2007, when new management came in, the firm embarked on several changes concurrently: expanding its clientele, expanding abroad and expanding its range of services.
After all, if a new broom sweeps clean, what more a whole new slate of leaders? Says Roy Chiang, who became chief executive officer in 2007: "We had a fresh look at the company."
The transformation was aided by former heads of department who decided "to let younger guys take the reins", he adds.
As the subsidiary of a major property developer, CBM started out in 1971 providing services for its parent company's properties. These were traditional facilities management services such as M&E (mechanical and electrical) services and cleaning.
Noticing that the company had built up many such competencies, the new team thought: Why not capitalise on them?
CBM thus sought new clients. Turnover rose from S$30-35 million in 2007 to S$150 million today.
Previously, some 80 per cent of CBM's revenue came from that single developer's projects, and the remaining 20 per cent from elsewhere. Today it is the reverse, thanks to the firm's enlarged client base.
CBM did not limit itself to Singaporean customers, either. Its second major push was to go abroad.
Admittedly, not all overseas forays have endured. The firm entered Abu Dhabi but later pulled out "because things were moving slowly". Its stint in India was also short-lived.
Yet there are also success stories. CBM entered Qatar in 2009 and Thailand in 2013, and is still present in both markets today.
Another overseas venture was related to CBM's expanding portfolio of services.
CBM started developing and testing equipment in commercial carparks in 2011. Two years later, it expanded into Housing Board carparks.
Then in 2014, it went to Taiwan to develop a carpark management business, as its existing carpark equipment partner was a Taiwanese company.
"Every few years we look at the market (for new opportunities)," explains Mr Chiang.
This is related to an approach which began in 2007: strengthening the firm's in-house capabilities.
Besides M&E services and cleaning, CBM now offers housekeeping, security, carpark management, carpark equipment supply, and laundry services. Says Mr Chiang: "By doing it in-house, you can control quality on the ground."
Setting up new business units is also a way to capitalise upon existing capabilities. Green consultancy CBM Solutions was formed in 2009, tapping the expertise gained from working on green building projects over the years.
The subsidiary "really became active" in the last five years, offering services such as Green Mark auditing - for the Building and Construction Authority's eco-friendly building rating system - and energy consumption consultations.
But perhaps the broadest skill that CBM has acquired, stretching across its various service areas, is the ability to think digital.
There's an app for that
Software and mobile applications have become an important part of CBM's work, both internally and in helping to meet clients' needs.
For one client, CBM helped develop an automated life cycle information tool. This software helps the client track the lifespan of physical assets such as lifts and air-conditioning.
Over its lifespan, such an asset usually accumulates hard-copy records - of breakdowns or servicing, say - that must be kept for many years, explains Mr Chiang.
But it can be hard to keep track of these physical files, especially if the service provider changes. The life cycle information tool makes it easier to keep all relevant data in one place.
In its own operations, CBM uses a range of software to manage work processes.
This includes a messaging service which can track both submitted photographs of issues, and subsequent follow-up actions taken. Each chat group includes the relevant client, so the client can see what is being done.
To boost housekeeping efficiency, CBM has an app through which room attendants can send photographs of the rooms they have cleaned to their supervisors. Previously, supervisors would have had to check each room.
Another app, introduced early last year, makes existing web-based software - in use for the past eight years via desktop - available on smartphones, making it easier to deal with customer complaints on the go.
Previously, if a customer called in, the relevant department would then have to call the manager on the ground to get details of the issue. With the app, such details can be easily and instantly shared instead.
Some of these apps and software were developed with the help of third-party developers, while others were simply purchased off-the-shelf.
Though both approaches require some outlay, CBM is willing to make the investment. Such decisions are not contingent on external funding, says Mr Chiang: "Typically we don't wait for the funding, we do it ourselves first ... We know we have to do it anyway."
"The main driving force is not so much the funding part but the need on the ground," he adds.
One tablet app was developed in 2011 to address a specific project's demands. CBM was tasked with inspecting neighbourhood coffeeshops twice a month, with one of the inspections having to take place after 11pm.
After taking photographs during the site visit, the inspectors had to work even later into the night, making notes on each photograph. The project required more than 20 staff.
CBM commissioned an app to make the process easier. Upon taking a photograph via the app, inspectors could immediately fill out a standard form with details such as the location and comments. This could also be sent directly to the client.
With the app granting greater efficiency, the team was reduced to 14 people - a manpower savings of about a third.
Singapore's manpower crunch is a major driving force behind CBM's efficiency push. Says Mr Chiang: "We have always been conscious that we cannot just rely on labour."
He gives the example of carpark management. By next year, CBM will have 300 carparks under its care.
"You cannot have people stationed at every one." Instead, all carpark hotline calls go to a single central monitoring room, active 24/7.
One of CBM's biggest productivity investments to date is for its laundry subsidiary, Systematic, in which it bought a 70 per cent stake.
By the first quarter of next year, Systematic will have in place a new laundry system that costs "millions".
This is supported by the WorkPro grant, administered by the Employment and Employability Institute.
Systematic's current set-up features some automation, but requires manual loading and unloading: from the washer to the dryer, then on to ironing, folding and packaging.
In contrast, the new set-up will have a tunnel washer that sends freshly-washed laundry straight for drying, and a conveyor system that reduces the need for loading and unloading. New folding and packaging machines will also be added.
The existing system can handle 35 to 39 tonnes of laundry a day with 80 people over a 12-hour shift.
With the new system, the same staff strength can handle 70 to 75 tonnes over an eight-hour shift - making the new system about three times as productive as the old one.
CBM is also reducing Systematic's retail fronts and introducing a "vending machine concept" instead.
It is not very productive to have someone stationed at a shopfront for the whole day, observes Mr Chiang.
With the new "Systematic ATM" concept, now in use at certain condominiums, customers simply drop their laundry off at unmanned points.
When enough laundry has been amassed, it will be picked up. The cleaned laundry is later delivered directly to the customers' home unit.
While manpower pressures drive efficiency, the need to compete pushes CBM to expand its offerings.
Being able to "provide everything from A to Z" is a competitive advantage, and makes things more convenient for clients, who have just a single point of contact for all their facilities management needs.
Establishing a reputation for quality and technological solutions also means not having to compete solely on cost, Mr Chiang adds.
But the firm sometimes faces an unexpected challenge: the client.
"Sometimes you have a solution, but the client is not prepared to change the way they think," he says.
"They see facilities management as a cost: the cheaper the better."
Furthermore, long-term contracts and those based on KPIs (key performance indicators) are the best sort to encourage investment in new technologies and manpower-lean approaches. Yet clients may be reluctant to offer such contracts, notes Mr Chiang.
It is easier for them to specify their desired worker headcount instead of something harder to measure, such as cleanliness.
One trend in service providers' favour, however, is that industry developments mean that wage costs can increasingly be passed on to clients: "They also feel the pressures of HR (human resource) costs."
The security industry is a case in point. Since 2016, licensed security firms have had to adopt the tripartite progressive wage model, which specifies minimum starting wages.
If a client specifies a fixed number of security guards, they will have to be prepared for higher costs whenever the wages are raised under the progressive wage model.
Thanks to this, clients now understand the need to go manpower-lean, says Mr Chiang. "So today, they are more prepared to listen."
Brought to you by The Future Economy Council