The Leader Magazine

MAR 2018

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We also analyze occupancy and related data to make adjustments in the delivery of our Cisco Connected Workplace solutions. We measure the performance of every real estate project and we provide a feedback loop so we can make improvements. In essence, each new project is better than the one that preceded it. Analytics have enabled us to deliver massive portfolio optimization. b enchmarking against peers We also use analytics to look beyond our internal metrics. We use benchmarking reports provided by BenchCoRE to compare and contrast factors such as cost per FTE, cost per square foot, operating expenses as a percentage of Cisco revenue, and operating costs (such as utilities) per square foot. When we're higher than the mean in some of these line items, the BenchCoRE reports – along with our internal analytics – help us understand why. The reports reveal the interdependency of individual metrics, such as space per FTE and real estate mix, so we can understand where we stand against peers based on our portfolio mix and theirs. One of the things we like about BenchCoRE is that we can slice and dice the data any way we like. We have an internal expense category called Primary Cost, by which we compare apples to apples with other tech companies. We can look at utilities, FM cost, insurance, or taxes, and we can create a bucket that captures most of the related cost. We also can remove all the outlying categories of data that other companies track but that we might not. For example, some companies might include automobile fleets or security in their metrics, or other data fields that we're not capturing, so we pull those out. Then we look at the past performance and where we stack up within the tech sector. We set targets based on where we are and where our trend is going, and what would be a reasonable target for improvement. BenchCoRE reports also help us identify and remove performance anomalies across the technology sector. Then we determine an acceptable performance range and where we stand within that range. In some areas we might beat the mean score; in others, we might be behind. If we're performing weakly compared with our peers, we use that data to create intelligent targets for each benchmark. What's important is that we know exactly why we're ahead or behind. Our mix is primarily office, lab space, and data centers, but it's mostly office – probably 80 percent. We don't have any manufacturing facilities, so we take that into account when benchmarking against peers who do. We benchmark at a high level of detail because we manage each line item as a global service, that is, FM, utilities, and the like. We have a global services manager for each critical line item, whether it's capital project management, lease transaction services, workplace solutions, or employee services. We have statistical process-control charts that we manage quarterly to watch how these services are performing and whether they're headed for our targets. We're serious about taking the best opportunity we can from the big data we've collected, both internally and via BenchCoRE. When you look at data analytics on a global basis, the only way you can really have a big impact on your cost is by reducing the footprint size – in other words, improving the performance of your real estate portfolio. You can go after line-item costs all day long and make improvements, but the real bang for the buck is when you reduce the overall footprint, when you improve total cost per person, or your workspace effectiveness. You can do these things only by measuring internally, benchmarking against high-performing peers, predicting where the trends are heading, and basing your strategy on those analytics. t H e le A de R MARCH 2018 19 Alan McGinty, CFM, is senior director, Global Workplace Innovation Group, at Cisco. The company's portfolio comprises 23 million square feet (2.14 million sq.m.) in 479 facilities. The company's 81,000 employees work in 94 countries.

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