The general process is driven by procurement teams and departments to deliver demonstrable results and efficiencies across their organisations. However, as a leader of a procurement department have you experienced what support a specialist or subject matter expert (SME) can identify and deliver in supporting a procurement generalist?

An SME will quickly identify:

• Hidden margin that contractors have shoehorned into costs
• Significant savings and improved service delivery through scope and specification parameters
• Smarter operational deliverables
• Contractual underperformance through KPIs not being hit and SLA targets not being achieved

A genuine SME understands the thought process of contractors within their chosen category. Invariably they will have worked on “the other side of the table” and therefore have the experience in delivering sales pitches to procurement departments. In addition, an SME will quickly unearth additional margin sat within costs.

There is no doubt that SME’s can be expensive and most businesses and organisations do not have the budgets to retain these experts on a full-time basis. However, using expertise to focus on specific challenges can unlock significant benefits and this value, on short term basis, can you justify the cost.

In theory, once a category has been reviewed and a new model implemented, the SME can be released, although their services should be retained on a quarterly basis to ensure that the contract management of the new service delivery contract is embedded and that it is being delivered in line with their original pitch.

A SME should also be accountable, even once they have finished their project to ensure they have delivered a sustainable solution.

The FM industry has become notorious in the last two decades for demanding that contractors operate on very tight margins – margins from which these contractors are meant to find profit.

As a result, cleaning contractors, as with many other types of contractors, have been found to hide additional margin within their costs even when a contract is operating under an open-book accounting agreement. It creates bad behaviours and is not in the spirit of a long-term relationship.

However, without a SME exploring the constituent parts of a standard or complex cleaning contract both the client and contractor miss the opportunities to bring down the cost of service provision, or unlock better outcomes.

In the way that clients attempt to save money to preserve their own margins, it’s not surprising that contractors need to do the same, therefore setting the tone for both parties to adopt bad behaviours and not work towards a genuine partnership.

It’s an adversarial system where there seems to be no mutuality of obligation from either party to the other so how can a SME FM procurer extract value for both client and contractor?

Engineering a win-win situation

From a client’s perspective, a specialist FM procurement professional can take responsibility for the management of the specific internal procurement process. They can provide leadership to resolve service and commercial issues, while acting as a genuine support function to both the procurement department and operational teams.

The presence of a specialist procurer also saves time for a procurement generalist who can then undertake more of their overall work responsibilities. In the background, the specialist procurer can work at pace to deliver a substantial return on investment on the delegated issue.

What about from the contractor’s point of view? The specialist encourages the client to stop fixating on a contractor margin of 5%-7% because that’s not where the bulk of any savings will be made.

The specialist encourages the client to think about the broader questions which can lead to much more significant cost reductions, service provision enhancements and better alignment with the organisation’s goals.