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Updated: Dec 14, 2020

Contributing ​Shadrach Stephens

CHALLENGE A non-profit organization was expanding at a tremendous rate, however with the addition of more physical assets, they would need a robust, cost effective approach to maintaining their buildings, equipment, and infrastructure.

Their capital development plan included building a $6.5 million community center and adding satellite facility to complement their current location. The challenge with this plan is that the operational & maintenance cost would significantly increase due to the additional square-footage. Their current location was maintained by external service providers, which is typically a low-cost solution versus hiring in-house staff, however with adding complex equipment such as an elevator, several commercial air handlers & condensers, restaurant equipment, and the supporting electrical distribution system, their future cost came with an expensive multiplier.

SOLUTION By analyzing the historical operations and maintenance expenses, the team was able to identify cost opportunities. Through this data mining exercise, they identified where they could 1) negotiate lower cost structures for some of their service providers, 2) optimize their work processes, and 3) in-source some of the non-critical maintenance activities.

Using program development strategies, they implemented an in-house labor strategy that would cover Repair & Maintenance, Environmental/Janitorial Services, and Project Engineering support. Each service group was guided by a new set of operating disciplines and procedures, in where preventative maintenance schedules per asset were determined, a Work Order Process was developed, and ultimately staff were hired.

Facilities Service Group Operating Discipline Model

Daily Maintenance Activities

RESULT Through effective planning, contract reductions, and a better resource allocation model, the operations & maintenance budget experienced a 25% decrease (this cost reduction includes building repairs, maintenance supplies, labor, utilities, and rentals). The organization more than double its area of operational responsibility, however they were able to reinvest the savings into their core level of programming.

Impact:  $190,000 annual savings

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