GCC facility management industry reaches its inflection point

The GCC’s facility management (FM) industry is at an inflection point, where past success recipes will cease to hold relevance in light of increasing convergence and the emergence of competition from unconventional sources.

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This is critical to note for an industry that was severely strained over the last two years in the GCC, being impacted by a slowdown in construction, cash flow issues and a relatively low degree of sophistication.

“The return of pricing pressures, shift in authority to the customer and uncertainty relating to the role that FM should play in the overall landscape of building management services are major challenges that FM companies in the GCC need to address on their path to achieving growth,” said Frost & Sullivan energy and environment research analyst Suganya Rajan.

Rajan added: “A much-needed overhaul of service-level agreements is yet to take off in the region. Many technologies are on the verge of breaking into the region, including Internet of Things, big data, 3D printing, energy management and the shift towards command center models for managing buildings.”

Role relook

This will force FM companies to relook at the role that a CTO or CIO would play in their structure and companies with a strong visioning process would surge ahead in the market. For instance, FM companies must prepare to have their own 3D printers and necessary consumables to reconstruct spares and parts of the building that require maintenance or repair, Rajan said.

The Kuwait, Oman and Bahrain markets, though relatively smaller, also present a favorable environment for FM companies to operate and grow within. However, the larger players will also face challenges, especially in terms of increasing growth and ramping up internal processes to cater to the increased portfolio they are managing.

Retaining talent

Companies that wish to accelerate their growth will also need to look at how they attract and retain talent, while focusing on managing the impact of convergence. “The FM industry in the GCC is at the crossroads of change and it is essential for FM service providers to imbibe global best practices after working hard towards customizing them to meet local nuances,” Rajan said.

“Ultimately, we can expect to see a number of smaller or inefficient companies just winding up, which would provide an ideal market for transactions in what has been a relatively inactive market in the past,” stated Rajan.

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