With rising operational expenses — utilities, buildings, and people consuming a lion’s share — organizations are searching for ways to cut costs without sacrificing productivity.
According to S&P Global Market Intelligence, the median ratio of operating expenses to total revenues rose to 83.7% in the fourth quarter of 2023, up from 82.2% in the first quarter.
The challenge is clear: businesses must find smarter ways to balance costs and outcomes.
And that’s something facility managers can help with.
Marshall MacFarlane, an honored IFMA Fellow and seasoned facility manager, believes that facility management is uniquely positioned to impact the major expense categories.
Whether it’s rethinking energy use, improving building efficiency, or enhancing workplace experiences, facility managers have a seat at the table where profitability decisions are made.
“There’s an argument to be made that building managers have a bigger impact on your overall health than your physician does.”
The good news is that facility managers don’t need to overhaul everything to make a difference. Small changes can lead to significant results — both in cutting costs and boosting productivity.
Are you ready to discover how facility managers can drive real impact in their organizations? Let’s dive in!
Cost-cutting strategies that actually work
For years, cost-cutting in facility management has been equaled to choosing the cheapest option or delaying necessary upgrades.
Marshall explains that this mindset is shortsighted.
“Controlling costs has been, and always will be a primary focus of facility managers”, he says.
“Historically, the problem has been communicating what controlling costs should look like. Without standing out as SMEs (subject matter experts, ed.) for our leadership ‘cutting costs’ will often end up meaning going without or just choosing the cheaper option.”
Take meeting room booking systems, for example. Skipping an upgrade may save money now, but it creates inefficiencies that lead to wasted employee time and manual workarounds — costs that compound daily.
Instead, Marshall advocates for investments that improve building operability and efficiency. Consider “thermostat wars” — when office temperatures are too hot or too cold, employee comfort suffers. Productivity thrives within a specific temperature range, and upgrading HVAC systems for precise climate control can help achieve long-term profitability.
“It’s much harder to see reducing the temperature of your buildings as simple cost-cutting when you know it will impact productivity as well. And that is the mindset we need to change”, Marshall explains.
He believes that upgrading HVAC systems, optimizing lighting, and implementing smarter building technologies can lower energy costs while boosting productivity — a double win.
Energy efficiency: The quick win you might be overlooking
Energy consumption remains one of the most significant yet manageable operating expenses. According to Marshall, this is where facility managers can make almost an immediate impact.
“First, I would look at energy consumption. And now just electricity but all utilities”, Marshall shares.
“There is almost always ‘low hanging fruit’ in our use of energy and optimizing those will produce relatively quick, and more importantly measurable results.”
The European Union reports that 75% of buildings are energy-inefficient. With a similar situation happening in the United States as well, opportunities arise for facility managers to implement energy-saving measures like LED lighting retrofits, automated systems for heating and cooling, and equipment upgrades.
Smart energy management systems can track and reduce electricity usage, detect anomalies, and suggest operational improvements — saving money without sacrificing comfort or productivity.
Tap into vendor expertise for energy-saving insights
Facility managers often overlook the expertise of their vendors. But as Marshall MacFarlane points out, “Vendors are experts in their respective fields and, in my experience, if I tell a vendor I need to cut costs, they will help me do it.”
From HVAC system optimization to janitorial service adjustments, vendors can help identify inefficiencies and recommend strategies to improve operations.
Facility managers should regularly engage vendors for performance reviews and cost analyses. This practice ensures accountability and can often uncover savings opportunities.
Why indoor air quality matters more than you think
During the COVID-19 pandemic, the importance of indoor air quality came into sharp focus. However, many organizations still treat industry standards for air filtration as sufficient.
Marshall challenges this mindset, pointing out that we don’t accept minimum standards in other areas — such as drinking water or healthcare.
“The industry standards for things like air filtration and air exchanges are minimum standards. There is more and more data showing that both human health and productivity are correlated with indoor air quality”, Marshall says.
By improving air filtration systems and monitoring air exchanges, facility managers can create healthier workspaces that reduce sick days and improve employee performance.
They can install sensors to monitor air quality metrics and optimize filtration systems. Cleaner air can also enhance energy efficiency by reducing strain on HVAC systems.
The case for involving facility managers in design
Too often, facility management is brought in after buildings are designed. Marshall believes this is a missed opportunity.
“By including facility management in the design and construction process, we can improve operability and efficiency.”
For example, designing spaces with energy-efficient materials and layouts can lower heating and cooling demands. Similarly, planning for flexible workspaces can accommodate hybrid work models, reducing unused square footage and associated costs.
Facility managers should advocate for early involvement in construction and renovation projects so that they can suggest design elements that align with operational goals.
ESG goals: Facility managers at the forefront
Environmental, Social, and Governance (ESG) initiatives are becoming central to organizational strategies. Facility managers are perfectly positioned to contribute, particularly on environmental factors like energy efficiency, waste reduction, and sustainable sourcing.
“Speaking very broadly, I think the post-covid workspace is our main concern. Company philosophies have changed, and they are still changing, which means our roles as facility managers will also keep changing”, Marshall states.
“But if I were to put it more specifically, I think many facility managers will be shifting gears to address company goals related to ESG.”
Incorporating ESG into facility management can go beyond regulatory compliance. It’s an opportunity to lead by example and strengthen an organization’s brand.
Facility managers can help by developing sustainability programs that align with corporate ESG goals, and then track and report progress to showcase impact.
Make the most of what modern solutions offer
Facility managers looking to tackle these challenges head-on can benefit from advanced tools and technology. For example, a smart visitor management system can ensure seamless tracking and monitoring of workplace access — a key component in optimizing safety and efficiency.
These systems eliminate the need for manual check-ins and offer robust real-time analytics, helping facility managers make informed decisions.
By integrating such tools, facility managers could streamline visitor management, optimize meeting room utilization, and automate some of the key operations.
These improvements not only cut costs but also enhance the overall workplace experience.
Take the next step with Sign In Solutions
Today, facility management is about driving profitability and creating spaces where people are feeling great — and being productive.
With Sign In Solutions, you can unlock the full potential of your facility management strategy. Apart from helping out with visitor management, our tools empower you to make smarter, faster decisions.
Ready to see the Sign In difference in action? Reach out today — let’s explore how we can help you cut operational costs and boost profits.