Facility Procurement Management 2022

ORFA’s Technical Director, Terry Piche chats about the gifts that the “light bulb salesperson” used to bring in the olden days to the benefits and challenges of having a purchasing department to navigate in todays workplace. When buying any equipment in our industry just because it walks like duck and quack likes a duck doesn’t always mean it is a duck.

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Terry Piche: 0:09

Hello, and welcome to another ORFA a podcast. Thanks for joining me again, this time, I'm going to walk down a little bit of memory lane. But I also want to take a look into the future. And I do appreciate, like I said, connecting with members who are in the front lines, then they're sharing with me their experiences. And often, these are newer members that have both collected the baggage from past facility managers, and are trying to navigate what the heck is going on in today's world. So it's it's complex, but it does give me an insight and it gives me food for thought in regards to information that we need to generate as an association, so that our members are better prepared to at least think through some of the things they have on the go. So one of the topics that come into play in the last little while is procurement. So what we have noted is that there has been a slight boom in construction. And if you haven't tapped into the discussion board to take a look at what's happening around the province, what we try to do is collect the new constructions that are happening so that we have a better understanding. So anything that goes in to the newspapers, we try to capture it and put it in a file folder. Couple of good things is one that you get to understand where they're possibly getting their funding from, to move forward. And to if you get to a point where you're going to be doing a similar construction, you may be able to reach out to that community and at least how I get them to help you through the weeds as you try and figure out how best to move forward. And that's really what the association has been doing. Since we were first created, believe it or not, 75 years ago, we are definitely in a niche, a information sharing business. So we're going to take you back a little bit to when I was directly in the field as a recreation director in a very small community. And in a small community, you wear a lot of hats, you become the human resource department or the policy procedures health and safety person. And then ultimately, you become the GC the general contractor to any type of new construction. So what would happen is that when something went wrong, so let's just pick one of the hats, I had to change eight compressors. So I mean, ultimately, my employer, really all they wanted to know was did I get three quotes, and how I built into the RFP, all the incidentals that come into play, when it comes to making the purchase. For whatever reason that was their safety net, they thought that if they could say that we got three quotes, and we had done our due diligence. But I would be lying. If I told you as a recreation director, I didn't learn how to navigate that. So ultimately, what I really relied on was other members who had been down the same path and get their advice in regards to maybe some of the pitfalls they fell into. Or they would give me tips on things to avoid or include in the RFP. So if you're in administration, you understand how you can sometimes get what you want by being creative. And ultimately, that in fact, is where it is going. Now, most municipalities, if not all of them are going to have some form of purchasing policy that we need to follow. And larger centers are actually going to have a whole department that are going to focus on what is referred to as procurement. And that's a double edged sword because they don't necessarily understand what it is that we want or need. All they're looking for, is the best price. And sometimes that works. And sometimes it doesn't, it works fairly well if I want to buy bulk white paper for the photocopier, it doesn't work so well when I'm looking for a chiller and even becomes more complicated if I'm going to go from a flooded traditional chiller to to maybe a plate and frame. And they don't understand what they're buying. All they understand is what's on the last page of the of the RFP when the prices come in. And that's what they're going to have to maneuver around because the general public, the taxpayer is going to expect them to be a watchdog for their dollars. And if they want to buy something that is more than the lowest bid, then there really needs to be a lot of explanation on why they're going that road. So it does make it fairly complicated at that point in time. Now, back in the day long before LED lights were even thought of we as a facility managers had to deal with the light bulb salesperson and they would end up in the rink and that what they would want to do is sell as bulk purchases of four foot fluorescence eight foot fluorescence at that time, we were probably using metal halide or mercury vapors and they would have a great deal. And I will tell you that on more than one occasion, I had a salesperson come in and miraculously, they had just finished up a great big job for distillery, some place in the distillery was so kind that they shared their product with them. And he wanted to share it with me if in fact, I bought a bulk purchase. And I know a facility managers that, you know, took trips, got sporting tickets, there was all kinds of things that fell out of the truck after the salespeople left. So the department that looks at procurement, it's obviously trying to tighten up those opportunities to ensure that in fact, we are doing what is correct, but the problem with that department, yes, they may be financially financial beagles meaning that they're watching how the dollars are spent. But they really don't know any difference between a and b. So I mean, ultimately, they will have to have an education in regards to what it is that in fact, we want to purchase. So that facility manager has got to do a pretty good strong business case, in regards to what it is that they in fact, are trying to get replaced, or, or purchase new. So you're really going to have to dig down deep so that you can tighten up those, those nuts and bolts. The other thing comes into play is that if the RFP is not written very strongly, to focus in on a lot of the other aspects that were responsible for, meaning the health and safety, while the work is going on the storage of tools and equipment and such, then these are all things that the facility manager, in fact, inherits. And so getting back to the the explanation, or the example of buying a a new plate and frame chiller, versus a flooded chiller, well, this is just not a matter of cutting out one piece of equipment and sticking in another, there is a lot of potential engineering that's going to come into play. That will have to be factored into the cost as as we go along. So procurement, if you watch the news, it's in the news on a regular basis for individuals who have acted inappropriate. But if in fact we are properly prepared, then ultimately we in fact, are going to be in great shape. Now the other thing that there's there's lots of things that come into play. Just because I got the lowest price doesn't mean I got to be the best piece of equipment. How easy is it going to be made to maintain How simple is going to be able to get parts. I've seen that unfold with dehumidification and ice resufacers where they buy a piece of equipment that holds their parts in another country. We can't wait three, four days to get parts to get these things back in play. Because we're not only in a downtime, we're losing revenue. So all again, the price may be less expensive. But in the long run from an operational side becomes, in fact, that much more complicated. Now, when we get into the RFP reviews, what we need to understand is that, you know, we can't buy a Cadillac for a Kia price that those things don't work. So if in fact there is a large gap between the pricings that should not immediately suggest that one of the suppliers is you know, being overly aggressive in regards to the amount of profit that they're trying to generate. Really what needs to happen is a very deep analysis in regards to why the price difference what's going on here. And somebody has to have that conversation to determine if in fact, some of the expectations are not built into the pricing. And that will become an issue once the contractor lands on site to install it. And they may not even have anything to do with the sale of the of the device. So you might buy the dehumification equipment from one individual and they may subcontract that out to another party for in fact having that in that installation, in fact, take place. So there's a deep dive that in fact has to come into play. So then, again, moving along in regards to the way the business is unfolding. You may or may not be aware that typically, let's let's talk about Wintario rinks because they're still the majority of the buildings that are inside the province. And these are buildings that were built in the mid 70s, moving into the mid 80s. And they were generated by, by lottery funding. So ultimately, when they were built, the projected life expectancy of those buildings were 50 years, meaning that at the 50 year mark, there was going to have to be a large investment, to make sure that they could go another 25 or 30 years, at 50 years, it was going to become very expensive to in fact, operate this facility. And then we're starting to look at major components like roofing and, and walls and water and electrical and such. So that number has come down to 35 years because of the advancement of technologies and materials. So the industry measuring stick is there at 35 years, there should be a fairly comprehensive review in regards to how far the building is lagging behind with current building codes, electrical codes, plumbing codes, and what state the infrastructure is, in fact, in. So again, the variables is how much the community has invested over the life of the building. And that will either extend or reduce the 50 years or 35 years, whatever. In fact, you're using it for a measuring stick. So in the end, one of the questions that I've tried to wrestle with myself is, What skills does today's facility manager have to have, and I think we've done a pretty good job of at least introducing the skills in our certified recreation facility professional designation, we've done a very good job of going out and sourcing industry experts or subject matter experts that talk about those skill sets. But one of the ones that is not built into a job description often is the fact that whoever is managing the facility, they themselves are they have to have people around them that in fact, can talk the talk with our service contractors. So the whole system is designed that facility management is supposed to be directing our service contractors on the work that is supposed to be done. So an example that I use, when I'm in the classroom is your own personal vehicle, you know, it needs an oil change, you can, depending on the age of the vehicle, you might be able to do it yourself some simple tools and a container to catch the oil and, and you buy a filter in oil, and you can do it in the backyard. There are rules in regards to what you do with the the oil and that will depend on your own moral compass in regards to how you're going to handle that. But you know, you in fact, can do it yourself. Or you're going to take it to a local service center, close to the house. And they may be able to quickly do it for you know, for a small charge, they're going to drop the oil, put a filter in put some fresh oil in and send you along the way, they're not going to do anything else, they're not going to check your tire pressure, and they're not going to do anything more than change the oil. Or you now can go to a Lube specialists, and there's many of them out there. And that's what they function in on. And when you go in, if you have experienced this, they're going to check your wipers and your air pressure and your cabin filter and your air filter. And as much as this sounds like a, it's a customer service relationship. In fact, it's an upsell, I want to see if in fact, they can sell you a few more things and an oil filter and some oil while you're there. Or you then can go to the dealer that you bought the vehicle from. And they're going to do a comprehensive re review based on the owner's manual, the mileage of the vehicle and they're going to make some recommendations on things that you should be doing above and beyond depending on how many miles are there specific to your vehicle. So if you take that same approach for your own equipment in the facility, then you're going to start to understand what it is that needs to be done. And really what I need is I need somebody that can read the owner's manual internally, do the checks and balances that are associated with the work. And then again, build it into the relationship that I have with the service contractor. But ultimately, it's my responsibility to ensure that the work is done so that it's going to be seamless. In regards to its operation. It's not going to give me or my staff any grief throughout the operating year. So in the end, the better that I do the maintenance then the better that the whole ship in fact is going to function. So the last food for thought I'm going to leave you with this. I don't know how many times and I've talked to members who have said you know what? The ice resurfacer broke down, and we had to cancel a days rentals until we could get the parts to get back up and operating again. And what I remind them is that the ice resurfacer didn't fail, the management maintenance of the ice resurfacer failed. So whoever was responsible to ensure that this piece of equipment was functioning as designed was getting the necessary tender loving care, both from the operational staff and outside service contractors. Most likely, that's the root cause to the failure. But we get to say that the ice reserves are broke down, we don't tell people that it was us that broke down in regards to our responsibilities inside inside the facility. So hopefully I've given you food for thought again, in regards to the intricacies and the complexities of our business. It is an interesting world. Looks like we're turning the corner in regards to COVID. I think we still have some bumps in the road, but I think we're you're hopefully through the closure of our buildings as we move forward and we're going to come back to some form of normalcy. So thanks for dropping into listening and listening. I hope that we get to connect again real soon. Until then, take care