FACILITIES MANAGEMENT

CHEW SIAK KOR

An assignment submitted in partial fulfilment of the

requirements for the award of Master of Project Management

Lee Kong Chian Faculty of Engineering and Science

Universiti Tunku Abdul Rahman

January 2019
 TABLE OF CONTENTS

TABLE OF CONTENTS 2
LIST OF TABLES 3
LIST OF FIGURES 4

CHAPTER

1 FACILITY MANAGEMENT PROPOSAL 5

1.1 Introduction 5
1.2 Core and Non-Core Business 6
1.3 Strategy Development 9
1.3.1 Services audit 11
1.3.2 Assessment of expectations and objectives 13
1.3.3 Portfolio audit 14
1.3.4 Resources audit 17
1.3.5 Market audit 20
1.4 Sourcing Strategy 20
1.5 Risk Management 26
1.6 Outcome 32
1.7 Conclusion 34

REFERENCES 35
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LIST OF TABLES

TABLE TITLE PAGE

Table 1.1: Sunway Group SWOT Analysis 13

Table 1.2: Sunway Group Resource Audit 18

Table 1.3: Sourcing Criterions 22

Table 1.4: Sourcing Strategy Optimized Model 25

Table 1.5: Risks of Non-Core Businesses 27

Table 1.6: Risk Assessment Matrix on Non-Core Businesses or FM

Services 28

Table 1.7: Risk Response on Potential Risks 29

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LIST OF FIGURES

FIGURE TITLE PAGE

Figure 1.1: Sunway Velocity Atrium 6

Figure 1.2: Sunway Velocity Outlook 7

Figure 1.3: Sunway Velocity Masterplan 8

Figure 1.4: Sunway Velocity Open Area Surrounded by Ecodeck 8

Figure 1.5: Strategy Development Processes by Atkin & Brooks

(2009) 10

Figure 1.6: Shopping Well-Being Model by El Hedhli et al. (2013)

11

Figure 1.7: Sunway Velocity Ground Floor 15

Figure 1.8: Sunway Velocity First Floor 15

Figure 1.9: Sunway Velocity Second Floor 16

Figure 1.10: Sunway Velocity Atrium 2 16

Figure 1.11: Sunway Group FM Chart 19

Figure 1.12: Sourcing Flowchart 21

Figure 1.13: Risk Management Procedures 26

Figure 1.14: Risk Assessment Matrix Template 28

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CHAPTER 1
1 FACILITY MANAGEMENT PROPOSAL

1.1 Introduction

As Kamaruzzaman & Zawawi (2009) identified that Facility Management (hereby

known as FM) covers various types of management skills including financial, changes,
real estate, human resources, safety and health, contract, building and engineering
services, utilities and domestic services. Other than optimizing building operation cost,
FM should aided with ISO 14000, ISO 14001 and EQA 1974 to align most efficient,
cost effective and greater quality with mission and goals of a building (Asbollah, Isa,
& Kamaruzzaman, 2016; Kamaruzzaman & Zawawi, 2009). As Kamaruzzaman &
Zawawi (2009) further clarified that a better maintained and managed building boost
the efficiency and effectiveness of the occupants performance and productivity.

This proposal is aimed to propose an effective facility management strategy for

the Estate and Facilities Department of Sunway Velocity shopping mall. The aim shall
be achieved through the following objectives:

i) Identifying the core and non-core businesses;

ii) Develop strategies for facility management; and,
iii) Identify the expected outcome of the implementation.
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1.2 Core and Non-Core Business

As mentioned earlier, it is necessary for FM strategy to align with the mission and
goals of the building. The mission for Sunway Velocity shopping mall is to landmark
as the destination to elevate shopper’s lifestyle. Where the vision is to enhance the
connectivity of people from various places to leading architecture and lifestyle
(“About Us - Sunway Velocity Mall,” n.d.). In reference to the mission and vision, the
core business of Sunway Velocity shopping mall is to: (i) Rent places for retailers; and
(ii) Attract and retain more shoppers.

Sunway Velocity is one of the developments from Sunway Group (“Sunway

Velocity Mall sasar 2 juta pengunjung sebulan | Bisnes | Berita Harian,” n.d.). It
consist of nine floors with the total floor area of ninety two thousand square meter and
RM1.6 billion of gross development value (“Sunway Velocity Mall KL - Shopping
Mall in Cheras,” n.d.). Sunway Velocity shopping mall connecting MRT station,
Maluri station with covered walkway. Also equipped with multiple carpark entrance
for easier access from any directions. The development providing multiple accesses,
allow to attract shoppers from various directions.

Figure 1.1: Sunway Velocity Atrium

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Sunway Velocity shopping mall is enveloped with glass panels and centred
with atriums inside the mall. It enables the passive use of natural lighting and provides
comfort of natural spacious environment. The featuring architecture sun shading panel
surrounded as a globe of the mall is embedded with LED lighting. This feature able to
display the most current season and event of the mall. Other than elevating the shopper
lifestyle, but also attract more shoppers, more tenant retailers.

Figure 1.2: Sunway Velocity Outlook

One thing that all Sunway Velocity shoppers would definitely know, natural
ventilation in the Sunway Velocity development is windy. With appropriate research
on local environment conditions, the architect located the building blocks of the
development as a trap for wind. Where natural wind would easily flow in and ventilate
around the entire development. Since the retail shops and carpark areas are connected
with Ecodeck, shoppers will walk around the development and chilled by natural wind.

On the Ecodeck, is an open area for plantation. The man-made garden consists
of trees, flowers, man-made pond, jogging trails, shaded platforms, bench, entrance to
lower level parking area, and the sort. This open area allows shoppers to escape from
shopping and keep in touch with nature for a break. Also linking with offices allowing
the white collars to chill around during breaks.
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Figure 1.3: Sunway Velocity Masterplan

Figure 1.4: Sunway Velocity Open Area Surrounded by Ecodeck

The development meant to send a message for people, where nature shall never
away from better lifestyle. Treasure the benefiting passive energy from earth.
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As non-core businesses are to support core businesses with better cost effective,
efficiency, productivity, and quality. The non-core businesses of Sunway Velocity
shopping mall including:

i) Maintaining the best interior comfort;

ii) Maintaining exterior architecture features;
iii) Cleaning the mall and keep track of hygiene;
iv) Ensuring comfortable security and reachable help;
v) Tender and contracting with retailers and services providers;
vi) Providing fire safety at appropriate locations and coverage;
vii) Managing events and retails space and location;
viii) Develop and maintain business continuity plan;
ix) Coordinating traffic condition within premises;
x) Day-to-day operation and seasonal decoration;
xi) Coordinating restaurants at centralize spots;
xii) Continuous testing and inspection of assets.

1.3 Strategy Development

Strategies are developed to accommodate with the objectives of business plans. The
strategies for FM should: (i) consider the needs and differentiating core and non-core
business; (ii) identify and establish manageable and measurable processes; (iii)
allocate appropriate resources for services including in-house and outsourcing; (iv)
identifying source of fund to implement the strategy; (v) identifying various budget
goals such as short-term, medium term, long term to achieve best value of money, and;
(vi) recognizing information management is the most effective control of FM.

There are three main processes of developing strategies which are Strategic
Analysis, Developing Solution, and Strategy Implementation. There are phases within
each process. Strategy Analysis requires to review or audit services, as to benchmark
the level of services to provide. The second phase is to assess the expectations and
objectives with the aid of various analysis tools such as Political, Economic, Social,
 10

and Technology (PEST) analysis; Strength, Weakness, Opportunity, Threat (SWOT)

analysis; Quantitative analysis; and Scenario analysis.

The next phase is portfolio audit with various techniques including space
analysis, real estate registration, maintenance plan, and risk assessment. Where the
following phase is to provide resource audit in reviewing people and skills profiling,
services provider audit (internal arrangement), and business process analysis. Follow
by the last phase of strategy analysis is market audit in identifying the external service
provider, real estate availability, and the market trends.

Figure 1.5: Strategy Development Processes by Atkin & Brooks (2009)

As for the next process, Develop Solution, first phase is to generate options by
identifying either outsource modelling or business process re-engineering. After then,
shall followed by evaluating the options with various evaluation tools including risk
analysis, maintenance plan, stakeholder analysis, cost-benefits analysis, life-cycle cost
appraisal, and feasibility study. Lastly is to select the options with the techniques of
optimization model and sensitivity analysis.

Where the last process for strategy development is Strategy Implementation. This
process consists of four phases. Starts with people and system, using the tools of
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change management, training and personal development, and business process re-
engineering. The other phase is communication, aided with the use of organization
intranet, newsletter and notice board, and also workshop and seminars. The next phase
is resources planning utilizing the techniques of project planning, scheduling, and
control, and also manage with resource levelling or optimization. The last phase is to
procure or purchasing, with the techniques of service provider selection, market testing,
and benchmarking.

1.3.1 Services audit

As mentioned earlier, services audit is to identify a benchmark for the project. This
would enable to identify the current performance against competitors, determine the
best practice within the industry (Chong, 2018; Phillips & Appiah-Adu, 1998). In
reference to El Hedhli, Chebat, & Sirgy (2013), it is proven that shoppers’ well-being
affecting shoppers’ loyalty and build-up good mal reputations. Whereby the shoppers’
well-being can breakdown to numbers of components which include functional related
factors, convenience related factors, safety related factors, atmospheric related factors,
leisure related factors, and lastly, self-related factors (El Hedhli et al., 2013).

Figure 1.6: Shopping Well-Being Model by El Hedhli et al. (2013)

In reference to Figure 1.6, the earlier mentioned six elements shall be

considered as benchmark criterions with the measures to gain more word of mouth and
mall loyalty. As El Hedhli et al. (2013) identified that in terms of functionality may
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conclude with the store variety, products assortment, quality merchandise, fashionable
merchandise, well branded stores, high value stores, and good services stores.

On the other hand, convenience factors include the mall location, accessibility,
operation hours, easy parking, comfortable layout, and easy reached restrooms. For
safety factors are rely on the great exposure of security guards, which provide the sense
of secure for shoppers. Where leisure factors are two, which are food and beverages,
and entertainment. Following self-factor measuring the shoppers’ personal feel on the
harmony with the society in the mall. Lastly the atmospheric factor judge based on the
mall’s cheerfulness, entertaining, stimulation, and colourful environmental judgement
(El Hedhli et al., 2013).

According to evaluation criterions mentioned above, the following section will

briefly evaluate the development to identify the differences from benchmark. In terms
of facility, Sunway Velocity mall consist of 500 tenant retailers sorted by floor level.
The mall also groups some of the retails into three main categories which are Market
Place at Basement 1, Food Street Food at Level 4, and Commune at Level 5. Most of
the stores available in Sunway Velocity mall are as par as the standard of Malaysia
best shopping centre, Pavilion.

Other than facility, the conveniences of the mall has briefly been introduced
where the mall is located at strategic location with comfortable layout. It also utilizes
the latest parking system, vacant parking LED indicator, which Sunway Pyramid was
previously awarded as best convenient parking system. The security available for help
also extends to carpark area with help alarm easy reach within few column spans. The
security guards are always available especially located at crowded area such as enter
gates. Sunway Velocity mall further provides traffic guards to direct traffic especially
during the peak hours. Also in touch with local fire department for compliances
(“Sunway Velocity Mall welcomes 2019 with a bang,” n.d.).

In terms of leisure and atmospheric factor, the mall is full of proper assortment
retailers with controlled appearance. Other than the retails appearance, the mall also
keeps closer track with events and seasons, and decorate the mall’s atrium area with
cherish colours and cheerful designs. Overall gained entertaining feelings to shoppers.
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As the mall has decorations and control their retail tenants, this would easily attract
certain group of shoppers. The result of similar characteristic shoppers will gain well
with shoppers’ self-related factors.

1.3.2 Assessment of expectations and objectives

One of the main analysis criteria for FM strategy, is to assess the resources availability
in achieving the objectives. In Sunway Velocity shopping mall PEST Analysis, it is
identifiable that the location of the development is strategically near to the city centre,
Kuala Lumpur. The income group and the spending capability of that area is at the
range of medium high range. The society around that area would demand for aesthetic
comfort, facilities convenient, frontier technology application, and users-friendly
either disable or environmental (Ng, n.d.).

It is important for the development FM strategize to deliver best condition of

all the mentioned non-core business to cope with such expectations identified. SWOT
Analysis shall further identify the possible solutions to cater with these expectations.
The following Table 1.1 is to analyse based on Sunway Group capabilities.

Table 1.1: Sunway Group SWOT Analysis

- Well diversified services provider - Higher liabilities than peers

- Steady dividend stream of real estate - Conservative standards application for
investment trust (REIT) stakeholders like employees
- Award winning good reputation - Small scale of diversification
- Secure good relationship with service
providers
- Maintaining great relationship with all
customers
- Attracting large portion of investors - Growing rate of living cost which may
- Located developments at strategic add-up cost of FM
locations - Compete with new and existing malls
- Embrace Virtual Design Construction - Lack of professional and specialist for
(VDC), ready to extend digitalize FM all kind of FM services
- Well experienced with various services
FM especially like theme parks and
shopping centres
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In reference to DBS Group Research.Equity (2014) and Ng (n.d.), SWOT

analysis of Sunway Group can be summarize as Table 1.1. The above table focuses on
the probable SWOT analysis which in relevant to FM. Internally Sunway Group shown
to be able to perform well with profile diversified services further identified that the
group secure well relations with services provider. Other than that, Sunway Group also
maintain well relationship with customers which reward them with an award-winning
reputation, and stronghold their REIT.

In short, internally Sunway Group has build-up strong economic foundation to

support all kinds of services with good service providers. These strengths of the group
is able to defend the threat findings from DBS Group Research.Equity (2014) and Ng
(n.d.). Even if the group may lack of professional FM personal, the good relation with
service providers and steady income able to grant them value worth FM services which
enable them to be more competitive with other malls around it.

In the following analysis found that Sunway group properties are mostly locate
at strategic locations where it attracts investors. This would be able to cope with one
of the weaknesses which is higher liabilities than peers. Followed with the embrace of
new technology implementation such as VDC fill the employees with excitements of
new technology, waive the unsatisfactory of conservative standard and encourage the
digitization of building information to utilize in operation management. Lastly, the
small scale of group diversification enables to gain in-depth experience in running the
facilities. This would further support the greater use of digital building information
and optimize the value of building with FM.

1.3.3 Portfolio audit

It is extremely important for shopping mall to optimize space analysis. As every inch
of space in the mall could generate numerous prospers. As earlier in the introduction
identified that there are numbers of atrium design in Sunway Velocity Mall. Other than
natural lighting and ventilation, the atrium opening further provides as an open space
for various events to held on.
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Figure 1.7: Sunway Velocity Ground Floor

Figure 1.8: Sunway Velocity First Floor

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Figure 1.9: Sunway Velocity Second Floor

The grey areas shown in Figure 1.8 and Figure 1.9 indicate as void. Whereby
that area is directly view to the lower floor level. The lower floor level area allows to
decorate with nearly no height limit interior. These decorations attract shoppers to
gather around the atrium and check out the event that’s on-going at the lower floor
area. It attracts curious shoppers more effectively compare to flyers distribution.

Figure 1.10: Sunway Velocity Atrium 2

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Such effective marketing approach has attracted various companies such as

Astro, HSBC, Nissan an et cetera to rent the spot and run event and roadshows. The
main risk to rent a place is the care given to the property. In the rental contract, the
property owner may reserve their right to request for best property condition keeping.
Any of spoil and damages shall falls as the responsibilities of the tenant. This risk shall
then transfer to tenant, and the risk profile for property owner is lessen. Other than the
risk of damages, the only remain condition for the property owner to take care is the
basic house-keeping works. As part of the maintenance portfolio, the detail elaboration
of the house-keeping works shall continue in the following section, sourcing strategy.

1.3.4 Resources audit

In reference to Chong (2018), resource audit reviews the internal resources available
to support and perform the core and non-core businesses. They are five categories of
resources to review which are physical, people, financial, suppliers and system. Things
to review in physical category includes the physical building conditions, utilization of
space, physical conditions of Mechanical and Electrical (M&E) equipment, building
energy consumptions, and also safety and security conditions.

In human resources requires to review the skill profile of each FM personals,

individual performance appraisal, organization structure of the FM team, and skills
development plan of the FM personals. The next resource to audit is the finance status
of the development. Where the concerns are the status of maintenance fees and sinking
funds collection, total defaulted amount, and also total expenses of the building.

Other than that, suppliers or service providers are another crucial resource.
Various concerns to review including the capability profile of each service provider,
the terms and condition for scope of works, the records and report for work quality,
and also the total expenses on the administration of service providers. Lastly, system
is another one of the resources to review in list. Where things such as the availability
of the system Standard Operating Procedures (SOP), need of implementation for new
technology, and also to embrace new digitalize FM system (Chong, 2018).
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Table 1.2: Sunway Group Resource Audit

Resources Reviews
- Physical building conditions
- Space utilization
Physical - Physical conditions of mechanical and electrical equipment
- Energy consumption
- Safety and security conditions
- FM personals skill profile
- Individual performance appraisal
People
- Organization structure
- Skills development for FM personals
- Maintenance fees collection
- Sinking funds collection
Finance
- Total defaulted fees
- Expenses
- Capability profile of service providers
- Terms and conditions of scope and engagement
Suppliers
- Work quality record and reports
- Expenses on service providers administration
- System Standard Operating Procedures
System - Need of new technology implication
- Need of digitalize FM system

In avoidance of repetitive content identified earlier in the other analysis, rough

review of Sunway Velocity resource will be discussed. The overall conditions of M&E
equipment for Sunway Velocity seems appropriate. Most of the facilities are equipped
with best conditions of M&E services supports. However, there’s no track of M&E
performance and maintenance data. Where FM Department may encounter difficulty
in identifying needs of regular maintenance and check-up. This will also directly void
the possibility of identifying fine details of building energy consumption. Sunway
Group collaborate with Hitachi developing an automated self-learning environmental
management system (EMS). As to date, Sunway Group able to compile overall energy
consumption data (Suwnay Group, 2017).
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Figure 1.11: Sunway Group FM Chart

Sunway Group has a subsidiary established since 1997, named as Sunway

Facility Management Sdn Bhd, taking care of all FM human resources. Other than that,
FM roles are also associated to higher management tier in the organization. This will
be making sure FM takes an important position in the organization. However, Sunway
Facility Management Sdn Bhd are not disclosed (CTOS, n.d.). Whereby any further
info regards to individual FM profile and FM skills developments plans are no in
Sunway performance report (Suwnay Group, 2017).

Although the subsidiary may no longer exist, but the group embrace SOP and
new technology for sustainable energy consumptions (Suwnay Group, 2017). There
are documented SOP for waste management, water management, energy management
especially on lighting and cooling, and also greenhouse gas emissions. Sunway Group
has implemented Building Management System (BMS), embedded with EMS by
Hitachi to analyse data and conclude with possible energy management actions.

As main discussions on finance and suppliers have mentioned in the earlier

section, whereby resource audit analysis will not extend and repeat the discussions.
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1.3.5 Market audit

Market audit is to identify the condition of the competitors and market trends, then to
review better performance done by others (Chong, 2018). Similar to benchmarking
approach mentioned earlier in the service audit. Discover more options available in the
market, and plan implementation for improvements. There are numbers of shopping
malls in Malaysia, it is easier for Sunway Velocity mall to explore and improve.

Other than comparing mall to mall, market audit also applies to review service
to service. It is encouraged to review the quality of the service provider from time to
time. Identifying the greater performance from other service providers, and renegotiate
with the current service provider, or to terminate and engage with the others. This will
ensure the development catch up the best value services available in the market. Also
encourage best FM practices implementation for better end-user’s experience.

For an example, Sunway Group has defined the best practice of dealing with
general waste (Suwnay Group, 2017). Sunway Velocity mall waste management may
refer to the standards and identify suitable contractors. In case when Sunway Velocity
mall found better practice contractor, the practice may share and implement to other
Sunway Group properties. This is to ensure the properties owns the best value perform
by the contractors.

1.4 Sourcing Strategy

As Figure 1.5 identified that after strategy analysis, the findings shall associate for the
development of strategy. Whereas strategy development has three stages as mentioned
earlier. First step is to generate options, either out-sourcing or in-house. Follow by
evaluating options, identifying the services can be provided and the differences from
the expectations. Lastly, is to select the optimized option.
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Figure 1.12: Sourcing Flowchart

Whereas Figure 1.12 identified that the core of strategy development, sourcing,
branch out to two options which are in-house and out-source. In in-house option, there
are three elements to concern with, including identify stakeholders, developing team,
and the service provision. Setting up an in-house team to look after various FM shall
identify who are the stakeholders that involves with the FM. Stakeholders could be
variant, including customers, suppliers, and et cetera. Also, to develop a team to cater
with the monitoring and analysis on the facilities and the stakeholders. The roles and
responsibilities of each team members are required to be clearly define. Enable
effective and non-duplicative work effort contributed. Nevertheless, scope of services
to be manage shall be identifiable. The team members must clearly set the scope as
their vision and targets to achieve it. Upon the clear definition of services provision, it
is easier to identify the exact relevant stakeholders, and the roles and responsibilities
of each team members.

Out-sourcing is another source of delivering FM services. Common processes

of out-sourcing shall first develop the strategy by defining the service, identifying the
current management method, identifying the stakeholders, and determine if there’s any
conflict in employment legislation. Exploring the extend of existing services have
covered, and determining what requires to be out-source.
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Next step is to draft out the tender document. The tender document clarifies the
service specification that are expected, or so called a service-level agreement (SLA).
The tender document should also spell out the requirements and criterions to carry out
the services works. Lastly followed by tendering process to choose the best service
provider in the market. Aided with the procedures of prequalification, tender briefing
and defining the tender period for evaluation and analysis.

Table 1.3: Sourcing Criterions

No. Non-core business Analysis findings Sourcing
Provide appropriate ventilation
Maintaining the best interior
1 and lighting services at In-house
comfort;
measureable human comfort
Full time monitoring and on
Maintaining exterior architecture
2 season renewing LED sunshade In-house
features;
performance
Internally scheduled trash
Cleaning the mall and keep track
3 collection and dispose to Out-source
of hygiene;
licensed contractors
Easy identifiable security
Ensuring comfortable security
4 guards and speedy reach help Out-source
and reachable help;
bell
Tender and contracting with Controlled tenants and well
5 In-house
retailers and services providers; monitored service providers
Providing fire safety at
6 appropriate locations and Contacted local fire department Out-source
coverage;
Managing events and retails Monitor and control the use of
7 In-house
space and location; atrium and the mall decoration
Published sustainability report
Develop and maintain business
8 since 2015 to measure eco and In-house
continuity plan;
business sustainability plans
Coordinating traffic condition Employed traffic controller to
9 Out-source
within premises; coordinate during peak hours
Day-to-day operation and Managing the appearance of
10 In-house
seasonal decoration; atrium according to seasons
Coordinating restaurants at Located variety of food
11 In-house
centralize spots; centralize in 2 levels
Continuous testing and Monitoring appliances with
12 In-house
inspection of assets. analysis
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Table 1.3 above shows the link relation between non-core businesses, and the
analysis findings, followed by some proposed sourcing approach. The proposed source
identifies based on the result of findings and determine with possibilities. However,
there are various concerns on sourcing. The characteristic, advantage, disadvantages
of in-house and out-sourcing approach should expose and discuss. As this is the next
step, evaluating options in strategy development.

The main characteristics of in-house FM team include (i) vertical integration

within the organization of processes and productions; (ii) permanent term employees
are assigned to specified tasks; and (iii) direct employment by the organization. These
shall bring up advantages including:

i) Implementation decisions made by the in-house team always align with

company visions and objectives;
ii) Financial analysis is better supported by data provided from in-house;
iii) In-house team growth escalates as per customers satisfactions; and
iv) In-house solutions provide developments of personal and careers, reduces
staff turnover rate.

Whereby the disadvantages of in-house FM team include:

i) Inevitable ambiguity in scope definition, which would lead to poor

customer satisfactions;
ii) Poorly define roles and responsibilities results to difficulty in performance
measurement;
iii) Lack of comparison with external service providers ended up poor quality
management of service delivery; and
iv) Self-regard attitude which contributes to poor quality performance.

Therefore, there is the need of considering out-sourcing the FM services. The

characteristics of out-source are (i) independent services provider; (ii) professional
service providers working at project-to-project basis; and (iii) contract procured. These
results to the advantages of out-sourcing include:
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i) Better chance for value worth costs reduction and expand services;
ii) Improving morale and productivity of in-house employees;
iii) Breakthrough more innovative possibilities and boost up company profile;
iv) Allow to filter the best experience, quality, speed, and performance of the
FM services providers;
v) Embrace for greater creative approach of delivering FM;
vi) Upgrading assets value with better services; and
vii) Reduces cost with specialization and large-scale economy.

Whereby the disadvantages of out-source FM team include:

i) Unable to deal with bigger volume activities;

ii) Various work ethic between in-house and out-source;
iii) Compromise to expected schedule and outcome;
iv) Inappropriate measures of contract performance and penalties;
v) Lack of flexibility;
vi) Lack of time management; and
vii) Too focus on cost cutting.

It is identified that only certain FM activities are suitable for in-house FM team
and only certain tasks shall out-source. Where the non-core businesses are required to
align with company visions and mission, must be executed by in-house team. As this
would be able to minimize the ineffective work execution. It also lessens the need of
communication to align the value of works deliver.

As for end users direct linked FM services such as cleaning and security shall
consider out-sourcing approach. This will make sure the FM service quality at best.
Furthermore, it eliminates the poor quality performed by in-house staff. Where the in-
house FM team shall take up the role of managing these services providers. Making
sure the best performance on optimize cost.

In case of bigger size project such as atrium decoration, shall both in-house and
out-source perform and coordinate the effort together for best outcome.
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Table 1.4: Sourcing Strategy Optimized Model

No. Non-core business Analysis findings Sourcing
Provide appropriate ventilation
Maintaining the best interior
1 and lighting services at In-house
comfort;
measureable human comfort
Full time monitoring LED
In-house
Maintaining exterior architecture sunshade performance
2
features; Seasonal LED sunshade display
Out-source
decoration
Internally scheduled trash
Cleaning the mall and keep track
3 collection and dispose to Out-source
of hygiene;
licensed contractors
Easy identifiable security
Ensuring comfortable security
4 guards and speedy reach help Out-source
and reachable help;
bell
Tender and contracting with Controlled tenants and well
5 In-house
retailers and services providers; monitored service providers
Providing fire safety at
6 appropriate locations and Contacted local fire department Out-source
coverage;
Managing events and retails Monitor and control the use of
7 In-house
space and location; atrium and the mall decoration
Published sustainability report
Develop and maintain business
8 since 2015 to measure eco and In-house
continuity plan;
business sustainability plans
Coordinating traffic condition Employed traffic controller to
9 Out-source
within premises; coordinate during peak hours
Manage and coordinate the
appearance of atrium according In-house
Day-to-day operation and
10 to seasons
seasonal decoration;
Decorate the appearance of
Out-source
atrium
Coordinating restaurants at Located variety of food
11 In-house
centralize spots; centralize in 2 levels
Continuous testing and Monitoring appliances with
12 In-house
inspection of assets. analysis

Table 1.4 shows the value worth optimized model of FM services. After review
to the characteristics, advantages and disadvantages, then identified the tasks of non-
core businesses for matching. The risk of such matches discusses in following session.
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1.5 Risk Management

Risk management is a systematic approach to ensure a risk is well aware and treated.
As in risk management, the processes to manage risk starts with risk identification,
risk assessment, risk evaluation, risk response, risk reporting and the flow shall cycle
with the aid of feedback information.

Figure 1.13: Risk Management Procedures

In the stage of risk identification, the FM team requires to explore potential

risks internally and externally. Any risk that possibly impact the finance, performance,
and the rest FM services delivery, shall further classified into core and non-core risks.
Where core risk will bring severe impact to overall FM performance, and non-core risk
is not essential but can be mitigate in eventually.

In order for easier risks identification, Table 1.5 below compiled the non-core
businesses of Sunway Velocity. Possible risks of the non-core businesses are identified.
The possible risk in maintaining the best interior comfort and exterior architecture is a
major equipment faulty. Appropriate mall cleaning, mall security, fire safety, and
traffic conditions are out-source and will therefore depends on the performance of the
service providers.

Tender and contracting always requires full of documents and easy to have risk
of messing up documents. Event and space management may catch up with the risk of
sudden increase of shoppers and failed to cater. Main risk of business continuity is
 27

failed to identify the continuity plan. Seasonal decoration may fail to manage deco
project well. Centralize food stall may not be possible when food retailers want to stay
away from their direct competitors. Lastly, inspection may overlook when there’s a
poor systematic approach of filling the maintenance and repairing records.

Table 1.5: Risks of Non-Core Businesses

No. Non-core business Risks
1 Maintaining the best interior comfort; Major equipment breakdown
2 Maintaining exterior architecture features; Major equipment breakdown
Poorly performed service
3 Cleaning the mall and keep track of hygiene;
provider
Ensuring comfortable security and reachable Poorly performed service
4
help; provider
Tender and contracting with retailers and
5 Mess-up contracting documents
services providers;
Providing fire safety at appropriate Poorly performed service
6
locations and coverage; provider
Managing events and retails space and Sudden increased of shoppers
7
location; and insufficient services
Develop and maintain business continuity
8 Business dicontinuity
plan;
Coordinating traffic condition within Poorly performed service
9
premises; provider
Day-to-day operation and seasonal
10 Delay in seasonal decoration
decoration;
Lack of location centred food
11 Coordinating restaurants at centralize spots;
stalls
Failed to identify the required
12 Continuous testing and inspection of assets. maintenance/Inefficient
equipment performance

After the risks are identified, the FM team shall continue to assess the risks.
Risks assessment requires to prioritize the risk profile based on the damage or impact
that the risks are associated with. There are various approaches to evaluate risks such
as risk baseline, risk rating, risk modelling, and et cetera. One of the relatively practical
approach is risk assessment matrix. The matrix assesses risks with two main criterions
which are likelihood and consequences. Whereby risks that are almost certain and the
risk impact is catastrophic, the risk shall be immediately taken care. In case when the
risk is rarely appeared, and the impact is insignificant, the risk may be treated less care.
 28

Figure 1.14: Risk Assessment Matrix Template

Table 1.6: Risk Assessment Matrix on Non-Core Businesses or FM Services

Consequences
Minor - 1 Moderate - 2 Major - 3
Sudden increased of Failed to identify the Major equipment
Certain
shoppers and required maintenance breakdown/services out
Likelihood

-3
insufficient services (3) (6) of order (9)
Possible Inefficient equipment Delay in seasonal Business discotinuity
-2 performance (2) decoration (4) (6)
Unlikely Mess-up contracting Lack of location centred Poorly performed
-1 documents (1) food stalls (2) services providers (3)

Aided with this mechanism, the risk evaluation is easier to be carried out. The
consequences and likelihood are rated by sequence of severity. The risks will multiply
the ratings and results as a weighting for the risks priorities. To arrange in sequence
with the consequences as the first consideration, the list shall be review as follow:

i) Major equipment breakdown/services out of order;

ii) Business discontinuity;
iii) Failed to identify the required maintenance;
iv) Delay in seasonal decoration;
v) Poorly performed services providers;
vi) Sudden increased of shoppers and insufficient services;
vii) Lack of location centred food stalls;
viii) Inefficient equipment performance; and
ix) Mess-up contracting documents.
 29

As above prioritization, it is able to identify that the first priority, third priority
and the eighth priority are mainly caused by ineffective way of collecting equipment
performance information. Other than that, the fourth priority, fifth priority and ninth
priority is mainly due to the incompetent management onto service providers or sub-
contractors. Whereby the second priority, sixth priority and seventh priority are due to
ineffective management planning in overall mall directional performance.

After the above risk evaluation, Project Management Institute (2018) indicate
four approaches of risk response which are avoid, transfer, mitigate and accept. Risks
avoidance applicable when the risk is rather high priority. It may require some change
to cope with the possibilities of the risk appearance. Risk transfer is shifting the risk to
other party with certain amount of premium. As it involves money and therefore apply
to risks which bring higher impact.

Risk mitigation is to identify the factors which form up the risk and treat the
factors to minimize the impact. For an example, several numbers of commissioning
test may apply to a service equipment before an event. This is to minimize the possible
breakdown risks during the event. Lastly, is risk acceptance, it is to absorb the impact
of the risks. Usually it applies to lower priority risks, especially the lower impact value.

Table 1.7: Risk Response on Potential Risks

Risk i) Major equipment breakdown/services out of order
Avoidance ii) Failed to identify the required maintenance
iii) Inefficient equipment services
iv) Business discontinuity
Risk i) Sudden increase of shoppers and insufficient services
Transfer ii) Delay in seasonal decoration
Risk i) Poorly performed services providers
Mitigation ii) Lack of location centred food stalls
Risk i) Mess-up contracting documents
Acceptance
 30

Risks which may occur for FM services at Sunway Velocity mall may group
as the possible risk responses. Table 1.7 identified possible risk response matching
with the possible risks identified. For equipment performance-based risks may best be
response with risk avoidance. The FM team is recommended to consider the adoption
of technology use in facilities maintenance.

Other than BMS and EMS identify earlier, Sunway shall consider the extensive
use of Building Information Modelling (BIM). Since the group has experience with
VDC, all it need is to extend the information use for optimizing building performance
(Azhar, Brown, & Farooqui, 2008). The model information can be integrated with
maintenance and repairing status updated by FM team, and also feedback sensors real-
time data on the equipment performance. This shall minimize the overall risks due to
ineffective equipment performance data collection.

The next thing for risk avoidance is business discontinuity. Sunway published
the group sustainability report since 2015. However, it is hard to convince that this
best practice is reasonably generate income. Non-profitable effort in a business group
is relevantly not effective. Therefore, is hard to secure the determination of continuing
this report. This will also bring up the risk where fail to identify business continuity
development plan. The risk avoidance action is to enforce this practice in company
yearly Key Performance Index (KPI). If necessary, further determine the influence and
impact of this report to the stakeholders. The result will encourage a business group
for continuous publication of the report.

Sudden increase of shoppers would easily congest the facilities and heavily
loaded all services available. Sunway Velocity mall FM team may research such kind
of seasonal patterns based on other malls data. Analysis should identify which event
or if there’s any consequences appears with extra volume of shoppers. However, the
execution of the analysis findings must implement risk transfer. As the occurrence of
shoppers’ crowd is not consistent and sometime may be difficult to foresee. It will only
be best to out-source the service to services providers. In case any unexpected increase
in the volume of shoppers, the in-house FM team may immediately invite the other
service providers to be on-board and maintain the quality of service delivery.
 31

Similar applies to seasonal decoration. Delay of decoration project is no longer

uncommon situation. It is only appropriate for the FM team to require the decoration
sub-contractor utilize insurer as a risk transfer party. In case there’s an identifiable late
delivery of decoration works; in-house FM team shall reserve the right to request for
insurance compensation and get another decoration team on-board to chase the death-
line for work completion.

The risk of poor-quality performance of the service providers is best suit with
risk mitigation. There are mechanisms for quality control and managing performance.
Some of the recommended approach to control the quality and performance is to make
use of real-time feedbacks from the shoppers. As the final objective or say the core
business is the well-being of the shoppers. The quality and performance of the service
provider should cater with the comfort of the shoppers. Continuous feedbacks from
the shoppers are able to review and improve by the service providers. If the feedbacks
are failed to be collected, there’s no baseline of evaluation, and tend to disregards of
continuous service improvements. In case the service providers performing well, some
recognition such as awards must be given. On the other hand, if performing not well,
penalty shall be fall to the service providers as well.

In case of the risk of poorly coordinating the location of food stall, the mall
must secure their stand on the coordination and recognize as final. The in-house FM
team must be able to foresee the current trend of food stalls to be invited as tenant. The
arrangement of food stall location shall avoid any future disagreement such as the
opposition of the direct competitors. In case if there’s such occurrence, the mall shall
allow possible layout renovation works which avoid confusing the shoppers.

Lastly, the risk of messing-up documentation works. There’s least possibility

and the impact may be as small. Rather than absorbing it, some of the preventive works
may also be done. The FM team may consider the certified implementation of ISO in
the workplace, or else to develop Standard Operating Procedures (SOP). The use of
ISO and SOP shall avoid poor systematic documentary works. This preventive action
may eliminate the possible of such risk.
 32

The last procedure of risk management is risk reporting. It is to continuously

review the identified risks and compile as report for easier follow-up. The report shall
consist the said mentioned risks including major equipment breakdown/services out of
order; business discontinuity; failed to identify the required maintenance; delay in
seasonal decoration; poorly performed services providers; sudden increased of
shoppers and insufficient services; lack of location centred food stalls; inefficient
equipment performance; and mess-up contracting documents.

Continuous update on the latest risk profile and risk management approach has
been executed. Enable the FM team to closely review the financial impact of the risk.
Also allows for better improvement on relevant risks management. As shown in Figure
1.13, a feedback shall link risk report to risk identification as a cycle. This is to indicate
the importance of lesson-learned, and recommend for continuous improvements.

The risk report may be composed aided with the structure of maintenance plan
management. Identifying the risks on the facilities have been taken care with either
one of the maintenance types. As there are three types of maintenance, including
corrective maintenance, condition-based maintenance and planned maintenance. The
risk report may also recommend the future maintenance type that equipment required.

1.6 Outcome

There are four phases to review in a strategy implementation stage as shown in Figure
1.5 above. The four phases are people and system, communication, resources planning,
and procurement/purchasing as discussed earlier.

The main concerns reviewing the people and system in the implementation of
proposed strategy in Sunway Velocity FM services may focus into few of the non-core
businesses mentioned. The non-core businesses including maintaining the best interior
comfort, maintain exterior architecture feature, tender and contracting, managing the
space and location, business continuity plan development, restaurants coordination,
and the continuous test and inspection.
 33

As discussed in the earlier sections, these non-core businesses involve in-house

FM team for execution. The internal team members may require to have development
plans on adapting the skills to perform well. Other than personal development plans,
there are also needs to change the approach of works execution. As these non-core
businesses prone to risks, it requires new mechanism throughout the implementation
for better risk management. Such as the implementation of SOP and ISO would be
new for the non-core businesses and it needs to be enforced. The implementation of
BIM for better building performance optimization may also required internal members
to equipped with skills for smooth application.

Communication reviewing mostly on the non-core businesses which involve

external parties such as services providers. Non-core businesses including maintaining
exterior architecture feature, mall cleaning, comfortable security, fire safety, space and
location management, traffic coordination, and seasonal decoration. These services
require real-time communication and coordination. Devices are most essential factor
to connect all the services providers. Aided with the availability of bigger technology,
City Information Modelling (CIM), BIM can merge into CIM and run on the greater
big data (Gil, Almeida, & Duarte, 2011). In-house FM team as centralize coordination
hub to communicate with all services providers at one glance platform. Simplify the
processes of communication and aided visualize analytic results.

Follow by resource planning review including both of the internal and external
resource allocation. The non-core businesses include maintaining interior comfort,
cleaning the mall, comfortable security, fire safety, space management, coordinating
traffic, seasonal decoration, and continuous testing and inspection. These non-core
businesses mainly require resources. In-house FM team have to continuously manage
and coordinate the resources allocation. This is to ensure better continuity services
support available. Aided with implementation of BIM, the coordination could be done
easily. As Microsoft (2018) claimed that AI integrated BIM space management could
optimize the use of the facility and maximize the value of the resources.

Lastly, the procurement and purchasing shall be review and monitored. The
non-core businesses that mainly relevant including tender and contracting services
 34

providers, managing event space and location, and seasonal decoration. It is always
important to make sure the services providers are performing at best value. Market
comparisons and shoppers’ feedbacks are the main mechanism to evaluate the quality
of the services providers. FM team should keep highly aware on the need of extra
service resource especially during events. Whereby certain circumstances would be
best to make sure the availability of standby services providers.

1.7 Conclusion

The proposal report is to propose an effective FM strategy for the Estate and Facilities
Department of Sunway Velocity shopping mall. The report identified the core business
of the properties, further elaborate the non-core businesses that supports the better
performance of core businesses.

The non-core businesses are further discussed to identify the need of resources.
Sourcing strategy were identified through evaluation on the development’s internal
and external factors. The sourcing strategy are then developed and identified potential
approaches that suit best. The developed strategy is further tested with risk analysis
and to elaborate as the implementation outcome.

It is identified that Sunway Group has strong internal foundations to support

the sustainable operation of Sunway Velocity shopping mall. However, there are still
potential risks which may cost heavy impact to the performance of the mall. In this
proposal, Sunway Group is recommended to consider the greater implementation of
digitalize FM. This would mitigate greater expect of risks and the implementation cost
would be rather lower as the group is readily in the application of VDC. Having new
application of digital platform, there are changes required to the human resources and
system. To optimize the greater processes of FM.
 35

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