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What are the best practices for managing third-party service providers in small business facilities?

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If you own or manage a small business facility, you know how important it is to outsource some of your non-core functions to third-party service providers. Whether it is cleaning, security, maintenance, landscaping, or catering, you rely on external contractors to keep your facility running smoothly and efficiently. However, managing third-party service providers is not always easy. You need to ensure that they deliver quality work, adhere to your standards and policies, and comply with your contract terms and conditions. How can you do that effectively and efficiently? Here are some best practices for managing third-party service providers in small business facilities.

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Rodrigo Cesar Ueda da Luz

Facility Manager | Hard Facilities Management | Engenheiro Civil | Especialista em Gest?o de Negócios e Patologias das…

1 Define your requirements

Before you hire any third-party service provider, you need to clearly define your requirements and expectations. What are the scope, frequency, and duration of the services you need? What are the quality standards and performance indicators you will use to measure the results? What are the risks and liabilities involved and how will you mitigate them? By defining your requirements, you can communicate them to the potential service providers and evaluate their proposals accordingly.

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Rodrigo Cesar Ueda da Luz

Facility Manager | Hard Facilities Management | Engenheiro Civil | Especialista em Gest?o de Negócios e Patologias das Edifica??es | Palestrante | PCM
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Defina um escopo bem detalhado com todas as necessidades para que o processo de contrata??o ocorra de forma tranquila e assim evitar surpresas desagradáveis por falta de atendimento de alguma tarefa por n?o constar em contrato.

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Arjun Rishi

Product Head at (Team Mateo) Neucomed Health & Hygiene Pvt. Ltd.
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Some must points to look for: 1. Define Expectations 2. Contractual Agreements 3. Regular Communication 4. Performance Monitoring 5. Flexibility in contracts 6. Budget transparency 7. Compliance and regulations 8. Escalation Procedures

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Atilade Ajao CFM, Dip. FM, ACICPFM

Head of Administration
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It is most critical to define terms of engagement with SLA, (Service Level Agreement). An SLA helps with how the workflow would be from Start to End. ( the characteristics of how the third party engagement would be).

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2 Choose the right partner

Choosing the right third-party service provider is crucial for a successful outsourcing relationship. You need to consider not only the price and quality of the services, but also the reputation, experience, and culture of the service provider. You want to work with someone who understands your needs, shares your values, and respects your feedback. You also want to check their references, credentials, and certifications to ensure that they have the skills, knowledge, and resources to deliver what they promise.

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Rodrigo Cesar Ueda da Luz

Facility Manager | Hard Facilities Management | Engenheiro Civil | Especialista em Gest?o de Negócios e Patologias das Edifica??es | Palestrante | PCM
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é muito importante pesquisar no mercado parceiros que tenham boas avalia??es e cujas miss?es e valores sejam compatíveis com os da sua empresa. Obter contato de outros clientes para obter um Feedback sobre a satisfa??o sobre os servi?os prestados também ajudam na tomada de decis?o.

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Alan Daniel Hernandez Ramirez

Facility & Procurement Manager México
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Al proveedor convierta lo en un aliado, tiene que permearle la cultura organizacional de la empresa y que e ponga la camiseta, hágalo que se sienta parte de la compa?ía involucrandolo hasta donde pueda contribuir.

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3 Negotiate a fair contract

Once you have selected a third-party service provider, you need to negotiate a fair and transparent contract that outlines the terms and conditions of the outsourcing agreement. The contract should cover the scope, frequency, and duration of the services, the quality standards and performance indicators, the payment terms and schedules, the roles and responsibilities of both parties, the dispute resolution mechanisms, and the termination clauses. The contract should also include any specific clauses that address your facility's policies, regulations, and security requirements.

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Juan Argumánez Gutiérrez

?? Facility Manager | MBA | Optimizo el uso y el dise?o de los espacios para mejorar el rendimiento y el bienestar
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En mi experiencia, la claridad en los contratos es fundamental. Especificar detalladamente los servicios requeridos, los plazos de entrega, los estándares de calidad esperados y cualquier penalización por incumplimiento. Establecer también los términos de pago de manera clara. Un contrato sólido sirve como marco de referencia para ambas partes, minimizando malentendidos y asegurando una relación contractual fluida.

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4 Monitor and evaluate performance

After you have signed the contract, you need to monitor and evaluate the performance of the third-party service provider on a regular basis. You need to establish a clear and consistent communication channel with the service provider and provide them with regular feedback and guidance. You also need to collect and analyze data on the quality, efficiency, and satisfaction of the services, using the agreed performance indicators and metrics. You should also conduct periodic audits and inspections to verify the compliance and quality of the services.

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Rodrigo Cesar Ueda da Luz

Facility Manager | Hard Facilities Management | Engenheiro Civil | Especialista em Gest?o de Negócios e Patologias das Edifica??es | Palestrante | PCM
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Monitorar e avaliar o desempenho é imprescindível. Veja se os KPI’s est?o de acordo com a expectativa e se os SLA’s s?o compatíveis com a necessidade dos usuários e edifica??o.

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5 Manage changes and issues

Managing third-party service providers is not a static process. You need to be prepared to deal with any changes and issues that may arise during the outsourcing relationship. For example, you may need to adjust the scope, frequency, or duration of the services due to changing business needs or market conditions. You may also encounter some problems or conflicts with the service provider due to poor performance, misunderstandings, or breaches of contract. In such cases, you need to have a clear and effective change management and issue resolution process that follows the contract guidelines and protects your interests.

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6 Foster a collaborative relationship

Managing third-party service providers is not only about monitoring and controlling their work. It is also about fostering a collaborative and mutually beneficial relationship that enhances the value and quality of the services. You need to treat the service provider as a partner, not a vendor, and respect their expertise, opinions, and suggestions. You also need to recognize and reward their achievements, celebrate their successes, and address their concerns. By building a trusting and respectful relationship, you can improve the efficiency, satisfaction, and loyalty of both parties.

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7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Juan Argumánez Gutiérrez

?? Facility Manager | MBA | Optimizo el uso y el dise?o de los espacios para mejorar el rendimiento y el bienestar
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Trabajar con empresas peque?as requiere una comprensión realista de sus recursos. Hay que ajustar las expectativas según las capacidades de la empresa proveedora. Fomentar la flexibilidad en los plazos y ser abierto a soluciones creativas o diferentes de las esperadas. Al mismo tiempo, dar apoyo cuando sea posible para fortalecer la capacidad de la empresa. Una relación de colaboración flexible permite a ambas partes crecer y superar los problemas que surjan de manera conjunta.

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What are the best practices for managing third-party service providers in small business facilities?

1

2

3

4

5

6

7

1 Define your requirements

2 Choose the right partner

3 Negotiate a fair contract

4 Monitor and evaluate performance

5 Manage changes and issues

6 Foster a collaborative relationship

7 Here’s what else to consider

Facility Management (FM)

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What are the best practices for managing third-party service providers in small business facilities?

1

2

3

4

5

6

7

1 Define your requirements

2 Choose the right partner

3 Negotiate a fair contract

4 Monitor and evaluate performance

5 Manage changes and issues

6 Foster a collaborative relationship

7 Here’s what else to consider

Facility Management (FM)

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