September 2022

Would Your Project Pass an External Contractual Compliance Audit?

PPP providers and suppliers are aware contractual compliance is a hot topic in the market now. Vercity Consultancy discusses the importance of contractual compliance and how to ensure your project would pass the test.

Challenging the Status Quo

Predicated by the growth of independent companies that offer external auditing and compliance monitoring services, promising to deliver contract savings to their public sector clients, investors and shareholders are focussing attention on ensuring that SPV and FM companies are meeting their full contractual obligations.

This workload, over and above daily reactive and planned maintenance, challenges the status quo of steady-state projects and strains resources. At a time of high staff churn and a busy employment market, this additional pressure can be highly disruptive. Additionally, because of cyclical Benchmarking and Market Testing of FM services, Brexit, COVID_19 and the cost-of-living crisis, margins on FM contracts are experiencing a squeeze.

FM contractors must look for ways to innovate and improve service delivery to return savings whilst maintaining contractual relationships.

Innovating Your Service Delivery

Staying abreast of the latest tools and best working practices is crucial to formulating innovations in service delivery. Innovations in working practices through introductions of technologies such as robotic cleaning, automated emergency light testing and agile working, if managed correctly, enable these savings and support in compliance with Statutory Maintenance KPIs.

Services such as reactive maintenance, delivery of statutory PPM, lifecycle, and defect management, which have long been the focus of performance reporting, and which carry commercial risk, have often been the priority of site teams. While wider contractual compliance may be overlooked by the teams on the ground. Often due to stretched resources, the urgency of client matters and statutory obligations.

Payment mechanisms, including quality failures and pain share/ gain share mechanisms, submissions of review items such as Schedules of Programmed Maintenance and annual fire reports, can mean the submission of annual energy reports comes late or not at all. This leads to a lack of client confidence and an open goal for external auditors looking to score deductions.

Generally, quality-based KPIs are treated as secondary to daily Estates issues. Intelligent tools and smart systems are able to track, monitor, and measure contractual compliance. Especially when these relate to measured contractual KPIs within the paymech.

Talking to other sector organisations about their approach and hearing examples of how they have overcome these challenges within the current contract management structure can help reduce the thinking time to find solutions.

How We Can Help Your Project

Vercity Consultancy is kickstarting this thinking by sharing techniques, tools and procedures we recommend putting in place to ensure your projects stand up to external auditor tests and checks.

In carrying out project-specific Contract Healthchecks, we provide a detailed snapshot of current levels of compliance and spotlight the areas where compliance with the obligations is weaker. This enables the production of action plans to raise compliance in these areas. 

Contract management plans and schedules of deliverables uploaded to smart technologies such as Affinitext, task master or added to a CAFM provide prompts to the delivery teams to avoid quality failure penalties.

For further information about the services mentioned, check out the steps Vercity Consultancy take to optimise facilities management performance here.

Optimise your real estate assets and protect their future value | Vercity (vercitygroup.com)