The Lloyd’s building in Lime Street is one of the City of London’s main landmarks and is home to the Lloyd’s Insurance market. Some years ago, Lloyd’s took a strategic decision to outsource its Facilities services to an outsourced provider who would manage most day-to-day Facilities services and be responsible for third party suppliers as well as self performing many of the services provided at Lloyd’s.
Although a good working relationship existed between Lloyd’s and their service provider existed, Lloyd’s felt the fifth anniversary was an appropriate time to review the contract and its competitiveness against a much changed marketplace.
Lloyd’s invited AWA to undertake a review the management services provided by the service provider and to benchmark their costs against other outsourced and in-house suppliers in the City of London.
AWA engaged with both Lloyd’s and the service provider to review all the management processes and performance measures using AWA’s library of Best Practices as a baseline.
To compare relative costs, AWA identified and recruited a variety of large respected organisations with global headquarters in Central London to participate in a confidential exchange of practices and costs. AWA’s standard definitions and proformas were adopted and agreed with Lloyd’s management and issued to the participants and the results shared amongst participants via a facilitated workshop.
AWA’s observations, understandings and proposals were shared in a subsequent workshop held with both Lloyd’s and the service provider’s senior management. From this, agreement was obtained on a future plan of action in which the contract and relationship evolved to encompass greater flexibility and risk sharing and with performance measures more closely aligned to today’s business conditions.
John Mitchell, Property Services Manager for Lloyd’s, said ”We didn’t see the immediate need to go through a costly and time consuming full market test but needed to satisfy ourselves that we were continuing to get value for money. Our relationship with our service provider was important to us and we wished to build upon that. We therefore appointed AWA as an independent consultant with whom we had previously worked to evaluate all our Facilities business management practices and costs. We wanted to learn about improvements, which we could move forward with as well as determine our contract re-negotiation position.”
Benefits:
1. Avoidance of client time and costs associated with re-tendering,
2. Identification of areas for process and commercial improvements.
3. Satisfies the need for establishing value for money.,
4. Building upon the relationship with the incumbent supplier.
5. Benefits to the supplier of avoidance of costs in submitting proposal to a tender
6. Benefits the FM outsourcing industry by avoiding investment in needless tendering costs
