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CPD WORKSHOPS
How to achieve operational cost saving in facilities?
Eng. Abdullah Al-ShehriVP, Facilities Management
Agenda
2
1 What is Budget? Types ?
2Facilities OPEX Reduction –Tools & Techniques
3 Examples of Cost Saving Projects – NCB Facilities
4 Q & A
1
What is Budget?
• A budget is a formal, numerical expression of how an organization
expects to operate for a defined period of time.
Budgeting Benefits:
• Improves communication and coordination.
• Forces management to plan.
• Provides a basis for performance evaluation.
Budgeting Approaches
Authoritative Participative Combined
• Senior management sets
everything from strategic
goals down to the
individual items.
• Lower managers and
employees fulfill these
goals.
• Known as a top-down
budget.
• Managers at all levels
and certain key
employees cooperate to
set budgets.
• Top management usually
retains final approval.
• Known as a bottom-up
or self-imposed budget.
• Combines the features of
authoritative and
participative methods.
• Known as an iterative
budget.
• Characterized by two-
way communication.
Types of Budget
• Short-term budget (usually one year)
• Projecting all estimated income and expenses during a given period.
• It excludes capital expenditures because they are long-term costs.
Operating Budget
• Long-term budget.
• non-routine expenditures for items like property, plant and equipment.
Capital budget
Budget Monitoring
Weekly analysis Annual analysis
►Frequency may be weekly, monthly, quarterly, midyear orannual.
►Helps to determine if allocated funds have been spent asspecified.
►Allows variations between the approved budget and actualspending to be analyzed and, if warranted, appropriateadjustments to be made.
Guidelines for FM Financial Operations
Understand the organization’s mission and
how the FM budget and financial decisions
move the organization toward that mission.
Facility Manage a huge cost center within
an organization & Must understand their
costs of doing business.
Clearly define roles in the FM budgeting
process (top-down versus bottom-up and
the approval process).
Understand fundamental accounting
practices and organization-specific practices.
Keep accurate financial records.
Compile accurate historical data for evaluating trends
and forecasting.
Prepare accurate and timely operational and capital
budgets.
Maintain clear, well-understood and documented
financial handling processes.
2
Facilities OPEX Reduction – Workstream
Implement Energy saving
Projects
Operation Re-modeling
Quality
Technologies“IOT”
Sustainability
Facilities OPEX Reduction – Tools & Techniques
Implement Energy saving
Projects
• Energy Auditing.
• Natural lighting concept.
• Smart Thermostat.
• Precooling System
• Smart Timers and occupancy sensors.
• Thermal isolation film
• LED
• Solar Power System
Operation Remodeling
• FM Contracts Re-Modelling
& Consolidation.
• Get Smart with Operating
Time.
• Space Optimization.
Technologies Sustainability
• Apply high quality
preventive & predictive
maintenance.
• IFMA, MEFMA, BIFM, …
• ISO 41001
• ISO 50001
• ISO 14001
• Green building concept
Quality
• CMMS
• BMS
• Predictive analytics
tools
• Water recycle systems
• Water saving
• Waste management
(paper recycling, Carton,
Plastic, Cane,..etc).
3
Grey Water Recycling Plants
14
Cost saving: SR 118,000/ year
Send on a daily basis to cooling towers
Some examples of achieving OPEX Savings in facilities
Grey Water: Wash basins, tea pantry & AHUs Condensate water.
Capacity: 50 m3
Pre-cooling system for A/C units
15
Average monthly saving: 20-30 %
assist the compressor to deliver the demanded cooling requirements with lower energy consumption
payback is 3-4 years
Some examples of achieving OPEX Savings in facilities
Waste management (paper recycling, Papers,Carton, Plastic, Cane).
16
Average yearly income= SR 100,000/-
Thru Waste Management Service Providers to properly manage
its waste disposal as per ISO 14001 EMS standard
Some examples of achieving OPEX Savings in facilities
Energy Audit
17
Average monthly saving: 5 - 10 %
Starting from level 1( walk through audit) which will save energy with neglected cost, up to detailed audit level 3
Some examples of achieving OPEX Savings in facilities
BMS
18
Average monthly saving: 5-10 %
Provide full monitoring and control overvarious parameters ,that will lead tominimize the operational cost
Some examples of achieving OPEX Savings in facilities
Smart Thermostat System
19
Some examples of achieving OPEX Savings in facilities
Average monthly saving is 8 %
PB period is 1 year
Programmable thermostat that will make the HVAC units work efficiently
Replacement of lighting with LED
20
Some examples of achieving OPEX Savings in facilities
Average monthly saving is 20-30 %
PB period is almost 18 months
• LED replacement is a quick win strategy.• Up to 80% from the conventional type.• Reduce the thermal load.
Installation of Lighting Timers and Occupancy Sensors
21
Some examples of achieving OPEX Savings in facilities
Average monthly saving is 7 - 10 %
Optimizing the usage of the lighting , to operate efficiently and effectively.
Supply & Installation of photovoltaic Solar Power system
22
Cost saving per year = SR 350,000/-
Total installed power for all branches is 500 KWP.
PB period from 7 to 8 years
Some examples of achieving OPEX Savings in facilities
Eng. Abdullah Al-Shehri, VP, Facilities Management
[email protected] 0-50-561-4226