An abatement mechanism that delivers
The popularity of public authorities adopting a PPP (Public-Private Partnership) abatement mechanism approach to the operation of public services and facilities continues apace in the Asia-Pacific (APAC) region.
This means that there is an ever-growing bank of experience, learning and precedent being accumulated by the organisation intimately involved, day-to-day, in servicing the operations of PPPs.
This approach spans education (schools and universities), health services (hospitals and health centres) and national and local government authority operations (civil service offices, government departments, prisons and detention centres), among others.
It is arguable that no business partner’s accumulated experience benefits the provider company carrying out PPP contracts more importantly than the one providing the abatement mechanism (PayMech) function: the computer utility used to calculate the fee due to the provider each month.
This is because it is in the nature of the PPP philosophy that annual/monthly service payment to the provider is the pre-agreed, tendered-for sum – minus deductions for under performance (characterised primarily by sub-standard quality issues and the unavailability of facility resources).
This partner’s position can be considered to be strengthened even further if the abatement function is closely integrated with the CAFM data sources recording, and providing to the abatement mechanism, all the relevant aspects of the day-to-day servicing of the contract.
There are inherent benefits, in set-up and day-to-day operation, in working with a supplier that owns the process from end-to-end.
A PPP arrangement requires the provider to deliver to the specified agreed service level and no more. There is typically no bonus or incentive element (i.e. profit) in financial terms to be made from over-servicing and performing beyond the call of duty on a contract – only deductions from the contracted fee for events of underperformance.
The reasons for underperformance are multifarious, set out in the hundreds of pages of a PPP contract specification. If they occur in combination, they can invoke a harsh, compounding, multiplier effect that results in enlarged penalties.
FSI has more than 15 years’ experience in delivering PPP abatement mechanism solutions to clients. This involves the use of our Concept Evolution CAFM range, for performance data gathering and service delivery management, through to the all-important abatement mechanism, which ultimately calculates the bottom line deductions each month in respect of the actual quality and quantity of service performance delivered.
FSI’s experience has been applied to the latest generation Concept Evolution Abatement system. Designed for swift, flexible deployment with considerable, pre-built ‘out- of-the-box’ economies, it builds on the existing functionality Concept Evolution offers and adds significant breadth and depth to meet myriad client-specific requirements.
The future-proofed, upgradeable and reconfigurable nature of the techniques used can be considered as having a potential 20- to 50-year life alongside the projected operating periods of some of the PPPs themselves.
This article also appears in the December/January issue of Facility Management magazine.
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