A few weeks ago I was asked by someone what it meant when those of us in the facility strategy and planning field state that we align facility assets with business strategy. My answer quickly turned into a question: How do people in the real estate and facility industry perceive this statement? Those of us in the industry throw the term around in articles, blogs and presentations sometimes without providing a clear understanding of what it means. On that thought, the following three points are my views on what it means to align facility assets with business strategy:

1.   Alignment with the Strategic Plan – Understanding and facilitating discussions with corporate level executives on the company’s strategic plan is important in understanding the key strategic issues impacting facilities. Issues such as globalization, growth and consolidation and business models are all strategic issues that have facility impacts. For example, if acquisitions are key to a company’s growth strategy, then understanding the acquisition target profile can shed light on potential headcount and operational impacts on facilities.

2.   Alignment with Financial Strategies & Goals – Since real estate is a significant asset and cost to a company, assets need to be managed to reflect the strategies and goals set by the CFO. Value, cost, ownership and utilization are all important metrics in managing facility assets. For example, if a CFO wants to mitigate the impact of FASB 13 on the company’s balance sheet and income statement, facilities can align with this objective by consolidating and selling facilities that have low utilization.

3.   Alignment with Business Plan – Assessment of the business plan is typically where facility assets are in direct support with the functional needs of a business unit or department. Issues ranging from headcount forecasting to selecting regional locations are examples of how facilities can align with business goals. For example, if a business unit’s plan calls for the co-location of offices in key growth markets with minimal risk to the company, a strategy could plan the facility for an appropriate level of resources under a short term lease with the potential to expand the facility and negotiate longer lease or purchase as market conditions strengthen.

The above points show that facility and business alignment can be rather complex and requires a comprehensive approach. We are interested in your thoughts and approaches to business and facility alignment.