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The Seven Deadly Mistakes to Avoid

Bad supplier and contractor selections


First, the most common and most costly mistake is bad supplier selections. There are many suppliers and contractors you will hire to help you relocate your office. These include architects, general contractors, project managers, interior designers, telephone systems and services, computer systems and networking, cabling installers, security system, furniture systems and moving companies, just to name the main ones. If you work for a larger company, the suppliers you hire for the move may total more than 100. If you don’t allow enough time to properly plan a move, you must make your selections in haste. Hiring a bad supplier or contractor can jeopardize the entire move. Suppliers who don’t deliver on time or as promised can delay the move, costing thousands of pounds in unnecessary expense.

The biggest complaints about suppliers & contractors are (in no particular order of importance):

  • DIDN’T SHOW UP ON TIME OR BEGIN WHEN HE PROMISED
  • DID NOT RETURN PHONE CALLS
  • DID NOT OBTAIN THE APPROPRIATE PERMISSIONS ON TIME
  • DID NOT APPLY ENOUGH MANPOWER TO STAY ON SCHEDULE
  • SUFFERED PARTS OR EQUIPMENT BACK-ORDERS THAT DELAYED HIS COMPLETION
  • FAILED TO COMPLETE THE JOB ON TIME
  • EXCEEDED HIS PROPOSED COSTS THROUGH EXCESSIVE CHANGE ORDERS
  • DID NOT FURNISH AGREED-UPON DELIVERABLES (TEST DOCUMENTATION, AS-BUILTS, ETC.)

Selection of competent suppliers always seems easier than it really is. Most novice relocation managers will resort to the “price and three references” method of selection. This means that potential suppliers are invited to submit a price for goods and services. Since it is assumed that all suppliers are created equal, the temptation is to hire the supplier with the lowest price. Just to cover themselves relocation managers will also require three references of “satisfied customers” who have successfully used that supplier. Simply by phoning those references and asking them if they were satisfied with the supplier should yield a risk-free selection, right? Nothing could be further from the truth! Do you really believe that a supplier will furnish names of dissatisfied customers? Suppliers will ONLY supply good references. Now, what do you do?

There are many areas of focus that will help you find the right supplier, and they go way beyond the “price and three references” approach. First, you need to determine the typical project size and scope in which your potential suppliers have the most experience. You want to match your project as closely as possible with your supplier’s experience. Does the supplier work on projects of your size, or do they suit a different size of customer? What about the scope of the project? Have they performed many very similar projects successfully, or is this one a stretch for them? Is your supplier a specialist in this specific requirement, or are they a generalist who attempts to satisfy many needs? The choice is ultimately yours, and there is no right or wrong answer. Experience is the key factor here.

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Poor Co-Ordination

The second deadly mistake, poor coordination is responsible for delays and cost overruns. Letting your suppliers run wild without tight supervision is a formula for disaster. You are in charge. You will run this show. Too often, relocation managers will allow their architect or general contractor to handle the coordination issues and manage the schedule. This usually results in a schedule that meets their needs, not yours. You have to hold their feet to the fire.

Why should you coordinate the project? Because if you don’t you will be the referee for every fight and disagreement between the various suppliers. Any time there are a dozen or more suppliers involved there are going to be conflicts. Every time the schedule is amended ALL of the other suppliers are affected. If you are constantly reacting to these amendments, you will become unpopular in short order. Rather than playing Solomon, wouldn’t you rather oversee a calm, orderly project?

The suppliers hired for a relocation project usually fall into two broad categories; construction related, and non-construction related. The construction related suppliers are obvious. The first of these is the architect that designed the interior space, specified the materials and furnishings to be used, wrote the RFP to find a construction contractor and applied for the permissions. Possibly, you hired an interior design firm that works in conjunction with the architect. Next, the general contractor will oversee the actual building of the interior space. He hires and manages all the sub-contractors whose products and services include electrical, HVAC, plumbing, joinery, partitioning, carpet, hard flooring, acoustic ceiling, painting, signage, and possibly others. If you have hired a project manager to oversee the construction project, this person will also fall into this category. He would be responsible for the timely completion of the construction project on time and on budget.

Not every supplier you hire is directly tied to the construction project. You will likely be looking for suppliers to provide and install a telephone system, access control security system, computer networking equipment, communications cabling, systems (modular) furniture, telephone services (including dedicated data lines, ISDN, DSL, and T-1), and a furniture-moving supplier. While these suppliers need to coordinate their efforts to maintain your project schedule, they are not considered to be construction-related. And here is where the coordination becomes critical.

Every change in the construction schedule potentially impacts the non-construction related suppliers. If the general contractor discovers that the carpet you want is on a long delivery the modular furniture supplier cannot begin installation on time. The cabling supplier and electrician can’t wire the cubicles until they are installed. The phone and computer suppliers can’t install and test their equipment until the cabling is finished. So, you can see how arbitrary changes made to the schedule would have a domino affect on every other supplier. You can’t allow one of your suppliers to make changes to the schedule, no matter how minor, until you have assessed the impact on all other suppliers. Your project completion could be delayed beyond the move-in date!

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Inadequate budgeting - An accurate budget is critical

Most business relocations are performed without any budget at all. Inexperienced move managers will get some quotes for furniture moving, a new telephone system perhaps and will then let their general contractor or architect control the most expensive item - the interior fit-out.

Costs escalate and frequently run way over the initial estimates. This is madness. An experienced relocation move manager would tell you that you simply MUST have a comprehensive budget that includes ALL costs associated with business relocation. If you don't know what to expect, you can permanently scar your business with cost overruns. Many businesses decide not to move at all once they see the entire cost of the project. Imagine not knowing these costs in advance! A budget also helps you make better decisions about selecting suppliers & contractors, considering options, minimizing cost overruns, and keeping people honest. A detailed budget is mandatory. Moving without a budget is suicide.

Many companies have no idea what they will have to spend on their office move, and have no firm budget established. Others will establish an arbitrary budget that has no relation to reality. Both strategies are doomed. Without guidance, entire systems are forgotten until the last minute, and must then be procured with unbudgeted funds. Constantly repeating “it’s not in the budget” serves no one’s interests. If you expect your suppliers to perform free services, you can pretty much imagine the quality of employee your supplier will give you. There are many places to look for help in getting budget estimates for all the goods and service required.

To save you some time, a partial list of items whose cost must be known upfront are:

  • Recurring Property Costs
    • Annual Gross Rent
    • Utilities
    • Parking
    • Service Charges
    • Property Insurance
    • Maintenance
  • Other Expenses
    • Recruitment Costs
    • Training Costs for New Employees
    • Training Costs for New Equipment
    • Employee Relocation
    • Travel Expenses
    • Postal/Delivery Costs
    • Lost Business
  • Capital Expenses
    • Tenant Improvements
    • New Office Furniture
    • New Systems Furniture
    • Copier/Mailroom Equipment
    • New Telephone System
    • New Computer Equipment
    • Cabling Installation
    • Security System
    • Depreciation
  • Moving Expenses
    • Communications
    • Stationery & Forms Printing
    • Warehousing/Archiving
    • Furniture Moving
    • Packing Expense
    • Boxes
    • Equipment Rental
    • Local and Long Distance Phone Service
    • High-Speed Data Lines
    • Service Agreement Penalties
    • Cost of Duplicate Systems
    • Waste disposal
    • Clean-up
  • Consulting Expenses
    • Architect
    • Interior Designer
    • Tenant’s property consultant
    • Move Coordinator
    • Project Manager
    • Engineering Firm
    • Legal expenses
    • Sets of Drawing Packages
    • Technology Consultant

Having no budget or an unrealistic budget is inexcusable. Take the time to go through the budgeting process before you begin the search for a new site. It will pay off in the end.

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Insufficient staffing

Inadequate supervision or poor coordination is usually the result of the fourth deadly mistake – that of insufficient staffing, or the inability (or unwillingness) to delegate tasks. If you have no help, you can’t possibly manage the entire move. You need an orderly approach to managing the relocation.

First, recognize that you need help. You will have to recruit employees from within your organization who can carry part of the load. You will be the big cheese, or “move director”. Select the members of your team based on their area of expertise. These need not be department heads. In fact, most middle and upper management types are not good choices. They are unaccustomed to taking direction, and tend to argue with you about your decisions.

Specialized knowledge is the key. You want team members who have good working knowledge on their particular area of expertise, and access to certain corporate records. Here is a short list to get you thinking about the areas of expertise you will need on your move team:

  • TELEPHONE SYSTEMS AND SERVICES
  • COMPUTER SYSTEMS AND NETWORKING
  • COPIERS AND OTHER OFFICE MACHINES
  • COMMUNICATIONS CABLING
  • ELECTRONIC SECURITY
  • FURNITURE (INCLUDING MODULAR FURNITURE)
  • WAREHOUSING (MATERIALS MANAGEMENT)
  • POSTAGE METERS AND OTHER MAIL ROOM EQUIPMENT
  • PRINTING SERVICES
  • EMPLOYEE ROSTER
  • CUSTOMER LISTS
  • CONTRACTOR/SUPPLIER RELATIONSHIPS
  • RECORDS STORAGE AND ARCHIVING
  • CONSTRUCTION ISSUES
  • COLOURS AND FABRICS

You will not need a team member for each of the above items. Many of your team members will have multiple areas of knowledge. For example:

Example 1
Your IT Manager may know computers, networking, phone systems, cabling and security systems well enough to represent these areas on your team.

Example 2
Your Office Manager may have expertise in furniture, telephone service, copiers, mailing room equipment, and printing services.

Example 3
Your HR Manager may know all about communications, and will have access to employee rosters, customer lists and contractor/supplier lists.

In the three examples above, you have covered all but a few items. What remains can be divided among your team members, or defaulted to you, the Supreme Commander.

Select your internal team early, and put them to work on specific tasks with firm dates for completion. You will have to set up a standing weekly meeting where everyone reports on his or her progress. Pick a time for the meeting when interruptions by phone or pager are less likely. Set an agenda each week, and stick to it. Set milestones for completion of each task. Get someone to keep minutes of each meeting so there is no confusion about what was agreed, or about who said what. Don’t end the meeting until everyone is clear about his or her responsibilities for the next week. Begin each meeting with a review of what was agreed last week.

After you have established your internal team and meeting schedule, you will need to appoint or nominate a coordinator or liaison for each department within your organization. These are not members of your team, and will not attend the weekly meetings. They will simply represent their department for planning and coordination purposes. Just to start you thinking about it, some departments may include executive, administration, human resources, product development, manufacturing, assembly, editorial, copywriting, marketing, sales, data processing, programming, information technology, MIS, communications, accounting, finance, customer service, order entry, fulfillment, installations, delivery, operations, shipping and receiving, materials management, claims and training.

Your department coordinators will be responsible for knowing what items are to be moved, disposed of, archived and warehoused. It is helpful to create a database for the items in each category. This will come in handy later when you are obtaining estimates.

Your department coordinators will also be responsible for the layout of their department’s space. This includes the layout of individual offices and rooms within the space. It is important to have each office occupant sign off on their office layout before installing electrical outlets and cabling outlets on the “wrong side” of the office.

The department coordinators will have to tell you exactly where they want to place computer equipment, fax machines, copiers and printers. This must be known in advance of designing the electrical and cabling systems. Many electrical outlets will need to be dedicated, not shared. You want to know this now, not after the electrician is sweeping up.

Once all the suppliers have been selected that will provide goods and services for your office relocation and fit-out, how do you ensure that they will perform as promised? Experienced office move managers have many tried and tested tools at their disposal. Do you have enough time in your already packed schedule to make sure that your selected suppliers will show up when promised, stay on schedule, deliver what you expected, or finish on time?

Delays by one supplier will affect other suppliers. Imagine that the carpet supplier starts late. Now the modular furniture supplier can't assemble the furniture. The cabling people can't complete their work without the furniture cubicles. The IT and telephone suppliers can't get their systems up and running without cabling. What would their reaction be if your employees had to move into their new office without working phones and computers? This domino effect can really sink your project.

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Starting late

The fifth most common mistake is starting late. An office move takes many months, even after a site has been selected and a lease has been signed. Too many companies paint their suppliers into a corner by allowing too little time to prepare a decent proposal and even less time to deliver or install the goods and services purchased. A rushed supplier makes mistakes. Don’t place your move in jeopardy by expecting miracles.

The larger the organization, the more time will be required to successfully plan and implement a relocation. There is no hard and fast rule that tells you exactly when to begin this long process but think about all the issues and how they are interrelated. Each must be completed before the other can begin. Here is a VERY brief list of the events that must occur, in chronological order. There are actually over 200 such events in a typical relocation, but we will not list them all here. This list is provided just to get you thinking:

Hire the architect/designer/space planner
Hire the property consultant
Find the space
Negotiate and sign the lease
Determine the move-in date
Prepare the floor plans
Obtain all necessary permissions
Hire the General Contractor
Hire the Project Manager
Establish the construction schedule
Select your internal move team
Choose department coordinators
Hire the telephone system supplier
Order telephone service and data-lines
Hire the cabling supplier
Hire the security system supplier
Hire the furniture supplier
Hire the computer systems supplier
Send letters to customers and suppliers
Order new stationery
Order new furniture
Hire the furniture mover
Order crates/boxes
Label all items to be moved
Store/Archive records
Arrange for waste disposal
Schedule computer system downtime (back-up)
Arrange for employee training
Distribute keys/pass cards
Re-paint company vehicles

Let’s say this is the short list of events that you will coordinate for your office move. Obviously, nothing can begin until you find a new space and sign the lease. But, you must know your space needs pretty well or you could make a bad selection. So, the architect might be hired first. The architect can help you determine whether a particular space literally fits your rough layout, based on an understanding of your work flow.

Once the move-in date is fixed it’s a mad dash to the finish line. All suppliers must squeeze their work into the time available. If you drag your feet on supplier selection, you will make this problem worse. If you really squeeze your suppliers, you are betting that nothing will go wrong and that there will be no delays or long deliveries. This is not a likely scenario.

The time to plan is BEFORE you have selected a space and signed a lease. How then can you estimate the time required in which everything must be done? Your property consultant can estimate how long it will take to find a space, negotiate the lease, and sign it. The haggling over terms is the big unknown here. Your architect can help you with a time estimate for the construction project. Permissions can be a big delay.

That’s about as much help as you’ll get. The suppliers you hire, like the telephone and computer suppliers, may have long lead times for equipment. You need to know up front which phone system and computer equipment you will purchase in order to avoid long lead times (or to know what those lead times are). The cabling must be done before the computer and telephone systems can be installed and tested. As mentioned earlier, the cabling is dependent on the timely installation of all modular furniture, which is dependent on timely installation of the carpeting.

Phone system installation is also dependent on the provision of services, such as ISDN and DSL lines from your chosen phone company. If your computer system needs to link to another remote site, the high-speed data lines must also be in place before the system can be made operational. Lead times for some services can be many months.

It is fairly simple to arrange for printing new stationery or for moving the office furniture, but most other events are co-dependent. All these interrelated events must be placed on a big list with dates for completion. As one changes, many others must change with it. Once the schedule is roughed-in, make sure there is enough time to conduct a respectable supplier selection process.

As you discover that key dates must move backwards, this will help you determine the appropriate starting dates. And, you’ll probably conclude that there is no such thing as starting too early.

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Compressing the schedule

Closely related to “starting too late” is the sixth deadly mistake, compressing the schedule. Trying to make up for lost time or a late start by reducing the allotted time for completion is very dangerous. Plan for enough time to allow each supplier to complete his task as agreed Just because it takes nine months to make a baby, does not mean that nine guys can make a baby in one month!

Your supplier or contractor planned for this project, based on information you provided during your competition. They were selected based in part on their ability to get the project completed on time and on budget. Now you must reduce the available time because of some schedule slippage caused by another supplier or unforeseen event. How can your supplier get the same quality job done in less time? One way is by throwing extra bodies at the project. Another is by working overtime (longer days, double-shifts and weekends). You can’t expect your supplier to eat this additional cost since it is beyond their control. They will expect to be paid extra for this.

If you decide to play “tough guy” and refuse to pay for the overtime your schedule slippage has caused your supplier’s only defence is to treat your project as a “loss leader”. This means that they will take their “A-Team” off the project, replacing them with less experienced employees who earn less money. Now, you have placed your project at risk.

Even if you still have your supplier’s “A-Team” on site, compressing the schedule rushes your suppliers and puts too many bodies on the job site at one time. Imagine the sight of a dozen suppliers all on-site at the same time, fighting for elbow room alongside the construction sub-contractors. Nobody can be productive under these conditions. Don’t kid yourself into thinking that your project will be different.

General contractors are notorious for compressing parts of the construction schedule. If they can’t obtain permission to close up the walls, they will spend the time installing ceiling tiles. While this sounds like they are making good use of their time while maintaining their OVERALL schedule, think about how this one change will affect other suppliers. Your cabling supplier will have far less time to install the cabling than planned. Who pays for their overtime? If the carpet is delayed, you already know how other suppliers are affected. Will the general contractor pay for the overtime required of the furniture supplier, cabling supplier and telephone system supplier? Even his small actions have major consequences.

Do yourself a favor and write some provisions in your contracts for how these schedule compressions will be handled. What are the ramifications for the supplier for causing a delay that will compress the schedule and cause overruns? You may consider a liquidated damages clause (LAD) that spells out the penalties that will apply for every day a supplier is late.

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Poor communication

Lastly, poor communication can sink your ship as surely as the iceberg sank the Titanic. You must keep your employees informed about the relocation and fit out programme of course. But most relocation/fit out managers stop there. You also have a responsibility to keep your customers and suppliers informed, as well as all suppliers you have hired for the job. Un-informed customers and employees will leave you. Suppliers can’t perform to your requirements if you don’t communicate with them.

At a minimum, you should consider the following letters and memos to keep everyone informed. Some of these can be combined into one letter or memo:

Customers
Notify customers that you plan to move
Provide customers with new address and phone numbers after you move

Suppliers
Provide date when relocation is planned
Provide new address and phone numbers after you move

Move Suppliers
Weekly memos keeping everyone informed of move progress

Employees
Notify employees of your moving plans
Provide orientation at new site before move-in
Provide public transport schedules and parking rules
Provide lists of local services (banks, restaurants, day-care centres)
Provide instructions for packing office contents
Provide employees with name of department coordinator

The hardest part of this is remembering all the suppliers and service providers that need to be informed of your plans. It is easy to leave out someone important. Here is a list to stimulate your memory:

Suppliers

Equipment manufacturers
Distributors
Copier/FAX dealers
Computer/Networking suppliers
Telephone System suppliers
Specialised equipment suppliers (Mail handling, printing press. etc.)
Furniture suppliers
Local telephone service provider
Long Distance telephone service provider
Leased line service providers (ISDN, DSL)
Commercial printer
Office supplies
Business forms
Service Providers
Banks
Accounting & Bookkeeping services
Payroll service
Business Insurance agent
Cleaning/Janitorial service
Advertising/PR firm
Employment/Temp agencies
Food/Snack/Coffee services
Plant watering service
Local public utilities (gas, water, electricity)
Retirement plan administrator
Health Insurance provider
Trade or membership organizations
Magazine or book club publishers
Local Post Office
Courier service
Delivery services


Don’t Try to Become an Expert While Doing

Now that you know the seven most deadly mistakes, how can you avoid them, or at least minimize their impact on your office move? This is not easy if you are new at the game. Simply knowing what lies ahead is a big help, but this won’t solve problems for you. Your biggest problem is time. There is never enough of it. And, you still have your regular job to perform. How do your peers get this done?

A good relocation/fit out manager will start phoning suppliers early in the move process to ascertain rough budget numbers for all the goods and services required. This provides some information that is useful but the process is time-consuming. Plus, how do you determine all the products and services you will need if you have little or no experience at this? Any omission will be costly, if not deadly.

Starting on time sounds easy enough, but how do you know when you are early or late? How can you avoid a late start or schedule compression when you don’t know the lead times required by each supplier?

Speaking of suppliers, how can you determine who the best suppliers are? How do you make the right supplier selections for your move? How do you go about locating good potential suppliers? Is there a way to compare suppliers and their offerings other than by comparing price alone? How can you learn this while you are doing it? You don’t have the time to become an expert. You barely have enough time to keep up with your regular job.

The short answer is of course – you MUST seek professional, expert help!

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