Covid-19 likely to accelerate demand for FM-compliant companies

The joint venture between Ramky Group and Atalian Global Services is poised to change the facility management (FM) landscape in India. "Covid 19 is likely to accelerate the demand for FM-compliant companies, which are offering flexible FM models to meet the work-from-home (WFH) and coming back-to-work strategy of their organizations," Ramendra Pratap Singh, country CEO (India), Atalian Global Services, tells Bizz Buzz

The facility management industry is poised for strong growth in India with increasing demand for experts to manage non-core functions. The trend for outsourcing of FM services is shifting from Metros to Tier-II and Tier-III towns and is likely to further accelerate the growth of the industry

With 'healthcare for all' a top agenda for the government, the sector is likely to grow at a CAGR of 18 per cent. With increasing sophistication of healthcare facilities, adoption of digital technology and focus on efficiency, demand for high-quality hygienic atmosphere will open newer opportunities

How is the facility industry doing in the country and how many players are there at present?

The facility management industry is poised for strong growth in India with increasing demand for experts to manage non-core functions. The trend for outsourcing of FM services is shifting from Metros to Tier-II and Tier-III towns and is likely to further accelerate the growth of the industry. While the commercial sector continues to be a leading adopter of professional FM services, other sectors like manufacturing, healthcare, transport and logistics are also experiencing a surge in demand for professional and FM-compliant outsourcing of non-core functions. Currently, the market in India is largely fragmented, with global and national FM service providers only servicing a fraction of the available opportunities.

What was the impact on the industry due to Covid-19 and what are the lessons learnt?

Covid has impacted many industries including the FM sector in India. While sectors like IT & ITES were able to adapt to working from home, many sectors like retail, hospitality and airports were forced to optimise operational costs or suspend services. This led to a large pipeline of contracts that have been suspected which also has a knock-on effect on local services that rely on them.

Industries that thrive have a strong online business model, including e-commerce and digital entertainment, which from an FM perspective meant a higher demand in logistics, warehouses and distribution centres. Other sectors are also included like healthcare and the public sector with a high demand for hygiene-related services. Although there is less demand in the office sector as people work from home, as an asset, clients will still have to maintain their site even if there is a reduced occupancy. The FM Industry plays a pivotal role in ensuring business continuity plans and this is now being recognised.

Covid exposed some weaknesses in business continuity planning across the sectors and there are FM lessons that can be learned from this experience. The key is having a proactive and collaborative approach to BCP.

How is the facility management service doing in the country's healthcare market? What is the future?

With 'healthcare for all' a top agenda for the government, the sector is likely to grow at a CAGR of 18 per cent. With increasing sophistication of healthcare facilities, adoption of digital technology and focus on efficiency, demand for high-quality hygienic atmosphere will open newer opportunities for integrated FM companies in healthcare.

What are the challenges being faced by the facility management industry in the country at present?

The biggest challenge faced by FM industry in India is the perception of the service provider as a manpower provider instead of a business partner offering quality and efficiency of non-core services. Although the commercial sector is gradually adopting the "Job to be Done" framework, other critical sectors like healthcare, logistics, and manufacturing may still need to take the first step to catch up. Commoditising of the critical FM services leads to sacrificing long term gains over short term savings. Sometimes the focus is just on pricing, to the detriment that clients are not able to differentiate between a compliant professional organisation and a non-compliant service provider. The risk to business due to non-compliance can be very costly and damaging, not just from an operational point of view but reputational too.

In a self-delivery business, we have to take care of the employees, pay respectful wages that are aligned with Government guidelines and provide training and career opportunities. Atalian works with clients who share our ethical values and ambitions to support local employment.

How India offers an attractive market for the industry and how was it growing in the country?

The Indian FM is likely to grow at a CAGR of 20 per cent, according to various survey reports. Professional FM services are becoming a necessity for companies to increase the life span for assets, plant, and machinery to ensure a safe environment for employees and occupants. The growing need to reduce operating costs of facilities, focus on energy conservation and optimum use of facilities will drive the demand for professional FM services in India. Covid 19 is likely to accelerate the demand for compliant FM companies that are offering flexible FM models to meet the WFH and Coming Back to work strategy of their organisation.

Atalian Global Services India began operations in 2018 as a joint venture collaboration with the Ramky group of companies. How has been the journey so far?

The joint venture between the Ramky Group and Atalian Global Services is poised to change the FM landscape in India. Atalian Global Services is building on 77 years of experience in FM in 35 countries across four continents. We have pan-India reach through Ramky Group with an enhanced network of multi-disciplinary business such as waste management and a workforce of over 4,500 employees across the country. Both JV partners complement each other and bring a unique value proposition to our clients.

The company has been targeting private and public sector companies in the country. What is the achievement so far?

Atalian provides FM services to public and private clients in 15 states, including key metros like Mumbai, Chennai, Kolkata, Delhi, Hyderabad and Bangalore. We have clients across a wide variety of private sectors, and we have global expertise within the public sector delivering FM for Government sites and public sector functions such as transport around the world. We are actively seeking opportunities in this sector in India.

Where do you see your company five years down the line?

Atalian has an ambitious accelerated growth plan in India intending to be one of the top global FM service providers in the country. Our strategy is to hire and develop Indian talent by upskilling the local workforce from using mechanical cleaning to reduce physically demand work for older workers, to providing international standard management skills. Our ambition is to develop skills and training aligned with a future workforce for India.

What are your expectations from the forthcoming Union Budget?

Atalian Global remains optimistic that although the FM industry faces a great challenge, there is also an opportunity to transform this industry. We will be focused on providing job opportunities for the current and future market that will build resilience in the Indian FM industry.