Impact of DOE Better Buildings Initiative: Ep 14

Jennifer Heath 0:18

Hello, everyone. And welcome. Thank you so much for joining us for another episode of the Hybrid Hangout Podcast. I’m Jennifer Heath Director of Product Marketing at FM:Systems.

 

Brian Haines 0:29

And I am Brian Haines, the Chief Strategy Officer at FM:Systems.

 

Jennifer Heath 0:33

And we are so glad you have joined us today we have a variety of things that we’re going to talk through, there’s been a couple of really interesting headlines. Lately, there’s always new stats and trends in the world of hybrid work, facility management. So lots that we want to get to today. But before we get into some of the new headlines, I want to go back to a recent podcast, Brian and I talked about the evolution of the facility management role. And how there’s a real perception of facility managers as you know, likely a man in a boiler room with a toolbox, there’s this perception of it being this really manual, hands on kind of role. And the reality is today, facility management is a much more technical field. It’s much more likely someone in an office at a computer, analyzing data, and driving building control systems. But one thing we did not mention in the changing nature of facility management, is the fact that there are more and more women in facility management today than there ever was. So IFMA recently put out a blog about the trend of women in facility management, and one of the speakers that they interviewed for this blog says, “We are still in the mindset that FM is a male dominated field. Because most understand FM as a traditional boiler room profession, we need to shift our mindset.” And I think when we think about how much technology has influenced facility management, how much that has opened up the field for women to join and be a part of what is really a very complex, dynamic industry. So it’s an exciting trend. It’s a really positive trend. Brian, what is your experience seeing the field change over the years in that regard?

 

Brian Haines 2:29

That’s a great question, Jennifer. I’ve had the privilege of working with a number of really incredible women in this profession. Right from the very start. When I joined the University of Arizona, my first job there was a CAD specialist. I was hired by a woman named Mercy Valencia, she was the Director of Space Planning and Management. And really made a huge impact on my career mentoring me. She promoted me a few years after that to a Space Analyst position. And I’ve always just had the most amazing memories of that time. I will say, though, that, you know, that was a long time ago, I’ve been at this for quite a while. Women in senior positions at that point were, you know, there weren’t many. And so she was really somebody who was leading from the front and incredibly inspirational. As my career has progressed, that’s changed. But it’s still not where it needs to be, I think. I was looking at an IFMA report on women and facilities that was just done in 2023. And North America’s leading the way. But it’s still only 25% of the profession are women, 75% are male. So it lags other industries. Tech is, is higher, I think tech is closer to 28 to 30%. I’m proud to say that FM:Systems is 38%. I think our goal this year was 38%. I think we’re around 40%. I know my department was over that. So I’m seeing tech change at a pretty good rate. I think facilities absolutely is changing in a positive direction. But we’re still not where we need to be, especially with the need for talent. It’s not like our profession is overflowing with the number of people standing in line. We need talent. I think women and females are a great place to go to look for that talent for the future of facilities and leadership. And I’m really excited about that opportunity. I think a lot of education, a lot of effort needs to happen, but we’ll get there.

 

Jennifer Heath 4:37

I agree some other sort of interesting stats out of the IFMA blog, “The average age of women in FM is 45, which is younger than the average age of men. Further women are being hired at a faster rate at every entry level or at every level of position, entry level mid level and senior level. Women are being hired at a faster clip into those roles than men.” So I think it does show that companies are realizing that there is this sort of imbalance there and they’re more aggressively recruiting women into these roles. So definitely some positive trends there.

 

Brian Haines 5:17

Yeah, that’s exciting. And those positive trends means that that percentage that I was talking about is naturally going to increase, which I think is really the opportunity, not only for women in this profession, but also for our industry to get better balance, which is going to be really exciting. Another thing, Jen, that I’m, I’m pretty proud of is that, as you all know, FM:Systems is now part of Johnson Controls. And in 2024, Johnson Controls was named one of America’s greatest workplaces, for women in 2024, by Newsweek. So, you know, I continue to be in industries and with companies that really value that contribution. So I’m quite proud of that. And I think that FM:Systems and Johnson Controls should both be quite proud of that.

 

Jennifer Heath 6:07

Yeah, definitely. I’m very proud to be associated with that as well. All right, let’s shift gears a little bit. There was a really interesting, several interesting headlines in the last couple of weeks from the Department of Energy. So the DOE has announced a proposal and prize for an investment in air quality improvements for K through 12 schools. And it’s a really interesting program. It’s a three phase program, I think it’s a total of around $180 million being invested into energy efficiency and air quality upgrades. Some of the things that were interesting to me in this, the first stat that really stood out, the average main instructional school building in the United States, is about 49 years old. And something like 40% of those were actually built prior to 1970. So even older than that, so we definitely have an aging infrastructure in that regard. The survey went on to say of the schools they surveyed, about 1600, respondents who had done a major renovation, most of those were 15 years ago, or longer. So even the schools that have made some steps forward are still you know, 10 to 15 years behind where they need to be. So what’s gonna happen with this prize, schools can write proposals, they can apply for this different funding, but it comes in phases. And so if you’re granted funding in phase one, you have to go through certain steps and be able to show your progress in different areas to then move and apply and be awarded funding in phase two, and phase three. So it’s a major project management undertaking to receive this funding, because you have to continually show your progress. One of the things that I found really interesting, the article said, the prize also promotes partnerships between school districts and industry experts, encouraging the formation of stakeholder support networks. And I think that is such an interesting opportunity for companies like FM:Systems, for anyone that does similar to what we do, because they’re creating an avenue for us to really come in and partner with these school districts. Not just in, you know, maybe replacing their HVACs, but looking at things like environmental sensors, the analytics, the data analytics they need to support these initiatives. The software tools they’re going to need to manage these projects and generate reports. There’s just a ton of opportunity for us to come in and partner with these different school districts. What are your thoughts, Brian?

 

Brian Haines 8:55

Well, Jen, it kind of goes back to the beginning of this statement, you made sort of the stereotype of FM’s being, you know, in the boiler room with wrenches. And how the profession has changed is absolutely mind boggling. Facility Managers are asked to do more and more. Every single day I’ve seen the profession progress, the knowledge skills that are needed by professional facility managers, is mind boggling compared to what it was. At one point they’ve got to be experts in life safety. They’ve got to be experts in space and occupancy planning. They’ve got to be experts in capital planning and finance. They’ve got to be experts in human resources. It’s crazy the way that facility managers, and actually an opportunity as well that, have to continually uplevel their skills. No energy and sustainability has entered the equation. IFMA offers a certificate in sustainability, which is showing that our profession continues to evolve. But I don’t know of any facility managers who have the time of the day to sit around writing proposals hoping they’re going to get help to improve their facility. So I really think partnering is the way to do that. There’s a lot of organizations that exist that are out there, industry partners, Johnson Controls being one of them, that can offer that expertise and ideas on how to better qualify for some of these programs. Because energy and sustainability, I think, is here to stay. Thankfully, for a long time, it was sort of an interesting, nice to have. Now, it’s a necessity, opportunity drives innovation and so does compliance. The SEC recently released new ESG guidelines for the US, I believe it was February 29 this year for publicly traded companies. Which means the reporting requirements, as you target your sustainability goals are going to be necessary as it could potentially affect your stock evaluation. Europe has been doing this with ESG initiatives for a while. And it just shows me and tells me that, you know, there’s a couple of things that really drive us forward in terms of need, in terms of knowledge. Compliance is one the opportunity to make our buildings better workplace experience, and that workplace experience, especially in schools goes all the way from, you know, the students who are passing through that school, the teachers, the administration, faculty. It’s really quite amazing the opportunity to make our buildings better. And the building stock, Jen, it is older. I was talking to my sister recently about the high school that I went to a long time ago, it’s still there, and there’s no plans to replace it. And I’m wondering how they’re dealing with that. And, you know, technology has evolved greatly. I think even existing building stock, old buildings have an opportunity. Not only through like significant renovation and retrofit to do things like replace the mechanical systems and upgrades, but also through IoT technologies, lighter weight, easy to implement technologies that are now readily available, so that we can monitor things like air quality, and occupancy, even security, there’s all kinds of things that you can do to buildings to make them better now, even old buildings. So I think it’s an opportunity. But I think partnerships, going back to your point is really the key for organizations that may be understaffed, don’t have an opportunity to jump in to the ring and go for these kinds of grants. They’re going to have to partner and get some help get these grants written and then get their buildings better.

 

Jennifer Heath 12:50

Yes, and you raise such an interesting point about the challenge of the older buildings. And that leads me right into the second announcement from the Department of Energy. They have also announced a significant investment to update and upgrade federal buildings, which are also for the most part 50, 60, 70 years old. So they have announced a new program called Affect, Assisting Federal Facilities with Energy Conservation Technologies. And it’s again, a multi phase program, a total of $250 million investment initial disbursements 104 million, and it’s all about clean energy, net zero goals, and energy conservation projects. And the first thing that I really thought was that exact thing that there are so many more opportunities to improve older buildings without having to, you know, rewire the whole thing or, you know, retrofit all of your HVAC and internal mechanisms. You can lean on, easier to implement technologies like environmental sensors, as a way to get started. I think for a lot of people, it’s overwhelming to think about taking on these huge projects, you know, what’s the best way to allocate funding? I think it’s always great to think about it in terms of just start collecting the data. No matter what you do, you’ve got to have sound accurate data to drive those decisions. And sensors are a pretty lightweight solution in terms of implementation. They don’t require a lot of technical infrastructure. It’s not, you know, a heavy lift to physically install them. So there’s a big opportunity there to leverage some of this newer technology and make this progress.

 

Brian Haines 14:35

Yeah, that’s interesting. When you say buildings, 50, 60, 70 years old, when I tell my European friends that they laugh, like this buildings brand new, the house I grew up in was built in 1400s. You know, I always hear that story. But you’re right. I think if you just go back a decade ago, when you were talking about creating a sustainable building, or a smart building, it was you know, it was almost exclusively related to base building, design, and construction, so new buildings going up. But technology has evolved in a number of different ways. We’ve got low voltage devices, and technologies like POE or Power Over Ethernet, where you can literally get enough power through an internet cable, like the kind that you plug into your laptop, to get access to the internet. There’s enough power in that cable to actually power, low voltage devices like sensors and digital panels outside of conference rooms. And all of those things can be implemented quite easily with a lot less heavy lift than what you would have had to done before with, you know, devices that required a greater amount of power. Also, battery life. That’s another thing that’s really revolutionized these devices and the way they have battery life. I think when FM:Systems first started implementing sensors and head sensor partners, you know, a decade ago, battery life was five, six weeks. And sensors were really only deployed for like little surveys. You’d send out a box, they’d install them, the batteries would go dead within, you know, a month or so. And you’d pull them off the wall, and you’d send them back or put new batteries in. We’re seeing battery life now for occupancy sensors reaching 5, 10 years. So they’re not nearly the problem in terms of implementing and supporting them that they were. And it’s not just, you know, utilization technology. But there’s a ton of different technologies that use these kinds of capabilities, indoor air quality sensors, light sensors, all of them using low voltage. And I think that that’s revolutionary. And then we can move into things like edge devices. I know that sounds pretty technical, but think about a small box that you put in the overhead of a facility that can take data from the facility like energy information, and send it up to the cloud. You were talking earlier about the value of collecting data- much easier, collect energy data, utilization data, Energy data is something that for the most part, you’d have to wait till you got your energy bill every month. And often that energy bill lagged a month because it takes them a month to bill you. And so it was really difficult to sort of keep up to date on, you know, how you were doing, you would see this giant spike that happened two months ago. And there’s no ability to be able to go figure out why that happened. Well, now we’ve got instant access, potentially. Even for existing building stock, I’m telling you, this stuff is actually pretty easy to implement, and really cost effective. A lot of organizations can make their building smarter with a minimum investment to get them up and running pretty quickly.

 

Jennifer Heath 17:45

And the return on the investment is substantial. So just within this article, this announcement about this grant, the Department predicts projects will save more than $29 million in energy and water costs just in the first year of operation. So with a fairly small investment, you can have downstream impacts that are really an impressive return.

 

Brian Haines 18:13

Yeah, I think it’s a no brainer, Jen, honestly. The more information you have at your fingertips, with this sort of minimal investment, the better you’re going to be able to be when it comes to rationalizing your real estate portfolio and making the necessary changes based upon, you know, informed intelligence. Really having information at your fingertips that’s reliable. You know, it used to be I keep talking about the old days, it used to be if you needed to know, you would go to like an analyst, if you’re lucky enough to have one on your staff, and they would, you know, take out a spreadsheet and they would start a project and that would take them months. And then they would produce a report and give it to you either printed or as a PDF. And it was basically looking into the past as to what happened and helping you understand what happened. Now we have the ability to understand what’s happening now. And into the future. We’ve got technologies that are coming into play like AI and machine learning that are allowing us to almost peer into the future by looking at historical algorithms and then predicting what the path is going to be forward in terms of things like how we’re using our energy, how our buildings are being used. And that’s really helping facilities organizations to not only better understand their current operations and costs, but also what they’re going to do with their portfolio into the future and how they’re going to evolve it to make it more resilient and meet sort of the ever changing needs that we’re seeing in our industry.

 

Jennifer Heath 19:47

All right, we’re gonna shift gears one more time. It would not be the Hybrid Hangout if we didn’t talk a little bit about hybrid work. I know it’s something that we’ve almost just talked to death. It’s been such a huge theme in the last few years. And it continues to evolve and new aspects of it continue to emerge. And so I saw a headline this week that really caught my eye. The title is “The High Cost of In Office Days,” and it was talking about how expensive it is, for people who do come into the office on a regular basis. If it’s the cost of the commute, both, you know, gas prices, as well as the time that you’re committing to your commute. If it’s parking, if you live in a, you know, a major metropolitan area, parking in the city can be incredibly expensive. The likelihood that you’re going to eat out, there are so many aspects of coming into the office that have a price tag attached. And the article was basically posing the question of – is it fair, in an organization where you have some employees that are required to come in every day, think about maybe manufacturing or health care, you have certain roles that you’d have to physically be there to do the job. Whereas you have maybe administration, team members, folks that are considered knowledge workers, they don’t have to physically be in that space, they can do their work from anywhere. But is it putting an undue burden on the folks that have to come in? Or is it giving the people that stay home an unfair advantage? And how do you balance that? And I think it’s a really interesting idea that, on the one hand of the people who are staying home, you can sort of claim the sustainability side of that, because they aren’t having to commute, you’re reducing that pollution. But is there an imbalance there? And is that a potential challenge for employee retention, for morale? The people who have to come in every day? Do they feel resentful for the people who don’t? Is there just an understanding that the roles are different? People are different? I think it’s an interesting question. What did you think about that?

 

Brian Haines 22:05

You know, I do think it’s interesting. I’m pretty sure I saw an article yesterday that New York City is either considering or is actually doing, I think they’re going to charge anybody who comes in to the city during congested times to work like $15 a day, like, that’s not parking, that’s not coming across the bridges. I mean, you could drive by New York City, and it cost you $30, right? Just the tolls. That’s the way it is. And it’s always been that way. But I was thinking to myself, how are employees who are already significantly impacted by that commute, going to be able to afford it. And it’s going to be interesting to see if it pushes, you know, people on the lower end of the wage scale out. San Francisco experienced this and continues to experience it, where the cost of housing has gotten so expensive, that the people who are in service industries are sometimes commuting two hours on public transportation, because they can’t live close enough to the city to buy. So I think it’s really going to be a problem. And it may actually accelerate more of a hub and spoke model Jen, which I think has been something that organizations have been looking at from a space and occupancy standpoint for a while where you may have that center in the city. One of our clients is a health care organization, and Phoenix has done this where you may have that big tower in the city where a lot of people work, but they’re completely authorized to work at one of their hubs, which may be on the outer edges of the city, maybe smaller offices a little bit more flexibility there. I think that that’s probably the change that we’ll see generated from this because the increasing costs, it can’t continue, especially if there’s pressure on employees. And it becomes unsustainable. At some point, it kind of flips, right? Like you go, Oh my gosh, it’s like too expensive for me to continue to work in this position, if they’re going to require me to be there. I think that’s going to, you know, that once you get to that tipping point, you may see some regulations come in, like where companies may need to compensate? I don’t know. But I think it is an emerging problem. I think it could be addressed by a different way of looking at our real estate portfolios, maybe the hub and spoke model or having satellite offices, or just frankly, understanding that it’s too expensive for a lot of these people to come in. You know, I think the challenge is, you know, it’s not hard to be a remote worker or commute like that when you’re in technology, you know, as long as you have an internet connection and a place to work, you can do it. But not a lot of people are building cars in their bedrooms, you know, it’s just not possible. So manufacturing is one that’s a real challenge. Healthcare, high touch environments, where actually being, you know, in contact with patients in a healthcare setting, impossible to do that, you know, as sort of a hybrid workplace. And I think you know, going back to the hybrid fatigue. I mean, we’ve talked about it so much. But the truth is, you know, hybrid is just a potential way of working. Many organizations aren’t hybrid, they are back or completely remote, we’re seeing the percentages, I think kind of stabilized around that maybe a slight increase, going back towards the office, but it’s really part of the potential solutions for many organizations. I think we have to be flexible with our employees as best we can to support their ability to be able to balance their lives, which also includes balancing their finances. And a way we can do that, I think, is to have a more flexible way that we think about space and where people work.

 

Jennifer Heath 26:02

I totally agree. And I think it’s really important for organizations to listen to their employees, that’s a theme that we have come back to over and over again, over the years of serving your employees, you know, getting that soft data, that feedback from them of what their experience really is. Maybe this is a made up problem, maybe people who are going into the office every day or going into the factory, the plant, the hospital, wherever they’re going, maybe they don’t feel resentful. You know, maybe this is a thought piece sort of a problem. But I think every organization has to take the time to really listen to their employees and find out what is the true sentiment? What do we need to do to adapt? Do we need to have some kind of a commuter bonus where you get like an extra stipend, you know, every quarter or whatever, to kind of offset some of those costs, and you only apply for it or you only qualify for it if you come in so many days a week. I think organizations will have to be creative and find ways to balance these different work styles. Because I don’t think it solves the problem to say, okay, all of our knowledge workers have to come in every day. I don’t think putting the burden on everyone is a solution, either. So listening to employees, taking that feedback, being willing to try different solutions to try different strategies, knowing that maybe it’s not going to work very well and you’re gonna have to try something different. You have to have courage I think right now as an HR individual, real estate exec, a Facility Manager to try different things, not be afraid to fail, constantly listening to your employees to try to deliver that ideal experience. All right. I think that is everything for us today. Brian, always a pleasure to get together and chat about what’s going on in our worlds.

 

Brian Haines 27:59

It’s a great way to start my morning, Jen, always really great conversation. I appreciate that. It’s always a lot of fun.

 

Jennifer Heath 28:06

All right, thank you so much, everyone who joined us today and we will see you next time.

 

Brian Haines 28:11

Bye everyone.