Some things seem so obvious that it’s hard to believe that other people don’t get it. You almost have to think that they actually do understand the point but for some reason don’t want to admit it.
For facility managers, the benefits of making investment decisions based on life-cycle costs seem self-evident. Investing in a more efficient chiller, carpet that is less likely to ugly out prematurely or a more durable roof system will minimize costs over the life of the product. How could top management not understand? And if they do understand, and they’re still saying no, maybe there’s really no hope of changing their minds.
Or maybe it’s time to try a different tack.
One place to look for a new argument comes from the quality department. Those folks have a concept called quality costs, and it was developed to counter the argument that better quality costs more than poor quality. The idea is simple. Divide costs related to assuring quality into three categories: prevention, inspection and failure. Guess what? A relatively small investment in prevention pays huge dividends by reducing failure costs, which can be the largest type of quality costs — by far.
Life-cycle-cost analysis can also prevent problems. One is higher long-term energy use. That not only saves money at today’s electric and gas rates, but also helps insulate the organization against energy price volatility and the prospect of limits on carbon emissions down the road.
Life-cycle-cost analysis can also help prevent premature replacement of systems. This saves more than capital dollars. Replacement disrupts occupants, and the failure itself can bring unexpected costs (think roof leak).Just using the word “prevention” won’t change anyone’s mind. But taking the time to educate top management about the real costs of building products and systems might get them to see facility investments in a new light.