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Facility Condition Index (FCI)
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key performance indicator (KPI)  which is used to objectively quantify and evaluate the current condition (ie., physical health) of a facility and to make two types of benchmark comparisons on the relative condition of that one facility with:
  • Other facilities within the same portfolio [see scatter plot or distribution table]
  • Against the same facility at a some time in the past. [see: FCI trending]
The FCI provides a measure of the "catch-up" costs of a facility and is typically derived from a Facility Condition Assessment (FCA) carried out by an experienced consulting team.

It is important to note that FCI is a measure of condition relative to the reproduction cost of the building. FCI is not an absolute statement of the size of the backlog of catch-up work. A large and complex facility, with a high reproduction cost, requires a larger backlog of deferred maintenance to raise the FCI than a smaller/simpler building.




Purpose of the FCI
The principal value of an FCI rating, particularly for the owners and operators of a single facility or a portfolio of facilities, can be identified as:
  • To assist in making resource allocation decisions amongst the buildings in a portfolio, particularly with limited budgets that are not adequate to address the deferred maintenance in all the facilities. It is therefore a means of identifying priorities.
  • To determine the annual reinvestment rates to prevent further accumulation of deferred maintenance. 
Some of the secondary values of an FCI rating for the facilities, are as follows:
  • A mechanism to monitor changing conditions over time.
  • A means to demonstrate the level of effort, due diligence and responsible stewardship to various stakeholders.

Classes of Reinvestment
There are three general classes of reinvestment that are pertinent to an understanding of the value of a Facility Condition Index. The three classes are listed below.

FCI Formula
The FCI formula is the ratio of all the deferred maintenance (the numerator) divided into the Current Replacement Cost of the entire facility (the denominator). [See formula on the right of the screen].

There are two alternative methods for determining the size of the backlog in the numerator of the formula:

There are alternative methods for establishing the denominator of the formula.



FCI Condition Scale
The relative measure of the condition of the facility (or facilities) is usually organized into a four-tiered condition scale, as follows:
  • "Good" Condition     - 0-5% of CRN
  • "Fair" Condition        - 5-10% of CRN
  • "Poor" Condition      - 10-30% of CRN
  • Critical Condition     - 30%+ of CRN


FCI Relationship Analysis
Since FCI is a snapshot of the current extent of catch-up, it is necessary to extend the analysis to include other variables, such as facility priority ranking and facility age.

1.  FCI and Mission Criticality (Prioritization)


The Portfolio Condition-Priority Matrix (PCPM)  plots the relationship between the relative condition and the relative priority of assets or facilities. within a portfolio. Listed below are the four quadrants in the analytic matrix.
The horizontal ("x") axis is represented by the Facility Condition Index (FCI) and the vertical ("y") axis by the Mission Dependency Index (MDI).

2.  FCI and Facility Age

The Portfolio Condition-Age Matrix (PCAM) plots the relationship between the relative condition and the relative age of facilities utilizing 5- stage facility lifecycle model as follows:
If a facility has been undergoing all the necessary capital renewal projects, then there should be little correlation between the age and condition of a facility.

3. FCI and Energy Efficiency

The Building Energy Performance Index (BEPI) plots the relationship between condition and energy efficiency of the facilities.
  • Energy Efficient Facilities in Good Condition
  • Energy Efficient Facilities in Poor Condition
  • Energy Inefficient Facilities in Good Condition
  • Energy Inefficient Facilities in Poor Condition
For example, the FCI analysis can be used to make decisions on whether to allocate funds towards Energy Efficiency Measures (EEMs) or towards routine facility renewal measures.

4. FCI and Condition and Backlog Quantum

The portfolio condition-priority-backlog (PCPB) matrix plots the relationships between these four variables.

5. FCI and
Facility Operatings Standards

Different facilities are governed on different operating standards depending on their mission criticality and budget constraints.
For example, if a facility is supposed to be operating at level 1: Showpiece (the target) but the FCI is above 10% ,then the building is actually operating at Level 4: Reactive Management. these types of disconnects between targets and actuals can be addressed by either adjusting the targets to more realistic levels or reinvestment in the facility to improve the FCI rating. 



Variations on the FCI Methodology
In order to accommodate regional differences, budget constraints, portfolio attributes and methodological alternatives, there are some variations on the standard FCI, including the following:



Analytics and KPIs
Listed below are some of the analytics and KPIs that can returned once the FCI has been established for one or more facilities in a portfolio.


Financial Modeling with FCI
Reinvestment is a reconciliation of the expenditure forecasts ("How much money will we need?) and the funding level ("How much money will we have?"). Sensitivity analysis asks the following two questions:

A. Linear Funding Models
This method asks the question: “If the owners fund at level x, what  will be the resultant FCI each year?

B.  Lumpy Funding Models

This method of funding asks the question: "What should our funding be each year to ensure that the FCI remains at a certain level."


Evaluation
Listed below are some of the advantages and merits of the facility condition index as an asset management tool:
  • It has been tried and tested on thousands of facilities over the last 30 years.
  • There are industry accepted thresholds for "good", fair", "poor" and "critical" condition.
Some of the primary limitations of the facility condition index are listed below:
  • It is not an absolute measure and is often used as a snapshot in time as a comparator to similar assets or as an index which quantifies the adequacy of a funding level over a longer period of time.
  • It focuses on issues that are Behind-the-Horizon but does not include future renewal projects that are In-the-Horizon.
      Numerator Issues Numerator Plasticity
  • The standard FCI formula does not include a weighting system to prioritize the relative importance of the backlog associated with each system or each within a facility.  For example, an electrical-intensive facility such as a theatre, may place greater mission criticality on the electrical system than on some of the other systems. This problem is partially resolved when the FCI is cross-referenced against a Priority Index in a 2-dimensional matrix.  
  • The FCI does not include keep-up costs, which are derived from an extended FCI methodology.
  • The FCI does not include for any upgrades or adaptations that may be necessary to address the other forces of retirement that act upon assets, such as functional obsolescence.
  • Due to factors such as condition drift, the FCI values may become rapidly outdated. It is important to recognize that the FCI is always relative to a base year
      Denominator Issues - Denominator plasticity
  • The fluid nature of the building reproduction cost calculation which can differ dramatically each year and result in an inconsistent FCI.  

Management principles
Management of the data from the FCI can be administered through the following mechanisms and techniques.

  • Assessment Cycle  - That is, how often should the FCI be updated. Some facility managers may deem a 5-year assessment cycle to be adequate, whereas others may consider a 3-year cycle more appropriate.
  • Assessment Match - That is, what level of assessment should be used to generate the FCI. For example, some facilities may be adequately evaluated with a top-down methodology whereas other facilities cannot be fully evaluated without a more rigorous bottom-up methodology.
  • Assessment Mix - That is, should  facilities be assessed at the different levels of detail than other facilities. (see: mixed scanning)
Facility Condition Index FCI formula
Fig. The three formulas and key performance indicators (KPI) used to measure and evaluate the physical health of a facility.


Illustration of how the facility condition index is generated for facilities to develop comparative analysis.
Fig. Illustration of how the Facility Condition Index (FCI) is generated for facilities to develop comparative analysis and then plotted as a Key Peformance Indicator (KPI).


FCI compared across multiple facilities
Fig. FCI compared across multiple facilities within a single portfolio with the objective of making resource allocation decisions in the context of limited resources.


Average FCIs for different departments within a single portfolio.
Fig. Average FCIs for different departments within a single portfolio.


Portfolio Condition-Priority matrix with scatter plot distribution of a portfolio of facilities.
Fig. A Portfolio Condition-Priority Matrix (PCPM) with scatter plot distribution of a portfolio of facilities indicating the current state of affairs.


Backlog reduction strategy for some facilities presented on the Condition-Priority matrix.
Fig. A  backlog reduction strategy for some facilities presented on the Condition-Priority matrix


3D matrix to cross reference the Facility Condition Index (FCI) with the Mission-Dependency Index (MDI) and backlog quantum.
Fig. 3D matrix to cross reference the Facility Condition Index (FCI) with the Mission-Dependency Index (MDI) and backlog quantum.


Workflow to illustrate how the FCI is used to generate linear funding models and lumpy models as part of a sensitivity analysis.
Fig. Workflow to illustrate how the FCI is used to generate linear funding models and lumpy models as part of a sensitivity analysis.


Sensitivity analysis testing the Projected FCI levels on two linear funding models.
Fig. Sensitivity analysis testing the Projected FCI levels on two linear funding models.


Catch-up costs distributed by priority rankingCatch-up costs distributed by system
Fig. The composition of the deferred maintenance (catch-up costs) can be analyzed in a variety of ways, including distribution by system and distribution by priority.


Example of a five-year backlog reduction strategy across a portfolio of buildings.
Fig. Example of a five-year backlog reduction strategy across a portfolio of buildings.


Three alternative backlog reduction scenarios (FCI), phased over a 5-year period.
Fig. Three alternative backlog reduction scenarios (FCI), phased over a 5-year period.


Relationship between FCI, funding levels and facility operating standards.
Fig. Relationship between FCI and funding levels across five facility operating standards.


The FCI spectrum and the five operating standards.
Fig. The FCI spectrum and the five operating standards.

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Geographical (GIS) representation of the Facility condition index (FCI) across a portfolio.
Fig. Geographical (GIS) representation of the Facility condition index (FCI) across a portfolio.


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Fig. Backlog quantum of the FCI (left) and identification of facilities in good condition (right).

See also:
Compare with:




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