Recession proof your building: financial executives should implement no- and low-cost energy efficiency strategies to reduce energy costs, assess and manage risks in the area of building performance as well as employ appropriate maintenance strategies.

• Author: Wash, Larry
• Position: STRATEGY

Many organizations are feeling a level of economic pressure beyond what they've experienced for decades.

[ILLUSTRATION OMITTED]

Businesses are faced with daunting capital and operating budget challenges given the current economic environment, and every industry feels the effects of rising or fluctuating costs for commodities such as fuel, services, material and employee expenses.

"As energy cost and consumption rise and corporate sustainability initiatives become more mainstream, management teams and boards of directors have become more interested in energy management," says Corbin Baumel, executive vice president and chief financial officer of LPB Energy Management, and member of Financial Executives International.

This interest, he adds, has caused an increased level of participation in building management and energy-purchasing decisions. He also says he's "seeing an increased need for Finance and Facilities Management staffs to work together because each group brings a skill set that the other needs when it comes to building and energy decisions."

Indeed, in today's recessionary market, careful asset management is the key to survival, and continued pursuit of cost savings is critical. Financial executives should implement no- and low-cost energy efficiency strategies to reduce energy costs, assess and manage risks in the area of building performance as well as employ appropriate maintenance strategies.

With this challenging environment taking its toll, organizations must do all they can to ensure their operations stay healthy. But it's also important to keep in mind that the building and the mission of a business are linked. Despite a tough economy, a strategy that focuses on building maintenance while raising the level of its performance so that it supports the business mission is so much the better.

Cutting costs without impacting occupants and stakeholders, deferring all noncritical expenses and stretching the life of building systems a little further are all strategies that contribute to the bottom line during difficult times. The top priority is to survive this downturn, but the long-term goal should be to sustain the value of an organization's building investment, or even enhance its performance to deliver cost savings, if conditions allow.

Analyze the Risk

For firms with limited resources that are forced to "make do" with their current infrastructure, there are a number of approaches they can take to garner substantial building-related savings. But they first must understand their own level of risk tolerance and the different types of risk.

The following steps will help organizations take the appropriate level of risk while defining...