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Extended Facility Condition Index (EFCI)

One of three primary condition indices and a key performance indicator used to assess the current condition of a single facility or a portfolio of buildings. Sometime also referred to as projected FCI

The EFCI is the ratio of two key reinvestment metrics:

  • The deferred maintenance - catch-up costs plus 
  • The forecast renewal projects (keep-up costs) over a specified number of years (x) 

These two metrics are divided by the current replacement cost (CRV) of the entire facility. The formula is contained in the figure at the right.

The EFCI therefore looks backwards in time (as with the FCI) and also forward in time (over a specified planning horizon).

A measure of the physical health of a facility, derived from the cost of the concerns and projected concerns for a given facility compared to the total reproduction value of the facility.



Purpose
The principal value of an EFCI rating, particularly for the owners and operators of a single facility or a portfolio of facilities, can be identified as:


Formula
The formula contains a numerator that is divided into a denominator to return a percentage KPI.


The numerator of the formula contemplates the following dynamics:

  • Catch-up Costs.  This includes deficiencies and deferred maintenance.
  • Keep-up Costs. This includes normal lifecycle renewal projects (but only over a specified planning horizon, typically set at 5 years).
The denominator of the formula is based on the current reproduction cost of the facility.



EFCI 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     - 0-20% of CRN
  • "Fair" Condition        - 21-39% of CRN
  • "Poor" Condition      - 40-90% of CRN
  • Critical Condition     - 60%+ of CRN
These thresholds only apply to the EFCI-5 variation. No industry standard has yet been established for the thresholds.



Variations
The EFCI must be presented relative to a designated planning horizon, such as:
  • EFCI-3 - The next three (3) years of renewal projects.
  • EFCI-5 - The next five (5) years of renewal projects.
  • EFCI-10 - The next ten (10) years of renewal projects.
In all cases, regardless of the length of the planning horizon, the EFCI will also include the aggregated value of all deferred maintenance (deficiencies).



Evaluation
Listed below are some of the merits and advantages of the Extended Facility Condition Index (EFCI) as a measure:

  • The EFCI provides a more comprehensive view of a Facility than the FCI since it also includes the keep-up cost requirements. That is, it looks forward to future renewal projects and backwards to outstanding deficiencies.
  • It includes issues that are Behind-the-Horizon and also future renewal projects that are In-the-Horizon.

Listed below are some of the limitations of the Extended Facility Condition Index (EFCI) as a measure:

  • The EFCI is limited to a particular planning horizon, such as EFCI-5 or EFCI-10, which can lead to confusion if the decision makers do not fully appreciate the scope of the metric.
  • Some items are subject to double-counting as catch-up and keep-up costs.
  • The EFCI does not factor get-ahead costs that arise from different forms of obsolescence.
  • There is no industry accepted standard for a "good", "fair" and "poor" threshold under the EFCI metric.
  • 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. 
  • One of the primary limitations of the Extended FCI is the absence of a weighting system to prioritize the relative importance of the backlog associated with each system within a building or each building in a portfolio.  This problem is partially resolved when the EFCI is cross-referenced against a priority index in a 2-dimensional matrix.  
  • The EFCI does not allow for modernizations and upgrades, which are addressed by the Facility Needs Index (FNI).

Management Principles
Included below are some asset management concepts to be considered relative to the EFCI:
  • Determine the mission criticality of the different facilities. [see: Mission Dependency Index].
  • Determine wether and FNI is necessary for all or some of the facilities. Where FNI may be considered unnecessary, determine if EFCI or FCI will suffice.
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)
Formula for the Extended Facility Condition Index (EFCI)
Fig. Three alternative formulas for determining key performance indicators (KPIs) for a single facility or a portfolio of facilities.The EFCI is the 2nd formula and is more comprehensive in scope than the first formula.


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Fig. Examples of deferred maintenance items that are included in the numerator of the EFCI formula. These are considered reinvestment category #1: catch-up costs.


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Fig. Examples of some of the types of capital projects that may be captured in the EFCI formula
. Left is roof renewal and right: domestic repiping project. These are considered reinvestment category #2: pending lifecycle renewal costs.


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Fig. It is essential that the EFCI defines the planning horizon over which the future renewal projects are to be identified. 10-year tactical plan where the first 5 years of forecast renewal projects are included in the EFCI calculation.


Example of a facility in relatively good condition established by the facility condition index and extended facility condition index

Example of a facility in poor condition established by the facility condition index and extended facility condition index

Example of a facility in poor condition established by the facility condition index and extended facility condition index

Example of a facility in critical condition established by the facility condition index and extended facility condition index
Fig. Examples of the correlation of EFCI with FCI to establish reinvestment or redevelopment decisions depending on whether a facility is deemed to be in "good", "fair", "poor" or "critical" condition.

Condition drift of certain facilities represented on a scatter plot.
Fig. Condition drift of certain facilities represented on a scatter plot with the Facility Condition Index (FCI) on the horizontal axis and the Mission Dependency Index (MDI) on the vertical axis.


See also:
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