Outsource Management Tool by htc96668


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									Don Savard, CSFM
Salesianum School
Email: donsavard@msn.com

A Guide to Outsourcing Grounds Maintenance Services

Outsourcing certain grounds maintenance tasks is another management tool Facility Managers
use for meeting goals, improving service and managing financial performance. This presentation
gives an overview of outsourcing, when to use it, its advantages, disadvantages and tips on how
to effectively manage the process. Specification writing, contract administration and contractor
selection will also be covered.

Outsourcing Grounds Maintenance Services
1.     Outsourcing overview.
       a.       What is outsourcing?
                i.      Results oriented relationship with a specialized outside organization to
       perform business functions for which a strategic business decision has been made
                ii.     Usually non-core business functions are outsourced.
                iii.    By outsourcing, management has made a strategic decision that a set of
       activities will not be developed internally, instead it leverages the specialized ability of an
       outside organization.
                iv.     Because outsourcing relationships are results oriented, management’s role
       is now “what” issues, not “how” issues.
                v.      Suppliers become partners bringing a creative approach.
                vi.     Outsourcing is only the provision of a service that can be contracted for,
       not the outcome. Ultimate accountability will always rest with the management.
       b.       Why outsource?
                i.      Save Money.
                ii.     Simplifies operations.
                iii.    Eliminate problems or distractions.
                iv.     Opportunity to meet goals, improve service and financial performance.
       c.       What type of work can be assigned to contractors?
                i.      Routine tasks
                ii.     Special projects
       d.       When to outsource?
                i.      When there is work that you cannot, should not or choose not to do.
                ii.     When you lack specialized equipment.
                iii.    When you expertise and experience.
     e.     Advantages to Outsourcing
            i.     Allows a business to concentrate on core activities
            ii.    Streamlines basic operations
            iii.   Gives access to professional capabilities
            iv.    Buying power of contractor results in materials cost savings
            v.     Shares risk
            vi.    Reliability of the provider
            vii.   No worry about introducing new technology
            viii. Frees Human resources
            ix.    Frees cash flow
            x.     Increases control of the business
            xi.    Makes the business more flexible to change.
     f.     Disadvantages of Outsourcing
            i.     You might lose control of the process.
            ii.    Potential redundancy.
            iii.   Your service provider could cease to be in business.
            iv.    Your service provider becomes too busy and dilutes your service.
            v.     You begin to lose focus on your core business and focus instead on the
     outsourcing process.
            vi.    Possibility of creating poor morale internally.
            vii.   Possibility of losing talent internally.
     g.     Contractors may share the risk of certain projects.
2.   Analyzing cost to benefit of outsourcing.
     a.     At what point is it cost effective to outsource?
3.   How do you select contractors?
     a.     Network
     b.     Competitive bid
     c.     Word of mouth
     d.     Referral from owner
4.   What do contractors expect of you?
     a.     Clear specifications
     b.     Contract
     c.     Written change orders
     d.     Prompt payment
5.   What do you expect of contractors?
     a.     Qualifications
     b.     Provision of services and materials as specified and contracted for.
     c.     Guarantee/warrantee
6.   Tips for Outsourcing Success
     a.     Consider your costs and needs
b.   Consider the scope of the work to be outsourced?
c.   Make a strategic decision
d.   Write appropriate contract specifications.
e.   Establish an appropriate payment schedule.
f.   Establish appropriate contract administration process and structure.
g.   Determine the appropriate structure for the contract document.
h.   Manage the transition to the outsourced arrangement.
i.   Agree to contract termination arrangements.
j.   Communication.

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