ABSTRACT

Outsourcing today is an increasingly common way of doing business. There are sound financial reasons for not employing permanent staff – who must be fully paid regardless of work flows – when you can buy in outside expertise which may be able to do the job better, cheaper and more quickly. Facilities managers’ time is, therefore, increasingly dominated by

managing contracts with external suppliers. This has required facilities managers to develop new skills. Whereas before, facilities professionals had to be multi-skilled, multi-functional and good managers of people from a variety of backgrounds, now – on top of all that – comes the responsibility for continuing to motivate those over whom they have no immediate line management authority, while managing outcomes through a third-party employer with their hands tied by legal contracts. Successfully working with contractors on a strategic level is another

challenge facing the facilities manager. Today’s outsourced contractors are ‘partners’ who ‘add value’ to a company’s operations. Command and control, as a management style, would be as self-defeating here as anywhere else. Partners are looking for long-term relationships, where trust means more than mere on-time delivery. It means sharing cost bases, profit ratios and business objectives. To a degree, it also means sharing information you might prefer to keep in-house. This chapter aims to explain the nuts and bolts of outsourcing, with

guidance on the whole process from choosing what to outsource, to writing and managing the contract, to maintaining a dynamic working

When outsourcing first entered the management arena in the 1980s, it was all about saving money on essentially manual tasks; premises cleaning was a typical and early example. The focus is now on access to skills, with outsourcing expanding to include areas closer and closer to the centre of business; companies are now looking to buy in outside expertise so that they can concentrate on their own core activities, and contract with external suppliers to provide many or most of the tactical elements. The shift from those early manual tasks has seen us move through other

administrative and infrastructure areas, towards innovation: how can the company move further ahead faster than the competition? Outsourcing today, and the expertise that comes with the specialist contractors, has now embraced R&D, design, product management, marketing, communications, even personnel supply and management. That development has not finished. Already into strategic functions, it

is not unlikely that outsourcing of core business areas – even the strategic direction of the company – could follow. Outsourcing should not be seen as just a money-saving management

device or tactic, but considered in terms of the potential value it can bring to a business. It may cost more to outsource, but the job may be better performed, the company image may be enhanced and it may release expensive management time for core activities. However, the year 2005 saw the possible critical turn of opinion regarding outsourcing with some high-profile industrial activities. Some companies are reviewing how they define ‘core’ activities, which begs the question ‘are we seeing a start of the move to bring stuff back in-house?’ Notwithstanding that development, what, in your specific business,

should you consider outsourcing and what should you retain in-house?