Setting up and managing outsourcing contracts to deliver value and accommodate change

Abstract

The concept of outsourcing is a recognised business planning strategy; senior corporate management and facilities services have been progressively outsourced in the UK for many years. However, transforming an outsourcing business plan into an effective and balanced operating contract remains challenging. Getting your outsourcing project properly positioned in the business, procuring the right integrated facilities contractor and then subsequently mobilising and managing the contract can be a difficult journey to navigate. This paper describes how to approach the principles and practicalities of outsourcing noncore services and how to make sure that some of the principal pitfalls along the road of the outsourcing project are avoided. It finally offers some ideas on how to get the most out of a project in the long term.

Closed-loop outsourcing logistics supply chain coordination management based on the profit-sharing contract

“…(1) Analysis the environmental features and find out the phenomenon cause the system does not coordinate (2) According to the characteristics of uncoordinated phenomenon in formulate coordination mechanism…”

“…But if through the contract of signed under the supply chain coordination and administration, both parties can effectively suppress, reduce or eliminate the hazards, and can even improve cooperative benefits. However, it is challenging to design effective contracts [2] . In reality, the common logistics outsourcing contract often is a kind of contract without coordination, and it can cause loss of profit of the whole system.…”

Contracting in FM: collaboration, coordination and control

“…A key feature in most FM contracts is a Service Level Agreement (SLA), where the quality and volume of the work contracted is described. Inhouse FM services are often poorly documented, and it is generally emphasized that the first step in change effort aiming at restructuring and perhaps outsourcing an FM department is to map and reassess existing service levels (Barret and Baldry, 2003;Pratt, 2003;Davis, 2004;Capgemini, 2005), a process that often results in changes in types, levels and volumes of service. If the FM department is kept in-house, SLAs will structure the FM services delivered and provide a basis for performance appraisal and benchmarking with other core businesses or external suppliers (Atkin andBrooks, 2000, Amarantunga andb).…”

“…B oth manufacturing companies and real estate companies increasingly prefer to buy facilities management (FM) services from external contractors. In the UK, over 50% of non-core services are considered to be outsourced, and the market growing with 10% annually (Davis, 2004). In the Nordic countries, perhaps 25% of the volume of facilities management services is outsourced (Jensen, 2006;Capgemini, 2005).…”

Performance management of suppliers in outsourcing project: case analysis from the financial services industry

“…However, where significant improvement in organisational performance has been found, many organisations have not found the magnitude of improvement hoped for (Elmuti, 2003). Procuring the right contractor then commencing and managing the contract can pose several issues, requiring a robust approach (Davis, 2004); according to Varma (2006), the two prerequisites are formulation of strategy and performance evaluation.…”