Cost Reductions, Greater Flexibility
Outsourcing....the Preferred Choice!
Introduction
Facilities Management may be described as the management of any non-core activity. It is an industry in its own right and a thriving profession. It allows the core business to operate at peak efficiency. Success depends not just on understanding and meeting the basic operational needs of the core business but also adding value. This involves standardising processes. Measuring performance levels. Delivering consistent customer service.
Fraser-Jones Alliance specialises in all aspects of property management, design, procurement and supervision of maintenance, furniture and interior design. We at Fraser-Jones have worked in the industry for a number of years and having built up good working relationships with a network of consultants, contractors and suppliers, are able to offer an invaluable service to our clients.
Managing Outsourcing
Managing the outsourcing process can result in significant benefits to any organisation in terms of quality / performance improvements.
- Cost reductions - usually the most common reason for Outsourcing
- Use of Specialists to manage peripheral activities to the core business
- Greater flexibility in the use of resources and costs
- Improvements in productivity, performance and quality
- Saves in management time and resources
The Outsourcing Market in the UK is now reasonably mature and contracting out is likely to be the favoured solution in most cases.
Reasons for Outsourcing |
Disadvantages of In-house Provision |
To reduce headcount |
Management is unlikely to be knowledgeable about non-core service |
To reduce costs |
Specialist training unlikely to be available and may be expensive to buy in on its own |
To concentrate on the core business |
The work may be carried out when the management is not on site and thus be inadequately managed |
To buy in the provider's core business |
Recruitment and absence cover can be a major problem |
To acquire expertise |
There are additional costs ie recruitment, human resources, training etc |
To aid the recruitment and the retention of non-core staff through an appropriate career structure |
Hidden costs such as accommodation eg rents, rates, maintenance, utilities etc |
The Procurement Process
- Clear strategy or plan in place to ensure that the service purchased, delivers the clients objectives.
- Considerable thought to be given to the services that are to be contracted.
- Consideration to be given to the format of the specification.
- To determine the approach when outsourcing. Such approaches may include:
- Adverts within appropriate trade journals
- Pre- Qualification Exercises
- Use of post-tender negotiations
- Identifying Potential Suppliers
- Contacting suppliers directly - dependant on the nature of the service
- Inviting expressions of interest from suppliers.
- Supplier Pre-tender Qualification Exercises - Where the service is to be provided over a long period of time or the number of services to be outsourced is large and complicated. Such exercises avoid wasting time and reduce the final choice of suppliers to a manageable level. The purpose being to measure competence, technical ability and financial stability.
- Establishing Approved Supplier List - These are particularly useful where there is a regular need for a similar type of work eg property repairs, maintenance, cleaning, emergency pest control etc.
Invitations to Tender
- Shortlist suppliers
- Limited number to be invited to tender for services
- Suppliers invited should submit their tender questionnaire and supporting documents by a certain time and date.
- Submissions should not be accepted beyond specified deadlines
Evaluation Process
The purpose of tender evaluation is to ensure that the contract is awarded to the most cost-effective tenderer. However the evaluation must not be based purely on financial considerations, but should also consider:
- Technical capacity, including Health and Safety
- Quality and contractual compliance
- Vision of what the contract will achieve
Contract Start up Issues
- The successful tenderer to be advised by telephone and then formally advised in writing
- The unsuccessful tenderer should be advised in writing
Two copies of the formal legal agreement should be prepared for signature by both parties, following signature each parties to retain one copy.
Monitoring Contract Procedure
The final stage is to establish the process for monitoring the progress of the contract.
- The client will need to ascertain whether the contractor is completing the work in the timescale required, to the specified standard and in a safe and healthy manner for all those concerned.
- It is important that regular meetings are held between the client and the contractor to ensure that issues can be discussed and problems rectified.
- Monitoring can also entail announced and unannounced inspections and visits.
- The client should reserve the right to suspend the contractor's activities or work if requirements of health and safety legislation or other contract conditions are not being met.
- Details of the monitoring process must be included in the contract in order to ensure that the contractor is aware of the process.
Mission Statement
Fraser-Jones Alliance is committed solely to First Class workmanship and thereby guarantees total client satisfaction. All contractors commissioned to carry out works are fully insured and carry substantial Public Liability Insurances. FJA will oversee all works carried out.
Fraser-Jones Alliance's Public and Employers Liability cover stands at: |
£2m Public Liability |
£10m Employers Liability |
