June 20, 2012

Outsourcing Physical Plant

Should I ???

Andra Cantrell

Jim Swan

• Current Issues• How do you deal with current issues• Reasons for Outsourcing Physical Plant• Cost Saving Opportunities• Outsourcing Benefits• Decision Time• What’s Next?• What are the issues?• Contract Negotiations• Transition Period• Implementation• Questions & Discussion

AGENDA

• Budget Reductions• Increased Enrollment• Decreased Funding• Employee Insurance Costs• Increased Deferred Maintenance• Capital Improvements on Hold• Decreasing Reserves• Increasing Security Requirements• ???

Current Issues

• Quality of Work Declining• Staffing Capabilities• Lack of Proper Training• Staffing Availability• Lack of Leadership• Reliability• New Systems more Technical• Attendance Issues• ???

Cost Related Quality Related

• Revenue Enhancements• Cost Reductions

$ Operations

Budgets

How to deal with these issues?

• Revenue Enhancements • Increase Tuition• Increase Fees• Increase Taxes• Alternative Funding Sources

• Grants• Strategic Business Partners

How to deal with these issues?

• Cost Reduction Opportunities• “Tighten the Belt”• Reduced Hours of Operation • Program Elimination• Personnel Reduction• Leveraging Technology • Alternative Funding Solutions• Purchasing Co-Ops• Outsourcing Solutions

How to deal with these issues?

• Do you really know what your true costs are for operating your campus?

• Do you really know where all of your true costs are accounted for in your campus operations?

Key Questions to Ask

Physical Plant Budgets• Salaries• Insurance & Benefits• Workers Comp• Training & Certification • Equipment• Tools• Supplies• Office Expenses• Equipment Rental

• Vehicles • Fuel• Repairs• Deferred Maintenance• Capital Projects• Contractors• Service Contracts• State Inspections • Safety

Are you willing to think outside of the box?

Should I Consider Outsourcing?

• Focus on core competencies• Save administrative time• Reduce downtime;

increase asset life• Greater accountability• Risk management/Liability• Budget control

• Cannot attain desired results• Lack of quality control• HR issues – cannot retain/attract

qualified staff• Complexity of systems and aging

facilities requires more specialized skills

• More predictable costs

Reasons for Outsourcing

• Budget stability/predictability• Guaranteed performance (valued outcomes)• Fixed and Guaranteed pricing• Use best-in-class technologies, processes and tools to

support service delivery• Value reporting to validate value created in the

partnership• Based on Mutual Trust & Common Goals

Benefits of Outsourcing

You Have Made the Decision to Adopt anOutsourcing Strategy.

Decision Time

Are you ready to hand over the keys to your campus?

• Communicate to Board, Faculty & Staff

• Get buy in and acceptance

• Follow the Process

• Negotiate in Good Faith with a good partner

• Be comfortable with the opportunity & support it

• Service

• Cost

• Contract

What’s Next?

• Employee Relations

• Faculty / Staff Relations

• Community Relations

• Notification of Vendors / Contractors

• What will be the difference on campus?

• Expectations & Outcomes

• Budget Items

What are the Issues?

• Existing employee concerns

• Clear and open communications

• Define scope and outcomes desired

• Terms of agreement

• Adjustments or changes

Contract Negotiations

• Take it slow and do it right!

• Communicate at all levels

• Be part of the process

• Cover all of the bases

• Know who you will be working with

• Have input in selection

Transition Period

• Work together as a team

• Work toward a common goal

• Support each other

• Be a Team

• Be a Family

Implementation

Questions & Discussion

TACCBO 2012