Work Quality Common Outsourcing Survey Themetest

By Dave Lubach, Associate Editor

July 2014

Work quality — good or bad — is a common theme throughout the survey. More than 35 percent of the respondents say their main concern going into the outsourcing process was the fear of poor quality work from contractors.

Their concerns appear to be well-founded. When asked about problems actually encountered during outsourcing, respondents cited quality of work (22 percent) and scheduling issues (22 percent). Cost savings, a lack of communication with the contractor, and inexperienced front-line technicians are also frequently cited problems.

In maintenance and engineering departments where budgets continue to get tighter, about one-half of the respondents say the ability to balance budget limitations with increased workloads was the biggest benefit of outsourcing.
But reported lower costs due to outsourcing can be misleading, Cowley says.

“One of the big things about outsourcing is that people talk about reducing FTEs (full-time equivalents) and costs, but somebody’s got to do the work,” he says. “The problem I see with outsourcing in many cases is dollars and cents are (just) on a different sheet of the ledger.”

Managers, Cowley says, “go back to the board of directors and say, ‘We’ve had a hiring freeze the last four-five years,’ and the FTE count has gone down 2 percent due to a trick, and they say you’re doing a wonderful job. But nobody talks on the other sheet of the ledger and says, ‘Your contractor and vendor costs are up 25 percent’.”

Labor-intensive and technical projects, such as electrical-system inspection and roofing projects, are among the most outsourced tasks according to respondents.

“Electrical testing is very sophisticated,” Cowley says. “I’d put it in the same category as vibration testing and system thermography. You typically see people outsource that because it’s so high-tech. I’ve done it in-house before, and what we found is it’s hard to keep those people because there’s so much money they can go out and make on their own. It’s difficult to take an electrician who’s making 25 dollars an hour and make him the vibration or thermography expert because he figures out rather quickly that he can leave and travel around and make far more money.”