Outsourcing Management Functions for the Acquisition of Federal Facilities (2000) / Chapter Skim
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Executive Summary
Executive Summary
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For private sector organizations, outsourcing was identified as a strategic component of business process reengineering an effort to streamline an organization and increase its profitability. In the public sector, growing concern about the federal budget deficit, the continuing longterm fiscal crisis of some large cities, and other factors accelerated the use of privatization)
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Recently, however, in response to executive and legislative initiatives to reduce the federal workforce, cut costs, improve customer service, and become more businesslike, federal agencies have begun outsourcing some management functions for facility acquisitions. The reliance on nonfederal entities to provide management functions for federal facility acquisitions has raised concerns about the level of control, management responsibility, and accountability being transferred to nonfederal service providers.
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Using Section 7.5 of the Federal Acquisition Regulations as a basis, the committee developed a two-step threshold test to help federal agencies determine which management functions related to facility acquisitions should be performed by in-house staff and which may be considered for outsourcing to external organizations. The first step is to determine whether the function involves decision making on important issues (ownership)
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Figure ES- 1 is a decision framework developed by the committee for federal agencies considering outsourcing management functions for facility acquisitions. This framework recognizes the constraints of inherently governmental functions and incorporates the committee's two-step threshold for identifying ownership functions that should be performed by in-house staff and management functions that can be considered for outsourcing.
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/ | Yes (Outsource ) \ / (Do not outsource > _ , FIGURE ES-1 Decision framework for outsourcing management functions.
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The committee recommends that federal agencies establish and apply a responsibilities-and-deliverables matrix similar to the example shown in Figure ES-2 to help eliminate overlapping responsibilities, ensure accountability, and ensure that, as problems arise, solutions are managed effectively. DETERMINING PERFORMANCE OUTCOMES A key element of an organization's decision making is measuring the effectiveness of those decisions, both qualitatively and quantitatively.
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Contract for construction Construction Phase Construction permits Construction management Construction work Final payment (construction complete) Start-up Phase Equipment installation Move administration Final acceptance Closeout Phase P A P A A A EC A A A A C C A p S p p p p S p S S S S A P _.
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By using the decision framework, by noting the findings, and by following the recommendations presented below, the committee believes federal agencies will be in a stronger position to formulate rational, business-like judgments in the public interest concerning the outsourcing of management functions for planning, design, and construction-related services. Findings Finding.
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The successful outsourcing of management functions by federal agencies requires competent in-house staff with a broad range of technical, financial, procurement, and management skills and a clear understanding of the agency's mission and strategic objectives. Finding.
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Recommendation. Federal agencies should first determine their role~s)
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