A first step to wholesale outsourcing?

I read the recent article on the Guardian’s website on the prospect of London Metropolitan University outsourcing its service departments. It was old news in so far as the tender went out on the EU journal some months ago but it does look at if the process is reaching a conclusion with three companies in the frame. What isn’t clear is now much of the business is likely to end up being outsourced. That may of course be covered in the tender document – it is not beyond reason that organisations were being invited to tender for all or part of the business on offer and looking at the companies that have responded, that would appear to be the case. Of the three, only one appears at first sight to have any experience of delivering non-IT services in the education sector.

This may not be a particular issue if (as may be the case) the staff currently employed at London Met are transferred to whichever company takes over services. In this case the knowledge and understanding of processes and procedures that currently resides in the University will be transferred to the service company. No service provision, whether internally or externally delivered, is perfect and there will be occasions when mistakes are made or the service does not deliver to the required standard. How issues like this are dealt with will depend on the contract and, more particularly, the service level agreement between the University and its supplier. This is something that a number of IT service departments struggled with when they took their first steps to outsource aspects of their service provision; the departments did not have the skills to manage the contracts well. However, it is a lesson that is being learnt and service departments are employing IT procurement/contract managers or are training their staff so that vendor management is part of their overall role in delivering the service. I imagine that there will be some interesting discussions on service levels ahead at London Met. The University recently had its Highly Trusted Sponsor status with the UK Border Agency suspended – will eventualities such as this be subject to penalty clauses within the service level agreement?

The sector will be watching developments at London Met with interest. Malcolm Gillies, Vice-Chancellor of London Met, has been a strong advocate of shared services and the outsourcing of services is perhaps a first step – prove that it can be done and then roll the services out to others. How successful this will be remains to be seen. It is a bold step and one borne partly out of financial necessity. There will be some ready to highlight the lightest failing but realistically it will be a number of years before an accurate assessment of the move to outsource can be made. Before then, the dust will have settled on this year’s admissions and we will have a better understanding of the impact of the new fees regime in England. Some are suggesting that there will be institutions that will significantly under recruit and they may need to look at cutting costs as a result. That picture will start to emerge over the next few weeks but if there are institutions in that position, they may well be beating a path to London Met’s door to learn from their experience.

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5 Responses to “A first step to wholesale outsourcing?”

  1. George Credland Says:

    “they may well be beating a path to London Met’s door to learn from their experience.” – Hopefully they’ll remember how London Met arrived in this position and think twice…
    http://news.bbc.co.uk/1/hi/education/7853203.stm

    Would you trust your institutions data and services to an organisation that racked up millions through shocking failures in running their own services?

    George Credland
    (opinions expressed are my own)

  2. WildNorthlands Says:

    It’ll all go great until a senior academic rings up because he wants something doing & is told “we can’t do that, it’s not in the SLA.”

  3. petertinson Says:

    George, thanks. I was thinking more of them learning from the outsourcing experience rather than necessarily adopting the identical solution. I think we are still some way from a uniform solution for the sector. A significant obstacle is the lack of standardisation of processes and terminology across the sector (or indeed, across a single institution).

  4. petertinson Says:

    @WildNorthlands – your point highlights the need to manage expectations within the institution (although of course people won’t necessarily pay any attention until they reach the situation you’ve described….).

  5. George Credland Says:

    @petertinson I agree there’s no point in “reinventing the wheel”.
    From my own experience Universities are very willing to engage and share experience when implementing new IT systems. However that’s as far as its gone. Even when institutions are running the same vendor’s software they run different versions, have different upgrade strategies and implement different modules (areas of functionality) within those systems. We’ve yet to see a breakthrough in collaborative working between institutions so each University is bearing 100% costs when implementing new functionality that other institutions are currently running. There has to be greater scope for joint projects and sector licensing agreements to get better value for money from existing infrastructure.

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