Discovering Value in Outsourcing Facilities Management - Life sciences businesses are turning to outsourcing as a way to drive down costs and support critical process quality. - BioPharm International

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Discovering Value in Outsourcing Facilities Management
Life sciences businesses are turning to outsourcing as a way to drive down costs and support critical process quality.


BioPharm International
Volume 18, Issue 5

A lack of direction from the corporate level creates a vacuum in which rivalries and turf battles can grow. For example, procurement personnel are likely to support outsourcing as a way to reduce costs and so enhance their value to the organization, but facility management personnel may perceive that outsourcing threatens loss of control over their side of the business. Left to their devices, the two functions may operate in conflict. Executive buy-in sends a message that outsourcing is strategically important.

Foster Mutual Trust and Effective Communication Outsourcing relationships evolve continually from the moment the contract is signed. For this and many more reasons, the outsourcing company and the service provider must be able to trust each other. In particular, their values and objectives must align, and they must communicate openly and frequently.

Transparency is key to building and keeping the relationship. While the service provider must appreciate the client's need to reduce costs, the client must understand that the provider needs to earn a fair profit. To increase transparency, outsourcing partners are moving away from fixed-fee contracts toward contracts based on reimbursable expenses plus a management fee.

Those issues aside, trust builds through experience in working together and through solid performance. It starts, however, by treating people appropriately. Employees affected by outsourcing confront the fear of losing their jobs or of being transferred to a different company. To the greatest extent possible, don't cut their pay or demote them if they transfer to the service company.

As part of the outsourcing relationship, there must be a communication plan that includes an initial meeting to establish expectations, feedback meetings at specified intervals (more often in the initial stages), and scheduled feedback sessions for executives.

TOWARD SUCCESSFUL OUTSOURCING Facility management outsourcing can be an excellent way for life sciences companies to drive down operating costs, tighten their focus on the core mission, and improve their competitive position. By producing a sound plan and a disciplined approach, companies can build outsourcing relationships that yield meaningful benefits from the start and for many years to come. We feel that smaller companies may derive similarly valuable benefits, and you can review our recommendations in the sidebar .

Timothy Maechling is vice president of business development for Johnson Controls, Inc., 3526 Breakwater Court, Hayward, CA 94545, 510.786.5725, 510.785.3170

Jeffrey Bredeson is business development director forJohnson Controls Life Sciences Group, 1255 N. Senate Avenue, Indianapolis IN 46202, 317.917.5172, fax 317.410.4435
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