Maintenance Outsourcing Research Articles

Service quality in outsourced facility maintenance services

PurposeThe purpose of this paper is to assess service quality of outsourced facility maintenance services (FMS) from end‐user perspective. For this purpose, a two‐dimensional model for service quality in a FMS context is presented.Design/methodology/approachThis paper is based on interviews in case study organizations.FindingsThe findings suggest that FMS quality may be divided into two industry‐specific dimensions – service recovery quality (response to a service failure) and observed maintenance quality (technical outcome). It seems that the main quality problems are linked to service recovery quality. These problems are caused by personalities of service personnel and lack of communication between end‐users and the service provider.Practical implicationsFor FMS providers and building owners it is important to understand the nature of end‐user perceived FMS quality formation. This makes it possible to assess the service provision and to improve the performance of FMS if necessary. If the service recovery processes and observed maintenance quality are not understood well, the improvements may be directed to the wrong processes.Originality/valueThe quality of outsourced FMS is important for employers, employees, building owners and FMS providers. Still, there is very little research on end‐user perceived FMS quality. This paper creates a basis for further research on this important topic.

Remote control and maintenance outsourcing networks and its applications in supply chain management

The paper analyzes the impact of e-business technologies on maintenance management and supply chain operations. The aim of this work is to investigate the network organization level of supply chains in case of remote maintenance application and to understand how maintenance policies are coupled with information technology (IT) solutions. To this purpose two literature reviews are presented: firstly, on the supply chain and network integration, and then on the evolution of maintenance using information technology. Following this, the paper present four specific industrial case-studies of eMRO network organisation. They have been chosen as reference models from a set of practical applications and pilot tests performed by the authors in different production sectors in the last 5 years. Technology complexity environments, maintenance outsourcing level, and supply chain integration context are discussed for each case-studies with particular regards to the profitable forms of collaboration provided by the introduction of IT and the Web. This analysis work toward the development of a framework useful to: (1) classify different e-maintenance systems and understand the relationships between the different members of the network, and (2) identify the variables which can influence the introduction and development of the systems.

Software maintenance outsourcing: Issues and strategies

Software maintenance outsourcing is becoming a popular alternative in software industry. Software companies are looking at outsourcing their maintenance and support activities as an area for competitive advantage. There are risks and benefits of introducing subcontractors in the framework of software outsourcing. Reliable maintenance is only possible if adequate measures are taken in advance during project’s development and maintenance planning phase and are documented in the maintenance contract. In this paper, we present and make a justification for a set of recommendations to make such maintenance reliable and cost-effective. We analyze the associated risks and propose some product quality metrics to be monitored during the maintenance phase.

Vague knowledge search in the design for outsourcing using fuzzy decision tree

One of the most popular strategies in business today is global outsourcing. The information which needs to be provided for outsourcing and obtained from outsourced maintenance during the R&D processes is very important for the successful development of a product. Although DFX plays a key role in the R&D processes by considering the important X item constraints simultaneously in the design stage, the vague outsourced maintenance data and knowledge are seldom properly analyzed and used. In this study, fuzzy decision tree is used to form a search mechanism for vague knowledge in design for outsourcing (DFO) with index for classifying vague knowledge. Computational experiments were conducted to demonstrate the performance of the proposed search mechanism and knowledge classification.

Maintenance strategies for used equipment under lease

PurposeThe aim of this research is to determine the optimal upgrade and preventive maintenance actions that minimize the total expected cost (maintenance costs+penalty costs).Design/methodology/approachThe problem is a four‐parameter optimization with two parameters being k‐dimensional. The optimal solution is obtained by using a four‐stage approach where at each stage a one‐parameter optimization is solved.FindingsUpgrading action is an extra option before the lease of used equipment, in addition to preventive maintenance action. Upgrading action makes equipment younger and preventive maintenance action lowers the ROCOF.Practical implicationsThere is a growing trend towards leasing equipment rather than owning it. The lease contract contains penalties if the equipment fails often and repairs are done within reasonable time period. This implies that the lessor needs to look at optimal preventive maintenance strategies in the case of new equipment lease, and upgrade actions plus preventive maintenance in the case of used equipment lease. The paper deals with this topic and is of great significant to business involved with leasing equipment.Originality/valueNowadays many organizations are interested in leasing equipment and outsourcing maintenance. The model in this paper addresses the preventive maintenance problem for leased equipment. It provides an approach to dealing with this problem.

Incentive maintenance outsourcing contracts for channel coordination and improvement

Consider a manufacturer who has a process with an increasing failure rate over time. In order to improve the process performance, the following two types of maintenance activity are outsourced to an external contractor: (i) preventive maintenance is performed periodically to improve the reliability of the process when the process is functional; and (ii) corrective maintenance is used to restore the process to a specified condition when it fails. We consider the use of incentive contracts to induce the contractor to select the maintenance policy that optimizes the total profit of the manufacturer and contractor. It is demonstrated that an incentive contract based on a combination of a target uptime level and a bonus always leads to the desired win-win coordination, and provides flexibility in allocating the extra profit generated from coordination and, importantly, an incentive to the contractor to improve the efficiency of the maintenance operations. The incentive contract can also be used to select the most economically efficient contractor from multiple contractors with different maintenance capabilities.

Maintenance outsourcing of a multi-process manufacturing system with multiple contractors

Consider a manufacturer with a manufacturing system that consists of multiple processes. The manufacturer's revenue is determined by the minimum of the uptimes among the processes. The maintenance functions of the processes are outsourced to independent contractors so that each contractor is responsible only for one process. A performance-based incentive contract is offered to each contractor, consisting of an uptime target level and a bonus rate for exceeding the uptime target. Under the incentive contract, a contractor receives a bonus only when the achieved uptime exceeds the target level specified in the contract. We develop a model for jointly determining the uptime target levels and bonus rates for the contractors which maximize system profit. We also demonstrate the financial benefits of coordination and added flexibility in allocating the additional profit to the contractors. In addition we show the impact of the variation in individual process maintenance times and costs on channel coordination and profits.

An analytical method for maintenance outsourcing service selection

In this paper an experience dealing with the analysis of maintenance outsourcing by means of multi‐criteria decision methods (MCDM) is reported. In particular, the analytic hierarchy process technique (AHP) is used as a managerial decision support system to select the best alternative between different outsourcing contracts in terms of maintenance services. The proposed methodology has been tested on an industrial case study dealing with an important italian brickwork. This application shows how the AHP is able to support the choice of the correct level of the maintenance activities outsourcing. In particular, the hierarchic decisional structure developed represents an instrument able to give a well balanced synthesis of several different factors that must be taken into account during this type of decision problem.

Managing outsourced support services: observations from case study

A company, outsourcing support services which are essential for the continuity of the company, may want to secure smooth functioning by tying a closer relationship with the service provider. While companies are modifying their support service sourcing strategies into alliances, there is also a need to readjust mechanisms to manage those transactions and the related risks. Focusing on collaborative facilities management environment, this paper examines coordination mechanisms that go beyond traditional market mechanisms. A proposed alliance management model is presented. The paper delineates a single case study of a triadic alliance between a client and its two partners providing in concert outsourced maintenance operations. The study was carried out using the action research method.

Highway Maintenance Outsourcing Experience: Synopsis of Washington State Department of Transportation's Review

Can outsourcing of traditional categories of state-provided highway maintenance produce savings in costs or improvements in service? While marketing materials and promotional press releases tout the attractions of outsourcing, insufficient attention has been paid to a growing body of follow-up information—much of it from official audit sources—of actual outsourcing experience. Presented are after-the-fact reviews of the performance of highway maintenance outsourcing from programs in five states and British Columbia. Cases noted include ones in which costs may have gone up instead of down, services deteriorated rather than improved, administrative and supervisory arrangements proved problematic, and contractor failures left states scrambling to provide services or caught in the distraction of litigation. Despite the range of experiences, common themes emerging from these reviews can be translated into lessons learned for state officials considering programs of this type. One clear lesson is the need for proper planning and scoping. Initial exploratory phases should include asset inventories, activity-based costs, and economic analyses based on before-and-after apples-to-apples cost comparisons. Risk-management reviews should consider litigation risks and costs. Managers should develop program exit strategies in addition to well-written contracts and specifications. Contracts should include clear performance expectations, evaluation schedules, and financial performance incentives or disincentives. Finally, an experienced management team must be in place to administer and evaluate contracts. These lessons can support more effective use of public resources, leading to wiser choices about whether outsourcing should be undertaken, and, if it is, what public management strategies and resource commitments will be necessary to make it successful. This research was undertaken in part to prepare for legislation in Washington State that would open new possibilities for competitive contracting.

Making maintenance contracts perform

Since the early 1990s, the drivers for outsourcing maintenance have grown and there has been a pronounced shift to maintenance being a noncore activity. Yet there is dissatisfaction across many market sectors with the way outsourced maintenance has turned out. Even so, the trend seems irreversible; successful contracting organisations of the future will have to be prepared to take on risk to ensure the client gets best value from their maintenance service. Maintenance embraces both long and short-term planning, operational expenditure and capital investment costs, and a diverse range of skill requirements for varying types of asset. Given this level of complexity, the question is: how can we move to asset based performance contracts where the supplier carries risk and has a stake in the successful performance of the assets it maintains? Asset based performance contracts focus the contractual effort on ensuring the assets perform, and suitably reward the contractor for the risk taken in meeting the agreed performance criteria. Significantly, a deeper and more mature understanding of the contractual relationship works to the benefit of both parties.

Table of Contents

AbstractIntroductionWhat's Driving Your Instructional Cost?Faculty CompensationFaculty ProductivityFinancial Commitment to TenureSummaryAre There Cost Savings in Academic Libraries?Acquisition CostsTechnology Impact on Academic LibrariesOutsourcing in Academic LibrariesSummaryCan Plant Operations and Facilities Continue to Be Ignored?Deferred MaintenanceOutsourcingEnergy ManagementSummaryIs Research a Facilitator or Barrier to Cost Containment?Sponsored ResearchUniversity‐Sponsored ResearchDirect and Indirect Cost FactorsSummaryCan University Student Services Remain Viable with an Increasing Cost Structure?Student Aid AdministrationStudent ActivitiesSupplemental Educational ServicesSummaryExternal Cost Factors: Are States' Policies for Higher Education Institutions Helping or Hindering Cost Containment Opportunities?Assessment and AccountabilityPerformance Funding and BudgetingRestructuringSummaryConclusion and RecommendationsSummary of Chapter Issues (Were the Questions Answered?)Final CommentsNotes

Derecognising Unions and Centralising Bargaining: Analysing Dualism in the Oil and Chemicals Industries

There has been a recent rise in employers derecognising unions. The oil and chemical industries have been identified as critical for the analysis and practice of derecognition. This paper presents data showing that major oil and chemical firms have, on the one hand, derecognised unions for key internal staff, but on the other hand, have enforced a centralised bargaining framework for their on-site contractors engaged in the out-sourced repair, maintenance and construction work. This centralised bargaining framework has strengthened the institutional position of trade unions. The paper analyses the key factors which have pushed the same employers to act in very different ways for the two sets of workers. It finds little evidence to support arguments that a strong anti-union culture in the industries underlay employers' actions. Rather the evidence suggests that management have acted pragmatically in response to pressing short-term economic pressures. The different approaches to unions for the two sets of workers have been guided by the different economic objectives facing employers and by the different historical position of unions in helping or hindering to secure those objectives. The conclusion considers the implications of these findings for the future of derecognition in the UK.

Meeting Great Expectations Through Performance Measures

As the aggregate level of outsourced highway maintenance and operations work rises, so too does the potential for public works agencies to lose control of service quality. To minimize this risk and maximize the effectiveness of service contracts, public works agencies must clearly define the specific performance standards they expect their contractors to achieve. If a contract is silent or unclear about an agency’s requirements with respect to quality, timeliness, or responsiveness to customer needs, the work performed may fall short of the agency’s expectations. This article will analyze these issues and present a framework for public works agencies to use in developing effective performance measures for highway maintenance and operations contracts. It will also provide guidance in how to monitor and enforce compliance with defined performance standards when agencies elect to outsource this work.

APPLICATIONS MAINTENANCE OUTSOURCING An Alternative to Total Outsourcing

Abstract Appropriately structured arrangements for systems maintenance outsourcing can yield significant benefits to many organizations. This article reviews methods for assessing potential maintenance outsourcing suppliers, for defining service criteria, and for evaluating contract terms.