Lessons from the Untold Success Story: Outsourcing Engineering and Facilities Management

Abstract

Over the past decade, there has been proliferation in the number of studies looking into IT enabled outsourcing. Little attention has been given to outsourcing of services in other sectors, such as Engineering and Facilities Management (EFM), which have also seen explosive growth. The article builds on a market research study of twenty-six outsourcing contracts making up approximately fifteen percent of Australia's EFM segment. This article aims to take a detailed look at the benefits sought and actually obtained from EFM outsourcing. The most successful contracts were then correlated against the most successful practitioners and the management issues further examined in five case studies. A number of learning points were apparent, and these can be grouped under four generic success factors: choice of contract style and management, relationship management, innovation management and workforce management.

Keywords: Outsourcing, Engineering and Facilities Management, Australia, New Zealand, Key performance indicators

JEL Classification: M55, L22