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What is your opinion of government outsourcing? 
Do you think the trend will continue?

Alan Wells, chief administrative officer for the Regional Municipality of York, says, "Over the last 10 years, [York Region] has developed a balance between direct delivery and outsourcing. We look for cost-effective and efficient ways to deliver programs and services to our ratepayers. When quality-control measures are in place, outsourcing can be a very effective way of conducting government business. An example of this is road maintenance, such as snow plowing and grass cutting. However, some programs and services will always remain in the public domain. These include aspects of health and social services."

York Region is currently undertaking an organizational effectiveness review. Outsourcing or contracting out is one of the many alternative service delivery options the region will be considering in its review of improving the way it delivers its programs and services. Wells points to outsourcing as one of a number of tools available to governments. "Other options include use of new technology, new staff structures, private partnership opportunities and sharing of municipal resources as they relate to staff. Ensuring a high degree of customer service in the delivery of programs and services is an important factor. There is a stigma attached to government customer service. As long as a fairly high standard level of customer service can be maintained, coupled with cost-effectiveness and efficiency, outsourcing is an option that the region and other municipalities should always consider in their business practices."

Jim Stanton, president of Jim Stanton and Associates, specializing in media and communications training and consulting, sees the increasing effectiveness of outsourcing in the training world in particular. "The choice facing government and industry across Canada and the United States is whether to have a team of highly qualified facilitators who can access the right consultant or trainer to do a specific job, or an excellent internal trainer/consultant, who may only be capable of meeting a small percentage of your needs."

Stanton also sees the importance of effectively managing and procuring outsourced service for government. "Most of these outsource contacts will be found in systems like MERX. However, the real value to managers looking for 'the right person to do the right job' lies increasingly in the contact list of a department's facilitator, the outsource manager. Outsource managers will be able to put internal project managers in touch with a number of specialists, each qualified to do the job and available on short notice. The manager will be able to interview the recommended personnel and make his or her decision. Because these external contractors will be registered with the government through a standing offer process, managers will be able to initiate contracts in a speedy and effective manner while maintaining the integrity of financial and content accountability. The pool of outsource experts is always changing so the system will not become one which sees favorite consultants getting the work."

Brigadier-General Bill Brewer, director general of the Department of National Defence's Directorate of Land Equipment Program Management, offers a different approach. "I prefer not to talk about outsourcing and alternate service delivery, or ASD, because the terms lack focus and are too generic - meaning different things to different people - and not necessarily keyed to business objectives. They are often wrongly interpreted as cost-cutting exercises leading to the loss of jobs or resources. Our divisional business line is weapons systems management, including everything from clothes to tanks. We have labelled what we do TWSS - tailored weapons system support. TWSS is a framework we have put in place over the last two years to determine the most effective and efficient way to provide in-service support to our weapon systems."

The approach focuses on finding the optimum balance of in-house resources and industrial or outside resources required for individual weapon systems. "On a priority basis we looking at our fleets and weapons systems by applying the principles of TWSS. One of the keys to our approach is a business case. The business case weighs all of the options against each other and leads to the most cost-effective solution. Our divisional life cycle materiel managers develop the options and business case working with whatever outside resources they may need including specialists within DND and government. Ultimately the aim is to generate savings, whether dollars or people, and direct them to other activities in our division that are under-resourced. Consequently TWSS is directly related to what we do - work with weapons systems."

Brewer sees the overall government outsourcing trend continuing. "Outsourcing, alternate service delivery and similar activities will continue in the future because government is under continuing pressure to be more innovative and more cost-effective in the way we do business. These are things we cannot afford not to do."

What is your view of public-private partnering?

Reply to:
David Newman, Contributing Editor
Summit: The Business of Public Sector Procurement
180 Elgin St, Suite 800
Ottawa ON K2P 2K3
Fax: (613) 688-0767

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