Successful outsourcing doesn’t just mean selecting the right service provider; you also need an effective Stay Back Team (SBT) in place. The SBT is the cornerstone of any outsourcing initiative and is an important link between your corporation’s business and the service provider, not only from the onset of the RFP process and ensuing re-organization when the contract is awarded, but also for ongoing management of the services.
The SBT should be established as early in the process as you can, so the team can be involved from the beginning, giving them the knowledge they need to manage the service provider when they are selected.
This is an important consideration, since an outsourcing initiative includes many steps from the decision to the selection and transition of the successful service provider. For the most part, these steps are sequential, and unless your SBT has been involved in each step along the way, you will lose the continuity and knowledge necessary to effectively manage the contract and the relationship.
Even so, managing the outsourcing relationship requires flexibility, since not everything can or will be reflected in the contract. The relationships between the service provider and Stay-Back-Team has to be flexible enough to enable changes as the contract progresses.
Role of the SBT
The role of the SBT can vary depending on the overall goals of your corporation and the exact nature of the outsourcing initiative, but the core role related to the outsourcing initiative will remain the same – managing and administering the contractual relationship between your corporation and your service provider.
Generally speaking, in any large outsourcing initiative the SBT performs the following important functions:
- Asset Management / Strategic Planning.
- Contract management / administration (including Performance Measurement).
- Coordinating the linkages between the service provider and the corporation.
- Other Facility Management functions retained in-house.
When you hire a professional organization to manage your facility functions, it is important to let the service provider do its job. The SBT should then concentrate on “long term” activities like Asset Management and Strategic Planning, in addition to monitoring the service providers’ performance.
Even if you outsource Asset Management/Strategic Planning activities to the service provider, a member of the stay back team needs to both oversee the activity and interface with the corporation due to the interrelationships between the facilities and the core business.
These new roles may be a fundamental shift for the SBT members. A typical challenge faced by the SBT is that the team often used to be the doers, and now they have to change their mindset. This includes ‘letting go’ of the details of how the service is delivered and focussing more on the strategic issues and outcomes that add value to the corporation.
In fulfilling this role, the interaction with the service provider becomes critical, since the service provider in an outsourcing initiative provides a much broader scope of services than with sub-contracting or out-tasking, and includes a larger management component to the service. There must be trust between the service provider and Stay Back Team, since a positive relationship is an important element of a successful outsourcing initiative. The SBT has an important interface role for the Service provider by:
- Translating the corporate objectives and goals for the Service provider
- Aligning the contractual relationship and objectives for the service provider with those of the corporation’s objectives.
- Defining expectations and priorities
- Establish short/long term objectives
While the term ‘Partner’ is embraced by some and avoided by others in their Outsourcing initiatives, the fact remains that your service provider will likely be much closer to the internal ‘customer’ than you are, and has a major influence on the success of your corporation’s core business. Partnership (in the non-legal sense) is critical to ensure that the service provider is successful, which will ultimately make your outsourcing initiative successful. The most successful organizations take this approach in managing their outsourcing contract. The best way is to work as a team, searching together for solutions that will fulfill both parties’ needs.
Since the role of the SBT members is often a significant shift from their current roles within the organization, it requires a careful matching of skill sets and even culture. Your staff will need to move beyond their day-to-day operations rolwes and assume the role of an owner representative with strategic planning responsibilities.
There are usually a variety of roles within the SBT, and each of them will require a different mix of skill sets and qualities. Some roles may be very similar to the ones that exist while others will be new roles that require a different mix of skill sets that may not currently exist in your organization.
With a focus on contract management/administration as well as a significant focus on asset management in the new role, there are a number of skill sets that should be present in the SBT, particularly within its leadership. Keep in mind that it is often very hard to change culture if everything else stays the same, and the most critical position will be the SBT leader, who will set the tone for everyone.
For roles closer to the operational activities, such as in-house services, the focus is more on knowledge and expertise related to the function, while at higher levels, the ability to change culture, strategically plan, consensus build and effectively manage the new relationships to meet the corporation’s goals is critical.
In most cases, many of the SBT positions are filled by internal resources, so it is very important to assess their skills and abilities in the new context to ensure they will be successful, and consider whether new resources from outside the organization should be included. As well, additional training in relationship management, contract management, performance management and, strategic planning and asset management, for instance, will be valuable to ensure each SBT member has the tools they need to be successful.
There are some basic elements that need to be present within the SBT for a successful transition from an internally provided service to an outsourced service. These include:
The SBT needs to be able to link the activities of the service provider and other in-house services with those of the corporation and it’s core business. This requires a broad knowledge of the services being provided and sufficient knowledge of the corporation and its core business. The SBT leadership must have the ability and the status necessary to interface with other groups within the corporations core business in order to have influence and be effective at managing the linkages.
The outsourcing initiative itself is a cultural change that needs to be effectively supported by people who can adapt themselves to the new culture, and can also lead others through the cultural change. It is important when selecting the SBT members that they fully support the initiative, and can work in the new environment. The SBT leaders in particular must be capable of influencing a significant change in the culture.
A critical mass of internal knowledge and expertise
The SBT needs to have a critical mass of knowledge related to the services being outsourced as well as the services that continue to be provided in-house. This knowledge should include that of the core business as well, if possible. Detailed historical knowledge is also very useful, however many of the staff with this type of knowledge will be retained anyway through the service provider and both the personnel and the records will be accessible.
The importance of establishing the SBT early in the process was discussed above, however there is another equally important reason for selecting the team early– to retain them until the transition occurs. During the process of outsourcing, there is significant uncertainty, and some of your staff may look for other opportunities. If you have not established the SBT and appointed staff to the roles early enough, you may lose your most suitable candidates.
The size and structure of your SBT will depend on the size and scope of the outsourcing contract as well as the services, if any, which remain in-house. The basic rolls and functions will almost always be the same, however they may be performed by a larger or smaller number of people, and the reporting relationships may be adjusted based on size, scope and geography as required.
As you move through the different stages of an outsourcing initiative, the make-up of the SBT may change slightly since the staffing levels and skill sets will be different throughout the various stages, but the core staff who will remain to manage should be constant. Assigning sufficient resources to the SBT at each stage is crucial, and this is an area where resourcing levels are often underestimated, particularly in the Transition phase, seriously jeopardizing the success of the outsourcing initiative.
When establishing your SBT, it is important to consider where they report within the corporation as a whole to ensure they have sufficient influence within the corporation, and can effectively participate in overall corporate strategies and decision making which impacts or is impacted by the Facilities Management functions. Your outsourcing initiative provides an ideal opportunity to reassess the existing reporting structure and influence any necessary changes.
The structure and interaction with the service provider is also an important element of the SBT. Your structure should allow the interfaces to take place at the right levels between the SBT and service provider, whether they are day-to-day or strategic. There will usually be important interactions at many different points between the service provider, the SBT and even other departments within the corporation, however it is important to formalize and maintain a single point of contact for issue resolution, contract interpretation and central coordination.