More and more businesses are looking to outsource what they view as non-core functions to reduce costs and focus on the true nature of their business. Although the market places for outsourced services (such as facilities management, employment and IT support) are very different, the principles of buying successfully are exactly the same.

• Never lose sight of your objective
• Research the market and how the service is currently operated internally
• Specify the expected output, so far as possible, by a quantifiable measurement
• Use clear unambiguous language
• Separate the service level agreement (SLA) from the main contract. The SLA should be re-defined on an on-going basis
• Maintain an exit strategy in the event the arrangement is not working out.

The benefits of outsourcing are diverse and situation specific, however they can include:

• Cost reduction through getting the experts in who can benefit from economies of scale and their in-house skills
• Establishing clear benchmarks to evaluate performance - keeping evaluation simple
• Creating a long-term collaborative approach allows:
  • the contractor to get a guaranteed income stream over a number of years and can benefit from greater economies of scale and therefore offer a lower price
  • the buyer to benefit from that reduced price, cost certainty and less resource spent on regular tendering exercises
• Working closely together ensures that both parties have a clear understanding of the others needs

• Facilities Management
• IT