University Outsourcing Services/Programs the Most

University Outsourcing Services/Programs

The most important issue, and the primary reason, for a university or college to consider outsourcing services and/or programs is financial. The driving motivation is to save and to make (or keep) more of its money.

The outsourcing of instruction may be one of the most controversial issues involved with this discussion. The costs may be too high for either the university or the supplier, but the real problem is that outsourcing the teaching function results in a loss of control for the institution over both the faculty, and, perhaps even more importantly, the methods of instruction. The other half of this, the vendor, may not receive the margin it needs between the fee it receives and the revenue received by the college -- because colleges may not be the best of negotiators. Therefore, the college wants a discount from the vendor to make up the difference. Or the vendor will charge a higher fee, and the college will be forced to raise tuition. The result is that it might be cost-effective for the college to continue doing its own teaching while attempting to save money on curriculum and faculty (Bailey, Jacobs, & Jenkins, 2004, p. 25).

Other issues involved in outsourcing would include: which services to outsource, who would benefit from it -- students, faculty, staff, how to resolve the union and civil service issues, how will the university's reputation and image be impacted by a positive or negative experience, will the level and standardization of the college's services be maintained and at what cost, oversight of the vendor's services and loss of control -- issues ranging from teaching affectivity, to loss of control over flexibility, costs, employees, priorities, loyalty, and responsibility. The impersonal nature and loss of identity and community are huge issues. And, if unsuccessful, reversing the outsourcing could be disastrously expensive (Phipps & Merisotis, 2005, p. 9).

Arguments

Outsourcing the teaching function at institutions of higher learning may seem like a radical new step to some and a hot item for debate. However, statistics show that over 40% of the teaching at these colleges and universities is done by part-time employees contracted from outside the school's regular full-time staff teachers (Schibik & Harrington, 2004, pp. 393-394).

Since it's already being done on large scale, is this outsourcing of the teaching function a good idea? Does it work? Is it cost-effective? And what about those control, management and oversight concerns?

The top five reasons companies outsource are to: reduce and control operating costs, improve company focus, gain access to world-class capabilities, free internal resources for alternative uses, and to gain access to resources not internally available (Schibik & Harrington, 2004, p. 396). Anecdotal evidence would suggest that most educational institutions use part-time teachers for much the same reasons stated for companies. They cost less than full-time; they can add "world-class" expertise that the university can't possibly have within a department; they allow full-time staff to do research, consulting or administrative tasks; they offer the school flexibility in quickly staffing up or down depending on needs; and the school gains access to resources not previously available (Schibik & Harrington, 2004, p. 396).

So, what are opponents saying? You "can't mix the broad public goals of a community or public college or university with the incentives inherent in profit-making companies" (Bailey, Jacobs, & Jenkins, 2004, p. 1). Opponents also argue that outsourcing would undermine the tenure system -- another huge issue and "deal-killer." Next, they argue that the quality of instruction will suffer because the vendor will only have one concern -- profit. They point out that the scope of the courses offered would be narrower and more limited in content due to the need for profit, thus, quality of instruction would suffer. Finally, the argument is repeated that the faculty would fear loss of control of the course design, choice of instructor, and instructional materials (Bailey, et al., 2004, p. 1)

Supporters argue that outsourcing will lead to a higher quality education since vendors will be driven by competition and market forces to provide a good product. They point out that the standardized, consistent curriculum provided by a supplier might be an advantage to individual instructor control of academia. And, vendors can supply specialized instruction with up-to-date curriculum because they are out in the field teaching. Supporters also point out that it would be less costly than hiring full-time instructors/professors. Finally, proponents of outsourcing argue that, with their corporate networks and contacts, a vendor could help students find jobs after graduation (Bailey, et al., 2004, p. 2).

Some of the hurdles seem impenetrable. Opposition of full-time faculty stands out as the most damaging to the potential wide use of educational outsourcing. Let's face it -- they are concerned for their jobs. Tenure to a professor is the holy grail. You don't mess with it!

Many of those in support of outsourcing say that contracts can take care of a good amount of the fears about quality of services, curriculum, and teaching, among other services. Management can structure the contract so that vendors bear the costs and penalties of poor service and quality. But opponents argue that outside business vendors write contracts all the time and are very familiar with the "ins and outs." The chances of a university gaining all the advantage they want would be slim and none (Phipps & Merisotis, 2005, p. 4).

The loss of community, identity and collegiality is one of the education institutions' greatest fears. Colleges and universities do things differently than corporate America does. Ultimately, a resistance to change and adapting may be a reason outsourcing does not spread widely.

Conclusions

Unlike corporate America, where there is no democracy and decisions are made, not based on unanimity and collegiality, but on whose office says "CEO," the management of academic institutions is often accomplished by consensus. This principal applies especially in a case like outsourcing where it can affect so many different functionalities of the college. The arguments state repeatedly that outsourcing must benefit "all" the factions -- teachers, staff, administrators, and students -- a near impossible task -- and in many cases, insurmountable.